Category Archives: Articles

Five years after the big bailout: Time to begin building a “new economy”

new-economy-week-fb-banner Five years ago today, on October 3rd, 2008, the federal response to the financial crisis began with the signing into law by then President Bush of the Troubled Assets Relief Program (TARP). After a half-decade of emergency measures—including not only the bailout, but the temporary nationalization of major auto manufacturers and round after round of “quantitative easing”—have we managed to put the economy back on a secure footing?

Unfortunately, the clear answer is that we have not.

To the consternation of both the public and the economists, this “recovery”—and the two which preceded it—have been “jobless recoveries.” While the government measure of the unemployment rate has declined to a modest extent, the absolute percentage of the population employed has remained more or less constant since 2009, as people resign themselves to joblessness and leave the labor force. Furthermore, even this anemic and halting climb back towards increased employment has been vastly uneven: a massive gap exists between the unemployment rate of lower income families (21%) and the rate for higher income families (3.2%). 15% of Americans—nearly 1 in 6—are seemingly consigned to live in poverty. Meanwhile, the banks that were “too big to fail” in 2009 are, despite scandal after scandal, bigger than ever. And while wages stagnate, corporate profits and the income of the 1% is soaring.

The title of my recent book, taken from Tolstoy, is straightforward: What then must we do? For some, the answer is simply that we need to remove or neutralize the conservative forces holding back a sensible Keynesian economic policy; a little more stimulus, a little more public spending, a few reforms around minimum wages and everything will be back on track. Yes, this would be better than nothing. But when we look soberly at the long-term trends, it is clear that we face a systemic crisis: a deep failure of the institutional basis of the traditional strategy for holding corporate capitalism in check. Poverty rates, income inequality trends, global warming, incarceration rates—these and many other three and four decade trends began long before the recent House Republican difficulties—and they are all but certain to continue on their current course long beyond the political problems of the moment.

In short, what we need is not just simply more pressure for reform around the edges of the system, but a movement to build a new economy, a movement that will build steadily over time as the civil rights, feminist, environmentalist and, indeed, conservative movements built up long term strength, step by step, until major political power was achieved.

Thankfully, a “New Economy” movement is beginning to emerge all around us, and part of helping it grow is making it more visible. A recent debate on new banking institutions appeared yesterday in the New York Times. Annie Leonard’s just released new video The Story of Solutions is a powerful followup to her Story of Stuff that highlights transformative work in the new economy. Worker-owned co-ops are developing in many areas. Even the august Academy of Management—an organization of leading business school professionals—opened a serious debate on the future of capitalism at their annual meeting this past summer.

And importantly the New Economy Coalition is organizing a week of events this month to highlight the activity bubbling up at the grassroots across the country. A pilot for what they hope to become an annual event, “New Economy Week” will bring together communities across the country in local celebrations, screenings, and lectures. (I will be speaking in Amherst and Great Barrington, Massachusetts on October 10th and 11th, and answering questions online for a national audience via the website Reddit on October 15th.)

Building effective movements for change rarely, if ever, happens overnight: The New Economy Week is a small but necessary step towards the one we need right now.

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What Then Can I Do? Ten Ways to Democratize the Economy

Read my article with Keane Bhatt on Truthout or here on

And find out how to host a community screening of my new film, The Next American Revolution or organize a reading group around What Then Must We Do? here.


The richest 400 Americans now own more wealth than the bottom 180 million taken together. The political system is in deadlock. Social and economic pain continue to grow. Environmental devastation and global warming present growing challenges. Is there any path toward a more democratic, equal and ecologically sustainable society? What can one person do?

In fact, there is a great deal one person working with others can do. Experiments across the country already focus on concrete actions that point toward a larger vision of long-term systemic change – especially the development of alternative economic institutions. Practical problem-solving activities on Main Streets across the country have begun to lay down the elements and principles of what might one day become the direction of a new system – one centered around building egalitarian wealth, nurturing democracy and community life, avoiding climate catastrophe and fostering liberty through greater economic security and free time.

Margaret Mead famously observed: “Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.” Some of the ten steps described below may be too big for one person to take on in isolation, but many are exactly the right size for a small and thoughtful group committed to building a new economy, restoring democracy and displacing corporate power.

As the history of the civil rights movement, women’s movement, and gay-liberation movement ought to remind us, it’s precisely actions of this sort at the local level that have triggered the seismic shifts of progressive change in American history…. Read more »



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Strange days: “Capitalism in Question” at the Academy of Management

It’s hard to judge the true depth of crisis developing in the foundations of our political and economic system when you are living, day in and day out, in the middle of it.  But it is clear that something deep is fundamentally broken with capitalism, and that fixing it requires thinking seriously about what might emerge as what can probably only be called “a next system.”

This is not a radical judgment. Perhaps surprisingly, you can find this perspective resonating within the most powerful citadels of the system itself.  Klaus Schwab, the founder of the World Economic Forum, for instance, introduced a recent Davos meeting of the global financial and political elite with these words: “Capitalism, in its current form, no longer fits the world around us [...] We have failed to learn the lessons from the financial crisis of 2009 [...] A global transformation is urgently needed and it must start with reinstating a global sense of social responsibility.”

Even more encouraging than Schwab’s informal comment is the consideration serious business and financial experts are giving to questions about the future of capitalism and the long term possibility of a successor system.  I have found receptive audiences for my work on this subject (and my book What Then Must We Do?) at major conferences dedicated to socially responsible investing like SOCAP and SVN.   I have also found that many people who have spent the last decades pioneering innovative projects that put their business acumen to use in the service of economic and social justice are beginning to realize that the system itself may be broken. And that, if so, we need to begin to think about alternatives that might be developed, even if over the long haul.

I admit that I was a bit taken aback, however, when I was asked to deliver a keynote address on August 11th at the annual Academy of Management meeting whose theme this year is, quite simply:  “Capitalism in Question.”  Read More »

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Alternatives to Capitalism: The Next System Project

The current issue of The Good Society, the long-running journal of the Committee on the Political Economy of the Good Society (PEGS), is devoted in its entirety to “Alternatives to Capitalism,” a symposium built around my essay (with Steve Dubb) on “The Possibility of a Pluralist Commonwealth and a Community-Sustaining Economy”.

The essay also serves as an important foundational document for a new Democracy Collaborative venture, The Next System Project, a multi-year initiative aimed at developing the carefully researched and comprehensive proposals required to deal with the systemic challenges—environmental, economic, social and political—the United States faces. It hopes thereby to help stimulate a broad national dialogue on longer term political economic directions.

The Next System Project will bring together leading thinkers, activists and practitioners and will use up-to-date research and understanding to place ‘the system question’ on the map. It will explore issues of political-economic system design with a view to generating alternative models—different from both corporate capitalism and state socialism—capable of delivering superior ecological, social and economic outcomes. The Project will stress such fundamental guiding values as participatory democracy, equality, liberty, ecological sustainability and community.

The overall effort will not seek to provide all the answers. Instead, it will focus on the development—through fellowships, research and strategic convening—of multiple system-wide proposals and as well as institutional and policy elements that can help catalyze a wide-ranging debate about the need for a radically different political-economic system. The goal is the careful articulation of a systemic vision beyond traditional corporate capitalism, and how we might move toward its construction over time.

More information on The Next System Project will be provided in due course. For now, the symposium is available free from JSTOR for a limited period—until the end of August 2013. I hope you enjoy the various contributions by Democracy Collaborative staff and others. In addition to the lead essay, there are articles on generative ownership design by Marjorie Kellystate and local policies by Joel Rogersconstitutional protections by Thad Williamsonthe crisis of European social democracy by Joe Guinan, and public ownership by Thomas Hanna.

Read and download the whole issue for free through the end of August

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The Legacy of the Boomer Boss

garnytThis op-ed originally appeared in the July 6th edition of The New York Times

Over the next decade millions of business owners born during the baby boom will retire. Many, with no obvious succession strategy, will simply sell their companies, the backbone of Main Street economies across the country, to large corporations. All too often the result will be consolidations, plant closures and lost jobs for the people who helped build and sustain their companies for decades.

The boomers should think again: selling to their employees is often a far better way to go — for both moral and economic reasons.

Take New Belgium Brewing, based in Fort Collins, Colo., which its chief executive and co-founder, Kim Jordan, sold late last year to its 400-plus employees through what’s called an employee stock ownership plan. “There are few times in life where you get to make choices that will have multigenerational impact,” she said. “This is one of those times.”

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