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Analysis Economic Justice Financial Justice Global Peace & Collaboration

Politics Should Frame the On-Going Discussion of MMT and the Dollar Regime

| Steve Clark and Tom Clark |

Tom Clark and Steve Clark (unrelated) were the initial proponents of October’s two-part, Voices for New Democracy forum on Modern Monetary Theory (MMT).

The recent discussions about MMT and the Dollar Regime showed clearly that (1) we are all deeply opposed to US imperialism and wish to break its stranglehold on the global economy; (2) we all agree that finance capital uses its present domination at the IMF to retain US dollar dominance in the world’s financial affairs and to impose sanctions on those that resist this domination; (3) we all favor deep cuts in US military spending, an end to the US-imposed sanctions regime and, alternatively, development of international collaboration (climate change, etc.) and peaceful conflict resolution; and (4) we all want higher taxes on billionaires and corporations to constrain their private hoarding and political influence.

We differ on a number of interconnected monetary issues including (1) the nature and cause of inflation and what recent price increases indicate about potential for runaway inflation; (2) how interest rates come to be what they are (how they are set), their impact on the economy, and whether falling rates are a problem; and (3) whether rising deficit spending relative to GDP is a barometer of a nation’s financial fragility.

In our minds, the matters of unity are crucial for working together and uniting with other segments of the progressive movement. In contrast, the issues in struggle are less crucial and can be worked on (and worked out) in the course of today’s practical fight for progressive political power.

One meaningful two-line struggle clearly came out in these discussions. After Steve offered the view that progressives gained a significant measure of dual power in the 2020 elections and the key political task, now, is expanding our base in 2022 and 2024, this participant said (we paraphrase) that a peaceful path to socialism is near-fantasy and the overthrow of corporate power by force is the only real path to socialism in this country. No one overtly agreed with him so, presumably, he is alone on this point. Apparently, we others share unity that, currently, progressives are in pursuit of a socialist USA via non-violent struggle and the election box.

Another important two-line struggle may exist but needs more clarification. While we — Tom and Steve, representing the MMT perspective — say Biden’s agenda is fully affordable and should be enacted forthwith, it’s not entirely clear (to us) whether Dennis Torigoe (who wrote — again, we paraphrase — swords must be beat into plowshares because we can’t do both) supports its passage, given Biden’s on-going failure to restrict military spending and his anti-China adventurism. In our view, progressives should continue criticism of Biden’s imperialist agenda while fully affirming his effort to put domestic spending on a new foundation.

Certainly, the results in 2022 will turn on the voters’ perception of the Biden Administration’s efforts to pass its domestic agenda, as well as its approach to certain international issues (like immigration and climate change).

Yet, the Biden agenda is being sabotaged by conservative (corporate) Democrats who reject it for corrupt (bought-off) reasons while offering the public rationale that it is too expensive and can’t be paid for. In the context of such obstruction, MMT stresses that Uncle Sam is the monopoly supplier of US dollars and can always create as many as are necessary to fund Congressionally-mandated objectives. A decision not to fully fund Build Back Better agenda is politically, not financially, motivated.

We appreciate the views that were shared in the forums. Our discussion about the nature of contemporary public finance (aka, modern money) must continue, and the on-going struggle for social justice and ecological salvation, worldwide, will provide plenty of context for resolution of our current differences.

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Economic Justice Financial Justice

Watch 10/3 MMT Forum, Join 10/10 Follow-Up Discussion

Last Sunday, Voices for New Democracy hosted our latest monthly political forum discussing Modern Monetary Theory (MMT) and the insights it holds for today’s Left. The full forum is available to watch in two parts below.

We also invite you to join a follow-up discussion to carry the dialogue forward. Please join us on Sunday, October 10th at 7pm ET / 4pm PT. Use this link to join the conversation.

The follow-up discussion of MMT will be open for any points or comments that you have. For stimulation, below is a list of questions that the planners gathered after last Sunday’s session. Don’t see your question on this list? Add it here.

  1. Why does this discussion of finance and MMT matter to me? 
  2. How is positive, public investment in US funded or how could it be better funded?
  3. What is the federal deficit and the accumulation of deficits (national debt), and what are their relevance?
  4. What is the point of increasing taxes on the rich (and/or corporations)?
  5. How is the general level of prices in the US set? What is inflation?
  6. How are interest rates set and is there a seed/reap cycle?
  7. What is the effect of US currency going abroad?
  8. Why are taxes and government income the basis of bonds and Treasuries issued by the government?
  9. Why are some government’s interest rates negative?
  10. How does massive currency creation for imported goods create structural unemployment at home?

The discussion is set for 90 minutes. If you want to prepare and investigate further on your own, please see the resource list here.

Categories
Analysis Economic Justice Financial Justice Global Peace & Collaboration

THE US DOLLAR REGIME

A RESPONSE TO STEVE CLARK, TOM CLARK AND SIGNE WALLER FOXWORTH ON THE DOLLAR AS THE WORLD’S RESERVE CURRENCY

| Dennis Torigoe |

First of all, thank you Steve, Tom, Signe and others for responding to my recent article, The Dollar as the World’s Reserve Currency. This discussion will help activists grasp the issue’s importance as well as deepen our understanding of this issue.

Under US capitalism, policies pushed by MMT can help with partial solutions to some of the country’s problems. However, in practice, the continual debt-driven printing of money drives economic polarization and the country down the wrong path to the future. Under what we call the US dollar regime, the rich are getting much richer while structural unemployment, as shown in the labor participation rate and deindustrialization, is worsening.  While the prevailing narrative of unemployment is that the Chinese are taking our jobs away, this story is increasingly being contradicted by acknowledging that we can simply print money and get their manufacturing products. Why should we then bother to do the dirty work of investing and manufacturing at home in the first place? 

Under the Fed’s huge printing of money the assets of the rich, like stocks and desirable real estate, have been skyrocketing. Wages and salaries for most workers are stagnant. While it shields the middle class, who own their homes in the right places and stocks in retirement funds, from the ravages of inflation, the super-rich are getting richer and the poor are getting a lot poorer. The paradox is that economic polarization gets worse as more money is printed. Alongside that, the US has always used its ability to print money — a de facto use of what is described in MMT — to fund wars of aggression and expand its military dominance around the world.

Printing money to fund spending on infrastructure and human needs makes sense because they are a direct investment in our postindustrial future. Large budgetary spending on programs such as early childhood education, cleantech, and communications make sense because they will propel us into a highly productive, more equal and democratic postindustrial future. Federal support of research and development — whether through universities, national labs or private enterprises engaging in activities such as semiconductor chip development — is decades behind and should be vastly increased. Printing money for use in these endeavors enhances the sciences and productivity and will be paid back in time. Even when a direct payback is absent, such as for Covid vaccination and climate adaptation in developing economies (provided these are offered free of conditions and imperialist designs), these types of expenditures  are essential to further a just and fair society. 

We are not against the dollar as a reserve currency in principle if it was a result of superior US productivity and innovation or the use of deficit spending by the government to carry out crucial infrastructure, for human needs and in developing human capital that will propel us into a highly productive, more equal and democratic postindustrial future. What we are against is the dollar as a reserve currency used as a weapon of the US to rip off other countries and vastly overfund the US military to carry out wars of aggression and threaten other countries with economic sanctions. We are against the use of the US dollar regime as a means to push the US into gutting its real industries, creating greater structural unemployment and extreme polarization in society. 

Turn Swords into Plowshares

Military spending and adventures that serve and enrich a narrow part of US society and special interest groups, to further empower the US military industrial and intelligence complex, are the opposite of the positive expenditures enabled by printing money. They take away useful, value-added productivity and turn it into death, destruction, waste and decay.

Thus, as part of a progressive program, we call for swords to be beaten into plowshares.

All of us agree that spending money on wars of aggression and huge military budgets are wrong.  We also agree that spending on domestic programs to increase productive activities that increase social wealth and equality are positives. 

Here is where we disagree. We cannot do both: there has to be a choice between plowshares and swords. Swords have to be turned into plowshares. That’s an essential programmatic element for any progressive agenda.  As Signe has said, there is a challenge to our view of economics and ethics.

By saying that we can do both, we are following the narrative of neoliberal US imperialism, which indeed, always attempts to do both guns and butter, of war, with reform and repression. But their neoliberal narrative does not acknowledge that spending at least 750 billion dollars every year on war and the military, with its hundreds of bases in foreign countries, is the amount not spent creating the conditions for postindustrial development. 

Even from a perspective of national self- defense, should such an unlikely eventuality become a necessity, a vast and rigorous R&D culture and network with the aim to better humankind will form a strong scientific and technological basis for a new and innovative national defense. 

Moreover, the cost of sustaining the current vast war machine is not just reflected in the annual Federal budget. It is reflected in the oppression of people in other countries who are victims of that war machine and US imperialism and the lost opportunities to implement real positive change in the conditions of the American people and the world.   

The Nature of Fiat Currency

We would like to address Tom’s point on fiat currency. All currency serves two basic purposes: first as a unit of account and as a store of value within a legal jurisdiction (normally within a country). Secondly,  it is a medium of exchange. Gold and silver have often been used historically for these purposes. However due to the expansion of human production and civilization (roads, cities, productive tools, cultural products and services) both in scale and quality, there is no longer an adequate amount of these precious metals to perform these two functions. 

Store of Value

However, to understand the US dollar regime, we must study a national currency used in more than one jurisdiction, that is, internationally. The rise of mercantile capitalism, colonialism and imperialism meant that a dominant currency was used in multiple jurisdictions. So a fiat currency of a particular nation, say in the case of  the British Pound, particularly one that’s powerful militarily and, like the Bank of England, has a long tradition of honoring its currency and establishing its global value. It built trust in maintaining its currency’s value or for goods and services. The replacement of Great Britain by the US as the premier international power, allowed the US dollar to have a greater value as a fiat currency with global dominance.

Medium of Exchange

The other principal reason for the dominance of a currency is its value for the exchange of goods. The US dollar through its redeemability in gold and silver and even before OPEC became the ONLY currency permitted in buying oil. Since the value of the global oil trade at oil’s high points could constitute up to 60-70% of the total value of global trade, the US dollar became more valuable and desirable as a result of this linkage,( which by the way seems voluntary but is not. It’s decidedly by force or the threat of force). Almost all globally-traded commodities are priced in US dollars, including energy, precious metals, base metals, and agricultural commodities. 

The US dollar is the dominant global currency. As such, it is used as a reserve currency by other countries. Today the US dollar is about 50-69% of all currencies kept by other countries for trading and other reserve purposes, though this has declined since the 1990s, before the US invasion of Iraq. To show the relative strength of the US dollar, only 2% of the world’s reserve currency is in China’s renminbi, even though it is a dominant trading nation. The Euro is in the ballpark with 20-30% while the Japanese Yen is about 10%.The US dollar is dominant not just in trade. It is also used as the basis for other pegged currencies such as the Hong Kong dollar and other currencies around the world including China which has printed its RMB from 1980 to the present, but particularly in the early years, based on the amount of US dollar they owned.

Why Has US Inflation Been So Low Since the 1990s?

The US became a world reserve currency and relatively free from inflation, even though a  much larger amount is printed beyond its domestic economic needs, because a large amount of printed currency gets absorbed by other countries, free from US domestic circulation, which would be highly inflationary. MMT and some mainstream economists contend that we can print as much as we need since there is no inflation. For example, they set up a 2% inflation goal (which justifies printing 2% more US dollars as a neutral, non-inflationary act). Since this 2% US dollar inflation was never reached in recent years, they say that it shows that it’s okay to print even more. 

What they didn’t say is that this is only a temporary phenomenon. Many formerly colonial and developing countries have embarked on economic development and created a lot of savings in the last two or three decades.  Their savings were saved in US dollars due to the weakness of their own currencies.  Absorption of this large pool of global savings enabled the US dollar to be printed without inflation. 

But will this continue indefinitely? We don’t think so. There are no free lunches in the world. These developing world savings are finite and have been exhausted. There is no more coming. Furthermore, will manufacturing countries continue to accept the US dollar as good IOUs as the Federal Reserve engages in quantitative easing, again and again into infinity? 

The recent commodity inflation (PPI) index has reached 10% and the consumer price (CPI) index over 5% indicating a pivotal change in inflation. Many mainstream leaders in finance such as Jamie Dimon and Larry Summers challenge the Federal Reserve’s view that inflation is only temporary. They both said that we will be surprised by the persistence of this inflation.

The Nature of the Federal Reserve’s Interest Rate Cycles

As Prof. Salas stated in his recent immigration forum, the Mexico border issue is not just a Mexico-US problem. It’s a North-South or developing world-US problem as a result of the US neoliberal imperialist system. US neoliberal imperialism is an economic-industrial-military political order which reaps world wide profit from the massive expansion of low-interest debt. As the US raises interest rates in due time, it bankrupts those that borrowed massively for economic development. This interest rate cycle, often depicted as a boom and bust cycle, or a Federal Reserve interest rate cycle are global and omnipotent. It sweeps the world first with hope and then certain despair. The finest assets such as Korea’s Samsung were once almost taken over (which would be like taking over a country without firing a shot) by the same group of hedge funds such as Elliot Management, the same group that attacked the Thai Baht, the Malaysian and HK dollars in the Asian Financial Crisis. The force of US-led global capital pushed Latin American countries and Russia  into bankruptcies or debt traps like the Brady Bonds. This spreading of the fishing net and reaping by pulling it in is predictable in almost 10-12 year cycles. 

The Federal Reserve’s Interest Rate Cycle is the US Dollar Regime

The key point is that the Federal Reserve’s MMT-like currency cycle is the US dollar regime. It doesn’t separate military spending from lending to poorer nations. If the set up does not guarantee “reaping,” that is, the ability to enforce measures on those who default on loans or the  military capacity to enforce isolation of countries like Iran or Venezuela when they get out of line (which is the post World War II practice) they won’t lend their money until the country targeted capitulates or there is regime change. In the first place, the US dollar regime is a regime — an established system of monetary, political, military and organizational orders that doesn’t separate where the money goes. It prints because it’s set up. It is set up to reap. 

When we say Keynesian spending on human capital and needs is good, we are not saying that as a part of that system. We are against the US dollar regime as a system. We are just saying there is nothing wrong to borrow through legitimate commercial channels or even by government spending but without military, SWIFT and hedge fund enforcement — the way it is done today.

The Counter-Cyclical Nature of Interest Rate Cycles of the Former Victims of the US Dollar Regime 

The US Fed has lowered the interest rate to almost zero as Covid-19 hits. Now they are tapering and ready to raise the rate to reap. However, this time things may be different. Many countries learned this game and have raised their rate before the US raises its rate. They do so to be countercyclical to preempt US reaping by minimizing potential damage, by trying to get out of or lowering debt before the nets are pulled in. Countries from North to South, Turkey to Korea, China to Vietnam are all trying to raise interest rates and lighten their debt owed before it’s too late. This actually has forced Federal Reserve Chairman Powell to taper ahead of schedule! This is another reason that this round of US monetization of debt and QEs may not hurt others as much it hurts itself.

After the wakeup call from China reversing its buying of US Treasuries, this round of the interest rate cycle may be a reset for the US. The amount of US government debt of $29 trillion along with $5.6 trillion of Federal Reserve debt on its balance sheet is scaring the rest of the world and they are buying fewer US Treasuries fearing inflation. This is part of the counter-cyclical interest rate game to minimize their losses.

This makes the latest round of Fed Chairman Powell’s moves questionable. Inflation is widening from commodities to everyday consumer products, a rare global occurrence that may foreshadow the beginning of the end of the US dollar regime. Stanley Druckenmiller has stated that the US dollar regime could end in 15 years if we keep printing money like this. And, he says, that could be the end of the American way of life as we know it.

Massive Deficits a Burden? 

Tom states: “As Godley showed, this accounting is a fact, not a theory, and decisively exposes the myth that the national debt is somehow a burden to our descendants, any more than the massive deficits from WWII were a burden to us.”              

While it is not necessarily true that national debt is a burden, there are limits to a sovereign currency. One is that the fiat money supply (printing money)  must not continually vastly outstrip the amount of goods produced, services available or savings or the currency will devalue. This devaluation most often will show itself as inflation, where prices paid in that currency rise on goods and services, which will lower people’s buying power and if it grows higher and uncontrolled will devastate the economy. This happened, for instance, in the 1970s in the US during and after the Vietnam War and in Latin America during the 1980s and early 90s and most infamously in Weimar Germany in the 1920s. In fact, Modern Monetary Theory recognizes that the limit of currency creation by a sovereign country is the ability to keep inflation at a tolerable level. Thus, sovereign currency debt creation is in fact not unlimited, but constrained by the real economic conditions in which it functions.

The other limit is that the government has to service debt created by deficit financing, for instance the servicing of bond interest. As the US government continues to deficit finance its budgets, it has to be able to pay bondholders the promised interest on the bonds. Right now, the US government allocates about 7.9% of its budget to interest payments ($325 billion) and the 2021 Federal Budget Proposal projects this by 2030 to become 10% of the budget, or $665 billion. The Congressional Budget Office projects that federal debt payments could reach 27% of GDP (GDP, not the Federal Budget !) by 2050 from around 8% in 2021. No amount of raising taxes could save the day. Moreover, any problem that arises from this debt servicing, such as the Tea Party Republicans threatening to default on US interest payments in 2011 and 2013, or like the Republicans in the Senate are doing today, will cause US treasuries interest rates to rise because of perceived risk, slows economic growth and weakens the dollar’s value, increasing import costs.

This growing federal debt service eating up more of the federal budget is also both a lost opportunity to fully fund more productive postindustrial programs and an increase to the inflationary threat. As more dollars are printed to cover this debt service, more dollars are released into the economy, causing inflationary pressure. It can also cause asset bubbles as investors chase higher returns  than near 0% interest Treasuries,  bubbles which burst and cripple the economy as happened in the 1970s, the dotcom stock market bust in the 1990s and the Great Recession in 2009-2014. Today, leading investors like Stanley Druckenmiller (who along with George Soros broke the Bank of England by shorting the English pound in support of the US dollar as the rising reserve currency) see that as a real risk in the next year or two. As stated before, he also predicted that the US dollar reserve regime may end in 15 years, fundamentally changing the American way of life as we know it.

On the question of the US’s massive deficits after WWII, I think we have to look at the global economic picture after the war.  While the US was not invaded or devastated, the countries of Europe and Asia were. The fact is that the US won the war. The statement that the US didn’t feel the effects of its debt fails to take into account the widespread economic destruction in China, SE Asia, the Soviet Union and Europe. The outcome was that America felt it in lives lost in war but in fact profited economically. By taking the mantle of global superpower and imposing the post war international order on the non-socialist world, through means of the Marshall Plan, the reconstruction of Occupied Japan and the crushing of Communist-led rebellions in Greece, the Philippines, Vietnam and Malaya, the US enriched itself by reconstruction contracts, the control of third world commodities, the domination of global trade and commerce producing major profits for its capitalist class. With the Bretton Woods dollar regime, the US lorded over the rest of the world economically and militarily.

In fact, North America enjoyed the longest rise in the standard of living in history during the post WWII period, until we hit Vietnam, Iraq and the Middle East. The Vietnam War ended in 1975 with 55,000 American lives lost but millions of lives lost in SE Asia. The war cost a little less than $1 trillion then. But combined with the rebellion pacification money of the Great Society and Urban Renewal (the last big printing of money by the US government) it was less than 20% of what we spent in wars in the Middle East and Afghanistan. Even then the Volcker recession drove the US economy way down in the 1980s (see The Myth of American Deindustrialization) until we revived it through the digital revolution that went from the mid 1980s until it went bust in the stock market’s internet debacle in 2000.

Is US Dollar Hegemony a Product of, or Integral to US Imperialism?

Tom states that the “dollar’s status as reserve currency is a result, not a cause, of US imperialism.” That is untrue.  The key fact is that US dollar hegemony is an integral part of US imperialism, and is part and parcel of US domination of other countries. Iraq was invaded and Saddam Hussein was ousted mainly because of his attempt to decouple Iraqi oil from petrodollars (oil could only be bought and sold by using US dollars). This agreement  was imposed by the US and OPEC. It was not only due to his invasion of Kuwait, as the US claimed.

The forging of the petrodollar and other US dollar-denominated commodities took arm-twisting, and were a huge part of what formed the post Vietnam War US-led world order in the first place. The agreement to back Saudi Arabia with US weapons and the stationing of troops there was in exchange for the Saudis and OPEC’s willingness to couple oil transactions with the US dollar to the exclusion of all other currencies. 

The Brady Bond Debt Trap

Another example is the imposing of the Brady Bond solution to the massive debt crisis in Latin America of the 1970s and 1980s that became shackles on many Latin American countries. The Latin American debt crisis was in large part due to the large loans to third world countries by US and European banks when interest rates were low, and this became a crisis caused by the increased debt service on loans because of  the huge increase in oil prices in the 1970s and 1980s. Because all oil had to be paid for in dollars, those countries had to further borrow huge amounts of US dollars from US and European banks (who were getting petrodollars invested from OPEC) to pay for imported oil. Latin American countries, beginning with Mexico in 1982 started to default on US dollar loans.  The results were catastrophic. According to Wikipedia, “A massive process of capital outflow, particularly to the United States, served to depreciate the exchange rates, thereby raising the real interest rate. Real GDP growth rate for the region was only 2.3 percent between 1980 and 1985, but in per capita terms Latin America experienced negative growth of almost 9 percent. Between 1982 and 1985, Latin America paid back US$108 billion.[4]

The Brady Bonds were a way to restructure the Latin American loans to make it easier for them to be repaid, but also to recover as much as possible for US and European banks and investors, rather than lose all in defaults.  Even then, defaults occurred in Brady Bonds. Ecuador, for instance, defaulted on interest payments and faced immediate repayment demands. It ended up cut off from the world financial markets and suffered through years of deprivation, social and political unrest.

The US Dollar Regime is the Most Effective Part of US Imperialism

The use of sanctions against Cuba, Venezuela, Russia and Iran, were direct acts of imperialism through the control of the dollar regime. The US SWIFT sanctions became in fact far more effective than the US military, as US military ventures often stalled and became ineffective, costly and unpopular in the US. There are no protests against US economic sanctions since there are no American soldiers brought home in body-bags by such acts.

In fact, today US dollar hegemony is the most effective part of US imperialism. It allows the US to conquer and dominate countries without firing a shot. The US dollar regime is the highest development of Western imperialism, and represents the furthest development of Lenin’s thesis of imperialism and the export of capital.

Weakening of the SWIFT system Weakens the US Dollar Regime

The excessive use of economic sanctions by the US against Iran, Russia, Cuba, Venezuela and many others and even European countries that use the SWIFT currency settlement information system forced many countries into developing alternative currency systems such as the Chinese Union Pay or the European Interdex systems. Some stopped using the US dollar as a reserve currency, period — like Russia. Furthermore China has signed a 25- year agreement with Iran in trade and economic cooperation to bypass the US dollar based SWIFT system.  

The development of sovereign digital currencies that don’t require SWIFT or any settlement systems at all also weaken the US dollar as the required reserve currency. MMT accepts the logic of the US dollar as a reserve currency. But this logic is failing.

Conclusion

The money printing policies of the US dollar regime is an integral part of modern US imperialism. On the domestic front, it can partially finance needed postindustrial development and necessary social needs, but as practiced in the US over the last decades, overall it has caused deindustrialization and devastating economic polarization.  

Internationally, the policies call for indiscriminate printing of money and lending it out at low interest rates around the globe as the beginning of the “seeding” cycle. For the US to reap the maximum profits from the world, they must inject or “seed” the largest amount of capital to the most vulnerable or greedy developing countries, who most need economic development. This first cycle is justified by MMT.  Then interest rates are gradually raised and liquidity is withdrawn around the world. This reaping process leads to destruction of the seeded and a profit festival for the global banks and hedge funds. This repeated seeding and reaping process, along with economic sanctions, the use of military force and the control through the SWIFT system is the reign of neoliberal imperialism.  

In order for the US dollar regime to survive it must keep on reaping profits either through outright military victories or continuous reaping from other countries.  The actual human toll of the US dollar regime’s repeated seedings and reapings around the world can be seen in deforestation, waves of refugees, overcrowding of urban centers and the gutting of American industries and urban decay.  We now have the unprecedented divergence of extreme wealth and hopeless poverty driven by extreme financial crises like the Asian Financial Crisis in the 1990s and the Great Recession, sparked by the Lehman Brothers collapse in 2008.  

In response, we must work to end this destructive, imperialist US dollar regime. We must turn swords into plowshares, resist US imperialist wars and economic aggression while fighting for the desperate need of the American people to build a highly productive, more equal and just postindustrial future for the nation and the world.   

Categories
Analysis Economic Justice Global Peace & Collaboration Organizing Social Justice

Watch: Forum on Palestine, 2021 Unity Uprising, and Beyond

In our latest monthly forum, Danya from the U.S. Palestinian Community Network joined Voices for New Democracy to discuss political developments in Palestine and recent uprisings throughout the occupied territories. Exploring the history of Zionism, Palestinian activism and resistance, and ongoing developments in the region, the conversation offers an important overview of the status quo in Palestine and possibilities for political change.

Watch the full forum below.

Categories
Analysis Economic Justice Financial Justice

Post-Industrial Systemic Transformative Thinking in the Contemporary Period

| José Z. Calderón |

Hidden too often in the mainstream’s version of history in this country are the many collective efforts that have created economic and political models of systemic structural change — models nationally and globally which have sought to create structural changes in Capitalism.  

We have the commonality that there is a need to advance a dialogue on the contradictions inherent in the system of capitalism, deepen research on the new local and global economic models that are emerging, and promote the growth of a movement based on the creation of transformative structural models of equity.   

With the inability of traditional politics and politicians internationally not being able to come up with viable solutions to a growing economic crisis, there is a growing movement to advance theories and practices for a new economy.  

This movement is one that is based on rethinking the nature of ownership and rethinking the definition of “growth” as a basis for gauging whether there is progress.  This is a movement advancing a transformation of the economy so that the public, rather than a small elite, little by little come to control the productive assets in the society.  

At the base of this rethinking is the turning around of a system that survives on the existence of an unequal stratification system and the divisions it creates on the basis of wages, wealth, and opportunity.  

An emphasis on the quantity of profit over quality of life has led to the rise of a right-wing movement to make sure that our potential power is scattered and decapitated through: deregulating and allowing corporations to spew chemicals in the air that result in more of us dying (particularly in people of color and low-income communities); through the cutting of our cutting health care; through incarcerating us (we have more African Americans in jail now than we had in slavery); through keeping us from voting by gutting the voting rights act and unjust gerrymandering; and through increased enforcement, deportation, and limits on asylum of our immigrant young people, families, and refugees. This movement, particularly evident in the policies of the past Trump administration, continues to rear its head by waging a war against our communities (and particularly those who have been in the forefront of any gains made in civil, human, and environmental rights in the last decades).  

We have the Alt-Right, the Bannons, the Rockford Institute, the neo-conservative movements in this country who promote white supremacist, racial-nationalist and neo-fascist ideologies, who push a deregulated free enterprise system, more funding for the military, and stand against anything that promotes a system based on equality. These are movements that continue to defend and promote the privatization of our economy and that, rather than advancing spaces and places of a more just and equal world, are seeking to foment a politics of individualism and ignorance about global warming and the economy.

This trend promotes an unregulated economic system where corporations rule, where the needs of our communities are put aside for the priorities of profit-making interests, and that advances a form of neoliberalism that places emphasis on privatization and consumerism with the outcome of destroying any ideology that truly advances practices for the collective good.  

To combat this right-wing conservative trend, we need a program that: transforms power at the top; abolishes a structure that allows the wealthy, the corporations, and businesses to manipulate the tax system in their favor; reverses banking concentration and supports a system of decentralized community accountable banks and credit unions; combats unjust gerrymandering; abolishes the electoral college; moves toward a form of proportional representation and builds a social movement in support of a living wage; health care with universal coverage; accessibility for everyone to a quality education; a guaranteed basic income; investment in pre-school, K-12, and higher education; public financing of elections; and trade agreements that ensure environmental and labor standards. 

At the local level, we need a social movement to create transitional forms of a new structure or a new system that is based on the collective and not just the interests of the individual. Some of these transitional forms include employee-owned enterprises; cooperatives; and businesses that are used in the interests of the community.  

About 130 million people in the country are members of various urban, agricultural, and credit union cooperatives. In Cleveland, Ohio, a group of worker-owned companies has been developed that is supported in part by the purchasing power of large hospitals and universities. The cooperatives include a solar installation and weatherization company, an ecologically advanced laundry, and a greenhouse capable of producing over three million heads of lettuce a year. The Cleveland model is not simply about worker ownership but the democratization of wealth and building community particularly in the low-income areas. They are doing this through the creation of community-serving non-profit corporations, a revolving fund, agreements that the companies cannot be sold outside the network and that they must return ten percent of profits to help develop additional worker-owned firms in the area. Further, an important element are the agreements with  local hospitals and universities who, until recently, spent their $3 billion on goods and services per year, outside the immediate neighborhoods. The “Cleveland model” has now won over these entities to be responsible as publicly-financed institutions and to allocate part of their spending and assets to the worker co-ops in support of a larger community-building vision. There are other cities now creating similar models (Atlanta, Pittsburgh, Amarillo, Texas, and Washington, D. C.) and there are unions, such as the United Steelworkers, that are developing co-op union models of ownership.

This is about an alternative form of municipal development and land use.  In some cities, such as Washington, D. C. and Atlanta, cities bring in millions by capturing the increased land values that their transit investments create. The town of Riverview, Michigan has been a national leader in trapping methane from its landfills and used it to fuel electricity generation (providing both revenues and jobs). There are 500 such projects nationwide. Many cities have established municipally-owned hotels.  There are nearly 2,000 publicly-owned utilities that provide power and broadband services  to more than 45 million people — generating $50 billion in annual revenue. In Alaska, state oil revenues provide each person living in the state,  dividends from public investment strategies.   

Related to this is the creativity of Community development Banks, like the Bank of North Dakota (a state-owned bank founded in 1919) that are designed to facilitate economic revitalization of poor communities.  In recent years, the bank returned $340 million in profits to the state. In Oregon, there are efforts to develop a similar bank, a “virtual state bank,”  with no storefront. The South Shore Bank in Chicago is another example (developed in 1973) that provides real estate management, technical assistance, job training, equity investment, and economic consulting. It has assets exceeding $1 billion with $150 million invested in low-income communities.   

All these models are closely related to what the New Democratic Movement (that many of us were part of) advocated in the 1980s: the development of a post-industrial society with concrete  innovative economic “transitional” forms.  

The Post-Industrial Society thinking of the 1980’s proposed a “struggle to develop the material basis for a strong cooperative movement” — and a society, not just based on “high levels of productivity” but on the maximum involvement of all the people. This outlook encouraged the development of small businesses, worker-owned cooperatives, and investment in human capital (particularly in education, housing, and health). It called for a society based on a revolution in the current mode of production where high productivity is possible through the development of the most advanced technologies. 

This direction, in the contemporary period, includes some contemporary writers and thinkers that are thinking along the lines of the need for a new economy. Some of the ideas that relate to the post-industrial thinking advocated in the 1980’s by the New Democratic Movement are now being promoted by such economists as Richard Wolff, Emeritus in Economics at the University of Massachusetts; Gar Alperovitz, historian and political economist; Marjorie Kelly and Ted Howard of the Democracy Collaborative; and Joe Guinan, Executive Director of the Next System Project and Martin O’Neill, Political Philosophy at the University of York.  There are many names being given to these models that, in addition, to post-industrial a post-industrial economy, include:  stakeholder capitalism, the solidarity economy, new economy, sharing economy, regenerative economy, and the living economy.

In connecting with some of these themes, in the contemporary period, economist Richard Wolff, proposes systemic change “where the nature of work is transformed;” where people “once again control production;” where the creativity of workers is valued, and where they are in “control of the entire product.” Agreeing with Marx’s notion of surplus value, Richard Wolff proposes “workers self-directed enterprises where workers, who produce the surplus capital, are in charge of the profit (and not the managers or executives). Similar to aspects of the post-industrial article, Wolff proposes that production works best “when performed by a community that collectively and democratically designs and carries out shared labor.” The transformative element for Wolff is the “reorganization of all workplace enterprises to eliminate exploitation … where the workers become collectively self-directed at their work sites.”  

In his book Democracy at Work: A Cure for Capitalism, Richard Wolff proposes that these models are fine but that what needs to change is the class structure of production and that many of the systemic models, including private and state capitalism have had the commonality of advancing state-capitalist class structures of  top-down production that exclude the workers from production decisions and the distribution of their production. He proposes that even in the transitions from capitalist to socialist economic systems in various countries, there was a lack of prioritization or did not “explicitly include, or if they came to power, institute an economic system in which the production and distribution of surplus was carried out by those who produced it.” Overall, he argues that even in those countries categorized as “socialist,” there was a lack of prioritizing what he proposes as workers’ self-directed enterprises (where the workers who produce the surplus generated inside the enterprise function collectively to appropriate and distribute it). His solution of “workers’ self-directed enterprises” emphasizes that workers must partly or completely own the enterprises where they work and have a decision-making voice in the surpluses they produce. Such a transformation, from his outlook, will also advance the abilities of “workers to become informed, competent, and full participants in the democratic governance of the communities in which they reside.” 

Similarly, Joe Guinan and Martin O’Neill in The Case for Community Wealth Building propose that organizing at the local level, in what they call “local justice,” can be a means of developing models (such as the ones that have been presented here as examples) that both take on the power of corporations and “build a more equal and democratic economy.”  

Gar Alperovitz, in What Then Must We Do, proposes a direction that builds models of democratizing wealth and the building of a cooperative and community-based economy from the ground up. Like aspects of the post-industrial article, Alperovitz proposes cooperative models that include community land trusts, worker-owned businesses, and employee stock ownership plans.

In this vein, Marjorie Kelly and Ted Howard, in The Making of a Democratic Economy, present models that are “making what was once radical seem more like common sense.” These models include: “cooperatively-owned work places; of cities committed to economic policies rooted in racial justice; of ethical financing and investing; of communities on the frontline of crisis-building” to show us that “a different economy is not just a theoretical possibility but that it is something happening in right now in the real world.” The models include policies such as that of the  Green New Deal (proposed by Congresswoman Alexandria Ocasio-Cortez) to shift to 100% renewable energy in 10 years, to create tens of thousands of new jobs, and to advance the implementation of publicly-owned banks like the North Dakota Bank. Already, New Jersey Governor Phil Murphy and California Governor Gavin Newsom have committed to establishing state public banks. This follows with the thinking of Gar Alperovitz that a whole new economic system is emerging that already include models of economic development with racial justice at the forefront, employee-owned companies, and local purchasing by anchor institutions. Agreeing with other economists, Alperovitz presents “anchor” models that are not just about theory but are “real models” that have taken the example in Cleveland (the Cleveland Model) and are now being constructed in other places ranging from St. Paul, Minnesota, to Milwaukee, Wisconsin, to Albuquerque, New Mexico, to Rochester, New York, and to Richmond, Virginia.

The rise of this new economy include worker-owned cooperatives ranging from the “Si Se Puede” cooperative (a Brooklyn house-cleaning enterprise owned primarily by Latinas) to union cooperatives (such as the Communications Workers of America Local 7777 in Denver (Green Taxi) where the leadership and board is made up entirely of immigrant drivers from East Africa and Morocco). Further, worker coops are being implemented now in New York City, Newark, Oakland, Rochester, and Madison. There are more than 6,600 employee stock ownership plans (ESOPs) throughout the country with $1.4 trillion in assets and “businesses owned by the people they serve” (that include credit unions, agricultural cooperatives, and consumer cooperatives) that represent $500 billion in revenue and employ more than 2 million people.

There are four principles that involve moving in this direction:  

  1. Thinking of new ways to democratize wealth  
  2. Placing the building of community and what is in the interests of community in the forefront in all development  
  3. Decentralizing power in general – so that there is community input 
  4. Planning in the interests of quality of life  

The character of capital and corporations is that they have the highest level of planning in individual corporations that do everything competitively to reap the most profits with a culture of greed and selfishness in the forefront.  However, there is the capacity for a new kind of planning, with a culture of collectivity in the forefront, to use the earth’s resources to solve the many problems threatening our survival.   

Categories
Analysis Democracy: Rule of Law & Elections Economic Justice Organizing Social Justice

Is a Progressive Majority in Texas Possible?

| Matt Perrenod |

Democrats have been talking about flipping Texas for at least a decade.  It’s not hard to understand why.  Nearly 40% of Texas residents identify as Hispanic, according to the 2020 Census.  An additional 20% identify themselves as African-American, Asian-American and other non-whites, meaning that only slightly more than 40% of the state’s residents identify as non-Hispanic white, and that number is shrinking as a percentage of the whole.  

Further, the state is large, with a population and electoral strength nearly equal to Georgia, North Carolina and Arizona combined.  If Texas were to become electorally competitive statewide, it would completely change the electoral calculus in the U.S. as a whole.  And both Dems and progressives have noticed, giving the state increasing attention over the last few years.  They have, nevertheless, been disappointed: the GOP continues to hold every statewide office, including both U.S. Senators, and dominate both the Congressional delegation and both houses of the state legislature, with no erosion in 2020.  Biden did narrow Trump’s margin in the Presidential race, but still lost by nearly 6%.

With this in mind, I spoke with Mike Siegel, who ran unsuccessfully for the U.S. Congress from Texas’ 10th Congressional district in both 2018 and 2020. Mike is an attorney and longtime progressive activist in the Austin area.  Mike’s campaigns were strongly progressive in content and tone, and he surprised many when in 2018 he came within 4% of beating a well-financed GOP incumbent in 2018 in a Republican-leaning district stretching from east Austin to the western fringes of Houston.

With more support and considerably stronger fundraising in 2020, he actually fared slightly less well in 2020, reflecting a statewide pattern.  “We raised a lot more money in 2020, and probably 80% of that went to polling and media,” he says.  “I think we need to get a chunk of that fundraising into grassroots organizing.”

In 2021, Mike and Julie Oliver, another progressive Congressional candidate who outperformed expectations in 2018 and 2020, have created a new organization called Ground Game Texas, with an aim “to organize and mobilize voters community-by-community, collaborating with partners on the ground to meet voters at their doors, hear their concerns, and highlight popular issues that are on the ballot.”

“Obviously I think they’re important, but electoral candidacies are a limited form,” Siegel says.  “They’re about a specific candidate, in a specific race, and specific location.  And to the extent ordinary people have bandwidth for politics, they may be thinking more about Joe Biden versus Donald Trump than about the local race… If we’re going to make real progress, we need a long-term horizon.”

Ground Game Texas is meant to address that, drawing on the lessons in places like Arizona and Georgia, and applying them to the Texas context.

“The folks who successfully fought to roll back SB 1070 (the Arizona anti-immigration laws enacted in 2010) kept working,” Siegel says.  “Now Arizona has two Democratic Senators.”  The New Georgia Project went door to door for ACA (Obamacare).  Organizing for health care led to voter registration, which led to fighting for voter rights, which led finally to some big wins.  If the goal is to build a progressive Texas, we can’t rely on shortcuts.  But Texas may be even tougher: “We need twenty Stacey Abrams.  We’re big, and we’re diverse.”

Siegel believes strongly that a sustained conversation around key issues is central to this long-term thinking.  To this end, Ground Game Texas will put money and organization behind a set of issues they characterize as “Workers, Wages & Weed.”

“These are wedge issues that work in our favor,” Siegel says.  “And in Texas, a key tactic is to put these issues on city ballots throughout the state, to excite progressive voters and stimulate political conversation, and address the disconnect between Democratic policies (which are often popular), and the Democratic brand (often seen as disconnected from popular concerns).”

Ground Game Texas hopes to promote progressive causes and candidacies throughout several electoral cycles by providing campaign expertise and funding to a combination of candidacies and ballot issues, sustaining an ongoing conversation among voters that will gradually swell to a progressive majority that matches Texas’ perceived potential.

One issue is how to constantly be advancing electoral work that galvanizes voter interest and turnout. “Safe seats are a problem,” Siegel says.  “Turnout is reduced, even in strongly progressive communities, when there’s not a closely-contested race.  So we’re looking to ballot issues as a key tactic.”

Citizen-initiated ballot issues are not allowed statewide in Texas, nor at the county level.  Citizens can petition for ballot measures at the municipal level, and Ground Game Texas hopes to promote these all over the state.

“You could put an initiative on the ballot to require a living wage in city contracts, for example,” Siegel says.  “Or you could limit enforcement of marijuana laws for possession of small amounts.  These are progressive ideas that majorities support.” 

Siegel hopes to take the fundraising capacity demonstrated in progressive candidacies and direct that toward grassroots organizing.  He notes that there is already strong grassroots organization in some parts of the state, citing as an example the Texas Organizing Project, which is active in Houston, Dallas and San Antonio.  In those cases, he says, Ground Game Texas can provide tactical support, including funding and legal help.  Progressives are less well organized in many other parts of the state, however.

“For example, there is Grand Prairie, outside of Dallas,” he says.  “It has over 100,000 people, and is majority Hispanic, but lacks political organization.”  He described how a city that leans Democratic continued to be dominated by white conservative Republicans.  “We were able to help two progressive people of color win city council elections for the first time.  And you’ve got places like Grand Prairie all over the state.”  

Again, Siegel emphasizes a prolonged effort.  “It would have been nice if one exciting candidacy could flip the state,” he says, referring to Beto O’Rourke’s unexpectedly strong showing against GOP Sen. Ted Cruz in 2018.  “But that’s not how it’s going to happen.  To be real, we need to be thinking about 2028.”

Ground Game Texas starts with $1 million, and a goal of raising another $2 million this year, and funding organizers to knock on a million doors throughout the state. You can find them at www.groundgametexas.org.

Categories
Analysis Democracy: Rule of Law & Elections Organizing Social Justice

Political Possibilites in the South & Sun Belt

| Matt Perrenod |

In the wake of the 2020 election cycle, there has been renewed attention among progressive electoral activists to Sun Belt states where people of color are a large part of the electorate in a region that for several decades has been dominated by conservative whites.  The Biden electoral victory resulted not just from his winning three northern states Trump won in 2016 (Pennsylvania, Michigan, Wisconsin), but also from victories in Georgia and Arizona, where Democratic candidates were unsuccessful for decades.  Similarly, the narrow Democratic majority in the U.S. Senate arguably rests on Georgia and Arizona, where Dems flipped four seats in 2018 and 2020.  There has also been significant attention given to North Carolina and Florida, where the GOP eked out a series of narrow victories in the 2018/20 electoral cycles, and Dems won the NC governor’s race.  Dems now control the state government in Virginia, as well as a majority of that state’s Congressional delegation.  A coalition of Hispanic, Native American and progressive white voters have delivered Dem majorities in New Mexico for several cycles.

Through much of the South and Southwest, however, the GOP retains an electoral majority, and progressives have been working on how to extend the successful experience in states like Georgia and Arizona to other areas.  Major states like Texas have drawn the attention of progressives for several cycles, but remain locked in the hands of the GOP. Stronger candidates have come forward in places like Mississippi, Louisiana, South Carolina and Alabama, but all of these states continue to be dominated by the right, despite large African-American populations.  With few exceptions, Republicans dominate the border states of Arkansas, Tennessee, Kentucky and West Virginia as well.

The South and Southwest have become centers of demographic diversification in the U.S.  Much of the growth in Latinx voters has been in the region, and AAPI communities have become a major component of urban centers like Houston and Atlanta.  The region remains the largest concentration of African-Americans in the country.  Given this, we ought to continue to look closely at the opportunities for progressive political power in this region, while acknowledging that demographics doesn’t automatically confer success.  Rather, we should be asking, and acting upon what it will take. I believe the successes in Georgia and Arizona point to the importance of prolonged grassroots organizing to breaking the conservative white lock on the Sun Belt.  For this reason, I hope to post occasionally on the intersection of grassroots and electoral organizing in my native region, and highlight emerging examples of how these movements are striving for political power.  I will look to both electoral contests as well as community campaigns, help amplify regional voices, and try to identify the lessons as they’re being tested and learned.  And I would like to hear from others living and working in the region, and your perspectives on the current situation.  Please comment on my posts, and feel free to email me directly at mperrenod@gmail.com.

Categories
Analysis Commentary Financial Justice

Signe Waller Foxworth Responds to “The Dollar as the World’s Reserve Currency”

| Signe Waller Foxworth, PhD |

In this piece, Signe Waller Foxworth responds to Dennis Torigoe’s recent article, “The Dollar as the World’s Reserve Currency.”

Thanks to Dennis Torigoe for a very informative piece in Voices for New Democracy about the privileged position the U.S. has in global finance due to the acceptance of the dollar as the world’s reserve currency. I am wondering about the relationship between Modern Monetary Theory (MMT), that has captured the enthusiasm of many of us, and the sovereign role of the dollar in global finance. 

We are excited about MMT because it exposes the myth of deficit spending and describes the actual working of the economy. MMT shows the deceitfulness of rationalizing the government’s failure to provide for the basic needs of the people with excuses like we don’t have the money for this or we would have to raise taxes to pay for that. These rationalizations are false because the U.S. Government is the sole currency issuer and creates fiat money by spending it into existence, a feat none of us can accomplish, at least legally. It is no more difficult to find the money for universal health care, housing, living wages, education, immigration reform and addressing environmental destruction and climate catastrophe than it is to find the money for bombs, drones, guns, corporate bailouts and aid to foreign countries that are human rights abusers. The failure to provide a decent living standard for its population is exposed as due to a failure of political will and moral values, not a shortage of money. MMT opens the door to a more democratic process of managing the U.S. economy.

What I find challenging is what is precisely the relationship between MMT and the international financial arrangements that lead to U.S. dominance over other nations. The sovereign dollar plays a major, if not decisive, role in promoting U.S. imperialism. Could we, or would we even want to, create a paradise in the U.S. by trampling the rest of the world to death with imperialistic and financial action afforded by our privileged position in the global financial system? The relationship between MMT, with its potential benefits toward democratizing our national life, and the global financial system that fosters U.S. imperialism challenges our thinking in the fields of Economics and Ethics.  Could we (is it even economically feasible) or would we want to (is it even ethically justifiable to) utilize the tools of MMT domestically to fund education, housing, living wages, immigration reform, universal health care and avoiding the worst climate catastrophes if the US sovereign position in global finance continues to allow us the latitude to address Americans’ needs by immiserating other peoples?

Categories
Analysis Organizing Social Justice

Truth & Reconciliation in Greensboro

| Nelson & Joyce Johnson |

SOME UNDERGIRDING VALUES, ASSUMPTIONS AND PROCESSES RELATED TO FORGING A NORTH CAROLINA TRUTH, JUSTICE AND RECONCILIATION COMMISSION (TJRC)

  1. Introduction and Sketch of the Vision and Basic Plan

Every significant social undertaking usually has unstated values, assumptions and strategic objectives related to that undertaking.  In this document we will sketch out some of those values, assumptions and strategic objectives as we currently see them for exploration and further refinement.  This is a vital step as we strive to build on the Greensboro Truth and Reconciliation Commission (TRC) initiative to establish a North Carolina Truth, Justice and Reconciliation Commission (TJRC). You will notice that we have added the word “justice” to this emerging North Carolina statewide process. 

Our country is trapped in a web of false or terribly distorted and contradictory historical narratives. Against this background, there is a growing consciousness of the need for some kind of truth seeking and justice making process in our nation.  In fact, there has been over fifty (50) calls for and/or initiatives launched in recent years for truth processes.  These include Rep. Barber Lee’s call for Congress to create a Federal Truth, Justice and Reconciliation Commission (TJR).  Also, it is becoming increasingly clear that the nation cannot long endure without a broader and more truthful understanding of its history and a wiliness to both own and creatively engage that history so as to heal the wounds and repair the wrongs of our yesterdays.  This is necessary if we are to have better tomorrows.  In a real sense, nothing less than our personal futures and the future of the entire nation is at stake. 

The NC-TJRC is envisioned as an ultra-inclusive process. That is, we want to reach a significant slice of the racial, economic, gender, rural, urban and ideological diversities within our state.  While all the diversities are included, there will be a preference for the most marginalized, abused, and neglected, including an emphasis on undervalued and underpaid workers.  

The rationale of working with all of these diversities is to touch the connective tissue of the common humanity in each of these components of our state’s population.   In some religious traditions this is understood as touching the image of God in each person. This view is, understandably, not shared by everyone.  Another way of capturing the same point is to raise the question: Can people (humans) change?  If the answer is affirmative, the follow-up question is:  What are the conditions conducive to changing in positive ways?  And, a related question is: What is the potential of creating those conditions on a scale sufficient to bring about a meaningful measure of positive moral/social/economic transformation? 

In this paper, we will outline significant elements of a process and name several key steps necessary to put the vision of a NC- TJRC in play.  Before we go further, however, we want to express our sincere gratitude for all people within the family and close allies, scattered across the nation for your support of the long, difficult struggle for a measure of justice in Greensboro, including the process that brought into being the nation’s first Truth and Reconciliation Commission (TRC). 

  1. The Objective Conditions Are Ripe and Crying Out for Change

It is difficult to see how the nation can continue in its current mode and direction without descending deeper into more devastating and violent division and conflict.  So, the more focused question is not whether conditions are ripe for change, as we are already changing, but rather, what kind of change. The George Floyd murder and the resultant explosion of the Black Lives Matter Movement, the 2020 elections and the January 6, 2021 insurrection at the nation’s capital, coupled with waves of state level voter suppressions laws designed to radically reduce the Black/Brown vote all speak to the objective conditions encasing and weakening our fragile and flawed democratic republic.  These conditions and the great wealth-inequalities leave the nation very unstable and, perhaps, more divided than it has been since the Civil War period. 

Given the current polarization and evolving conditions, again, the question is not whether the objective conditions are ripe for change but rather in what direction the nation change will.  We believe, under the current conditions, that a high quality Truth, Justice and Reconciliation Commission (TJRC) in one mid-sized, southern state (10 million people) can have significant impact on the character and quality of national change going forward. It is our hope that we can contribute to a genuinely transformative national “Truth, Justice and Reconciliation” momentum by modeling such a genuine TJRC process in North Carolina.

  1. The NC-TJRC Must Cultivate a Deep, Respectful Atmosphere of Mutual Listening, Mutual Speaking, and Mutual Benefits

Cultivating an atmosphere of deep, respectful listening and speaking will require a good bit of advance, patient, one on one and small group work (initially within groups that roughly share essentially the same ideological tendencies).  One on one and small group discussions will help to establish the essential ground-work (a particular form of training) for growth into deeper discussions and greater unity between the broad diversities of peoples in the state.  The point here is to avoid, early in the process, heated arguments between different social/economic/gender and racial groups that cause the emphasis to shift from understanding each other to winning the argument.  

Also, if the NC-TJRC process is to work, we cannot over emphasize that there must be mutual benefits for all parties, especially black and brown people, the poor in general, with an emphasis on poor whites. Tragically, so many white people are captive of the ideology of white supremacy and who tend to see benefits for black and brown people as opposed to their interest.   Therefore, we must avoid the zero sum win/lose framework that is built into our current national and cultural.

Even those who “lose” financially (the rich) will win in other ways; we know it is not likely that the majority of the upper economic class will agree with this perspective.  However, disagreement with this perspective, does not make it untrue.  After all, what does it ultimately profit a few people to gain a lot of wealth (stuff and things) but lose the nation and what’s left of one’s humanity, i.e. living outside of a beloved framework (and in fear of being exposed and becoming a target).  The details of how to structure these conversations will vary, but all will require deep, mutual, respectful speaking and listening with mutual benefits promised for all.  

  1. We Must Forge a Sufficient Body of Agreed upon Historical Truths (Community Truths) That Contributed to the Accumulated Historical Wrongs and the Currently Lived Confusion and Injustices

This is where the rubber meets the road.  Given our national history, there will necessarily be conflicting narratives of hardships, injuries, wrongs, who to blame, etc.   A whole world of misinformation, disinformation, false information, confusing information and painful information will flow from these discussions.  Such discussions can be both gut-wrenching but are also absolutely necessary.  Truth is often bitter.  These discussions will not only reveal unspoken truths, but will also be partly therapeutic as the emotional trauma is deeper and more enduring than most of us realize.  Engaging these discussions across the state will require patience, tolerance and persistence.   This will be an extended exercise in deep listening and respectful speaking that will involve sorting out, reframing, re-contextualizing, forgiving and forging alternative narratives.

In the course of these discussions, the injuries, damage, and pain will become clearer.   Although, we are in a period Dr. King characterized as the “fierce urgency of now” yet, we cannot rush the process. We must take the time necessary.  This is how people grow into the process and thereby help to forge a body of acknowledged “community truths.”  We envision a North Carolina Truth, Justice and Reconciliation Commission (TJRC) of 11-15 people. We will strive to attract people with integrity and sensitivity.  We envision that the commissioners will bring professional gifts and expertise with a range of life experiences. 

Further, most of the commissioners will be from North Carolina, with no more than three from outside of North Carolina.    Ideally, there will be at least one commissioner from each of the geographic sites in the state. The TJRC will schedule public hearings across the state that will provide an opportunity for Commissioners to hear and respectfully pose inviting questions to those testifying, creating space for elaboration at the public hearings.

  1. The Limitations of TJR Processes & What It Takes to Repair Historical Wrongs

It must be acknowledged that all historical wrongs cannot be corrected, even with a good NC-TJRC or a goof national TJRC.   However, this should never become a reason for not doing the best we can. The “best we can” has the possibility of helping to bend the moral arc and hopefully contribute to setting our state and nation on a different course.  

Over the years, we in Greensboro have played a significant part in helping to build a budding movement infrastructure in North Carolina.  It will take ramping up and connecting the range of social justice organizing work already being done in the state, as in the Fight for 15, the Poor People’s Campaign, plus local and state police, environmental, educational, housing equity, and other initiatives seeking justice. We are challenged, together with others, to help these struggles “walk towards each other”.   Both quality and size of these connected struggles cause them to become transformative.  Hopefully the growth of this trend in North Carolina will inspire others across the nation to intensify forging a range of positive, creative initiatives of which TRJC (s) is one component, but an essential component.  

All of the elaboration in the previous paragraphs is to say, we have no illusions that a state or national TJRC will alone change the direction of the nation.  At the same time, we believe that a greater measure of shared truth (and love) is necessary to counter the rapidly growing trend of falsehood, confusion, manipulation, fear and division resulting in a growing trend towards greater force and violence.  That is why we are happy to partner with the Poor People Campaigns (PPC), and we will be reaching out to religious, civic, labor and neighborhood organization as well as youth/student groups, street groups (that some call gangs) and others who agree with our declaration of intent; our hope is to enlist them in the NC-TJRC process.  For us, this is a major initiative that we likely would not be undertaking except for the work in Greensboro, especially the labor movement and the Greensboro TRC-related work with which so many in the Family have been a part. 

It is becoming increasingly clear that white supremacy is burned deep into the culture of the United States. In this context, we join with the spirit of Phil [Thompson]’s paper on Economic Democracy which states

Going back to Abraham Lincoln, his greatest worry on the heels of the Civil War was that the majority of white citizens did not want to be part of the same community and polity, and certainly not put on an equal footing with black people.  This is still the main alienation in US society.  Economic inequality and government unaccountability, in the eyes of many whites, are the result of unfair advantages handed out to people of color. The pathway to changing the economy and government is to unite white Americans, but unity necessitates overcoming this racial resentment which is so strong that it threatens the foundation of the democracy…

The starting point for building unity across race, in our view, is changing white America’s image of black people as wanting to take material things away from white people.  Black, and other people of color, need to advocate a broadly appealing economic platform to dispute that image.  A forward-looking economic platform could meet white workers where they currently are and help move them away from a zero-sum calculation that they have nothing material to gain by uniting with people of color. But this is only a first step; an economic platform will not fully remove the anxiety many whites feel about no longer being a demographic majority with the ability to dominate society.

The “white anxiety” of which Phil speaks will be partly engaged by a NC-TJRC process that involves “deep listening and speaking” in an authentic truth process. 

  1. The Projected Issue Focus Areas and Geographical Focus Areas  

The TJRC’s Declaration of Intent lists six areas for exploration. They are:

  • The historical and current abuse of police powers and judicial processes.
  • The historical and current blocks and impediments to financial security and wealth creation.
  • The historical and current blocks and impediments to adequate housing.
  • The historical and current blocks and impediments to quality physical and mental healthcare.
  • The historical and current blocks and impediments to voting and full participation in the democratic process.
  • The disparate impact of climate change and other ecological factors on people of color and the poor. 

These focus areas might change based on further exploration and discussion with local geographical areas around the state.  The State of North Carolina is divided into three broad regions:

  • The Coastal Plains:  This is the eastern part of the state.  It was and remains the major farming area in the state.  The land is rich and flat. This is the region where the large slave holding plantations existed.  For years before the Civil War and for some 75 years after the Civil war the large plantation and former slave owners ruled the state government. This is also the area (the NC Black Belt) where the largest percentage of black people in the state still live
  • The Piedmont Region:  This is the middle part of the state going from east to west.   This region is where the major urban areas of the state are located.  These urban areas include Raleigh, the state’s capital and the second largest city in the state; Charlotte, the largest city in the state, Greensboro the third largest city in the state, Durham the fourth largest city in the state, Winston-Salem, the fifth largest city in the state. The largest universities and colleges are also located in the Piedmont Region. These cities grew up during the industrial period.  Textiles, furniture, and paper processing plants were some of the major industries that grew up in this area. Many of these industries, particularly the textiles, have moved to foreign countries in recent years.
  • The Mountain Region:  This is the western most part of the state.  It is primarily a mountain range. It is the poorest of the three regions. It is made up of small towns and villages with small farms.  People in the region rely on industries linked to natural resources of the region.  These include farming, mining, forestry, manufacturing and tourism. Asheville is the largest city in the western region. The ethnic makeup of the mountain region is 89.9% white; 9% Latino (Hispanic); and less than 1% Black (African-American). 

Our current plan calls for identifying two sites in each of the state’s three regions.  We will select the sites based on at least four criteria:

  • The desire of a sufficient core of diverse leadership, especially grassroots leadership, to sponsor and be part of a statewide TJRC process; 
  • Commitment of local leaders to help seek financial and human resources to undertake the project; 
  • Defining one of the six issue focus areas (listed in the Declaration) or identifying a different focus area that those committed to the NC-TJRC process are willing to assume as their geographic area of focus.
  • A good fit into the projected rural/urban divide, the black/white indigenous divide and of course a good fit into the regional divides. 

The geographical sites to be chosen should reflect a good cross-section of the North Carolina population.  If our resources allow and, if there is a groundswell of support to do so, we will expand from six to no more than twelve (12) geographical sites, i.e. up to four (4) sites in each of the state’s three geographical regions. As the NC-TJRC matures, these sites will be increasingly connected, effectively reflecting a statewide process.  

  1. Raising the Money and Putting Together the Team
  • Fund Raising: We believe it will take about $8 to $10 million dollars over the life of the project that we project will take about four (4) years.  We have already raised over $1 million.  We have been working with others to forge an effective fundraising team that is working hard to raise the necessary funds.  Once the NC-TJRC is officially and publicly launched, we believe there will be greater interest and more funds made available.   
  • The Staff:  Initially, (by September) we plan to have new full-time staff of seven people. Within six months that staff will likely increase to 12 people.  Also, we anticipate both college interns and full time volunteers being recruited for this work. If necessary and, if the funding allows, we may employ several part-time people.  We will push, together with others, to organize, organize, and organize with on the ground training, training and more training. We are putting special emphasis on quickly growing a top-notch communication machine (capacity) as this will be essential to growing and holding the expanding process together.   
  • The Kitchen Cabinet:  We have put together a diverse Kitchen Cabinet of 14 people that we hope to consult with on a regular basis (as needed).
  • The National Advisory Committee:  We project a national advisory committee of about forty (40) people that will meet virtually or in person twice a year.  We are projecting that twenty-five (25) of its members will be from North Carolina and fifteen (15) from outside of North Carolina.  All of the members will be available for consultation between its formal meetings, as needed. 
  1. Building from the “Bottom Up” and from “the Center Out”

Truth and Justices processes cannot and will not work if they are not deeply rooted in the grassroots, i.e. the people most damaged and wounded, the people most neglected and devalued.    This is one of the lessons learned from South Africa.  The South African TRC was not a failure, but it was also not a glowing success.  It probably did prevent a South African Civil War; that in itself was significant.   As we have learned from those who helped to forge the South African TRC process, there were three very interrelated, overlapping significant weaknesses.

  • First, according to those who were active in the process, it did not adequately reach out into local areas where the lion’s share of the pain and suffering was experienced by black people.  Stated differently, it was too centralized and did not reach deeply or broadly or prolonged enough into parts of the population that suffered the most. We have put a major emphasis on avoiding that mistake.  That’s what we mean by building from the bottom up and the center out.  The center is not the perspective of rich white men. The anchoring perspective is rooted in the people most the injured, abused, devalued and harmed. 
  • Second, a significant part of the white South African population did not adequately or sincerely engage in or commit to the TRC process.  This is where we think the depth of white supremacy comes into play.  Our best understanding is that white South Africans engaged in the process in a limited and pragmatic way. It probably was more about participating with a view of “getting it behind us” and with little fundamental change. The South African process seems to have done little to cause white South Africans to see deeply into themselves and their need for deep change. This is also a danger in any process that is developed in the United States, including the NC-TJRC process.   Engaging white supremacy at its roots will be very challenging, as it is has to do with touching that part of us that makes us truly human and connects us with other humans across the historical ditches of racism, nationalism, regionalism, genderism and all the other “isms” that cause one to view “surface” differences in the human family as a justification to exploit, devalue, injure and even kill others and justify it based on making certain people “the other” and inherently “less than” or just “evil.”  This is a very difficult challenge to overcome.  It does, in our humble opinion, require a greater measure of deep truth and love of humanity. 
  • Third, and very closely related to the first two, is that there was inadequate attention given to the economic sphere.   While there was a shift in political power, the deep historic and ongoing damage done in the economic sphere was not meaningfully addressed.  When we were in South African in 2007 at the invitation of the Tutu family, some of us talked with economically poor Black youth one night on a corner in Soweto. They shared their disgust at seeing whites who admitted to viciously killing Black people walk away free.  In contrast, they argued that if they stole a chicken or some food because they were hungry and impoverished, they would be given active jail sentences.  I know this is an over simplification as the economic system is international and complex, but such complexity should not stand as an excuse for evil in South Africa or the United States.  We in the U.S. must simply strive to do better. 
  1. Building Power and Forging Relationships across the State and the Forms of Power That Overcome Polarization and Produce Positive Policy Changes

A major part of the success of the NC-TJRC will be our capacity to forge positive relationships with people and organizations that are already active, i.e. organizers, researchers, scholars, and current participants in the social justice movement, etc.   

In concrete terms,  we will seek to grow positive relationships with people working in the six issue focus areas mentioned in the Delectation of Intent: the abuse of police powers and judicial processes; blocks and impediments to financial security and wealth creation; blocks and impediments to adequate housing; blocks and impediments to quality physical and mental healthcare; blocks and impediments to voting and full participation in the democratic process; the disparate impact of climate change and other ecological factors on people of color and the poor. 

In the process of doing our work, our hope is that we will de-intensify the growing polarization, grow greater “community truth” and seek expanded common ground among the diversities of people in our state, particularly the poor and excluded.  If we make progress in these areas, this will be a somewhat different kind of “people power” base. We will necessarily have to make strategic and tactical decisions, much of which will have to grow out of the process itself and is currently beyond the scope of further reflections in this document.

  1. Projected Launch of the NC-TJRC Process

We have not tried to keep it a secret that we are working towards a NC-TJRC process.  However, we have chosen not to make any formal statements about our plans.  There were and are too many loose ends.  When we make a formal public statement about the NC-TJRC, we intend to have on-boarded key staff members, a fully confirmed Advisory Committee, a committed “kitchen cabinet,” and a thoughtful plan on how to best publicly launch the process. At this point our anticipated launch date will be between August 15 and September 15th

Our launch will include a plan to reach out to a variety of individuals, organizations, and networks to inform them of the NC-TJRC process and to suggest ways they can be involved.  Some of the organizations and leaders include:

  • Statewide religious organizations and leaders
  • Statewide grassroots organizations and leaders 
  • Statewide labor unions and leaders
  • Statewide youth organizations and leaders (including student organizations and leaders)
  • Law School organizations and leaders
  • And, a network of as many local, grassroots, movement oriented organizations as we reasonably can.  

With this vision, our media and communications capacity has to be firmly in place.  We must be able to get our message out effectively and quickly. Of course, inquiries and offers to help are to be expected, and we must be prepared to respond to those in an efficient and timely manner as well.    

  1. Summary and Concluding Words on the Eminent Situation Before Us

We have set forth a bold vision, sketched out initial elements of a plan and begun the difficult journey of growing greater truth, justice, reconciliation and healing in our state. Objectively, this is building on the work in Greensboro, including the TRC, for which suffering was endured, blood was spilled, and lives taken.  If reasonably successful, we believe this initiative can be a significant contribution to the nation.  The push we are currently making would not have been possible except for the love, work and contributions of many people (the family) across the nation.  For this we are grateful.

Developing the NC-TJRC is a challenging undertaking and is likely to become more difficult in the months and years to come.  As we said earlier in this document, “It is difficult to see how the nation can continue in its current mode and direction without descending deeper into more devastating and violent division and conflict.”

We have been in weekly discussions and planning with a strategically located group of people for over a year, including the Rev. Dr. Peter Story one of the leaders of the South African TRC process. Even though some progressive strides have been made in the United States over the last year (specifically the national election), it is our humble opinion that the national crisis has continued to grow deeper and wider.  

Under the false banner that “the election was stolen”, the former president, and leader of the January 6th insurrection, is being embraced on an even deeper level by a significant slice of the US population, including the base and leadership of the Republican Party. At this moment, our elected national leadership does not seem to have a clear pathway forward to effectively rally the majority of the American people around a clear vision and steps to “save the soul of the nation, while transforming the circumstances of the people of this country.

In a sense the insurrection is on a slow burn toward the further destabilization and ultimately the destruction of the already deeply flawed democratic/economic institutions of our nation. It is not clear when the “slow burn” will swiftly expand into a raging inferno.   That is the growing danger.  In a real sense, we are in a race against time. 

The primary fuel for this burn is the ideology of white supremacy and the economic system that promotes growing poverty and wealth inequality, all of which has its particular history.   It is becoming clearer, at least for some of us, that the historical damage of white supremacy inflicted on Black people, Native American and “third world” nations has also been inflicted on white people themselves, especially poor whites.    As white people lose their numerical majority and their capacity to dominate, the false stories they have told themselves about matters, such as their greatness and goodness, are being peeled back. This is unleashing hidden trauma and openness to a range of dangerous conspiracy theories.  This is the base of the “Make America Great Again” (MAGA) movement.

As a child in grade school in the late forties and fifties (Nelson), the word slavery was not in text books that we used.  Instead, slavery was called the “peculiar institution.”  This was a form of hiding from the truth and replacing it with false narratives.   Now, a movement, an obsession, has developed to band the teaching of what is called critical race theory.  This is simply another mechanism to avoid the truth of this brutal aspect in the history of our nation.  The growing acceptance of falsehood, conspiracy theories, division, conflict and hate are parts of the slow burn.

The substance of our thinking and commitment that we have tried to put forth is this rushed document is to join in growing a process, indeed a movement in North Carolina, rooted in the truth of our tortured history but also rooted in a history of generosity, determined resistance and a deep belief in the human capacity (all humans) to change for the better. 

We invite your response and continued help.

Love, peace and blessings,

Nelson and Joyce Johnson

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At Last. Progressive Power Assets Itself.

| Steve Clark |

Clark’s essay was first published on his GlobalTalk blog.

Perhaps, I should quit being surprised by Biden’s acumen. He has a next-to-nothing Democratic majority in the Senate, and critical pieces of that majority are reluctant allies. Yet, he’s playing it like a violin.

Or, to mix metaphors, he’s playing from a deck stacked by broad, energized, progressive-driven, public opinion.

Either way and both ways, the American people seem to have found a leader who will pursue our demands.

The bi-partisan deal that Biden announced yesterday with 11 Republican Senators (enough to overcome the threat of a filibuster) has two key pieces:

First is $570 billion in new infrastructure spending (roads, bridges, water system, electric grid, broadband, etc.) with no “pay-for” restrictions. This is part of a $1.2 trillion, eight-year infrastructure investment plan. Because 11 Republicans support it, the infrastructure plan will get and win an eventual floor vote in the Senate.

Second is $2-6 trillion in additional federal allocations for childcare, education, healthcare and the green new deal (details to be decided), none of which are supported by any Republican Senators (though a few may eventually go along). Because of the filibuster rule, this family care package cannot get a floor vote in the Senate, but the same 11 Republicans (above) stood quietly, then spoke heartily of bi-partisanship (see, some of us Republicans can get things done), after Biden explained that these family care matters may be included in September’s “reconciliation bill” when the official FY 2022 Budget is approved by a simple majority vote of the Senate (thus, avoiding a filibuster).

With a summer of negotiations ahead over the actual content of these bills, plenty of time remains for political defections. It’s been less than 24 hours, and, already, some of the 11, feeling rolled by the direct linkage of the two bills, are threatening to pull out. But the threat of House progressives (supporting progressive allies in the Senate) to refuse the stand-alone infrastructure bill and, instead, put them both in reconciliation and pass it without any Republican support (and leaving the 11 hanging) may have set the deal in stone.

The decision (when final) of the 11 Republicans to go along with Biden’s deal is a concession to the political reality that the Trump era is over, and the nation will continue its political life in traditional democratic, two-party fashion, finally rebuking Reagan’s long-ago, fool-hearty assertion that government IS the problem. Going forward, they agree that government is part of the solution… and, at least as far as physical infrastructure goes, they’re putting their toes back in the water.

After the deal’s announcement, Bernie Sanders, chair of the Senate Budget Committee (that will draft and approve the specifics of the Senate’s reconciliation bill), expressed the gleeful opinion that the Senate would soon pass the “most important piece of legislation for working people in America since the 1930s.”

This deal ensures that money will flow and the economy will pick-up all next year when the midterm elections roll. This should produce a landslide for Democrats and a big haul for progressives.

But this deal is not enough, and many progressives in and out of Congress are saying as much. It is a “down payment” on the trillions that must still be spent…and, after 2022, heading into 2024, progressives will be advancing and passing additional legislation in a host of areas. Indeed, 2022 through 2028 is likely to be the most creative, active period of progressive legislative action in the history of the nation.

This week’s deal sets a basic framework for the coming social contract, but key features are still big blanks: reparations for slavery and indigenous dispossession; financial democracy and public investment; and international financial justice/opportunity for the Global South.

We’ve entered the last, fateful phase of this Fourth Turning. Now, codifying and institutionalizing programs to rectify these remaining injustices — while moving ahead with public investments in infrastructure, education, healthcare, climate justice and a federal job guarantee — is this revolution’s practical next steps.

For this, progressives have three jobs: (a) designing constructive problem-solving programs to achieve social justice and avert climate change; (b) educating and mobilizing Americans to pursue the progressive agenda; and (c) electing enlightened progressives to public office to enact our agenda.