Category Archives: Articles

Do We Really Need a Billionaire Class? Gar Alperovitz on inequality and excess

Too Much LogoThe Institute for Policy Studies’ publication Too Much focuses on inequality and excess. In this interview originally published on February 21, 2016, Too Much editor Sam Pizzigati speaks with Democracy Collaborative co-founder and Next System Project co-chair Gar Alperovitz about his “long-haul perspective on how we can go about shearing inequality down to democratic size:”

Too Much: You see capital — who gets to own it, to benefit from it, and derive political power from it — as a key to both understanding and ending our staggering levels of contemporary. What do you mean by capital?

Alperovitz: In the formulation I use, capital amounts simply to wealth ownership of any kind, ownership that can be translated into power. You can sell it to get income. You can hire people with it. It’s another word for wealth ownership.

Too Much: We’ve become so unequal, you’ve also noted, that we’ll never become significantly more equal unless we have a fundamental shift in who controls capital, in who owns wealth. A shift to what?

Alperovitz: Wealth brings power, political power, institutional power. Wealth on its own gives people the capacity, as a friend of mine likes to say, to “rent” politicians and control the political process. Wealth gives the wealthy access — access to political levers that alter the way the economy works.

Wealth gives the wealthy the capacity to ‘rent’ politicians and control the political process.

In all the advanced countries, labor organizations used to provide a counterbalance to this wealth. On the shop floor and in the political system, unions directly challenged capital on wages and the distribution of income.

But in the United States we’ve always had a much weaker labor movement than most other advanced capitalist nations, and today our labor counterweight is disappearing. Increasingly, we have no institutional counter to the political power of capital.

Many activists today think that building a movement will solve this problem. We obviously need a movement. But at the heart of the movement that helped make America more equal in the middle of the 20th century, we also had an institution, labor unions.

Unless you can build both institutions and a political movement, you won’t have the power and wherewithal to really challenge capital.

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Wall Street Journal embracing the democratization of wealth?

Just three years ago, I worked with the staff here at the Democracy Collaborative to write this article, which made a very basic point about the way systemic solutions to economic inequality were treated by the business paper of record, the Wall Street Journal.  As you can see, business structures that directly democratized ownership of the economy received short shrift:

But three years later, as the crisis of inequality continues to deepen—and after Piketty and Corbyn and Sanders and Pope Francis—the WSJ seems to have changed its tune.  The system question—that is, the question of how the ownership of capital should be structured in society that purports to be a democracy—is clearly on the table in a remarkable long essay published this past Saturday, written by the authorized biographer of Margaret Thatcher.

The piece begins with the simple imperative: “If Western countries want to disprove the dire forecasts of Karl Marx, we must think creatively about how to make the middle class more prosperous and secure.“

Let that sink in for a minute. The threat, according to this featured piece in the Wall Street Journal, is not just Marxists and their ideas, but the possibility that they might be right about capitalism after all. The author strikes the same note in his conclusion:

 […] Marx did have an insight about the disproportionate power of the ownership of capital. The owner of capital decides where money goes, whereas the people who sell only their labor lack that power. This makes it hard for society to be shaped in their interests. In recent years, that disproportion has reached destructive levels, so if we don’t want to be a Marxist society, we need to put it right.

And what is the alternative that this author sees as the way forward to avoid the hypothetical looming dictatorship of the proletariat?  Simply put, the author insists that we need to “take ownership much more seriously,” and put democratic control back into corporate governance:

Why are so few companies owned by the people who work for them, and why do both liberal and conservative political parties not offer greater incentives, such as tax advantages, for this to change? It is extraordinary that the joint stock company, the foundation of modern commercial and industrial wealth, is still so little influenced by the views of shareholders. This is perhaps most evident in the preposterous salaries paid, particularly in the U.S. and Britain, to top executives of public companies. If the owners of these companies truly exercised authority over what is theirs, this wouldn’t happen. If these enterprises had grown over the last 20 years at the same rate as pay for the men who run them (it usually still is men), no one would be talking of a crisis of capitalism.

But even more strikingly, the author goes beyond the idea of shareholder democracy, and insists on a large-scale push to imagine and implement the democratization of wealth, not through redistribution, but through newly revitalized forms of cooperative and democratized ownership and control of our economic institutions:

The Victorians were more imaginative than we are about principles of mutuality—credit unions, building societies, the cooperative movement. Such organizations feel creakier in an age when people want larger sums, faster. But is it really beyond the skill of our great modern business brains to develop these concepts and adapt them to modernity?

Admittedly, this is a single article that does little in the long run to correct the systemic bias revealed in the graphs above: the WSJ is by no means running regular coverage of the growing number of experiments in community wealth building and democratized cooperative ownership that are emerging throughout the nation (yet). But the oddity of the WSJ, bastion of capitalism’s most defended ideological heights, running such a forceful indictment of the current system and its tendency to reproduce and deepen levels of inequality inimical to democracy cannot be ignored: the system question may not quite be on the table in the mainstream media in the way it ultimately needs to be, but it’s getting close.

 

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New York Police Slowdown and the Classic Challenges of Alternatives to Capitalism

Originally published in Truthout on January 14, 2015.

Quite apart from the political challenges it represents, the current New York City police slowdown illuminates a classic general issue that must be faced by those concerned with how to structure a next system that moves us beyond the problems of both traditional corporate capitalism and traditional state socialism.

While we may enjoy some satisfaction in the NYPD’s attempt to enrage its critics by giving them exactly what they’ve been asking for – i.e. a drastic reduction in the criminalization of the lives of poor communities of color – it’s important to confront the additional question of who should be able to make these kind of decisions and how, both now and in serious system-changing discussions. (If every decision about how the NYPD operates were left up to its workers, that would certainly not further the goal of real justice.)

A common position among some theorists is that the answer to the failures of state socialism, for instance, is simply to encourage worker-ownership and self-management of virtually all industry, instance by instance, case by case. Historically, this position was commonly termed “syndicalism.”
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A guaranteed income for veterans

Originally published in Aljazeera America on January 12, 2015.

Whether or not one agrees with the decisions taken by our political leaders who sent them off to war, it’s undeniable that the veterans of the various post-9/11 wars are suffering. The nearly three million veterans of Iraq and Afghanistan who have returned to civilian life are afflicted with an official unemployment rate of around 9 percent — substantially higher than the overall rate of 5.6 percent. Another half million have the left the labor force entirely. Many struggle with poverty, foreclosure and homelessness brought on by an anemic and uneven recovery and compounded by the mental and physical scars of war.

The plight of veterans of recent wars who continue to fall through the social safety net offers a unique opportunity to reimagine the way government provides for the welfare of its citizens. Too often discussions concerning the provision of basic needs for Americans get tied up in questions of desert: The “undeserving” poor see their lifeline slashed to incentivize them to pull harder on their own bootstraps. But only the most callous among us would find it easy to disown the obligation we owe to those who have demonstrated willingness to put their bodies in the line of fire on our behalf. Veterans offer a chance to think clearly about how best we can help those in need — and if the primary problem we must solve is that far too many veterans lack an income to support themselves, why don’t we just provide it to them?
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Is Worker Ownership a Way Forward for Market Basket?

Originally published on Truthout.

The Market Basket situation is indeed, as many commentators have remarked, nearly unprecedented in the annals of American labor relations: When have we ever seen so many workers protest so vigorously for, rather than against, their boss! (For those new to the story, the New England supermarket chain has been wracked by massive employee protests, organized without any union involvement, after a faction of the family that owns the chain took control and ousted extremely popular CEO Arthur T. Demoulas. The mobilization in support of the former chief executive has resulted in nearly empty shelves and the mobilization of angry communities of formerly happy customers.)

But beneath the surface of the singular job action, in which workers and community have banded together to demand the reinstatement of the former CEO, the conflict in New England points toward something much more fundamental: the need to build institutions that can sustain the kind of community- and worker-friendly business leadership that earned “good brother” Arthur T. such incredible loyalty.
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