How it could have been done if the preachers of the free market had stuck to their principles instead of launching a moronic war

[Originally posted here.]

In my post a moment ago I mentioned how I’d once heard that, for the money the US spent on the war in Vietnam, we could have paid for the installation of an in-ground swimming pool for each and every Vietnamese family instead. What a great way to win the hearts and minds of our enemies, eh? So I decided to try out the math for this stupid, awful, and infuriating Iraq war. What if we had tried to bribe the Iraqi people to overthrow Saddam Hussein and install a working democracy instead of imposing these things (rather: trying futilely to do so) by force?

Cost of war to US taxpayers as of March 28, 2008: a bit over $506,359,000,000. Source.

Population of Iraq in July 2008, according to the CIA World Factbook: 27,499,638.

I threw in 2,000,000 extra people to account for the dead and refugees, so the numbers below are based on an estimated population 29.5 million people.

Cost per Iraqi (each man, woman, and child) paid so far by US taxpayers on the war: $17,767.21.

First of all, what if we’d just offered Saddam Hussein and his top leadership only, say, half the total that we’ve spent”“roughly $253 billion”“to leave Iraq and go live in the Bahamas? Well, if he’d refused but the so-called free market loving leadership in the US had pursued this market line of thinking, we could have had Hussein overthrown”“without the loss of a single American life”“by offering each man, woman, and child in Iraq any of the following.

There you have it. The Iraqi people could have had a Saddam Hussein-free Iraq and eaten their apple pie, too. But that’s not the way we did it, because, as usual, the American government tried to do it on the cheap. Haven’t any of these people heard “penny wise, pound foolish” before? And now Bush/Cheney and McCain have got their sights set on going double-or-nothing broke in Iran as well. Will you buy that?

Via DailyKos: Unions Saving the World

Too bad all unions aren’t this bad-ass. But when a union is bad-ass it can make a real difference, and, as DHinMI at DailyKos says, this is “An Example of Why Authoritarians Fear Labor Unions.”

Because they stand up to power:

A Chinese ship carrying arms destined for Zimbabwe was last night forced to turn back after South African unions refused to unload it, claiming that to do so would be “grossly irresponsible”, South African media reported…

The best democracy money can buy

I was trolling through Flickr looking for photos of John McCain (for a t-shirt design I’ve got in mind) and came across this graphic by pseudoplacebo. It shows how much Clinton, Obama, McCain, and Ron Paul had spent per delegate they’d won, as of February 25, 2008. It’s something that’s been on my mind lately. Even though I’ve come to be an Obama supporter, it is seriously grossing me out how much money this election is costing–more than that, it’s unnerving to me that Obama’s lead (and probably victory) in the Democratic primary has depended so heavily on such obscene amounts of money. Yes, yes, I know, more than almost any politician in recent years, Obama’s money is coming largely from small donors. Even still, it gives pause for thought.

Anyhow, thanks to pseudoplacebo for giving this graphic a Creative Commons license!
cost_per_delegate_feb25_by_pseudoplacebo.jpg

Night of the living “brain-dead liberal”

I know I’m behind the times, but last night I was reading some (seriously) backlogged email and in it was a link forwarded by my mom to David Mamet’s recent essay in the Village Voice, “Why I Am No Longer a ‘Brain-Dead Liberal’.” It’s a strange essay that’s simultaneously difficult to follow and clearly intended as an embodiment of Churchill’s (perhaps apocryphal) dictum that “If you’re not Liberal when you’re 25, you have no heart. If you’re not Conservative when you’re 35, you have no brain.” It took Mamet more than 25 years to harden his heart, but by golly he’s done it! As for the question of whether he successfully traded it in for a new and improved brain… well, that’s not quite so certain.

It seems his first mistake is in assuming that his playwriting is an accurate reflection of reality, and then using an interpretation of his own play as a way to see back through to reality. His example of the clash between “conservative” and “liberal” is from his recent play, November.

But my play, it turned out, was actually about politics, which is to say, about the polemic between persons of two opposing views. The argument in my play is between a president who is self-interested, corrupt, suborned, and realistic, and his leftish, lesbian, utopian-socialist speechwriter.

Notice that his “conservative” is actually just a jerk: “self-interested, corrupt, suborned” — I won’t grant him “realistic” since this is Mamet’s subjective interpretation of his own character after the fact of Mamet’s conversion to a more conservative philosophy about life. Nothing about being self-interested or corrupt or suborned has anything to do with political outlook. People across every inch of the political spectrum are sometimes self-interested (and sometimes not) and sometimes corrupt (and sometimes not). True, the stereotype of a conservative in our culture is of a self-interested “old white man,” and leading conservatives in recent years, from Dick Cheney to Tom DeLay and so on, have done a bang-up job of encouraging the belief that conservatives are also likely to be corrupt; but those things don’t really have anything to do with conservatism per se, only with the nonpartisan tendency of power to corrupt and absolute power to corrupt absolutely.

On the other side is Mamet’s stand-in for a “liberal.” The key term for her is that she’s “utopian” (though her being a lesbian is surely frosting on the cake for Mamet). And again, though utopianism fits the stereotype of the left, it’s an intellectual flaw that knows no boundaries. Hitler, among other things, was certainly a utopian (and certainly not a liberal).

So Mamet has allowed himself to be confused by the surface ephemera of cultural stereotypes, has embodied them in his play’s characters, and has then analyzed them in his effort to deduce essential truths. It’s no surprise that he’s missed the mark.

Mamet’s conversion is based on his revelation that people, alas, are not generally good at heart. Instead, he says, “people are swine and will take any opportunity to subvert any agreement in order to pursue what they consider to be their proper interests.” He goes on to say that recognition of this truth of human nature is at the heart of the U.S. Constitution.

The Constitution, written by men with some experience of actual government, assumes that the chief executive will work to be king, the Parliament will scheme to sell off the silverware, and the judiciary will consider itself Olympian and do everything it can to much improve (destroy) the work of the other two branches. So the Constitution pits them against each other, in the attempt not to achieve stasis, but rather to allow for the constant corrections necessary to prevent one branch from getting too much power for too long.

Rather brilliant.

I’m in no position to disagree, but this points us towards Mamet’s next essential error. While Mamet is a fan of the separation and more-or-less balancing of powers between the branches of government, his conversion to conservatism (which, though hard to tell for sure from his essay, sounds pretty much like libertarianism) leads him to imply that the “free-market” should be left to itself and the power of government eliminated, or at least mostly so.

What about the role of government? Well, in the abstract, coming from my time and background, I thought it was a rather good thing, but tallying up the ledger in those things which affect me and in those things I observe, I am hard-pressed to see an instance where the intervention of the government led to much beyond sorrow.

But if the government is not to intervene, how will we, mere human beings, work it all out?

I wondered and read, and it occurred to me that I knew the answer, and here it is: We just seem to. How do I know? From experience. I referred to my own””take away the director from the staged play and what do you get? Usually a diminution of strife, a shorter rehearsal period, and a better production.

Let’s ignore the fact that, once again, Mamet is mixing up the metaphors of his reality. When you take away a director, you aren’t just taking away generic “government,” you’re taking away authoritarian government. It might be true that taking away any and all forms of government leads to beautiful theatrical productions, but that’s not a conclusion Mamet can legitimately claim from his example.

Anyhow, Mamet’s bigger confusion is one of scale and it leads him to fall for a bait and switch. Sure, a group of people the size of a bunch of actors and production crew can probably figure out how to behave with one another reasonably well most of the time. “Live and let live” works, mostly, maybe, at the level of neighborhood or community. (Don’t forget, however, that it has often been transformed into “live and let lynch.”) So conservatism/libertarianism might be perfectly reasonable at small scale; to paraphrase Churchill again, this might be the worst political philosophy there is for the small scale of society, except for all the others.

But our world is not as claustrophobic as Mamet’s theatrical in-crowd. We don’t live in one giant small town. And if the separation and balancing of powers makes sense for government, where is Mamet’s desire, post-conversion to “conservatism,” for a balancing of the power of corporations, of the market economy? This is Mamet’s most interesting mistake, in my opinion, because in pointing out the inconsistency of his thinking I’ve realized that the traditional “liberal” response doesn’t hold up well enough for me. Mamet’s bashing of government as leading to not “much beyond sorrow” is the knee-jerk conservative response to failures that are real; and while I think that government is necessary to serve as a balancing power against the whims of the market economy, the frustrations that both conservatives and liberals continuously feel at the state of our society leads me to a further conclusion: this balancing act isn’t working because it’s a two-legged stool. The Constitution balances the powers by splitting them up between three branches. If one branch gets out of hand, the other two–even if only for entirely selfish reasons–will be inclined to join forces to bring the first branch back within proper limits. But it takes three branches to enable such a dynamic.

In our contemporary society, there doesn’t seem to be a third branch of structural power available, not one that I can think of at least. Perhaps once the labor movement served that role. The civil rights movement and other mass social movements might be understood to have functioned as third branches of social power in their times. Nowadays, I don’t see anything filling the role of a third branch. The result, from my “liberal” perspective, is a government largely overrun by the power of the economic sphere. (Of course, it’s not just the “economy” generically speaking that can organize and direct power; it’s the people in elite positions of the economy who can do so.) And when the government has been “suborned” (my thanks to Mamet for that–I was annoyed at first that I had to look up his fancy word, but it’s a good one) by the economy, is it any wonder that so many of the government’s actions appear to lead to sorrow?

So what’s out there to rise up as a new third leg of power, capable of enabling a balancing with government and economy? A revived labor movement might do it, but I’m not holding my breath. Some new social movement, maybe, like that of immigrants or environmentalists. But I think I might be better off buying Bear Stearns stock than putting my hopes in one of those possibilities. Even if such a social movement does arise, what chance does it have to institutionalize itself to remain relevant for more than a few years, a decade or two at the most? What makes it even more unlikely is the fact that institutionalization of social movements seems mostly associated with the demise of their social power, their appropriation into the realms of government and economy, not the maintenance of an independent power structure. How about “the church”? That’s the most likely candidate, but frankly, I’d rather stick with the second-rate status quo than risk going the route of The Handmaid’s Tale.

The only suggestion I’ve heard that might do the trick–and I don’t know that it would–is that of Peter Barnes from his book a year or so ago, Capitalism 3.0 (available in full as a free PDF). In the book, Barnes argues in favor of the establishment of a legally empowered and widespread system of “commons”; that is, resources and organizations held as common property by some relevant group of people, from the level of neighborhood to nation to world. This commons sector wouldn’t replace the market economy and its associated private property (though some resources currently utilized as private property would be converted to common property) and it wouldn’t replace government and its associated public property (though some resources currently utilized as public property would be converted to common property). What makes a commons sector viable, perhaps, as a third leg in balancing the social powers is that it would (as envisioned by Barnes) be institutionalized in a manner that maintains its separate power base from the private property economy and the government. Unlike Mamet, Barnes has no interest in dazzling readers into a state of confusion and irritation, so his writing is clear and pleasant to read. Could the commons be enough to do the trick? Would it truly be robust and resilient over time? I don’t know, but the book is short and sweet, so check it out and see what you think.

Now I want to get back to something I touched on above. One of the ironies of Mamet’s essay is that, partly (though surely not entirely) due to his obnoxious tone of condescension towards all those “brain-dead liberals” he’s left behind in his conversion, the comments in response to the article are filled with back and forth vitriol between offended liberals and conservatives offended at the offended liberals. I tried reading the comments but quickly sickened of the dismissive attitudes that predominated. So here’s the irony: Mamet thinks that people work things out when left to their own devices, just like his utopian theater group that puts on such great plays when liberated from under the thumb of the governing director; and yet his article elicits evidence of exactly the opposite. As I suggested, the theory that people just work things out A-OK might be a good theory to apply to small groups (but then, why so many runaway teenagers? why so many battered wives? why so many suicides?) but, repeating myself, the world is much bigger than that. Our modern world is filled to overflowing with connections, some seen, some hidden, between people near and far, people who not only don’t know one another but don’t even know that the others exist. Farmers in Kansas converting their fields from wheat to corn, in order to cash in on the ethanol boom, are part of a system that results in skyrocketing bread prices in Egypt (and yes, I realize that this example is one in which government plays a leading role in screwing things up, though — does it really need saying? — the US government’s ethanol policy wouldn’t be nearly the disaster that it is if the government weren’t so susceptible to the lobbying efforts of Archer Daniels Midland, Cargill, and the other agribusiness corporations).

More banal, but experienced by almost anyone reading this missive of mine, is the fact that the anonymity and distance of modern modes of communication, perfectly presented in comments on blogs and other online pages, triggers so very many people to adopt an “act like an asshole first and apologize later, if I feel like it” attitude. It’s neither liberal nor conservative to be bothered by the decay in cultural decency; but Mamet’s self-described conservative preference for just letting it all fix itself leaves a lot to be desired. Sure, sometimes government action exacerbates a problem; sometimes there’s no good solution and leaving things alone is the best available from a set of bad options. But in a world of “people [who] are swine and will take any opportunity to subvert any agreement in order to pursue what they consider to be their proper interests,” does it really make good sense to always and everywhere ask the swine to work their own problems out, regardless of the fact that some but not all of the swine are armed to the teeth, that some but most definitely not all are richer than God, that some revel in their swineness while others care at least to try for a little courtesy and decency and honesty? The answer to a swinish human nature in the realm of government was the balancing of powers. It also seems to me the best answer I’ve encountered for the overall realm of society at large. Balance those powers. Put a leash on the government, absolutely for sure, but also for sure put a leash on the economic powers cuz those pigs will steal the shirt off your back and then smile as they offer to sell it back to you at a special discount, “just for you ;).” For now, at least, that’s the liberalism this zombie is sticking with.

A Modest Proposal: Step 3, Reform the Money System!

A Modest Proposal: Ten Steps to a Democratic Economy

In my initial installment of this series, I proposed, “Ten Steps to a Democratic Economy.” With this column, I would like to explain and defend my third proposal. I invite commentary and analysis.

3. Reform the Money System ““ The money supply system is directly under the control of the Federal Reserve. This agency has 14-year terms. They need to be placed under congressional control, not Presidential control. I recommend that their terms be limited to 4 years and they should be checked by Congressional fiscal policy. High interest rates currently only benefit banks and financial institutions.

The Federal Reserve, usually called, ”The Fed,” is the central banking system of the United States. The Federal Reserve System is composed of a central Board of Governors in Washington, D.C., and twelve regional Federal Reserve Banks located in major cities throughout the nation, and a number of member banks. The Federal Reserve Act created the Federal Reserve System in 1913. The board and its chairman are appointed by the President of the United States and approved by the Senate.

The money supply available at any given time in our economy is a product of the interest rates that are set by the Federal Reserve. As it raises or lowers the interest rate it charges to member banks, it increases or decreases the amount of money available to the economy. Higher interest rates slow the economy and lower interest rates speed it up. This means that the economy is producing goods and services and thereby creating jobs in a “slow” manner or in a “faster” manner.

I am not an expert in economics, but I know that high interest rates hurt low-income people and benefit wealthy people. Low interest rates help low-income people, but do not hurt wealthy people. The wealthy have a surplus and they profit from whatever the amount of the interest that it earns. Their complaint would be that they are not being rewarded “enough” for their thrift and/or miserly behavior. People who have surplus money can, of course, give it away, but most wealthy people prefer to “rent” it out. The money you pay in interest on a loan is in effect the rent for that loan. The wealthy are the creditors and the poor are the debtors. Those who lend are the creditors and those who borrow are the debtors. (One problem with this scenario is that truly destitute, impoverished people are hardly ever loaned money. They are considered poor risks.)

When a bank grants someone a loan, most people feel happy. This is understandable but they should not feel happier than the bank. The bank is now getting a 6% return on its money, when earlier it was only getting 2%. This is how banks make money for themselves. They take it in at one window and loan it out (part of it) at the other window.

Low interest rates stimulate purchasing of goods and services. With low interest rates it is easier to borrow money to buy a car, a refrigerator or a house. This means that more people will exercise that purchase option and the economy will move along. This tends to create a bit of inflation.

Wealthy people do not like inflation. It means that their wealth does not buy as much as it used to buy. Large financial institutions feel the same way. They like to have the Federal Reserve under the control of people who are not elected by the citizens, or at least at a distance from the people. The President appoints Federal Reserve Board members. Their terms in office are for 14 years and the Senate confirms them. The House plays no role. The Senate is the more conservative of the two legislative branches. Senators have 6-year terms. There are two per state regardless of population.

Recently, after Hurricane Katrina, hit the Gulf Coast, a number of people felt that the Federal Reserve should have lowered interest rates to make goods and services available to those afflicted. It did not do so. It was focused on the anti-inflationary policy that it had been following. This is an example of monetary policy interfering with fiscal policy. Tax cuts meant that the government would have to borrow to cover the costs of the hurricane and aftermath.

Fiscal policy refers to the ability to raise revenue by way of taxes and to spend money on needed projects. In a phrase, fiscal policy refers to revenue and expenditure policy. With a democratic fiscal policy, we could collect more money from the affluent and provide more services to the poor. Tax the rich and help the poor.

It is for this reason that conservatives fear and loathe democracy. Conservatives fear that a majority would probably want to spend more money on schools, health care and environmental protection, instead of prisons, police and the military. Since the wealthy people would see an increase in their federal income taxes, if this happened, they generally oppose giving Congress strong fiscal tools, and instead rely on monetary policy to adjust the economy.

A more democratic society would give us better economic policies. Better economic policies would put people before profits.

A better world is possible.

References:

Economic Report of the People. Boston: South End Press, 1986.
(Center for Popular Economics, Amherst, Massachusetts)

http://en.wikipedia.org/wiki/Federal_Reserve

Hidden taxes and even more hidden subsidies

BusinessWeek has a recent article about the new law requiring improvement in automobile and small truck fuel efficiency (“The Road to a Stronger CAFE Standard“). Among other things, the article describes how the law changes the way that the CAFE (Corporate Average Fuel Economy) measurement is calculated. Under the old CAFE calculation, fuel economy is measured separately for each auto manufacturer. Under the new calculation, all manufacturers will be measured together, and a trading scheme is established so that companies beneath the industry-wide average must buy credits from companies that are above the average. Since American auto manufacturers produce a disproportionate share of minivans, pickup trucks, and SUVs (all lumped together as “light trucks”), the American companies are more likely to be on the buyer side of the credit buying while companies like Toyota and Honda will be more likely to be on the seller side of the scheme. Says one guy from the American company perspective,

it’s SUV and pickup buyers who will be stuck with the tab, suggests Chrysler Vice-Chairman Tom LaSorda. “It’s likely to be another big hidden tax on the consumer, as well as small businesses and building trades.”

What BusinessWeek’s writer fails to mention is the other side of the equation: this system also results in a hidden subsidy for buyers of efficient cars. If Honda is selling lots of relatively efficient cars, and therefore is able to sell credits to Ford (which is selling more in the way of trucks), then Honda can hold down the price of the cars while still making the same overall profit. The pressure on Ford that pushes up the price of trucks will be an “equal and opposite” pressure on Honda to hold down the price of their small cars. All in all, it could be a completely neutral system in terms of the overall effect on consumers. Of course, lots of details and corporate decisions might end up making it either more or less than perfectly neutral in the end, but BW’s article is misleading when it only highlights the one side of the equation. On this general concept, see more about “feebate” proposals.

Oh, and by the way, all of Detroit’s (and Toyota’s, the Prius notwithstanding) hemming and hawing about how hard it is to make more fuel efficient is pretty obviously a load of bunk, even if the people doing the hemming and hawing believe their own bunk.

Carbon labeling on my mind

[Crossposted at my work blog.]

BusinessWeek’s GreenBiz blog tipped me off to a recent BW article on carbon labeling. Carbon labeling means to label consumer products with an indicator of how much greenhouse gas was emitted in the production and distribution of each product to the point of having it on the shelf in front of the customer. The idea has been around for a while, but only recently have manufacturers (like Timberland shoes) and retailers (like Tesco, a British chain of mega-grocery stores) started to implement carbon labeling programs. As it turns out, according to BW’s article, carbon labeling is tricky for a few reasons. First, it can be tremendously difficult to squeeze all the aspects of modern, globalized manufacturing into a single numerical measurement of greenhouse emissions. Second, for such programs to work, there needs to be a fair bit of consumer education so that people will have any idea of what these carbon labels actually mean. (If a label says, “50 grams of carbon,” is that good or bad or what?)

Here are some thoughts suggestions that probably have been thought of by other people as well, but what the hey:

1) The ideal carbon label will be structured similarly to the energy guide labels on refrigerators and other appliances we see in the US. That is, on a line that shows the minimum-to-maximum amount of greenhouse emissions caused by similar products to the one in your hand (like all canned vegetables or all pasta products or all color televisions) as well as an indication of where on this line the individual product falls. If canned vegetables incur anywhere between 10 and 100 grams of carbon-equivalent greenhouse emissions (using made up numbers for sake of the example), and the can in your hand incurred 30 grams, then you’d see something like “10”””“30“””””””””“100″³. That’s the first part of the labeling scheme, and would be called the “Manufacturing & Distribution” count. For some products, like canned vegetables, that would be enough. For products like TVs that require the ongoing consumption of energy in use, there would be another line (like the existing energy guide labels on refrigerators and such) that indicates the relative use of energy going forward, based on the average greenhouse emissions of the electric grid across the country. This would be the “Usage” count. Finally, for products that have both counts on their label would be a third measurement line called “Expected Lifetime” which would be a combination of the “Manufacturing & Distribution” count and an estimate of the probable cummulative lifetime “Usage” count, for example the combination of M&D plus 10 years worth of normal usage of a TV. Some products might have high M&D counts but be more efficient in use, and therefore their lifetime impact would be lower than an alternative product that had a lower M&D count but was inefficient in usage.

2) I realize that this notion of an ideal carbon label still ignores the difficulties in actually figuring out accurate counts for greenhouse emissions; but if you can get decent estimates of the emissions, then I think that’d be a good way to do the labeling in a way that consumers could interpret and make meaningful choices between products. You have to have the relative position of each product on a scale for the number to mean anything.

3) If you want to educate the populace on how to use these things, teach 10 year olds about it. They will quickly and insistently instruct the rest of us, treating us like absurd fools until such time as we master the system as well as they have.

4) The trickiness of figuring out accurate and consistent greenhouse emission labeling is an argument in favor of using carbon taxes/cap-and-trade systems. Sorta. On the one hand, the financial tool of carbon tax/cap-and-trade “” implemented on upstream sources of carbon (and other greenhouse gases) “” easily introduce an effective alternative to the carbon label into the economy. Product prices will rise relative to the amount of extra cost their manufacturers & distributors face as a result of the greenhouse gas emissions incurred during manufacturing and distribution. The can of corn that involved more greenhouse emissions will incur a greater carbon-cost increase than the alternative can of corn that involved less emissions. However, this isn’t totally satisfactory, because so much else is involved in pricing: the “price signal” is terribly noisy and prone to distortion and/or misinterpretation. In addition, there are some “” how many? “” people willing, even eager, to pay more for products that they are confident involve less greenhouse emissions. Working the greenhouse effect of a product into the product’s price is a good thing, but that doesn’t obviate the usefulness of a more fully informed consumer as a second level for reducing carbon footprints. One further thought on this, though: it’s possible that if a carbon tax is implemented, the tax itself could be used as a tool for measuring the greenhouse emissions on a product and therefore be the basis of the carbon label. Businesses already keep track of the taxes they pay, and so the added burden of accounting should be less than trying to account for a new system of purely physical carbon emission counting. Right? Because the carbon tax itself is predicated (or should be) on a carbon-equivalent scale, it would be an easy translation to take the cumulative taxes paid on a product through its manufacturing and distribution lifetime and restate that as an amount of carbon emitted during the process. The increasing use of rfid chips in distribution chains only makes this easier to implement, as you have better tracking going on and the ability to link movement of materials and goods to the taxes those materials and goods incur for the businesses making and moving them. (Having said this, I still favor a Peter Barnes’ style cap-auction-trade-dividend approach over the carbon tax approach.)

5) I gotta get back to work!

A Modest Proposal: Step 2, Raise the minimum wage!

A Modest Proposal: Ten Steps to a Democratic Economy

In my initial installment of this series, I proposed, “Ten Steps to a Democratic Economy.” With this column, I would like to explain and defend my second proposal. I invite commentary and analysis.

2. Raise the Minimum Wage ““ I think it would be a good idea to raise the minimum wage to $10.00 per hour. It is currently $5.85 per hour.($8.00 in Massachusetts.) I would also shorten the workweek to 35 hours to give people more free time for recreation and education.

Raising the minimum wage would put a lot more money into circulation and would stimulate the economy. Most of the people who would benefit from this new policy would spend their money on goods and services that they presently do without. For all of these people, it would mean more money above the subsistence wage that they are presently earning. These people are the working poor. They are for the most part the invisible poor. Visible or not they are a reality in the current American economy.
The economist Holly Sklar is a widely published op-ed columnist and author. She is co-author of “Raise The Floor: Wages and Policies That Work For All Of Us,” which Barbara Ehrenreich calls, “A commanding work and powerful tool for the living wage movement.” She is a contributor to numerous high school and college text anthologies and is a frequent guest on talk radio.
She tells us,

“The number of Americans in poverty is a group so large it would take the combined populations of Louisiana, Mississippi, Alabama and Texas, plus Arkansas to match it. That’s according to the Census Bureau’s latest count of 37 million people below the poverty line.
Millions more Americans can’t afford adequate health care, housing, child care, food, transportation and other basic expenses above the official poverty thresholds, which are set too low. The poverty threshold for a single person under age 65 was just $9,827 in 2004. For a two-adult, two-child family, it was just $19,157.
By contrast, the Economic Policy Institute’s Basic Family Budget Calculator says the national median basic needs budget (including taxes and tax credits) for a two-parent, two-child family was $39,984 in 2004. It was $38,136 in New Orleans and $33,636 in Biloxi, Mississippi.
America is becoming a downwardly mobile society instead of an upwardly mobile society. Median household income fell for the fifth year in a row to $44,389 in 2004 — down from $46,129 in 1999, adjusting for inflation.”

Under my proposal, if the principal wage-earner was paid $10.00 an hour for a 35 hour work week, their family income would be $17,500.00. This would not eliminate poverty, but would put a floor under it. With family assistance for the working poor, in the form of tax credits or income credits, we could effectively insure that no family lived in poverty.
A higher minimum wage also helps protect the wages of workers in the higher brackets. It also promotes a greater sense of community, in that it eliminates the resentment that gross inequality in income and wealth promotes. This resentment contributes to criminal and anti-social activity.
The minimum wage would have to be indexed to inflation to protect it. To promote skilled labor, a minimum wage policy would have to include free education. By making education available to all, with free tuition, room and board, etc. we would remove a number of people from the work force and at the same time invest in future job growth for highly skilled graduates. Over time these skilled workers would pay back the system by paying their just share of taxation.
The current system will not move toward this direction unless we build a social and political movement that works to bring it into being. The current economic elite is aware of how fragile their social position is. That is why they spend so much money for lobbyists and political bribes (aka “contributions) to keep the current unjust system in place. A disciplined political organization of working people and their allies could easily overcome this. It really is just a matter of, “keeping your eyes on the prize,” as they used to say in the civil rights movement.
One thing is certain, if we do not try to build a progressive movement, then we will not have a progressive movement. If we try, we might fail. But a rational and realistic effort, very probably would succeed.
The alternative is the misery and injustice that we see around us today. To maintain that outcome, we need to do nothing.

A Modest Proposal: Ten Steps to a Democratic Economy, Step 1

A Modest Proposal: Ten Steps to a Democratic Economy

by John J. Fitzgerald

I propose Ten Steps to a Democratic Economy. Starting with this column, I would like to explain and defend my proposals. I invite commentary and analysis.

1. The Right to a Job ““ Every person should be guaranteed a job. If the private sector cannot help them, then a public sector job should be available. This could include working on a mass transit system to replace the interstate highway system. Maintenance of public parks, fully staffing public schools and public hospitals could be other areas of employment. We should also publicly fund an alternative energy policy to end our dependence on foreign oil. The model to follow here would be Sweden.
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Every person who is not significantly handicapped should be able to work for a living. I define a decent job as one that pays at least $10.00 per hour, for a 7 hour day, 5 days a week, with decent working conditions, health care and Social Security coverage. If the current market can not supply those jobs, then the government should. This program would be similar to what Franklin Roosevelt’s New Deal meant in the 1930’s, except it would not wait for an economic depression to get it started. I would like to see this expand and contract as the situation required. For example, maintenance of public parks and recreation areas would be an ongoing effort. Maintenance of public buildings, schools and hospitals which are historically neglected because of budget concerns would be fully funded, thereby creating a supply job market that will always be present to match demand. Creating a mass transit system would require a huge workforce just as the interstate highway system of the 1950’s and 1960’s did. Converting from an automobile based transportation system would ease global warming and end our dependence on oil from the Middle East. Converting from petroleum and natural gas to wind power, solar and increased hydro would also require new construction and manufacturing jobs.
Shortening the work week to 35 hours will also create more jobs. It would increase leisure time and thus would promote jobs in that sector. We would also have to make over-time illegal. One should be able to survive and flourish on the income generated by one job. The goal is to create more jobs. The whole idea is to get away from a profit making system to an economy that puts people first. Another name for this is democratic socialism.
To attain this goal we need to start discussing it as a goal. Some people are already close to doing this. This past month, [December, 2006] AFL-CIO President John Sweeney outlined his federation’s vision for stopping what he called, “the senseless slaughter” of good American jobs.
In a speech to the National Press Club, Sweeney described how America’s workers have struggled over the past 25 years as “a perfect storm of outsourcing, off shoring, tax evasion, layoffs, work speedups, wage cuts, health care cuts, pension cuts, shifting risks, bashing unions and short-changing communities”
has swept across the economic landscape.
Sweeney talked about some of the immediate actions Congress and President George W. Bush can take to stop the erosion of good jobs in
America, including:
“¢ Guaranteeing America’s workers the freedom to form unions and
bargain for a better life.
“¢ Giving workers the same protections as corporate interests in
our trade policy.
“¢ Making it illegal for companies to buy or sell products made
in sweatshop conditions.
“¢ Repealing tax laws that encourage companies to send jobs
overseas.
“¢ Passing universal health care coverage.
“¢ Telling corporate America to rejoin our national community by
investing more in workers and less in their executives.
“¢ Doubling the money we spend on education and job training.
“¢ Raising the minimum wage.

Sweeney is making proposals within the context of a corporate-capitalist-labor union system. I think we need to move beyond this approach and for that we will need to get involved with political parties and political campaigns. A good start might be found in a progressive movement within the Democratic Party.

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