Tag Archives: socialism

Raise taxes on capital and the rich

24 Feb

In the 1940s, following decades of booms, busts, unemployment, disorder, wars and destruction, rigid free market policies were abandoned. Governments began to deliberately act to maintain employment and market demand. This shift was identified with J.M. Keynes, a prominent British economist and government adviser who had made the case that classical economics was wrong. Depressions, he wrote, were not caused by a decline in the supply of capital but by a fall in demand caused by declining wages and rising unemployment.

During Keynesian times, until the late 1970s, economies and employment grew steadily. Democracy came to mean that governments had a responsibility to protect and advance the interests of common people. Keynesian policies, including increased access to higher education, public health care and income support were funded by taxes on those with the means to pay. The marginal tax rate on the highest income was 80 per cent. Taxes on corporate income were 50 per cent and higher.

Humankind now faces global crises. Widening disparities in income, opportunities and control are provoking disorders, militarism and wars. Emissions of carbon dioxide from fossil fuels threaten the climates on which human well-being depends. Private capital, focused on short-term profits, systemically aggravates these problems. Prevailing ideology is now aggressively hostile to government action. Tax cuts for corporations and the super rich have reduced the public funds required.

Since 1980 taxes paid by corporations and the rich have been methodically reduced. During Keynesian times, the richest one per cent got ten per cent of total income. The richest one percent now gets twice as much, twenty percent. Ten per cent of total income has been transferred from public revenues to private capital.

Neoconservatives like Margaret Thatcher and Ronald Reagan claimed that giving capitalists more money and freeing corporations to maximize profits would be generally beneficial, trickling down to the masses. Instead disparities widened. Tax cuts not only provided private capital with more funds to invest; it gave the super rich more money to manipulate political agendas. Regulations on corporate finance and industry were weakened. Union rights were curtailed. Corporations were freed to move capital to countries with lower taxes, and jobs to places with lower wages. Real wages fell. Unemployment rose.

With consumer markets stagnant, investors awash in funds turned to speculation in stocks, bonds, futures and real estate, to derivatives, index funds, credit default swaps and collateralized debt obligations. Capital markets became casinos, adding little to real production. Gains for a few came out of the losses of many others.

Meanwhile as taxes on capital were reduced, public deficits and debt increased. Concerned that capital would lose value, the rich demanded austerity. Although governments were more than willing to spend more on prisons, intrusive surveillance, militarism and war, social programs and infrastructure spending were frozen and cut. Public assets were privatized. Here in Canada, while courts were confirming rights of indigenous people, governments used deficits as an excuse to disregard Treaty obligations.

Meanwhile, carbon emissions from the burning of fossil fuels continued to rise. In 1995 countries meeting at the Kyoto Conference agreed to voluntarily reduce carbon emissions. Science had concluded that carbon dioxide levels had to be kept below 350 parts per million. But corporate capitalism preoccupied with profits from existing industry did not act. Declining public revenues and corporate opposition prevented government action.

By 2014 carbon dioxide levels exceeded 400 parts per million.  If green energy had replaced two percent of fossil fuel energy each year since 1995, as the Kyoto Accord proposed, carbon emissions would already have been reduced by half. Instead, corporate capitalism responded by spending hundreds of millions to deny that carbon dioxide emissions were a problem. Hundreds of billions were spent to develop, produce and transport more fossil fuels.

Everyone not blinded by capitalist dogma or the prospects of immense profits now knows that fossil fuel emissions are melting polar ice caps and glaciers, raising sea levels, flooding coastal communities, acidifying oceans, and generating more frequent and more destructive weather events.

Now that denying climate change is no longer credible, capital simply disregards the threat, claiming that there is no technologically realistic alternative to energy from fossil fuels. Yes, the technology to efficiently store and distribute alternate energy on the scale required has yet to be developed. But the needed technologies would already be available if solar, wind, wave and geothermal power had received the investments, tax breaks and subsidies provided for offshore drilling, fracking, tar sands and oil pipelines.

Technology is not the problem.  With relatively small expenditures Denmark in 2014 got 40 percent of its electricity from wind power. Renewable energy, mostly solar, is providing Germany with 25 percent of its electricity. Solar power is providing China, India, Brazil, and African countries with expanding shares of electricity.

Capitalism is the problem. So long as major shareholders and top corporate executives are entitled to make major economic decisions in their private interests, capitalist profits will continue to trump employment, labor income and public services. Environmental costs will continue to be externalized—passed off to communities and future generations. Replacing capitalist title with human entitlement begins with deliberately transferring income from private capital to the public.

In his Capital in the Twenty-First Century, Thomas Piketty makes the case that corporation taxes should return to 1950s levels. Marginal tax rates on personal incomes over $500,000 should be raised to 80 percent. He proposes an annual tax of 0.1 percent of private wealth over half a million dollars rising in steps perhaps to 2 percent on wealth over three or five million dollars.  Homes are already taxed annually.  Why should stocks, bonds, and other wealth be excluded?  Piketty adds a progressive estate tax on inheritances over one million dollars and a tax of 0.1 percent on financial transactions. He argues that more transparency in income records and better statistics gathering would make it practical for countries to cooperate in preventing income and wealth from being hidden in offshore accounts.

Of course, the super rich will aggressively object. But nearly everyone else would gain. Taxing capital could provide local governments with funds to reduce disparities and expand social services. Public spending on green infrastructure would provide more employment and increase market demand. Public spending to reconfigure cities could make it practical for people to live their daily lives without cars. Public spending on solar, wind, wave and geothermal power and public transit would reduce carbon emissions and generate more jobs.

Al Engler

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Top 10 ways we can build a better economic system

26 Aug

For the numerous readers who asked: “But what can we do?” after reading my Top 10 Reasons to Hate Capitalism:

  1. We can elect governments that represent people rather than corporations. This will require serious electoral reform and include laws to make it clear corporations are not people and therefore cannot participate in the political process. A government representing all the people would regulate corporations to ensure socially responsible behaviour and transform psychopathic capitalist monstrosities into democratic, social enterprises that benefit all.
  2. We can build communities and organizations that encourage solidarity, compassion and altruism. These will include worker, consumer, housing and producer cooperatives, as well as institutions of government. People must always remain vigilant, especially while capitalism continues to exist, about the pervasive power of greed to destroy these communities and organizations.
  3. We can promote and build a democratic economy in which social ownership replaces private ownership of communities’ means of livelihood. The people who work in them and the communities in which they are located should control economic enterprises.
  4. Since authentic freedom for any of us can only come when all of us are free we must create enterprises, communities, forms of governance and institutions that respect the rights of everyone and encourage the creativity of all. Socially useful individual enterprise should be encouraged but everywhere people work together we must create effective forms of democratic decision-making to promote creative input from all involved.
  5. Everywhere we work we can organize in ways that become the building blocks of a new, democratic economy. Sometimes this will be through existing unions but often we will create new organizations that defend our day-to-day interests while self-consciously preparing to replace capitalist minority rule with democratic social control of all enterprises.
  6. We can work to undermine capitalist, consumerist propaganda whether it masquerades as news, entertainment or advertising. We can create forms of newsgathering and information-exchange that challenge capitalism while building the self-confidence of people everywhere to democratically manage our economy. Rather than spend countless empty hours consuming mindless advertising-driven ‘entertainment’ we can relearn the myriad forms of healthy social interaction that brought joy and solidarity to generations past. Millions of us can discover the fun in making a better world.
  7. We can rebuild a progressive taxation system in which people with extreme incomes pay very high levels of taxes. We can promote a one person, one vote system of decision-making everywhere we work together, whether in the political, social or economic realm. The means of bringing about such fundamental change may, in part, come through existing political structures, but will also include diverse forms of mobilization as workers, residents, concerned citizens, producers and human beings supporting a healthy planet.
  8. We can speak up for our planet as one community with intertwined interests that can only be satisfied through mutual respect and cooperation. We can learn from indigenous communities to respect the earth. We can act on the principle that an injury to one anywhere and everywhere is an injury to all. At a minimum this requires an end to war and environmental destruction of every sort. We can work together in enterprises and organizations that exist in local communities, but which also connect with like-minded regional, national and international groups to accomplish the changes we need.
  9. Through our words and actions we can demonstrate that the realistic alternative to capitalism is an expansion of democracy. In order to build the peaceful, ecologically sane world we desire, our tactics are non-violent, but we understand that people under attack have a right to self-defence.
  10. We can replace capitalism with a system based on social ownership, equal human entitlement and workplace democracy. Building an economic democracy is the key to human survival. We can exist in harmony with our environment if we get rid of capitalism and promote respect for nature and understanding the interdependence of all forms of life.

Gary Engler

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Capitalism a leech on publicly funded research

23 Aug

Prevailing neo-liberal dogma holds that private capital is responsible for most economic innovation and that governments stand in the way. In The Entrepreneurial State: Debunking Public vs, Private Sector Myths, Mariana Mazzucato points out that most research is funded by governments and that current anti-government policies not only widen disparities but threaten future innovation, especially the mobilization of resources necessary to rapidly shift away from dependence on carbon-spewing fossil fuels.   

Mazzucato—professor of The Economics of Innovation at Sussex University in the UK—argues that capitalists are not the visionary risk-takers that free-market economists, the corporate media and politicians would have us believe.  Their focus on maximizing profits actually makes capitalists risk-averse.

Governments fund and organize research and development precisely because they do not have to answer to shareholders. They can have broader goals—future well being, new employment, reduced disparities, or environmental integrity.  And in fact, even in the U.S. the federal government funds two-thirds of the country’s research and development: private business funds less than twenty percent.

Neo-liberal ideology aside, capital has long depended on governments to fund research. In earlier times, governments funded research on canon fire and ocean shipping. They funded construction of railways, telegraph then telephone lines, and funded research on aerodynamics and jet engines. After government funding has made production profitable private business takes charge.

Today, military-industrial corporations continue to rely on publicly funded research to develop weapons and equipment. They then sell the results to governments at cost plus inflated profits. Pharmaceutical corporations do the same. Most new drugs are developed in publicly funded labs.  These are then modified slightly, patented and sold to government-funded health care systems at hundreds of times the production cost.

Contrary to public opinion, neither Steve Jobs nor Apple had a critical role in the development of the Internet  or iPhones.  Hard disk drives were developed by the U.S. Defense Advanced Research Projects Agency. The Internet was constructed by U.S. federal agencies working with publicly funded universities. The Hypertext Transfer Protocol (HTTP) and the World Wide Web were conceived by U.K. government-funded scientists.

Touch screen technology was developed in government labs in the U.S. and U.K.  GPS was developed by the U.S. military and continues to be funded by the U.S. Air Force. Lithium Ion batteries were developed by U.S. Department of Energy scientists. Liquid Crystal Display (LCD) and Thin Film Transistors (TFT) were developed in government-funded labs. So were SIRI, an artificial intelligence program, and the critical Web Search algorithm.

Steve Jobs and Apple can be credited with stylishly rounded edges on computers and iPhones. Eye-catching design and effective marketing allowed their shareholders to make billions from the socialization of research and the privatization of profits.

Future innovation in the U.S., U.K. and Canada, Mazzucato argues, is threatened by current anti-government policies. A few—wealthy capitalists—have unquestionably benefited from neo-liberal policies. Corporations have been freed to move technical and professional employment as well as jobs in manufacturing and services to places where wages are lower, where enforcement of labor and environmental regulations is lax. Meanwhile, cuts to taxes and government spending have widened disparities, aggravated market stagnation, and by reducing funds available for research are prolonging dependence on fossil fuels.

If carbon-induced global warming is to be reversed, massive sums will have to be invested. Widely coordinated action will be required to rapidly replace dependence on fossil fuels with solar, wind, tidal, wave, and geothermal power. Existing capital is locked into profits from fossil fuels; private capital cannot be expected to take the lead. Only the public can mobilize the resources required.

Where measures have been taken, public authorities have taken the initiatives. Denmark is a leader in the technology of wind power.  China has massively increased its production of wind and solar power.  Germany has installed solar panels that can produce as much electricity as 24 nuclear power plants. Wider action is blocked by corporate lobbying anti-government ideology. Denying carbon-fueled climate change is no longer credible; still so long as governments are denied the means to act, corporations and their shareholders can continue to make massive profits from fossil fuels.

Concerted public action is urgently required to develop low-cost electricity storage, to construct the smart grids and digitized energy distribution systems needed to “optimize the flexibility, performance, and efficiency” of wind and solar power.  Concerted public action is also required to rapidly reduce consumer waste and industrial and agricultural pollution.  National, regional and local governments could gain the resources needed if taxes were raised on corporations and top incomes as well as on financial transactions, wealth, and inheritance. Increasing taxes on capital would socialize some profits. Most of the costs of innovation have already been socialized.

Al Engler

 

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Top 10 reasons to hate capitalism

13 Aug
  1. Capitalist corporations suffer from a personality disorder characterized by enduring antisocial behavior, diminished empathy and remorse, and are rewarded by shareholders for acting that way. If corporations could be sent to a criminal psychologist’s office they’d be diagnosed as psychopaths and locked away forever.
  2. Capitalism encourages greed. But greed is only good for capitalists. For normal people it is anti-social and soul destroying, not to mention very bad for our communities, which rely on altruism, compassion and a generalized concern for others.
  3. Capitalism is a system of minority privilege and class rule based on the private ownership of means of livelihood. This gives a few rich people the power to buy and sell jobs, which means they can build or destroy entire communities that depend on those jobs.
  4. Capitalists praise freedom and individualism, but they destroy freedom and individualism for everyone but themselves. The vast majority of us who work for a living are daily asked to uncritically follow orders, to act as if we are machines, and limit our creativity to what profits our bosses.
  5. Capitalists denigrate cooperation and collectivism, but create mass production processes that rely on both from workers. Their system requires us to be cogs in a giant profit-making machine, but because they fear the power this gives us we are told working together for our own interests is illegitimate and bad. Thus capitalists undermine unions and other organizations that encourage workers to cooperate with each other and act collectively.
  6. Capitalism requires the largest propaganda system the world has ever known to convince us it is the only system possible. It turns people into consumers through advertising, marketing, entertainment and even so-called news. Millions around the world are employed to use their creativity to twist our feelings of love, desire, human solidarity and fairness into tools of manipulation, so that ever more profits can flow into the hands of a tiny minority.
  7. Capitalism is a system in which the principle of one dollar, one vote, dominates that of one person, one vote. Those who own the most shares (bought with their dollars) control giant corporations, many of which are more powerful than all but a few governments. Rich people also use their money to dominate the elections that are supposed to give us all one, equal vote. Under capitalism those with the most money are entitled to the most goods and services as well as the most say in directing our governments and our economy.
  8. Capitalism proclaims the virtue of naked self-interest, but self-interest without regard for morality, ecology or common sense leads to environmental degradation, destruction of indigenous communities, colonialism, war and other forms of mass destruction. Self-interest leads capitalists to seek profit absolutely everywhere, regardless of the damage done to other people and the health of the planet’s ecosystem. Self-interest leads capitalists to destroy any rival economic system or way of thinking (such as indigenous communal land use and respect for nature) that can be a barrier to their endless quest for profit.
  9. Capitalism is not a friend to democracy but ultimately its enemy. When pushed, capitalists choose capitalism over democracy. If people use democracy to weaken the power of capitalists the rich and powerful turn to various forms of fascism in order to keep their privileges.
  10. Capitalism is a cancer taking over our planet. Capitalists make profits from global warming, from destroying our oceans, from pumping ever more chemicals into the atmosphere and from patenting everything they can, including life itself. Only by getting rid of capitalism can we rescue our environment

Gary Engler

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The new Capital — a review

24 Jun

Thomas Piketty’s, Capital in the Twenty-First Century, is a sensation—an economics textbook, translated from the French, that has been on the New York Times best-seller list. It is an important work. If you ignore more than one hundred pages of notes, it is still a long but easy read.

Piketty, a prominent French economist and social scientist, uses rigorous logic and reputable statistics to dismiss the mainstream claim that capitalist markets are based on individual equality, and that great wealth is a fair reward for individual contributions to general wellbeing. He shows that capitalism in its logic and observable practice actually widens disparities between the super rich and everyone else.

The title of the book conjures images of Karl Marx’s Capital. But Piketty says he is not a Marxist; he does not call for the abolition of capitalism. He is a social democrat who explicitly rejects the top-down centralized state ownership of the twentieth century USSR. He looks to a more democratic alternative, arguing that economics, which he prefers to call political economy, should refocus on how best to meet human needs. He looks to cooperatives, community ownership, and more democratic control of workplaces.

The two Capitals have distinct starting points. Marx began with the commodity. He makes the case that exchange value is determined by labor time embodied in commodities, and that the wealth and power of capital come at the expense of labor. Although Marx grumpily dismissed campaigns to abolish market exchange as utopian, his focus on the commodity convinced many of his readers that opposing capitalism meant opposing commodity exchange.

Piketty’s analysis is focused on the distribution of income and wealth. He begins with a logically indisputable proposition: when the rate of return on capital is greater than the rate of economic growth, capital increases its share of total income. He then tests this hypothesis with historical statistics. These show that national growth rates usually range from one to two percent; the return on capital is usually around five percent. Without deliberate public intervention the share of income going to capital must grow.

Piketty’s focus on income distribution is a more direct and convincing critique of capitalism. To be fair, Marx was writing in the 1860s. Credible income statistics did not become available until governments adopted income taxes to pay for World War I. Marx’s critique was necessarily more abstract, more a criticism of capitalist market theory than of capitalist practice.

Piketty, born in 1971, knows that twentieth-century attempts to replace market exchange with top-down state direction required unacceptably heavy and intrusive repression. The USSR’s disadvantages have been well documented, but capitalism is hardly the utopia of equal opportunity its supporters claim. In France, the U.K., and the U.S., the share of total income currently appropriated by capital is thirty percent. The top 0.1 percent of income earners own twenty percent of wealth. The top one percent own 40 percent. The top ten percent own 80 to 90 percent. The bottom 50 percent own a mere five percent of wealth.

Mainstream economics justifies great fortunes in a few hands by claiming these are just rewards for successful work, innovation, and merit. In fact sixty percent of great fortunes are inherited. Piketty shows that capitalism continues to be a system of patrimonial wealth. Even for those few wealthy individuals who are or were innovators, it does not take long before the income earned from their past capital exceeds the income from their work. For countries with reliable statistics, annual income from capital now accounts for thirty percent of total income. Privately-held wealth equals 600 per cent of annual national income.

Nonetheless, governments, electoral parties, and the corporate media insist that the main problem facing economies is public debt. Actually public debt in most countries ranges between thirty and seventy percent of GDP. In the nineteenth and twentieth centuries, the governments of major capitalist countries had debts that reached 200 percent of their GDP. Past governments reduced debt by cutting public spending, by allowing inflation to rise, and by increasing taxes.

Austerity is the most damaging way to reduce public debt. Government cutbacks increase unemployment, reduce working-class income and consumer purchasing power, aggravating market stagnation. Inflation does reduce the real value of debt, but largely at the expense of the investments of middle income pensioners. The most benign way to reduce public debt is to increase taxes on great wealth and on the highest top incomes.

Piketty argues that marginal tax rates on income over $500,000 could reasonably be raised to 80 percent and that progressive inheritance taxes should be instituted or raised. In addition, he calls for an annual tax on all private wealth including real property, stocks, bonds, bank balances, and assets held abroad. This annual wealth tax could be one percent on wealth from $1 to $5million; two percent on wealth over $5 million; and 5 to 10 percent on wealth over $1 billion.

Piketty concedes that such taxes in the present political climate appear utopian and could lead to capital flight, if not coordinated among numerous countries. Still people should begin discussing such taxes. Once widely implemented by the international community, public debt could be quickly eliminated. Public spending to meet human needs and to sustain consumer markets could be increased. The tendency of capitalists to appropriate more and more income would be reversed. Democracy would be strengthened as information on private wealth become more transparent. Such taxes could also provide the public with the means to respond to climate change. Massive investments are required to move away from dependence on fossil fuels: if private capital does not take the initiative, taxes on wealth could provide the public with the revenues needed.

Al Engler

Capital in the Twenty-First Century, Thomas Piketty, The Belknap Press of Harvard University, 2014, 685 pages

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Piketty’s book important, but should go one step further

2 Jun

Is Thomas Piketty’s Capital in the 21st Century a left-wing book?

Yes and no. It depends on how you define left wing.

If you believe the litmus test of being “left” is opposition to capitalism then the book may be interesting and important, but it is not left wing. If, on the other hand, you believe capitalism is a dynamic economic system worth preserving, but in need of a tune-up, you would likely have a different answer. In the range of political/economic opinion allowed in the corporate North American media the book is certainly at the left end of the spectrum.

But perhaps there is another more important question to consider. Is the book useful, including to those who think an alternative to capitalism is both desirable and necessary? And the answer is an unequivocal yes.

Strangely, it’s not primarily for the reason you may think, if all you know about the work is what you have read or heard in the mainstream media.

While most of the commentary has been about the book’s take on inequality and the author’s prescription (a tax on capital) for controlling the problem, the really unique and useful aspects of Piketty’s work are his insistence on what might be called “reality-based” economics and his straightforward, easy-to-read language.

Unlike the obscurant writing and “fairy-tale” premises that typify most works of economics, Piketty bases his arguments in actual data and sets out to explain them in a style that is accessible to a broad range of readers.

Imagine that! Economics for everyone, including those of us who insist that theories should be tested in the real world! Refreshing, almost scientific.

If Piketty can do it we should hold all economists to these standards. Imagine no more theories of perfect competition where all buyers know everything about all sellers, but instead explanations of what really happens when individuals suffering from a lifetime of brainwashing come up against the might of multinational corporations. Imagine economics that explained the world as lived by ordinary people in a fashion that most of us can understand.

This threat of a good example explains much of the “emperor does so have clothes” reaction of orthodox academic economists and their fellow travellers in the business press to Piketty’s book. Then you add in the overwhelming evidence presented in Capital that inequality does exist, has grown over the past three decades of neoliberal reform, and is likely to grow much greater  — and yes sir those apostles of greed sure are angry.

So, the book is important and you should read it, but … let’s just say one should be aware of its limitations.

Contrary to what you might assume based on the attacks from certain quarters, the author does not advocate socialism — unless you believe socialism can be defined as simply trying to be nice to everyone and sometimes using the government to override the power that capitalism gives rich people.

Piketty is firmly in the camp of those who would save capitalism from itself. While he does argue too much inequality is bad because it threatens democracy and leads to revolution, or at least economic nationalism, there is no question he supports the system. He frequently and explicitly praises capitalism as the best economic system because it produces the most growth. There is no mention of an environmental crisis and its link to inequality and an economic system that values greed above all else until the very end, almost as an afterthought. He does not deal with environmental limits to growth.

Still, the book provides all sorts of useful information about the last 200 years of actually existing capitalism. Its offers a glimpse of what the study of economics should be. Piketty seems to be on the side of ordinary people and even makes mention of economic democracy.

Go and buy Capital in the 21st Century from your local bookstore, but read it with this thought in mind: Rather than tinkering with capitalism, can’t we come up with a better system? One that democratizes economic decision making while rescuing our environment from the ravages of unchecked greed, also known as the fallacy of unlimited growth?

Gary Engler

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An impertinent question

21 May

Do people exist to serve the economy or does the economy exist to serve people?

This question came to me as the left side of my brain was reading Thomas Piketty’s important new book Capital in the 21st Century while the right side of my brain watched the news.

There was an item about the B.C. government chopping money from university arts’ programs to fund apprenticeships because it would produce more taxpayers, which would be good for the economy, followed by a commercial touting the Northern Gateway pipeline, which also would be good the economy. As my right brain soaked in the TV images my left brain was digesting statistics that demonstrated conclusively most wealth is owned by a few people and this inequality is growing.

Do people exist to serve the economy or does the economy exist to serve people?

When the two sides of my brain began acting together I realized this is not merely a rhetorical question. Rather, even raising the issue is subversive, or at least impertinent to those who maintain the status quo.

At its most basic level the economy is the sum total of the things people do to provide themselves food, shelter and other things that enhance life, such as recreation, healthcare, entertainment and art. So, the answer to our question should be clear-cut: The point of an economy is to serve people.

But the reality for most of us is exactly the opposite.

We are told the economy demands this or that as if it were some sort of primitive deity to be appeased.

Raising the minimum wage is bad for the economy. Expanding the tar sands and building pipelines to ship bitumen around the world is good. Public daycare or increased pensions are not affordable. Mass layoffs and wage rollbacks are necessary. But consume anyways (the more disposable the better), because that’s what makes the economy go round and round.

Politicians, corporate executives and the media all send us the message that our lives only attain meaning in so far as we contribute to the economy as consumers or taxpayers.

Rather than serving us, “the economy” has become an excuse to treat many people badly, to create unhealthy products, to damage our environment, to justify exploitation, to steal from other people and even to wage war.

Why?

The primary reason is that too much of the economy is run by and for a small minority of people. As Picketty’s statistics show, actual existing capitalism (as opposed to the phoney idealized system taught in school) concentrates ownership of wealth in the hands of a few people. This wealth produces both income and power, so much of which has gone to the richest 1% that any effective democracy is threatened.

Many of us feel powerless in the face of this inequality. Our unions have been undermined and delegitimized. The system tells us our only valid participation in the economy is as consumers, but getting to choose between Coke and Pepsi hardly inspires a sense of engagement.

We certainly get no vote in directing the economy, unless we are shareholders, and in that realm decisions are made by one-dollar-one vote, so billionaires hold sway. Moreover, for at least the past 30 years, the prevailing wisdom has been that governments are incompetent and therefore must keep their hands off the economy. We are told any sort of democratic control is bad because it creates distortions in the natural working of the system, as if there was some divine order that was being interfered with.

But it is not god’s will that is being challenged when democratic control is asserted. Rather it is the will of the 1% who currently own a vast proportion of the economy and direct it (and us) in their self-interest. There are no mysterious natural forces deciding what gets built, what gets shut down, who loses their jobs, how much to invest in green energy versus the tar sands; there are only very wealthy people and the managers who work for them.

Given that, it is really no surprise that the economy seldom serves the interests of the majority — it serves other masters. The economy follows the orders of the people who own it. And it gives the biggest rewards to the ones among them who are the greediest, the most willing to grab huge profits for themselves while making the rest of us pay for the pollution, ill health and other forms of destruction their industry causes. Then they spend some of those vast profits to buy politicians, think tanks and media pundits who work to convince us that this form of minority rule is good for us — the natural order — and trying to create a better system is hopeless.

But what if, despite all that, we demanded an economy that served all of us? What would we do?

Piketty argues for a tax on wealth and that might be a good starting point, but if we really want to fix this we must go further. When the problem is too much power in the hands of a few the obvious solution is to distribute that power more widely.

We should take away control of the economy from the greedy minority and share it amongst all of us. A good name for such a system is economic democracy.

The exact form such a system might take would probably depend on a country’s history, culture and level of development. But essential elements would be: one-person-one-vote instead of one-dollar-one-vote decision making in all aspects of the economy; workplace democracy instead of master-servant relations and community control instead of corporate control.

If we want an economy that serves all people we must create a system of democratic governance to ensure that happens.

 Gary Engler

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Global warming is caused by capitalist greed

30 Apr

Humans have caused climate change by pumping ever more carbon dioxide into the atmosphere and we must quickly cut these emissions.

True, but what has this got to do with unions?

Well, at their core unions are organizations that bring people together to fight for the common good. This essential truth is reflected in the structure, philosophy and history of most unions.

But exactly whose “common good” a union is fighting for can vary widely.

Is it narrowly defined as immediate job interests of local union members? Is it the common good of all those working in a particular trade? All union members in one industry?

Or is it more widely defined as the common good of every union member? Every worker in a particular country? Of all Canadians? All the workers of the world? Every person in the world? Or even wider as the common good of all life on the planet?

The truth is every thoughtful union member, and especially every union leader, must consider the common good from many different perspectives. Everyone has more than one self-interest and therefore more than one common good.

No one is solely a pipefitter, nurse, front desk clerk; or employee of General Motors; we are also children, parents, residents of a city or town, citizens of a country, inhabitants of a planet who are dependent on a common environment, and much more besides.

But unions often find it easiest to fight for the narrowest common good, the immediate self-interest of workers in a particular trade, industry, or company. Higher pay, improved benefits, better job security — members almost always cheer if a union achieves these things. Fighting for all life on the planet or against inequality is a bit more complicated.

But there is another reason as well why unions find it easiest to fight for the narrowest common good. “Looking after No. 1” is what capitalism tells people to do. You are a consumer. Buying more is what life is all about.

In fact, proponents of capitalism argue there is no such thing as the common good, that we are all simply individual consumers and therefore unions are an illegitimate intrusion into the free market. Still, if workers are going to unite for any purpose it had better be limited to stuff like higher pay, something that allows people to buy more and does not challenge capitalism.

So, here’s the reality we face: In so far as a union, its leadership and members have bought into capitalism, the greater the likelihood that union will choose to focus on a very narrow self-interest and ignore such issues as climate change or inequality. Some unions do buy into capitalism despite the fact it does not like workers joining together to fight for any common good, whether narrowly or broadly defined. If it were up to capitalists there would be no unions at all. Capitalists — the bosses — are not our friends. The more people buy into their system the weaker unions are.

And the opposite is also true. The more people come together to fight for the common good, the stronger unions are. The more unions fight for the widest common good, the more people will be on our side and the stronger unions will be. The more unions fight the existing system the stronger unions are.

History shows that the periods of greatest growth in unions were times when capitalism faced widespread challenges and the periods when unions have shrunk, like during the past 20 years, were times when opposition to capitalism was weak.

History also shows that unions have been willing to fight for the widest common good despite opposition from the rich and powerful. Unions were part of the struggle to end slavery and child labour; unions helped win universal voting rights, public education, equal rights, Old Age Pensions, Medicare, the 40-hour work week, paid vacations and numerous other social programs that have benefited society as a whole.

It won’t be easy to stop global warming. Many brothers and sisters earn their living extracting oil, building private automobiles and mining coal, industries that must shrink or disappear to save our planet. Of course this raises difficulties inside the labour movement because it pits narrow self-interest against the wider common good.

But progressive unions were not deterred by similar internal problems in the struggle for civil rights or against sexism and homophobia. As in those battles we must do what is necessary and right. We must demand jobs that do not harm the environment. We must not shy away from battling climate change because there is no more important common good than the health of our environment. We must learn from and work with environmentalists.

But environmental activists must also learn an important lesson from the long history of the labour movement: Capitalism is the problem and certainly not the solution.

The capitalist drive to maximize profits explains the externalizing of environmental costs. Capitalism is a system of small minorities profiting at the expense of others. Private ownership of what are social means of livelihood allows capitalists to make decisions that pass the real costs of industry to communities, workers, future generations and other species.

Capitalism requires growth. But what happens when the environment needs a smaller human footprint? When, at least in wealthier countries, we must learn to live with less stuff?

If a capitalist economy shrinks for a sustained period the system goes into a crisis. Banks crash, unemployment rises and wars suddenly make sense to rich people in order to get their system growing again.

Supporters of capitalism claim the system is based on freedom and choice, but when it comes to the environment for many people this amounts to the freedom to choose between destroying the planet or having a job. The promoters of tar sands, fracking, coal mining and pipelines are explicit about this. The business pages are full of stories quoting the captains of the carbon-industrial complex as telling us: “You must choose between economic prosperity and what is good for the environment, because you can’t have both.”

With capitalism they are correct.

Yet someenvironmentalists, as well as some union members, look to capitalism for solutions. That’s like expecting Toronto Mayor Rob Ford to tell the truth. A sustainable, democratic economy is incompatible with a system run in the interests of a tiny minority that constantly demands more profit.

Science leaves little reasonable doubt that the burning of currently known reserves of coal, oil and natural gas will push atmospheric carbon dioxide levels past a tipping point, after which rising global temperatures will irreversibly undermine the conditions on which human life as we know it depends.

Despite the evidence, today’s capitalism rests on the expansion of fossil fuel production and use.

In Canada capitalist investment is focused on expanding tar sands production. The promoters claim that these developments will create jobs. But every analysis shows more jobs would be produced if equivalent investments were made in solar, wind and geothermal power. Far more jobs could be produced by investing in domestic employment for domestic markets, in the production and distribution of sustainable local agriculture, clothing, etc. Even more jobs would be created by investments in childcare, elder care, social housing, public transit and other green infrastructure.

More jobs but less profit. Capitalists invest in fossil fuels because corporate profits now largely depend on cheap fuel. Equivalent profits cannot be made meeting actual human needs.

So, unions and environmentalists share a common enemy: an economic system run by and for the wealthiest people in the world.

Together we can fight for a different sort of economic system that will prosper in harmony with the environment. Or apart we can fiddle with capitalism as our planet burns.

Gary Engler

From a speech given on the weekend at the Peoples’ Social Forum Assembly on Climate and Oil & Gas in B.C.

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Sustainability and capitalism: Can we have it all?

30 Jan

From a speech given at the One World Week Forum at the University of Warwick on January 30, 2014.

Can capitalism solve the problems of global warming and growing inequality?

It seems to me this is like discussing the issue of inappropriate hyper-sexual imagery bombarding 11-year olds and then asking: Can Justin Bieber or Lady Gaga fix the problem?

Real capitalism, not the theoretical version taught in school, is a system of minority rule in which a few people profit at the expense of others.

Real capitalists are always trying to cut their costs and increase their profits, which leads to unemployment, falling wages, rising economic disparity and not paying for the environmental damage they cause.

Private ownership of what are social means of livelihood produces incentives for capitalists to pass along the real costs of industry to communities, workers, future generations and other species.

Private ownership makes growing inequality inevitable. A system can proclaim itself democratic, but if a minority holds most of the economic, and therefore social and political power, that minority will inevitably reward itself, its power will grow and ever-expanding inequality will be the result.

Capitalism is sociopathic. Its ideologues, like the late Margaret Thatcher, reject the social, claiming only individuals exist. Yet capitalism has driven individual producers to the fringes of economies. Most people, ninety per cent in the U.K., depend on wages or salary, working with others in cooperative, coordinated labour — social labour, but directed by wealthy minorities for their own profit.

Capitalism promotes greed. It boasts of this. So why would we be surprised when a small minority with most of the power looks after itself, in effect telling the rest of us: “Screw you and the planet you live on! We don’t care about global warming because we have the money to buy a nice place regardless of how high the oceans rise.”

Capitalism requires constant growth to satisfy its need for more profit. But what happens when the environment needs a smaller human footprint? When, at least in wealthier countries, we must learn to live with less stuff?

History shows capitalism reacts badly to declining markets. When the economy shrinks for a sustained period the system goes into crisis. Banks crash, unemployment grows and capitalists often turn to war to get their profits rising again.

The truth is a sustainable economy is incompatible with a system that constantly demands more profit.

To quote the greatest living English political philosopher, Russell Brand: “I know what the fucking system shouldn’t do. It shouldn’t destroy the planet and shouldn’t create massive economic disparity.”

Like Russell we know what we don’t like. That’s the easy part. But how can we get rid of capitalism and what is the alternative?

To answer we must go back to the issue of power and how to distribute it in a way that promotes the common good, a key element of which is a healthy environment. The best way is through more democracy. REAL democracy. Economic democracy.

Do you want an equitable, sustainable economy? Then help overthrow capitalism and create an economic democracy.

What exactly does this mean?

Let me give you an example: With the one pound one vote system that governs corporate capitalism, Richard Branson, with a net worth of 3.5 billion pounds get 3.5 billion votes. In comparison you (pointing) get 147 and you get 58. Most of you poor buggers owe more than you own so you get no votes at all. Economic democracy means giving everyone the right to a voice and an equal vote in their communities’ economic decisions. When everyone has an equal right in decision-making, economies will be motivated by general wellbeing, not private profit. Economic democracy means eliminating the divide between workers and owners by making everyone an owner. Economic democracy means multiple owning communities  — local, regional, national, international — so that power does not become concentrated in the hands of a single central state. It means that wherever social labour occurs a system of democracy manages the enterprise.

Imagine companies that are democratically run by workers together with a local, regional, national or international government, whichever is appropriate to that enterprise; companies whose mandate it is to promote the common good, rather than the narrow self-interest of rich shareholders; companies that no longer have incentives to destroy the planet, but rather face real penalties for harming the environment.

Now, I know what at least some of you are thinking. This is not realistic. Your ideas are just pie in the sky. But the truth is capitalism has already created what one might call “objective conditions” that do indeed make economic democracy possible. Most people in most countries already depend on social labor. Most of you, if you find paid employment, will be salaried or wage workers. If we choose to fight for it, we can expand one-person, one-vote decision-making into every area where people work collectively, which is most of our economy. If we elect governments committed to it we could pass laws that limit private property to what is truly private and doesn’t give an individual power over others. We could create a system of social ownership with multiple democratic owning communities.

If we accomplish these three things — replacing corporate ownership with social ownership, replacing capitalist entitlement with equal human entitlement and replacing master-servant relations with workplace democracy — the system that drives enterprises to maximize profits, regardless of the consequences, would no longer exist.

Capitalism and sustainability, can you have it all? No. But there is a much better alternative: Economic democracy, a system that will offer authentic jobs, a nourishing work-life balance, your fair share of power and a healthy environment. This sounds like the essentials of a good life to me.

Gary Engler

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Video: Understanding Capitalism — Idiocy

5 Jan

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Capitalism uses unemployment to keep workers in line

1 Jan

A just society should provide everyone with access to a job yet nearly 2 million Canadians can’t find work.

Officially 6.9 per cent of the Canadian workforce is unemployed. But this number rises to 10.3 per cent when those who’ve given up searching for work are included. Counting “discouraged workers”, about 1.8 million Canadians can’t find a job.

Looked at from a different perspective, StatsCan announced last week that there were six job-seekers for every job available in September. Counting “discouraged workers” that number increases 50 percent.

Incredibly, some consider Canada’s unemployment rate a success. In his October throne speech Stephen Harper misleadingly declared that “Canada now has the best job creation record in the G-7 — one million net new jobs since the depths of the recession.”

This isn’t simply self-promotional rhetoric. Policy moves suggest the government is little concerned by the large number of Canadians out of work. Over the past two years they’ve curtailed Employment Insurance benefits, increased the age at which people can receive Old Age Assistance and slashed public-sector employment.

While the government would never say as much publicly, some among the corporate-funded think tanks argue that having over 1 in 10 Canadian workers out of a job is actually too few. “Canada’s unemployment rate dangerously low” was the title of an April Financial Post article by Philip Cross, Research Coordinator for the Macdonald-Laurier Institute.

Hostility to anything approaching full employment reflects the growth of neoconservative policies. Over the last three decades the idea that everyone should have access to a job has largely disappeared from political discourse. But it used to be fairly common.

In the 1963 election Liberal leader Lester Pearson ran on a “Sixty days of decision” platform that included a pledge of full employment and during his time as Prime Minister Canada’s official unemployment rate dropped below 3%. Similarly, the UN’s International Covenant on Economic, Social and Cultural Rights, which was adopted in 1966 and signed by Canada in 1976, called for the right to employment. It recognizes that “Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.”

Instead of focusing on peoples’ right to employment, policymakers today emphasize property rights. In effect, this has meant extending patents, easing safety/environmental regulations on corporations and enabling investors to move to low-wage jurisdictions.

While these policies certainly benefit some, few of us gain our income from owning property. The vast majority of Canadians are wageworkers, their dependents or retired wageworkers. And without a job it’s difficult to get by.

But a job is not only about paying the bills. What one does is generally an important part of a person’s identity and most people want to feel like they are contributing to society. Persistent unemployment can be psychologically damaging for individuals.

It’s also socially damaging. Mass unemployment is a waste of peoples’ energy and ingenuity. Imagine what the 1.8 million Canadians out of work could accomplish if they were mobilized to develop green energy sources or to expand mass transit and childcare services.

But how do we mobilize all this latent human energy. One socially useful way to stimulate employment would be to have the government significantly expand its role in mass transit and childcare. Another would be to push Corporate Canada, which is sitting on over $575 billion in cash, to invest in renewable energy.

It’s time to rekindle the idea that all adults have the right to a job. There are 1.8 million Canadians waiting to better contribute to their society.

Yves Engler

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Workers and their unions must fight climate change

24 Dec

For those of us in the labour movement, tis the season to ponder what good our unions can do in the upcoming year and to renew our commitment to a key principle: What we desire for ourselves we wish for all.

At this time of year, while many of us focus on gifts, it is easy to desire the latest gadget, that new car or even a remodelled bathroom. But, most of us would agree, in the grand scheme of human priorities, certain fundamentals are more important than simply acquiring more things.

For example, decent housing, nutritious food, public education, a safe and loving atmosphere to nurture every child and access to quality healthcare would all be understood by most union members as essential, rather than as simply “stuff” that would be nice to possess. In other words, when we come together in a union we acknowledge certain basic social priorities. Thus the first unions fought for a living wage, the eight-hour day, public schools, pensions etc., not simply more money. Without the basics of life, being able to buy more things is meaningless.

And that’s how we need to think about our environment and especially global warming.

There is nothing more important than a healthy environment. Without that, all the other fundamentals — food, housing, education, family, leisure, pensions etc. — are at risk. If human activity, in the pursuit of accumulating more stuff, destroys the liveability of our planet, we will have done a great wrong to all creatures, including ourselves.

And the best evidence we have is as categorical as science gets. Humans have caused climate change by pumping ever more carbon dioxide into the atmosphere and we must quickly cut these emissions.

Here’s how one leading climate change expert put it earlier this month:

“We need a radical plan for cutting emissions to avoid the radical repercussions of climate change,” said professor Kevin Anderson, deputy director of the Tyndall Centre, based at the University of Manchester in England. “To do this, industrial countries have to cut energy use by around 8-10% each year or 60-70% over the decade, and we have to start now.

“Low-carbon supply and incremental reductions are no longer sufficient to avoid dangerous climate change. We have to have early, rapid and deep reductions in emissions and this can only be achieved in the short term through reductions in energy use.”

Will corporations that dominate the world economy provide us with the “rapid and deep reductions in emissions” that scientists tell us must happen soon to avoid environmental catastrophe? No.

Rather than cutting back on emissions we see corporations invest billions in the tar sands, fracking, offshore drilling and digging up more coal, because all are profitable.

Our current economic system requires ever expanding profit. As a result, if corporations were people they would be diagnosed as psychopaths. They are ruthless in the single-minded pursuit of profit. Psychopaths feel no empathy for their victims. They do not care if the consequences of their actions could soon be the overheating of our planet to the degree that our grandchildren no longer have a habitable environment.

So who will fight to protect our planet?

For 175 years unions have fought for justice, democracy and to make life better for all. We helped end child labour and slavery. We fought for universal franchise and equal rights for all. These battles required enormous sacrifices to overcome opposition of the rich and powerful.

Sacrifices will be necessary as well to stop global warming. Many brothers and sisters earn their living extracting oil, building cars and mining coal, industries that must shrink or disappear to save our planet. This raises difficulties inside the labour movement.

But progressive unions were not deterred by similar contradictions in the struggle for civil rights or against sexism and homophobia. Similarly we must not shy away from battling climate change.

Unions must defend our common interests. There is no more important common interest than the health of our environment.

Gary Engler

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Remaking Mexico’s oil industry on behalf of the 0.1%

16 Dec

MEXICO CITY  — Are we living in a time when ordinary people have forgotten their history, when all those who fail to remember the past will be condemned to relive its harsh reality?

I thought of this as two Canadian tourists marched with thousands along the Paseo de la Reforma last week to demonstrate opposition to the energy “reform” bill being debated by Mexican legislators. The new law would allow foreign oil giants into the country for the first time in 75 years.

Certainly the people who had come from every corner of the country to form a human chain around the Mexican Senate and Chamber of Deputies were well aware of history and cited it on their signs, in their chants, speeches and songs that began in the early morning and continued until late at night. (The noise, traffic jams and thousands of riot police were scaring off tourists and locals alike.) For the students and others banging on the metal barricades surrounding government buildings changing the constitution to allow foreign multinational companies to exploit the country’s oil and natural gas resources is a return to the bad old pre-1930s era when Mexico’s government exercised less real power than the foreign corporations that controlled its vital energy sector. Posters taped to the barricades harkened to history. One read: “The Spanish came to steal the yellow gold for trinkets. The gringos are coming for the black gold … Are you going to stay silent?”

In fact, the 1938 expropriation of the world’s second largest oil industry, which was the first nationalization by a capitalist country, and the creation of government-owned Pemex are celebrated throughout Mexico and their significance in transforming the country is taught in schools.  Kids learn how oil profits that once went to foreign investors remained in the country to build schools, roads and provide social services. The moderately leftish president, Lázaro Cárdenas, who confronted and defeated the British and American oil giants of the day, is honoured with streets, parks, schools and other buildings named after him and is generally considered one of the founders of modern Mexico.

Ironically it is the party that Cardenas was instrumental in creating, the ruling PRI, together with the more overtly right-wing PAN, that over rode the constitution with a two-thirds vote in both the Senate (95-28 on Tuesday) and lower house (353-134 on Thursday). All that is left for the bill to become law is approval by 17 of the 31 state legislatures, most of which are controlled by the PRI and PAN.

Given the statues and school curriculum, it is difficult to argue that ordinary Mexicans are unaware of the history of their country’s oil industry and the excellent reasons to retain “the peoples” ownership of this vital resource. Indeed, a survey published in June, before the legislation was introduced, showed 65 percent of Mexicans opposed foreign investment in the oil industry. Most clearly believe that the oil belongs to the people and profits should be invested in the country’s future rather than fatten the bottom line of ExxonMobil, Shell, BP or Chevron.

In reality the problem confronting Mexico is not the lack of historical memory. It is the lack of real democracy. It is the power of the ruling class, both international and Mexican, to get their way. The people who will benefit from an influx of foreign capital and a reintroduction of “free enterprise” into the oil industry know full well that this legislation will ultimately be bad for most Mexicans, but they don’t care. Their primary concern is how to enrich themselves.

The cheerleaders for capitalism proclaim loudly for all to hear “greed is good” and yet we act surprised when capitalists act in their own self-interest, ignoring the common good.

Mexican capitalists will destroy government-owned Pemex (as they have been trying to do for decades) because for them any economic activity that does not produce private profits is useless — worse than useless, because it may offer an example of an alternative economic system.

What is happening to the Mexican oil industry is another in a long line of international rollbacks of anything that limits the power of the 0.1% richest people around the world, who take the vast bulk of profits from the capitalist system.

Until we, the 90% who work for a living and have the power to take over, rise up and challenge this minority rule of the 0.1%, things will continue to get worse. More social programs will be chopped, more nationalized industries will be sold off to private interests and our so-called capitalist democracy will continue to prove itself no more than a system of one dollar, one vote.

The sellout of the Mexican oil industry is just the latest example of where capitalism is taking us.

Gary Engler

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Do we have enough time to fix global warming?

13 Dec

Even Vladimir Lenin was surprised when the Russian Revolution began in 1917.

Is this just an interesting historical tidbit or a profound example of how fast seemingly stable political, social and economic systems can collapse?

The subject of how long lasting our current system really is comes up frequently in discussions about global warming and what we can do about it.

Usually the conversation goes something like this:

“Scientists tell us we’re getting close to the point of no return. We don’t have much time left to drastically cut our carbon emissions.”

“Yes, but corporation keep investing billions in the tarsands, in coal, in building ever more private automobiles. The oil sector, that’s where the money and jobs are.”

“Even the people who understand global warming is a problem need jobs.”

“Governments pay lip service to combating global warming, but in reality they follow the money too. Big corporations buy them off. They run everything.”

“The problem is capitalism. Capitalists require ever-expanding profits and will do anything to keep them flowing. That’s just the way the system is.”

“So what can we do about it?”

“Get rid of capitalism.”

“How likely is that?”

“I guess it depends on how many people come to the same conclusion and are willing to do what it takes to change the system.”

“In other words, it’s hopeless.”

“Why do you say that?”

“Look around, people don’t care. They’re too busy shopping or worrying about their own private problems. People are too scared to join a union, let alone overthrow capitalism.”

“Things can change, very quickly.”

And that’s where the story about how the Russian Revolution surprised everyone comes up.

For those of us who understand the importance of acting quickly to reduce carbon emissions and that capitalism is incapable of dealing with this urgent problem, the question of how fast we could build a new, environmentally friendly economic system is critically important.

Is there time or are we cooked? Literally.

The answer depends, in large part, on one’s views about how “revolution” occurs.

If you believe that major change only happens after long years of organizing by dedicated, professional revolutionaries building a party that can lead the masses into a brave new future, then human beings today are probably like a lobster in a pot just before the chef turns on the burner: “I don’t know what all the fuss is about. This water seems quite comfortable to me.” It’s doubtful if we have the time to develop the cadre necessary for taking over a system as complex and all-encompassing as world capitalism.

On the other hand, if you believe in the power and ability of ordinary people to rise up when confronted by a crisis that affects us all, then it is possible to be optimistic. If the system you want to build begins with working people around the world taking over the reins of the economy and replacing capitalist minority rule with economic democracy, then that could happen relatively quickly. Yes, it still requires “leaders” working hard, talking and organizing, but history offers many examples of ideas spreading quickly and then people acting upon them.

The critical element — the “objective conditions” — already exists. Capitalism itself has created an economy overwhelmingly dominated by social labour. This gives the working class the potential power to take over almost every part of the economy in the vast majority of major economies around the world.

Most people in most countries are workers. If we chose to do so, we could easily expand one-person, one-vote decision-making into every area where people work collectively, which is most of our economy. We could limit private property to what is truly private and doesn’t give an individual power over others. We could move to a system of social ownership where multiple democratic owning communities based on the appropriate level of government — local, state/provincial, national, international — replaced corporations. If we did these three things the system of greed that propels capitalists to earn profits, regardless of the consequences to our environment, would no longer exist.

Saving the planet from global warming and ensuring a future for our grandchildren are powerful incentives for billions of working people to participate in this necessary global movement.

Can it happen quickly enough? Yes.

Will it happen quickly enough? That is up to us.

Gary Engler 

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CEO fat cats purring all the way to their Swiss banks

5 Dec

Last week in Switzerland big money staved off an important challenge to big paychecks. But the sentiment that spurred a Swiss effort to tie executive compensation to common workers’ wages will not be defeated so easily.

A Sunday ago Swiss voters said no to a referendum question that would have capped executive compensation at 12 times the lowest paid worker in the firm. After gaining over 130,000 signatures to put the question to voters, proponents of the initiative were overwhelmed by a flood of money claiming a “yes” vote would drive companies away. Early polls found 46% of the Swiss public opposed to the 12:1 pay measure but with opponents spending up to 50 times more than the “yes” campaign, 65% ultimately voted “no.”

According to supporters of the measure, the average Swiss CEO made 43 times the average wage in 2011, up from six times in 1984. A number of top Swiss CEOs make more than 200 times their employees’ wage.

But Switzerland’s CEO-to-worker pay differential appears socialistic compared to North America’s. After the U.S., Canada has the second highest CEO-to-worker pay ratio. Last year, for instance, the CEO of BCE, George Cope, received $11.1-million in compensation. This staggering sum is nearly 200 times more than what a Bell Canada technician in Toronto makes and 2,000 times the pay of an Indian call-centre worker who responds to Bell customers.

Despite making 200 times the average industrial wage, Cope was not the best-paid executive in Canada. According to the Canadian Centre for Policy Alternatives’ summary of Canada’s 100 highest paid CEOs in 2011, the $11.1 million Cope made in 2012 would have placed him just off the top 15. Incredibly, the CEO of Canadian Pacific, Hunter Harrison, took home four and a half times Cope’s pay.

In recent years the difference between regular employees’ pay and CEO compensation has grown rapidly. A recent Globe and Mail survey found that ratio has reached 122-1 at Canada’s biggest firms, up from an average of 84-1 a decade ago. Using a different set of data, the CCPA and AFL-CIO put the Canadian CEO-to-worker pay ratio significantly higher.

As a flagrant symbol of growing inequality, executive pay is increasingly facing political challenge. While the 12:1 initiative was defeated, in March more than two-thirds of Swiss voters supported a referendum question requiring companies to give shareholders a binding annual vote on executives’ pay, while outlawing bonuses to executives joining or leaving a business or as part of a takeover. Similarly, some EU officials have suggested that shareholders should be given the right to vote on the ratio between a company’s best and worst paid workers.

The French government took office last year saying it would limit executive salaries at state-controlled companies to a maximum of 20 times that of the lowest-paid employees and on Wednesday, Ontario New Democrat leader Andrea Horwath called for the salaries of CEO’s at the province’s hospitals, electrical utilities and other public sector agencies to be capped at $418,000, twice the premier’s annual salary.

Politicians should legislate a maximum pay differential between the best and worst paid workers in all companies. How about a ratio of 20 times that’s steadily reduced over time?

It may be difficult, but I’m sure CEOs like Bell’s George Cope could learn to cope on a million bucks a year.

Yves Engler

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Unions should lead the fight against global warming

4 Dec

What is working class culture?

This question arose as part of a conversation about convincing members of Canada’s newest union, Unifor, to make saving the planet from climate change a priority.

“You’ll run up against working class culture,” said a friend who considers himself an anarchist.

“What do you mean?” I responded.

“Consumerism. High paying jobs with lots of overtime to buy ever more stuff, two cars, a big house in the suburbs with NASCAR and hockey on the two big screens in the basement, plus Housewives of Vancouver on the TV in the kitchen,” he said. “And how many thousands of your members build cars, dig up the tarsands and work in oil refineries? How can people with jobs like that ever be environmentalists?”

The first response I thought of was: “Are you saying soldiers never turn against war? Because history proves they do,” which spun the argument in another direction.

But the subject of working class culture lingered. Is there one and is it defined by consumerism? Or are there many, including ones opposed to the “culture” that TV tries to convince us is how we all live?

And regardless if there is only one, or many, where does it/they come from? Does culture simply happen or is it imposed upon us? Is it something that we can consciously build?

Certainly working class movements in the past have sought to educate themselves in an attempt to create an explicitly anti-capitalist culture. Many social democratic, anarchist and communist groups, including unions, grew into mass movements precisely by challenging the dominant ideology and suggesting an attractive, believable alternative. Rather than bemoan, but accept, the culture that rulers imposed on the working class, social democrats, anarchists and communists instead talked and listened to their fellow workers, convincing them that an alternative to capitalism was desirable, possible and necessary.

Those of us who understand that capitalism is environmentally unsustainable must do the same work today. We must inform people about the importance of immediate action to slow global warming and fix other ecological rifts that threaten human existence on our planet. We must challenge the notion that capitalists will solve environmental problems when in fact they are the ones who profit from mining the tarsands and building the pipelines which threaten our children’s and grandchildren’s future. We must point out that constant economic growth (unsustainable on a finite planet) is at the core of capitalism. But most important of all, we must offer a vision of an alternative to capitalism. This system must be environmentally sustainable, more democratic, provide a comfortable life and be fun to build.

One such alternative to capitalism is economic democracy. This means replacing master-servant relations with workplace democracy, replacing capitalist title with equal human entitlement and replacing corporate ownership with social ownership. The essential ideas of economic democracy are: Expanding one-person, one-vote decision-making into every area where people work collectively, which is the vast majority of our economy; Limiting private property to what is truly private and doesn’t give an individual power over others; Replacing corporations with multiple democratic owning communities based on the appropriate level of government, local, state/provincial, national or international.

In an economic democracy individual greed could not overrule the collective good, which would be determined by democratic means. When the majority of people understand the causes and dangers of global warming, their governments and collective enterprises would become agents of change rather than barriers. Entrenched interests who profit from spewing ever more carbon into the atmosphere would not control them. If workers and communities ran industries, such as the automobile and oil sectors that must change or disappear if we are to make the necessary drastic cuts in carbon emissions, they would be a lot less likely than profit-addicted corporations to blackmail society into supporting private interests that damage the environment. Worker and community owned enterprises would support just transition strategies to move jobs from polluting to sustainable industries. They would also be much more likely to promote an alternative culture of artistic leisure over mindless consumerism.

Environmentalists in and outside the union movement should not cite “working class culture” as an excuse to avoid raising critical issues about the jobs we do. Hundreds of millions of workers have proved capable over the past two centuries of managing the contradiction of opposing capitalism while seemingly dependent on capitalists for their jobs. Pointing out how capitalists use jobs to blackmail us into supporting their interests helps people understand why capitalism is the problem, not the solution. Rather than being a barrier to environmental understanding the fact that capitalism cannot do what is necessary to repair the damage it has already done, is a powerful argument in favour of building a working class alternative to the current system.

Strong, democratic, environmentally conscious, militant unions are one of the keys to success in this project. Such unions do not shy away from difficult but necessary discussions.

Gary Engler

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If Canada was truly democratic

7 Nov

What would a trade agreement intended to benefit all Canadians look like?

This is of more than academic concern right now as the Harper Conservative government will eventually unveil the full details of the Canada-European Union Comprehensive Economic and Trade Agreement (CETA).

From what we know about it now this agreement is little more than a ‘corporate bill of rights’. It gives corporations even more power to shift investment as they see fit and directly strengthens their interests in everything from public procurement to patent laws.

The one-sidedly pro-corporate nature of the agreement reflects the power that corporations yield over discussions of international trade. Despite the corporate world’s current stranglehold over international economic decisions, a here and now People’s Alternative to CETA is feasible.

To protect multinationals from the scourge of “discriminatory” government policies, CETA includes an investor-state dispute settlement process. This will give corporations based in Canada and the EU a new supranational tool to sue governments for pursuing policies that interfere with their profit making.

But rather than giving even more power to the top 0.1% richest people in the world, who are the investor class, an economic accord driven by a People’s Alternative would set up a labour-state dispute settlement process. In these tribunals workers could sue governments that fail to force employers to abide by labour law and International Labour Organization statutes.

CETA also gives multinational corporations unprecedented rights to bid on public contracts. In a bid to create a “level playing field” for multinationals in public procurement, the agreement will weaken provincial and municipal agencies ability to “buy local” and pursue other environmental and socially minded policies.

Instead of undermining public agencies’ ability to pursue ecological and social goals when tendering contracts, a progressive economic accord would prod firms to follow the highest ecological and social standards within the trading area. A People’s Alternative would give priority to firms that cut their carbon emissions in line with the stronger levels mandated by the EU. It would also prioritize companies that establish works councils, which give workers some formal voice in the operation of the firm and are common throughout Europe.

Under CETA Canada will lengthen the time drugs remain under patent, which is expected to drive up already high Canadian pharmaceutical drug costs by more than $850 million a year. Instead of extending Canadian patent laws to more closely reflect Europe’s rules, why not harmonize daycare programs to reflect the best of the trading area?

Most European countries provide public day care services, which have both costs and benefits to the economy. According to the logic that says trading partners are supposed to be on similar economic footing, it makes as much sense to standardize daycare systems as it does patent rules.

Another argument presented to justify extending patents is that it will lead to more research and development taking place in Canada. But, over the long-term, publicly funded day care would better accomplish this objective. Particularly beneficial to the intellectual development of poor kids, quality public day care increases the likelihood that disadvantaged children will be successful in school and contribute to future innovation.

With the corporate perspective so thoroughly dominating public debates on international trade it can be difficult for critics to do anything more than oppose the current policy direction. But when we disentangle the “economy” from what’s good for corporations a pro-people international economic accord is entirely feasible.

If we enjoyed real democracy, our governments would consult the people about their priorities in trade agreements.

If we lived in an economic system of one-person-one-vote, rather than the one-dollar-one-vote corporate system we have today, trade would flourish but trade agreements would look much different. They would be concerned with benefiting ordinary people, not just the already wealthy and powerful.

Yves Engler

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Working for a living in an irrational economic system

1 Nov

Our economic system is pretty funny, eh.

I don’t mean of the belly laugh sort, but rather the ironic variety (although a decent argument could be made that many elements of modern work life have the humour quotient of a Three Stooges skit).

There was a rally Thursday to support unionized cleaners working in Cadillac Fairview buildings in downtown Vancouver who are paid in the $12 per hour range. Cadillac, self-described as “one of North America’s largest investors, owners and managers of commercial real estate” and owned by the Ontario Teachers’ Pension Plan, has given its former $12 per hour cleaning contract to another supposedly unionized company that pays its workers $10.50 per hour.

These hard working people, mostly immigrant women, clean the offices of financial analysts, brokers, accountants, lawyers, executives and others, mostly men, who are paid five to many hundred times more.

Among the many ironies in this sad situation is the realization that the harder and more important the job the worse it pays. The more pointless and socially unnecessary the work the more cash is thrown at the person.

Keeping buildings where we work clean is pretty important. Making the clothes everyone needs to wear, picking the vegetables and fruit that keep us healthy, making sure urban sewers don’t get blocked, or picking up garbage are all important and difficult jobs, but how much are people doing them paid?

Gambling, on the other hand, pays extremely well, if it’s the sort that rich people do. Of course we’re told that what they do on Wall Street or Bay Street is part of the real economy and only what happens on the Las Vegas Strip is gambling.

But it seems to me, real gambling is when you don’t understand what is going on. Think about it: If I bet my pension on whether or not the little ball is going to fall in a red slot or a black slot, at least I can see what happens. If I hand it over to a mutual fund, I don’t have a clue.

How many of us really understand how the stock market works? Sure, we nod in agreement when the analyst comes on the six o’clock news and says: ‘Bond prices rose six basis points and the Dow dropped 43 points today on news the September durable goods figures were higher than expected.’ Say what?

If I put my hundred on the table the least they can do is show me the cards to prove whether I won or lost. On a Las Vegas craps table I see the pit boss check the dice. Cameras cut down on cheating. On Wall Street? No pit boss, no cameras, not even some guys named Guido and Tony to take a cheater out in the alley. Two years after some company steals ten billion, the government starts a court case that lasts another 14 years with appeals and at the end of it all, five rich guys lose their trading privileges.

But I digress.

If you want to earn the really big dough in capitalism you get a job in one of those Cadillac Fairview-owned buildings buying and selling numbers, letters and symbols that only exist on a computer screen. They call this working in the financial sector, but is it that much different than gambling?

And even better paid than those doing the buying and selling are the guys who give advice about which numbers, letters and symbols — that only exist on a computer screen — to buy and sell. Best paid of all is the guy who hires all these people and then sits back and lets them do their job. He’s called a hedge fund manager and can pull down a pay cheque of two million per week or more if he’s really, really good at convincing other rich people to let him “invest” their money.

Sure, some of these number pushers are smart and even have a lot of education, but is what they do socially useful? Compared to cleaners or seamstresses or fruit pickers or garbage guys?

They “make” money, that’s all, something that is supremely valued in our current economic system, but which when judged by any sort of authentic human experience is nothing more than fantasy.

It’s as if the world were one gigantic cornfield, but instead of harvesting it for food, we build mazes because they fascinate the people with money. Cornfield owners can earn huge profits if they invest in mazes. Trillions of dollars change hands, with the really big bucks going to the experts who design them and those who help people find their way through the mazes. But the people who grow the cornfields are paid barely enough to live on.

The truth is, the cleaners of Cadillac Fairview buildings — like the people who grow the corn — perform easily identifiable useful work. The same cannot be said for many of the people who work in the buildings.

What does this reality say about our economic system?

Gary Engler

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Russell, the revolution’s name is economic democracy

26 Oct

In the match between comedian and journalist it was a straight sets victory for the funny guy at the Who Makes More Political Sense Grand Slam event near Wimbledon.

Hundreds of thousands have already watched the BBC’s Jeremy Paxman take on Russell Brand in an interview about the need for revolution, a sign that the subject is of more than passing interest.

While it should not be surprising that humour was more effective than earnestness, it was curious to watch how effective Brand’s self-acknowledged ignorance about politics was in scoring political points. Perhaps it was because it made him seem more like the vast majority of ordinary people who know that something is wrong with our economic and political system, but can’t articulate an alternative.

Brand hit an ace when challenged about how he would do things differently and responded by saying what the system shouldn’t do. It “shouldn’t destroy the planet and shouldn’t create massive economic disparity,” he said.

In those ten words he brought together the most important political issues facing humanity today. And they share common roots: Power. Or the lack there of.

Both growing income inequality and the inability to deal with our looming environmental crisis are a result of the concentration of economic and social power in the hands of fewer and fewer people.

In our one dollar, one vote economic system that power inevitably becomes political power. In every system throughout history economic and social power always became political power (then military power).

If left unrestrained, those with more economic, social and political power will use it to get themselves an even larger share of the economic pie, regardless of the effect on the environment or other people.  That’s how the system works.

So, money is power, but it is also a result of power. More money, more power, more money, more power — a virtuous cycle if you are among the wealthiest 1%, but a vicious cycle if you belong to the 99%.

This concentration of power in the hands of the few is the enemy of democracy, which is why so many people are concerned about rising income inequality. But it is also the source of the powerful resistance to dealing with global warming and other looming environmental catastrophes. Oil and coal, for example, make money for powerful people.

Once this reality is understood the question of what to do about the problem of growing income inequality and fixing our environment needs to be reframed as: What can we do to fix the inequality of power?

Answers in the past have included: High taxes on high incomes (up to 90% in many countries); Inheritance taxes on the wealthy; Taxes on all forms of property; Nationalizing sectors of the economy to bring them under “public” control; Encouraging the growth of unions. Most people call this package of policies Keynesianism.

All of these measures do reduce the power of the very rich and have in fact worked well for ordinary people in many countries. Prosperity was the result. The gap between rich and poor shrunk. And capitalism survived, despite protestations of the wealthy and their sycophants.

Capitalists survived so well that they eventually reversed many of these reforms. They demanded and won drastic cuts in their taxes, the privatization of nationalized industries and the destruction of unions. Even in most of the countries that once proclaimed themselves socialist or communist, capitalism has returned. New capitalist classes have emerged. The result has been growing inequality.

Is this return to the past proof that capitalism and inequality are inevitable? Just the way things are? That capitalism is natural or god-ordained? That we like it? That the economic elite is better than the rest of us and deserve what they get? Or is there a better explanation?

These are questions that I would have liked to hear Russell Brand answer. And here is my suggestion for what he should say:

Minority rule is what makes growing inequality inevitable. A system can proclaim itself democratic, but if a minority holds most of the economic and therefore social and political power the result will be the same: The minority will inevitably reward itself, its power will grow and ever-expanding inequality will result.

So we are back to the question of power and how to distribute it equally. The answer is more democracy. Real democracy. Economic democracy. Workplace democracy. Social democracy as it was originally conceived.

We need to experiment to find the best ways to have workers and communities democratically administer the economy, to look after our environment. We need multiple owning communities so that power doesn’t become concentrated in the hands of a central state. We need to eliminate the divide between workers and owners by making everyone an owner. Everyplace where social labour occurs — people working in coordination with others — must be governed by democratic principles. We must get rid of incentives to destroy the planet.

That’s the sort of revolution that I think Russell Brand was talking about.

Gary Engler

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Economic democracy is the solution to global warming

18 Oct

Why are greenhouse gas emissions not being drastically curtailed? As carbon dioxide levels rise, temperatures rise, oceans become more acidic, polar ice caps melt, sea levels rise, the atmosphere absorbs more water. Floods, hurricanes and droughts become more frequent and more destructive.

Science makes it clear that global warming is caused by the burning of fossil fuels—coal, oil, natural gas—and biofuels.

In September 2013 scientists on the UN Intergovernmental Panel on Climate Change released their conclusion: the burning of fossil fuels at current levels will lead to devastating warming within this century. In 2012, the Berkeley Earth Surface Temperature Study reached the same conclusion. This was a surprise since it had been financed by Charles Koch and led by Richard Muller, one of the few reputable scientists who had remained a global warming sceptic. Shortly after the release of the Berkeley study, the U.S. association of meteorologists, who had not taken a position on global warming, announced that they accepted the science.

In the face of the scientific consensus and worsening natural disasters, corporate capitalism responds by investing billions in fracking, tar sands, deep sea petroleum development, and expanding pipelines.

Although some individual capitalists are alarmed by global warming, capitalists as capitalists focus on maximizing profits. In theory, green industry could be just as profitable, but profits are made on existing corporations. In resource extraction, materials processing, agribusiness, manufacturing, international trade, communications, and finance, profits are based on cheap energy from fossil fuels.

Supporters of the system claim that capitalism empowers individuals. Capitalism has actually pushed individual enterprise to the fringes of economies. No more than ten percent of populations are self-employed. In Canada and the U.S. ninety percent depend on wage and salary work. Although capitalism gives individual capitalists title to means of livelihood—title that is bought and sold for private profit—wage and salary workers are actually engaged in cooperative, coordinated social labor.

Corporations, capitalism’s dominant institutions, are minority-owned collectives that dominate markets, monopolize supplies, and control technologies. The twenty largest transnational corporations have more revenues than most governments.

Corporate governance is neither democratic nor egalitarian. Those with the most shares have the most votes. Less than one in four own any corporate shares. Most corporate shares are owned by less than five per cent of populations. Major shareholders and top executives, who combined are less than 0.1 percent of populations, control most corporations.

Under capitalism, the productivity of social labor has substantially increased. Aided by technology and expanding markets, humankind can now deforest entire continents, level mountains, dam major rivers, deplete mineral reserves, and fish sea life to extinction. Meanwhile, private title allows corporations to give priority to profits and to externalize environmental costs, to pass these on to communities, workers, future generations, and other species.

In the 1970s, neo-conservatives like Margaret Thatcher and Ronald Reagan initiated what are now called neo-liberal policies. Taxes paid by corporations and the wealthy were cut. Laws and regulations were changed to make it more difficult for unions to organize and to make gains in collective bargaining. Public utilities and services were privatized. Capital was freed to move abroad in pursuit of cheaper labor, lower taxes and weaker environmental standards. As capitalists got richer, they gained more capacity to dominate political agendas and to manipulate the media and the outcome of elections.

So long as capital-owning minorities are entitled to direct economic and political activity in their private interests, private profit will take precedence over human wellbeing. The alternative is economic democracy. With economic democracy, community ownership would replace corporate ownership. Everyone—wage and salary workers, the self-employed, the unemployed, students, and the retired—would have a right to a voice and equal vote in their communities’ economic decisions. Workplace democracy would replace master-servant relations.

When everyone is equally entitled, communities will focus on meeting human needs, on providing employment and social services, on sustaining and improving the quality of present and future life. Instead of focusing on what is the most profitable, communities—responsible to all equally—would aim to balance employment opportunities with available labor. Public revenues would be balanced with needed social services. Imports would be balanced with exports. Industrial activity would be deliberately limited to the carrying capacity of environments.

Humankind cannot afford to delay action until the system changes. We must act now to cut greenhouse gas emissions. As individuals we can walk instead of driving, live in smaller residences, travel fewer air miles, eat less meat and choose produce grown organically. But so long as capitalists are entitled to direct economies in their private interests, corporations will continue to externalize environmental costs. The corporate media will continue to identify happiness with consuming more. Most employment will continue to depend on capitalist profit.

Isolated individual action has little impact, but human activity does transform the natural environment for good and ill. Capitalists can pass on environmental costs; humankind cannot.

We can begin by acting together to reduce damage to the environment. Some action—far too little—is already being taken to cut dependence on fossil fuels. Cities can be reconfigured so that most people can walk or bike to work, to school, to entertainment and recreation.

Investment in public transit can reduce dependence on private automobiles. With current technology, wind and solar energy could be much more widely used. Geothermal and waste heat networks would further reduce fossil fuel emissions. Governments could speed up development of cheap, safe, plentiful sources of energy. Public investment—freed from nuclear weapons interests—could determine whether breeder reactors would eliminate radioactive waste, and whether thorium reactors would eliminate the danger of meltdowns.

International agreement to raise average tariffs from the current five percent to thirty percent (as in the 1950s and 60s) would increase local production in agriculture and manufacturing, replacing fossil fuels with human energy. The revenues raised would help provide governments with the funds needed to redirect social labor to more sustainable ways of meeting human needs. Substantially increasing taxes on corporations and the highest incomes would further increase public revenues and would have the added benefit of reducing the money available to promote narrow capitalist agendas.

Communities can act now to assert their right to veto damaging industrial activity. Parties and coalitions can be formed to give priority to human wellbeing. Campaigns for electoral reform can make governments more transparent and responsible to general human interest. Expanding social entitlements, the right to food, housing, education, health care, employment and basic income would reduce dependence on capitalist profit.

Al Engler

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Taking responsibility at work requires taking power

15 Oct

Something about the Canucks versus Canadiens hockey game Saturday night has stayed with me, producing a mental itch that won’t go away.

It wasn’t Dan Hamhuis scoring on his own net on a whiffed pass, double ricochet off Roberto Luongo , although that will haunt the Canuck defenceman for the rest of his career.

It was in a break from the action when my TV screen filled with beautiful images of crystal clear streams, healthy salmon and pristine British Columbia back country. A kind and gentle voice praised the incredible environment that Mother Nature has bestowed on this province. One felt a sense of soothing comfort, tinged with pride at having chosen to live in this part of the world.

It was a commercial promoting the proposed Northern Gateway pipeline. An ad for a project that is an essential part of what one could argue is the greatest single environmental threat currently facing the planet.

After the initial shock at the over-the-top doublespeak of using our love for nature to promote a pipeline proposal to transport some of the most carbon intensive oil on the planet, I began to wonder who would sell their soul, along with their creative energy, to create a piece of propaganda that would have amazed George Orwell himself.

Somewhere, a group of artists, or at least reasonably creative women and men, had sat in an office discussing how best to convince a skeptical public (polls have shown well over 60 per cent of B.C. residents opposed) on the merits of building a pipeline from the Alberta tar sands to the west coast.

Imagine these human beings, not much different from you or me, pitching proposals, exchanging ideas and debating the merits of various creative approaches to ignoring climate science, disregarding the likelihood of breaks in any pipeline, discounting the well-reasoned fear of shipping accidents and completely overlooking the opposition of First Nations whose land the pipeline must cross.

“Let’s sell them on a pipeline by showing pretty pictures of nature,” one of them says. “And use a voice that people trust to brand the pipeline as environmentally friendly.”

“That’s it,” says another. “That’s it exactly. It’s the same as selling beer. If we can convince young men that getting drunk makes them more attractive to women, we can easily use people’s love of nature to sell a pipeline.”

“Exploit the very thing that the pipeline will destroy to sell it, that’s hardcore,” says yet another. “Deviously wicked.”

“I love it,” says the client.

And not one of them feels the least bit guilty for helping to destroy the livability of our planet. Why? Because they are just doing their jobs.

So the commercial is written, produced, directed, location scouted, lighted, costumed, filmed, acted in, edited, catered, etc. and not one of the dozens of people making it feel the least bit guilty for contributing to global warming, because after all, they too are just doing their jobs. Likewise the sales rep at the TV station, the traffic person, the director, master control operator and every other worker from Calgary to Fort Mac to Vancouver who take no responsibility — all are also just doing their jobs.

Am I the only one who is bothered by this? “Just doing my job,” sounds eerily similar to “just following orders,” a soldier’s excuse for committing a war crime. Is this where our economic system’s pursuit of ever-greater profits has led us? The sum of our individual actions is creating an environmental disaster but none of us are responsible?

I’m pretty certain most who work in Fort McMurray understand how destructive what they do is to the environment. I feel confident that the vast majority of creative people involved in selling products that are bad for us understand what they are doing. Most may prefer not to think about it, but they do understand. They believe there’s no choice. Acting like you don’t care is simply what it takes to successfully earn a living.

This is the attitude of people who feel powerless. It is the attitude of a soldier who has learned the negative consequences of ever questioning an order.

Our economic system gives the power to decide most things to a small number of people motivated by greed. Most of us must follow orders if we are to succeed. Our ability to choose is confined to decisions like Coke versus Pepsi. We feel powerless because that is our reality.

To take responsibility requires taking power.

This is the mental itch that won’t go away: How do people who feel powerless take power and build a world with a democratic economic system where we collectively decide what to produce and how, rather than let the profit motive decide all?

We better quickly figure out an answer because all the science tells us it will soon be too late.

Gary Engler

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Why would any young person support capitalism?

11 Oct

They say you get more conservative, nostalgic for the past and critical of young people as you age. In my case it’s true, but maybe not in the same way most people expect.

This 60-year-old grandfather’s conservatism is reflected in a growing respect for the institutions, programs and social services that previous generations of ordinary working people built through organizing and struggle. I believe in preserving these institution, programs and social services despite the onslaught of right-wing choppers and cutters who proclaim “progress” when in fact people’s lives are being made worse.

My nostalgia for the past is reflected in fond memories of huge anti-war demonstrations, picket lines packed with people determined to get a good union contract and the feeling of being one among millions who believed another world was possible.

And I do sometimes ask myself what’s up with young people today. Mostly I’m just amazed they’re not out in the streets making a revolution.

I mean, they’ve got a hell of a lot of good reasons. Aside from the ongoing crap —war, the latest empire trying to dominate the world, poor people being screwed, aboriginal people being screwed, racism, sexism, other forms of discrimination — the economic system has put a huge bulls-eye on young people’s backs and the environment is about to collapse.

University and college costs at least six times more than it did when I was young and this at a time when you need a graduate degree just to get an unpaid internship. Youth unemployment is high and rising. And the jobs that are available? Suck-up service jobs. Smile and say, “have a good day,” or you won’t get a tip, if you’re lucky enough to have a job where you get tips. More likely you don’t have any incentive to smile except fear of a pathetic power-deprived supervisor who will ream you out for telling a customer your true feelings.

But let’s say you do get a decent job working for the government or making things in a factory or working in an office, the current economic system says you’re worth less than your parents and you damn sure don’t have a right to a decent pension and benefits. All that stuff is being cut back because the system can’t afford it, or so the people running things say.

A steady job? That’s not how it works anymore. Retire at 65? Sorry no, if you’re under 40 you’ll have to work years longer than your parents to qualify for any sort of pension. And all those good union jobs that people once enjoyed? Forget about it, the system has decided to crush unions. Or in the unlikely event you do find a union job, the new reality is lower wages for new hires.

Since the era of Ronald Reagan and Maggie Thatcher the system has gone out of its way to screw young people. Since the stupid capitalists took power the system says it can no longer afford the wages, benefits, social services and rights that the smart capitalists managed to provide in the 1950s, ’60s and ’70s. (But it can afford war and bailouts for banks.) Ever since the rise of neo-conservatism (also called neoliberalism) in the 1970s the cheerleaders of capitalism on crack have been up front about attacking unions, pensions, public education, healthcare and social services — all stuff that people over 50 got to benefit from, but which young people are told they can’t have.

Then to top off all this shit, people under 40 and their kids are the ones who will really feel the effects of global warming.

So, what’s with a generation that accepts punch after punch and then insults on top of the beating, barely raising a peep in protest? How could anyone under 40 support capitalism? Why aren’t they organizing, striking, picketing and marching?

Sure they have more distractions than we had: video games, the Internet, texting, Tweeting, Facebooking etc, But most of these could be put to good use rabble rousing the revolution, if the dream was there.

Most likely young people are so brainwashed by the system that they simply can’t imagine another world is possible. Consumerism and its evil twin individualism are the most likely culprits. Both have been pushed down the throats of young people the past four decades like bird parents stuff regurgitated food into the beaks of their babies. Buy, buy, buy. Me, me, me. Both these isms lead to ill health, alienation, and social paralysis. Inaction is the result.

And who is responsible for pushing individualism and consumerism? People my age. The me generation. Hippies. The turn on, tune in and drop out crowd. The feel-gooders through substance abuse. Individualism and consumerism were their bag.

Teach Your Children was the name of a famous 1970 song. We did, but now we can only hope that they are wise enough to unlearn much of what they were taught.

Take some advice from a grandfather: Dream of a better world with a democratic economic and social system. A system that lives in harmony with the environment rather than one that wrecks our planet. Get involved to make it happen. Take action, especially collective action. You’ll have the time of your life.

And teach your children well.

Gary Engler

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Capitalism or a healthy environment — time to choose

4 Oct

If all you care about is making more stuff, capitalism may be the best system ever. But if you want to save the planet from environmental catastrophe our current economic system is a dead end.

I remember in my socialist youth often being told: “Your ideas sound good but that’s just not how things work in real life.”

Today, in my socialist sixties, these same words seem appropriate as an analysis of mainstream environmentalism.

Here is the harsh reality:

Capitalists make huge profits from destroying the planet. The capitalist drive to maximize profits explains the externalizing of environmental costs. Capitalism allows small minorities to profit at the expense of others. Private ownership of what are social means of livelihood allows capitalists to make decisions that pass the real costs of industry to communities, workers, future generations and other species.

Worse, capitalism requires constant growth because it always needs more profit. Making ever more profit is what motivates people to make investments. But what happens when the environment needs a smaller human footprint? When, at least in wealthier countries, we must learn to live with much less stuff?

All the evidence shows capitalism is really lousy at dealing with declining markets. Every time the economy shrinks for a sustained period capitalism goes into crisis. Banks crash, unemployment rises and wars are often necessary to get capitalism out of its crisis.

Supporters of capitalism claim the system is based on freedom and choice, but when it comes to the environment for many people this amounts to the freedom to choose between destroying the planet or having a job. The promoters of tar sands, fracking, coal mining and pipelines are explicit about this and in fact go even further. The business pages are full of stories quoting the captains of the carbon-industrial complex telling us what amounts to: “You must choose between economic prosperity and what is good for the environment, because you can’t have both.”

If we continue with capitalism they are correct.

Yes, some so-called environmentalists do look to capitalism for solutions, but that’s like asking the fox to fix the henhouse. You can’t be a serious environmentalist and support capitalism. A sustainable economy is incompatible with a system that constantly demands more profit.

Now that the human population has passed seven billion, it should be obvious that we inhabit a planet of finite resources. But population growth is not the problem. Human energy remains our most precious and underutilized resource. Once basic material needs for food, clothing, housing and healthcare have been met, human wellbeing depends less on consumption than on opportunities for education, employment, social participation and social recognition.

Science leaves little reasonable doubt that the burning of currently known reserves of coal, oil and natural gas will push atmospheric carbon dioxide levels past a tipping point, after which rising global temperatures will irreversibly undermine the conditions on which human life as we know it depends.

Despite the weight of evidence and the urgency of the problem, capitalism rests on the expansion of fossil fuel production and use.

Around the planet trillions of dollars are being spent to develop massive deposits of shale oil and gas. In Canada capitalist investment is focused on expanding oil production from tar sands. The promoters claim that these developments will create jobs. But the funds required to extract and transport that fuel will create far fewer jobs than would be produced if equivalent amounts were spent on the development of solar, wind and geothermal power. Far more jobs could be produced with investments in the production and distribution of local agriculture, clothing, shoes and communications products. More jobs would be created by investments in childcare, elder care, social housing, public transit and other green infrastructure.

But capitalism prefers investments in fossil fuels because corporate profits now largely depend on cheap fuel. Equivalent profits cannot be made meeting actual human needs.

So, we have some important choices to make: Support capitalism or support the environment. Build a different sort of economic system that can prosper in harmony with the environment or fiddle with capitalism as our planet burns.

Gary Engler

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Interview with Gary Engler

18 Sep

In our final installment of the Unifor Interview Series with union leaders, staff, and rank-and-file members, we speak with Gary Engler, Vice-President of Unifor Local 2000, the Media Union of BC. Gary also recently penned two articles at Rabble.ca, “Thoughts on Labour Day” and “Unifor and the potential rebirth of militant union activism.” He recently co-authored “The New Commune-ist Manifesto: Workers of the World It Really Is Time To Unite“.

Listen here.

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The case for much higher taxes on the rich

10 Sep

High government deficits are being used to justify cuts to public employment and social programs. It is not a surprise that transnational finance, the corporate media and right-wing political parties demand that returns on investments be given priority over employment, workers’ income, and the well-being of the marginalized. Having aggressively supported cuts to business and income taxes, they have reason to worry about the real returns on government bonds.

It is also not a surprise that unions and students in Europe have mobilized millions against these cuts. Unions, public sector workers, pensioners, immigrants and the poor are not to blame. Government deficits are a direct result of tax cuts, capitalist speculation, the 2008 financial crash, government bailouts, and the resulting loss of employment, income and government revenues.

If public deficits were the real problem—not just a pretext—military spending particularly in the U.S. would be drastically cut. Taxes would be raised. Of course, tax increases have consequences. Higher sales and value-added taxes reduce consumer purchasing power, further weakening markets in times of recession. Taxes on enterprise revenues can reduce expenditures for plant and equipment and lead to the failure of more businesses.

Steeply graduated income taxes would upset the super-rich but are otherwise benign. Taxing income over $200,000 a year at rates of 75 per cent, and over $500,000 at 90 per cent would substantially increase government revenues without reducing markets for most goods and services. Taxing profits on the buying and selling of stocks, bonds, real estate, and currencies could raise additional revenues. International agreement to raise tariffs to 15 to 25 per cent from the current average of five to ten per cent would raise more. Although the profits of transnational corporations would be squeezed, the resulting growth in local production for local consumption would expand employment, income, and public revenues everywhere.

Increasing taxes on capitalist income is anathema to the supply-side economists who have dominated government policy for thirty years. They claim that increasing taxes on the wealthy reduces the supply of funds available for private investment, causing job loss, reduced real incomes, and economic decline. Supply-side economics was a wealth-holders’ reaction to Keynesian demand-side policies.

The Keynesian period—from World War II through the 1970s—had been a response to destructive twentieth century wars, financial crashes, prolonged economic declines, and rising support for militant unionism, socialism, and communism. To counter growing opposition to capitalism, to stimulate consumer demand and to revive opportunities for profitable investments, governments increased spending on pensions, unemployment insurance, education, healthcare and income support. Laws were changed to make it easier for unions to organize and to bargain collectively.

Much of the cost of stimulating demand was covered by steeply graduated income taxes. In Canada, the U.S., and the U.K. the highest incomes were taxed at marginal rates up to 90 per cent during the war and after. Although lowered in the 1960s, income taxes remained steeply graduated through the 1970s. The share of total income going to capital as profits, dividends, interest payments, and rent did decline. Nonetheless, investments in machinery, equipment, buildings, infrastructure (bridges, roads, schools, hospitals, public transit), and housing stock rose steadily.

By the 1970s many of the very rich and corporate oligarchs had concluded that the welfare state was not in their interests. Unions were in decline. Communism was clearly not outperforming capitalism economically or militarily. At the end of the decade, neoconservatives like Margaret Thatcher and Ronald Reagan were winning political office claiming that Keynesian policies had increased demand at the expense of the supply of capital for investments. The result, they said, was not growth, but inflation and stagnation.

In fact, the Keynesian period was a time of steady, impressive growth in investment and consumer income. Inflation rates did reach double digits in the 1970s. Neoconservatives blamed this on rising social spending and government deficits. A more obvious explanation was the combination of rising oil prices and massive inflows of capital from abroad. Oil prices had risen from under $3 to over $30 a barrel, increasing the price of nearly all goods and services. Suddenly awash in revenues, the rulers of oil exporting countries invested billions in the U.S., U.K, Europe and Canada. Governments that were already cutting taxes paid by the rich and accumulating deficits, responded by borrowing more. U.S. government decisions to finance war in Indochina with borrowed money, not tax increases, compounded the problem.

In the 1980s, after supply-side policies became the economic orthodoxy, taxes on corporations and upper incomes were methodically lowered. Industries were deregulated. Laws were changed to make it more difficult for unions to organize and to engage in effective collective bargaining. Public utilities and services were privatized.

The rich did get richer—the super-rich substantially richer—but economies did not flourish as supply-siders had predicted. The quality of public services declined. Social infrastructure was allowed to decay. Employment in manufacturing and service industries fell. The real income of wage and salary workers stopped growing. Markets for consumer goods stagnated.

Supply-side theorists ignored the evidence. Instead, they turned phrases from Adam Smith into a mantra. More income for capitalists, they intoned, meant more savings, more investment, more economic growth. But Smith was not talking of twentieth century corporate oligarchs when he equated capitalist income with savings and investment. He was describing a middle class of prosperous farmers, shopkeepers, and merchants, whose frugality he contrasted with the aristocracy’s fondness for luxury. The middle class, he said, turned their surplus income into savings for investment in the future; aristocrats spent and borrowed for their current pleasure.

Today’s super-rich are more like eighteenth-century aristocrats than the middle classes of Smith’s day. They are mega and giga-consumers who transform revenues from productive assets and social labour into personal wealth—into mansions, yachts, beachfront condos, and winter retreats. As a class, they are obsessed with maximizing returns on their wealth, but they have little interest in productive investment. For them, innovation means new more profitable investment instruments: futures, derivatives, dubious mortgages packaged as collatoralized debt obligations, and credit default swaps (bankruptcy insurance).
Even when pyramid scams and outright fraud are not involved, nothing is added to means of livelihood when one capitalist buys and another sells stocks. Financial entitlements are merely shuffled from one to another. When the rich do invest in actual plant and equipment this is likely to be abroad where labour is cheaper and profits are higher.

The economic argument

Steeply graduated income taxes would make public debt manageable. Unlike taxes on consumption, taxes on the highest incomes would not dampen markets for consumer goods. Additional public revenues could be used to improve education, healthcare, social housing, income support, public transit. As employment and markets expand, enterprises would be encouraged to invest more.

Undistributed corporate profits are the main source of investment in research, development, plant, and equipment. By discouraging the distribution of profits as dividends, executive salaries, and bonuses, confiscatory tax rates on the highest incomes would give enterprises more reason to retain earnings, increasing the funds available for investment in real means of livelihood.

With far higher taxes on capitalist income, the super-rich will have to make do with less sumptuous homes, fewer and less luxurious automobiles, yachts, and vacation spots. For everyone else, the cost of keeping up with the Joneses will be less. People in all income groups are likely to save more, making more funds available for investment in housing and local enterprises.

The democratic argument

Capitalism claims to be a system of individual opportunities. Increasing the revenues for education, healthcare, pensions, and income-support would expand opportunities. Steeply graduated income taxes would transfer control of social surpluses from a corporate oligarchy to elected national, regional, and local governments.

Can governments and elected representatives be trusted to act in the common interest? With steeply graduated income tax, a small self-serving minority would have less money to influence legislation and corrupt politicians. Billionaires, like the Koch brothers—two of the wealthiest men in the U.S. who have bankrolled the U.S. Tea Party—would have less spare cash to dominate and manipulate political agendas in their narrow class interests.

Steeply graduated income taxes alone would not end capitalist entitlement, but as elected governments gain more revenues to expand social entitlements and public employment, people will demand to have a voice in economic decisions. The right of wealth-holding minorities to impose their immediate interests will be replaced with the transparent, democratic right of people to direct economic life in the common interest, in the interests of human and environmental well-being.

The environmental argument

The wealthiest one per cent presently claim twenty per cent and more of total income. If their share were reduced to five per cent, extravagant consumption and the accompanying waste of resources would be greatly reduced.

Governments would have the funds needed to replace dependence on private automobiles with fast, accessible public transportation. Federal, regional, and local governments could be provided with the funds to construct public heating and cooling systems that require less fossil fuels. Investments could be made in local agriculture for local markets. Environmental protection agencies could employ enough inspectors to investigate complaints and to act against corporate damage to ecosystems.

As control of social surpluses passes from the hands of wealth-holding minorities to elected governments, people will mobilize to demand that national, regional, and local communities provide more employment and goods and services as human rights. Fewer people will come to depend on the profitability of capital in general and of transnational corporations in particular. More people will be free to oppose environmentally destructive industrial activity.

As communities replace private corporations as the institutions making economic decisions, industrial and service workers, professionals, the retired, homemakers, students, farmers, mushroom pickers, loggers, and ecologists will all have the right to a voice and equal vote. The interests of major shareholders and top corporate executives will no longer take precedence over the income and employment of common people, or over the carrying capacity of environments.

Al Engler

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What free market? A review

3 Sep

The University of Chicago has long been the center of opposition to government economic intervention and support for the claim that free markets best serve general interests. It is a surprise to find Bernard E. Harcourt—professor of law and political science at the University of Chicago—challenging neo-conservative market extremism.

In The Illusion of Free Markets: Punishment and the Myth of Natural Order, Harcourt holds that markets will be regulated by governments or by the rich on behalf of themselves.  Few markets are actually unregulated. He goes on to make the case that markets directed by dominant players in their private interest result not in greater freedom but in heavier repression.

Harcourt begins by examining the Chicago Board of Trade and the New York Stock Exchange. These exchanges are widely viewed as epitomes of the free market, but they are actually self-regulated private monopolies protected by legislation. Their rules are made by member firms and policed by internal committees that determine the methods and time of trading as well as who may participate. As should be expected, the rules favor those who make them.

The Chicago Board of Trade forbids outsiders from engaging in after-hours trading.  However, the insiders who control the Board, when they agree among themselves, can modify the rules, giving themselves opportunities for exceptionally profitable trades. The Chicago Board of Trade and the New York Stock Exchange allow brokerage firms to restrict retail buyers (outsiders) from reselling for periods of thirty to ninety days. “But the same brokerage firms may allow large institutions to dump their stock in the after-market at any time.”  In New York, “members of the stock exchange may get together and fix the commission rates on stock transactions of less than $500,000,” but they can “freely negotiate commissions for larger stock transactions”—which they dominate.

In Chicago, when parties are in dispute, the Board’s Office of Investigation and Audits may investigate. Where its decisions are challenged, the Commodity Futures Trading Commission may get involved. If disputes are unresolved, the U.S. Attorney’s office can initiate civil or criminal actions. The point is that these “free markets” are minutely regulated, first by the dominant insiders and then by civil and criminal law.

Stock exchanges are not exceptions. Markets from the local to the global are dominated by firms with the largest market share, who typically have privileged access to supplies, technologies, marketing networks, and credit.

It is no revelation to point out that when a few are allowed to make the rules, they will direct markets in their own interests. Nonetheless, in mainstream opinion it is now taken for granted that markets regulated by dominant players are preferable to government regulation. This was not always so.

Before the rise of industrial capitalism, industries were self-regulated—by Guilds that were usually dominated by wealthy merchants. Seeing this, political thinkers from the Scholastics to the Enlightenment generally held that governments had a responsibility to intervene to curb speculation, price gouging, and hoarding, to keep the prices of necessities low, to police the quality of goods and services, and to maintain public hygiene.

Mainstream economists now teach that support for free markets can be traced back to Adam Smith in the late eighteenth century and Jeremy Bentham in the early nineteenth. Harcourt notes that Smith and Bentham did view self-interest in the market as generally beneficial, but he points out both also wrote of circumstances in which government intervention was clearly required to curb the self-interested power of great merchants and masters.

Harcourt also questions the prevailing view that the late nineteenth century was a time of laissez faire policies.  While industrial production did expand dramatically, governments played critical roles in the accumulation of capitalist wealth. To expand their countries’ shares of global trade, governments organized and financed shipyards and railway construction. They spent lavishly on navies and armies and colonial wars. Each empire restricted access to captive markets through imperial preferences and tariff walls.

However, the claim that control of markets should be left to the rich has an historical precedent.  Harcourt draws our attention to France before the 1789 revolution and the Physiocrats—so called because they advocated rule by natural laws. Most economic histories now dismiss Physiocrats  for having insisted that land alone is the source of exchange value. In France in their time, that was not so controversial: land still was the main source of great wealth. In their time, what distinguished the Physiocrats was the claim that private property and unregulated markets were in accord with laws of nature and that the role of government was to vigorously repress criminal acts against this natural order.

Physiocrats held that absolute monarchy, by placing government in the hands of the largest landowners, was the natural form of government. Leading Physiocrats—Francois Quesnay, Samuel Du Pont de Nemours, and Le Mercier de la Riviere—were prominent in the Court of Louis XV. For them it was natural to oppose government restriction on profit-making. They likewise viewed it as natural to advocate repressive policing and onerous penalties for thieves, the idle, the disorderly and anyone else who could interfere with their natural order. Le Mercier, as governor of Martinique—then one of the wealthiest French slave colonies—gained notoriety for his heavy-handed policing which even plantation owners came to believe was provoking disorder among the slave population.

Although slavery, landed aristocracies, and absolute monarchies have largely passed into history, the ideology of natural order, freedom for the rich and powerful, and repression for the dispossessed and disaffected still resonates with the very rich and their supporters. That is at the root of the current neo-conservative reaction.

Beginning in the 1940s, University of Chicago economists Milton Friedman and Friedrich Hayek, began campaigning to replace liberal-social democratic welfare state policies with old ruling class verities. By the 1970s, they had a powerful constituency: the super-rich.  Long hostile to Keynesian policies, and frustrated that domestic profit-making opportunities were decreasing, the wealthy heirs of great family fortunes were smitten by arguments that economic rewards and decisions are best left to the very rich.  By the early 1980s, the policies promoted by Chicago School economists and generously financed by corporations and the foundations of wealthy families were adopted by the newly elected conservative governments of Margaret Thatcher in the U.K., Ronald Reagan in the U.S., and Brian Mulroney in Canada.

By the late 1980s a Washington Consensus called for the deregulation of markets, cuts to the taxes paid by corporations and the wealthy, privatization of public utilities and cuts to social services. Although some of the advocates of unregulated markets call themselves libertarians, the widening disparities that followed anti-Keynesian policies were accompanied by more repressive state power.

Freeing the rich to do as they choose in the markets they dominate, obviously allows them to appropriate more of total income. Among the masses, some may benefit from a trickle down. Of those who are left with less income and employment, some will find comfort in knowing that at least a few have gained more wealth than they can imagine. Others will go on strike, organize boycotts, or participate in unauthorized protests.  A few will engage in petty criminality. In countries that have been impoverished, some may lash out with any weapons available. In response or in anticipation, the privileged will demand more aggressive policing, more onerous criminal sanctions and more punitive military actions abroad.

Neo-conservatives view repressive violence as a required response to domestic and international criminality. Harcourt makes the case that crime rates are actually related to entitlements, employment opportunities, and income disparities. For him, this is not purely academic. Earlier in his career, he had practiced law in Birmingham, Alabama, representing prisoners facing capital punishment. He continues to act pro bono as an attorney for prisoners on death row. In his 2001 book, The Illusion of Order: The False Promise of Broken-windows Policing, Harcourt had made the case that more aggressive policing had no significant impact on crime rates in New York.  These, however, are closely related to changing social conditions.

Al Engler

The Illusion of Free Markets
Punishment and the Myth of Natural Order
By Bernard E. Harcourt
Publisher: Harvard University Press, 2011
Paperback, 328 pages
ISBN-10: 0674057260
ISBN-13: 978-0674057265

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We need to demand more than simply more

2 Sep

Why is there so much attention paid to people as consumers, but so little to people as workers?

Is it because the mere mention of our rights as workers brings up all kinds of uncomfortable truths that threaten the very ideological foundations of the current economic system?

As we celebrate Labour Day these are important questions to ponder.

The vast majority of us are wageworkers. Wages are our primary source of income. Or we collect a pension because we and/or our spouse were once workers. Or we are dependents of workers.

In fact a huge proportion of the money spent by consumers in our economy comes directly or indirectly from our wages as workers.

Despite this obvious reality, while the media is jam-packed with material about consumer rights, consumer choice, ads claiming the best price for consumers, stories about politicians claiming “to do what’s best for consumers” and much more focused on consumption, there is almost nothing about work or workers’ rights. Typically what little there is concerns strikes or other “disruptions” to the economy. It’s as if workers are just cogs in a giant machine, only worth discussing when a breakdown occurs. There’s certainly no money to be made promoting workers’ rights; in fact we are seen primarily as a cost that reduces profit.

Yes, there is some lip service given to workers as a resource; words to the effect that “we’re all in this together” might be spoken, but real examples of workplace democracy are few and very far between. If workers were truly valued as people “all in this together” wouldn’t there be at least some semblance of democracy at work?

Instead, under our current economic system, the master-servant relationship is the legal framework that dominates workplaces.

Reality for most workers, which means most people, is a fundamental lack of respect at work. That’s why “the system” prefers to focus on us as consumers rather than as workers.

So what, one might ask? What’s the big deal if we must give up being treated as an equal human being at work, so long as we are well paid? The object of work is to make enough money so that we can consume what we want and enjoy the good life, nothing more.

Aside from the fact many of us are not well paid, the answer to the question “so what?” is that work is an essential element of human identity. When asked at a party, “what do you do?” not many of us answer: “I shop.” And if we did, what would that say about us?

What we do — work — is what defines us, what makes us human. We want a job that is a source of lasting satisfaction, not simply consumption. When the system does not provide that sense of satisfaction at work alienation is the result. This leads to stress, addictions and other forms of ill health.

Even some unions become complicit in this alienation, focusing exclusively on getting more money, which is another way of agreeing with right wing supporters of the existing system that its members are just consumers.

These right wingers want us to only care about more money. They want us to consume more. Smart capitalists are Keynesians. They want workers to demand more and to spend more. But we’ve reached the limit of Keynesianism in two senses: Capitalists have abandoned it en masse so appeals for them to return to some golden era of Keynes is a pathetic dead end. And even if the capitalists were willing to give us more, more has become an environmental dead end.

Instead workers and their unions must learn to dream bigger.

We must learn to demand more than simply more.

Gary Engler

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New union offers promise of new direction

28 Aug

This Labour Day weekend promises to be an exciting time for the Canadian union movement and perhaps a spark for workers around the world.

The Canadian Auto Workers (CAW) and the Communication, Energy and Paperworkers (CEP) are merging to create Unifor, the largest primarily private sector union in Canada with about 300,000 members.

The new union offers the potential of something great for the future of unions and the Left. Many good things will happen if Unifor fulfills the promise of its new constitution. For example, Article 2 — 10 states: “Our goal is transformative. To reassert common interest over private interest. Our goal is to change our workplaces and our world. Our vision is compelling. It is to fundamentally change the economy, with equality and social justice, restore and strengthen our democracy and achieve an environmentally sustainable future. This is the basis of social unionism — a strong and progressive union culture and a commitment to work in common cause with other progressives in Canada and around the world.”

A union that is militant, outward looking, engaged politically and willing to work with progressive people outside the labour movement is exactly what we need to motivate a new generation of activists. The future of unions depends on harnessing the energy, enthusiasm and political sensibility of young people in and about to enter the workforce. To accomplish that unions must be involved with community struggles, seen to be battling injustice and willing to work with anyone who shares our common causes.

I remember being a student at the University of British Columbia in 1972 and walking my first picket line during a SORWUC (Canada’s first feminist union) strike at a Denny’s on Broadway St. in Vancouver. Walking the line was a way of showing support for women’s rights in general, as well as helping the few dozen people actually on strike. And it set in motion decades of further involvement in the union movement.

Unifor’s new constitution has many progressive features. It requires gender equality on the national executive. It commits 10 per cent of national dues to organizing. It calls for “community chapters” that “can help build strong communities and enhance our collective strength in the struggle for social and economic justice by opening our Union to workers who currently have no access to union membership, because they have no collective agreement, or job, or hold temporary contract or other precarious employment.”

The potential for building community chapters that attract a wide spectrum of activists is immense. Common cause could be made with environmentalists, students, open media supporters and many other potential allies, as well as workers in sectors that have so far proven extremely difficult to organize. Someone first attracted to Unifor through a community chapter could one day become a skilled union organizer. The support of community activists who have worked with one of our community chapters could be key to winning a particular strike.

Enemies of unions like to portray us, and our members, as self-interested, greedy and out to get more than our fair share. Of course this is ridiculous coming from supporters of an economic system that glorifies greed, but unfortunately this is exactly what some people believe about unions.

Unifor, through its political action and community chapters, could demonstrate that unions are an essential element of a progressive democracy. The new union has the potential to help build a better society while at the same time building a stronger union.

Of course, as in all unions that exist in an economic system where we are bombarded with messages glorifying individual rights and individual greed, some delegates to the founding convention of Unifor may resist social unionism. Some may argue against broadening the union’s reach through community chapters. Some may want the union to limit itself to simply looking after existing members. But that road is a dead end. History has proven that is a recipe for shrinking membership and ultimate irrelevancy.

The promise of Unifor is in a rebirth of militant union activism. That’s what this delegate is going to the convention to vote for.

Gary Engler

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Rant: Sense, cents and sensibility

27 Aug

It makes no sense we blow billions buying bombs or bailing out banks, but can’t afford to end world hunger. It makes no sense we pay to see a movie and then are forced to sit through commercials before it starts.

“It makes no sense.” I’m using these words more and more often.

The tyranny of idiot capitalism has become so ridiculous that it must be a sign the system is in crisis. The outrageous lies and distortions told to defend it have got to mean capitalism is finally obfuscating on thin ice.

At a minimum, please tell me other people have noticed the same absurdities that make me feel like smacking every sycophantic shill for the ruling class across the side of the head and screaming: “You’ve got to be kidding me! This is the best system possible? This is the height of human achievement? What do you take us for? Utterly brainwashed fools?” (And then I think it takes one to know one.)

Capitalism means freedom. Really? For the ever-greater proportion of people working in precarious part-time jobs paying peanuts? For the 70-year olds behind counters selling Big Macs or greeting Wal-Mart shoppers? For the tens of millions who have had their pensions chopped? For the garment workers toiling in life-threatening conditions in Bangladesh or Haiti or Honduras to earn $5 per day? For the millions of suburbanites who spend a quarter of their income and their waking hours on and in the vehicle that takes them to their shitty job? For the tens of thousands who have been recently bombed into “our way of life” by the greatest or one of the lesser capitalist powers? For the generations to come who will face climate change caused by profits earned spewing ever more carbon into the atmosphere?

Don’t interfere with the free market. You mean the same “free” market that has destroyed millions of good working class (what the scared-of-the-socialist-bogeyman Americans call “middle class”) jobs in order to enable a few dozen multi-millionaires to become billionaires? The market that had to be saved by bailouts to the very companies that caused its crisis, but which can’t afford good free public education for all? The market that gives us ever more processed food made from genetically modified plants fed to animals that graze in slashed-and-burned rainforests then shipped ten thousand miles but can’t provide nutritious meals of locally grown real food for every child on the planet? The market that is so efficient it requires hundred of billions of dollars to be spent on advertising to convince us to buy its products? The market that gives us plenty of $80,000 cars and $10,000 watches but can’t give billions proper sewage and water systems? The market that enforces patents owned by huge corporations, instead of the right for all to access affordable life-saving medicines? A market free from government controls, which when you really think about it means a market whose rules are made by and for the rich instead of through democratic decision-making?

Yes, we live in an absurd world. A world all about making cents, not sense.

The apostles of greed claim competition and choice are the only rights worth fighting for, as if we are all only consumers. But the vast majority of us are workers too. What about our rights at work? They are ignored, trampled upon and denied because that is what the “free” market requires.

Yes, we live in an absurd world but it can’t possibly get any worse. Can it?

It will, if we don’t fight back.

It can and it will get worse unless millions of people join together behind a common vision of an alternative to this system of one dollar, one vote called capitalism.

Once upon a time we did have a vision of an alternative economic and social system. Once upon a time a movement of hundreds of millions of ordinary people with that vision was created to build a better world and it was successful in many places, winning the universal franchise, public education, the 8-hour day, pensions, health and safety legislation, public health programs, daycare, laws against discrimination and more. Pretty much every reform that was listed in the Communist Manifesto 165 years ago.

But the unions and political parties that came out of that movement never won the most important thing: equality of power, the right of everyone to participate in running both our economic and political system. It never fought for and won something best described as economic democracy.
It left power in the hands of tiny minorities who ultimately run the world in their self-interest. And now these self-serving minorities are rolling back the reforms our mothers and fathers struggled so long and hard to win.

Yes we live in an absurd world. And it will get worse unless we come together to change it. It’s time we showed some collective sensibility.

 Ernie Peshkov-Chow

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Capitalism versus economic democracy

26 Aug

Capitalism is a system that gives major shareholders and top corporate executives—one per cent or less of populations—the right to direct means of livelihood in their private interests. The system’s dominant institutions are corporations. Deemed in law to be individual persons, corporations actually combine the capital of numerous shareholders with the intention of dominating markets.

Corporations are privately owned capitalist collectives. The largest control more revenues than most governments.  To maximize profits, corporations expand production and introduce labour saving machinery, cut wages, and move employment to places where labour is cheaper. A recurring result is that the income of majorities who depend on labour falls as production increases. With declining markets for consumer goods, capitalist investment turns to financial speculation. Market crashes follow. Production facilities are shut down. Unemployment worsens, more jobs are lost, wages are cut further. Individual lives are disrupted. Communities are impoverished.

To deal with disaffection, the system relies on repression, militarism, and war. Within countries, surveillance is expanded and tightened. The marginalized, the dispossessed, and the disorderly are racialized and demonized as criminals. More people are jailed for longer periods. Globally, people who actively oppose the system are demonized as terrorists; countries are bombed and occupied. Wars are highly profitable for well connected corporations and divert attention from domestic divisions. Wars also glorify the violent machismo that encourages the subjugation, abuse, and marginalization of women.

Military intervention in Iraq, Afghanistan, and Libya increased sales of B-52s, guided missiles, helicopter attack ships, aircraft carriers, and drones. In the invaded countries, life was made worse. Power and water plants, bridges, railways, communications systems, schools, neighborhoods and entire towns were destroyed. Tens of thousands have been killed. Millions have become refugees. Invading countries gain no tangible benefits, but for politically influential aircraft and munitions corporations like Raytheon, Lockheed Martin, and Boeing profits did rise substantially.

Supporters of military action abroad claim it is humanitarian intervention. In Haiti the aim of “the responsibility to protect” was to make the poorest people in the western hemisphere so desperate that they would work for even less. In 2004, the U.S., France, and Canada sent troops to remove Jean Bertrand Aristide, the elected and widely popular President. Haiti was occupied in the name of the UN Security Council. Haitian government and municipal institutions were dismantled. Public workers lost their employment. The minimum wage law was abolished; so was public transit. Education was turned over to foreign aid organizations. With no functioning public institutions, Haitians were left with no means to protect themselves from hurricanes or to rebuild after major earthquakes.

Capitalism is at the root of growing environmental crises. Private capitalist entitlement allows corporations to externalize environmental costs, to pass these on to communities, workers, future generations, and other species. Science has convincingly demonstrated that rising carbon dioxide emissions from the burning of fossil fuels disrupt weather patterns, melt glaciers and polar ice caps, and acidify oceans. Still, major transnational corporations continue to fund campaigns of denial.

When the supporters of capitalism concede the seriousness of carbon emissions, they propose profit-making schemes (scams) like cap and trade, or they insist that consumers are to blame and should pay. Here in BC, corporate business supported the Campbell government’s carbon tax—paid by final users of gasoline and heating oil. This ostensibly green policy fits neatly with neoconservative plans to shift the tax burden from business to working people. Meanwhile, the government increased tax-breaks and write-offs for oil and gas exploration and development.

In capitalist rhetoric, unions, public sector workers, and local communities are reactionary vested interests, opposed to change. From a human perspective, capitalists are the most socially and environmentally destructive vested interest. They shamelessly use their wealth and political influence to increase their wealth by impoverishing others and blocking changes that undermine the profits made from fossil-fueled production and trade.

The working-class alternative

The working class—everyone who depends on labour not capital for their income—has the capacity to challenge the right of capitalists to direct social labour for their private profit. The working class includes wage and salary workers and the self-employed—shopkeepers, owner operators, farmers, and self-employed professionals, all whom depend on income from their labour. Those without capitalist entitlements also include most artists, artisans, full time parents, pensioners, students, the unemployed, and those unable to work.

Being the overwhelming majority—everyone but the one per cent, 0.1 percent or 5 percent who control and live off capital—the working class frees itself only by freeing all. So long as some are exploited and oppressed, the wellbeing of everyone who depends on income from labor is threatened. A world of human equality requires the replacing of capitalist title with human entitlement, corporate ownership with social ownership, and master-servant relations with workplace democracy.

With equal human entitlement, residents of owning communities will replace shareholders as the legal beneficiaries of means of livelihood. Social labour will be motivated and directed not for private profit but for general wellbeing. When all inhabitants including people whose livelihood depends on tourism and organic agriculture, berry and mushroom pickers, scientists, educators, parents, and students as well as manufacturing and resource workers have a voice and equal vote in economic decisions, communities will limit industrial activity to the carrying capacity of environments.

With social ownership means of livelihood will no longer be bought and sold for private gain. Social ownership must be distinguished from state ownership. State ownership as it exists continues the top-down command structures of corporate capitalism.  Social ownership means ownership by towns, neighborhoods, cities, regions, nations, and perhaps international communities. Social ownership means democratic and transparent planning by inhabitants for their wellbeing.

With workplace democracy workers in all occupations—machine operators, clerical workers, trades people, administrators, professionals—will have a voice and equal vote in the direction of their labour time. All occupations will be self-regulated professions. Assembly line workers will have a voice and vote in the direction of assembly-line work. Skilled trades people, clerical workers, engineers, and administrators will democratically direct their labour time. General assemblies of workers in all occupations may elect managers; owning communities will elect or appoint auditors and perhaps the directors of enterprise boards.

When capitalism is replaced with economic democracy, social labour and economies will no longer be directed in the interests of capitalist profit. When everyone is equally entitled to participate in economic decisions, communities will aim to provide acceptable employment opportunities for all available labour. No longer pressed to give priority to private profit, communities will be freed to balance industrial activity with the carrying capacity of environments.  The financial costs of social services will be balanced with revenues generated in exchange. The cost of needed imports will be balanced with exports.

Capitalism is based on market exchange, but capitalism should not be confused with the latter. Markets flourished long before capitalism. Ending capitalism does not mean abolishing market exchange. The working class has an obvious interest in democratic control of means of livelihood and labour time.  Majorities have an equally obvious interest in expanding social entitlements—employment at decent wages, education, food, housing, health care, child care,  leisure. However, people who depend on wages and salaries cannot reasonably be expected to support the abolition of market exchange. Half and more of working people are employed in the production and distribution of goods and services for exchange.

The right of individuals and communities to freely exchange goods and services with others—subject to democratically agreed taxes and regulations—is and will remain a basic human right. The widest practical access to supplies and markets is a major source of material wellbeing. Perhaps when capitalist entitlement has become a distant memory, exchange values and market forces will be anachronisms. Until then, communities from the local to the international will aim to base trade on the exchange of equivalents in labour time.

Three twentieth century dogmas have obscured the working-class alternative. The first narrowly defined the working class as blue-collar industrial workers. The second held that the alternative to competitive capitalism is centralized state control. The third is that ending capitalism requires armed revolution to seize state power.

Factory workers have a vital role in production and in mass movements against the system, but production workers alone do not provide an alternative to capitalism. The working class is far broader. It includes blue collar, pink collar and white collar wage and salary workers—service providers, skilled trades people, clerical workers, and professionals as well as assembly line workers. When the self-employed are included, the class of people without capitalist entitlement unquestionably does everything necessary to initiate, plan, produce, transport, distribute, and sustain the production of goods and services required for human wellbeing.

In the twentieth century, top-down centralized state control was generally viewed as the alternative. The collapse of the Soviet Union and China’s adoption of capitalist policies, did embolden corporate oligarchies. From a working-class perspective the demise of what was called actually existing socialism was not entirely negative. We no longer have to answer for external alternatives that divide people. We can look for the alternative within, in the working class, in the collective capacities and human aspirations of overwhelming majorities everywhere.

The twentieth century identification of fundamental social change with armed revolution did not inspire working-class opposition to capitalism. Violence and disorder damage immediate and long-term working-class interests, undermining employment, democracy, and human rights. Young men are maimed and killed. Women and children are victimized, terrorized, and killed.  An anti-capitalist working class will look not to armed struggle but to strategies and tactics that rely on the energy, spirit, and knowledge of men and women, on workplace organization, political action, and community mobilizations

Extremists among wealth-holding minorities may initiate or provoke violence to protect and advance their privileges. While people have an inherent human right to defend themselves and their interests, the working-class response is to look to mass support and to winning soldiers and police—who are themselves wage and salary workers—to the side of working-class majorities. Venezuela, Bolivia, Egypt, and Tunisia provide recent evidence that police, soldiers and officers can be won to the side of majorities.

From gross production to human wellbeing

So long as capitalism is unopposed, the working class appears dependent on capital, but it is capital that depends on labour. Capitalists as capitalists are drones; their function is to appropriate values produced by others. Every activity required for human wellbeing is now done by the working class—including the self-employed, as well as wage and salary workers. What the working class lacks is the understanding that capitalism is a house of paper entitlements that rests on the acquiescence of majorities.

Ideally, people who depend on labour for their livelihood would overwhelmingly refuse to accept rule by, and in, the narrow interests of a wealthy minority. Everyone would continue doing the work they now do, but instead of submitting to master-servant relations, people in all occupations—production, transportation, distribution, and sales people, professionals, managers, day care workers, service providers, teachers, accountants, nurses, and doctors—would democratically direct their labour time. Instead of working for the profit of shareholders, they would work in the interests of their communities.

Realistically, so long as capital is dominant substantial numbers will believe that their relative wellbeing and status depend on capitalism. Many will ignore capitalist privilege and see the enemy as the state, big government, foreign countries, unions, the poor, minorities, immigrants, liberals, Ivy League elites, feminists, older white men, communists, anarchists, criminals, Jews, Christians, Muslims, Hindus.

Seeing human equality, cooperation, and democracy as a realistic alternative will encourage the disaffected to look to human solidarity, to respect diversity and each other. It will deepen opposition to a system that gives the interests of wealthy minorities priority over human and environmental wellbeing. It will encourage community mobilizations, workplace organization, and political action for gains and reforms that weaken capitalist title and strengthen human entitlement. As such gains are made, more men and women will be inspired to mobilize against the system.

In the second half of the twentieth century, a time of virulent anti-communism, Keynesian reforms that improved living conditions did dampen opposition to capitalism.  When motivated by visions of economic democracy, movements for reforms that improve the quality of life can convince more people that opposition to capitalism is practical.

The exact issues that will inspire mass mobilization against the system cannot be predicted. We can start by campaigning for steeply graduated income taxes. Rates of 75 per cent or higher on incomes over $250,000 a year could increase government revenues by an equivalent of five per cent or more of gross national income. The revenues raised would eliminate government deficits and provide needed funding for social services, health care, education, public transit, and renewal of needed public infrastructure.  Higher wealth and inheritance taxes can be similarly beneficial. Tobin taxes on financial transactions and the re-regulation of international currency and interest rates would reduce the negative impact of financial speculation and raise more public revenues. Increasing tariffs enough to encourage domestic production would further increase government revenues and weaken the power of transnational capital over markets.

Supporters of the system claim that attempts to increase taxes on the rich inevitably backfire because capital will move elsewhere. In fact, capitalists invest where it is profitable. Capital does move in response to marginal changes in profitability, but wherever we are, we are not alone. Raising taxes on capital can inspire similar movements elsewhere, potentially limiting the threat of capital flight and weakening the power of capital to play regions and countries against others for their private benefit.

Public ownership of banks would direct savings away from speculative manias to socially useful investments. Reversing privatizations, renewing public ownership of utilities, transportation and communications systems, and natural resources could methodically weaken the power of capital and strengthen democratic control of means of livelihood.  Reforming political campaign finance rules, lobbying regulations, electoral laws would reduce the control capital now has over political agendas.

Local communities can take initiatives to set up cooperatives and community owned financial institutions, social housing, electrical power and communications utilities. Public support for local food production can make people less dependent on the vagaries of capitalist markets.  Environmental action can help ensure a better human future. Local, national, and international mobilizations can help reduce dependence on fossil fuel and replace automobiles with public transit and bicycles. Cities can be reconfigured so that walking once again is a pleasant, healthy mode of daily transportation.

Community and workplace mobilizations in solidarity with First Nations, racialized minorities, the marginalized, women, and immigrants will build human bonds and help expose the mean-spirited divisiveness of wealth-holders’ privilege. Support for policies that are intended to reduce disparities increase global human cooperation. These include the right of people to democratically direct their domestic markets as well as international funding with no strings attached for education, housing, health care, and infrastructure. Development should be directed not by foreign agencies but people themselves. The aim is to help provide people with capacity to help themselves.

The capacity of capitalists to use violence against working-class gains can be reduced. Vocally supporting the work police do in protecting persons and property, while exposing covert politically motivated policing, demanding public accountability of the criminal justice system, and mobilizing against police assaults on opponents of the system can help win police to the side of the people. Supporting soldiers in the sacrifices they make while opposing militarism and war can expose capitalist profiteering at the expense of soldiers as well as of people abroad.

Unions will have critical roles in movements against capitalism. Workers not represented by unions have no means to formulate their workplace interests independent of capitalists.  Unions were organizing centres of campaigns for freedom of assembly, association, speech, and the press, as well as the right to vote for men and women. Unions are largely responsible for the wages and working conditions that allow capitalism to claim it provides rising living standards. Now in a time when capitalist interests are eroding collective bargaining rights, unions have been preoccupied with conserving past gains. Still unions have provided critical support for First Nations, racialized minorities, women, gays and lesbians, and immigrants.

Revived opposition to capitalism may begin with the unemployed, marginalized, dispossessed minorities, immigrants, or students. Wherever it begins, rising opposition to capitalism will encourage workers already organized for collective bargaining to join in solidarity. As opposition to capitalism grows, more wage and salary workers will demand collective bargaining rights. Revived unionism will convince more people that a working-class alternative is practical.

Mass protests over the past few years in Brazil, Egypt, Tunisia, Wisconsin, Greece, and Israel show that people will rally against repression, privatizations, public sector layoffs, cuts to social programs, rising food costs and the high cost of for-profit housing.  Immediate results may be disappointing, but as people come to see that they are not alone in opposition to a system directed by and for super-wealthy minorities, mass protests can turn into general strikes and workplace occupations as well as into electoral gains for democracy and equality.

Al Engler

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