Category Archives: Politics

November 23, 2012 · 10:00 am

Don’t Let Obama Cut Medicare, Medicaid and Social Security

The Progressive
November 15, 2012
by Arun Gupta

If you voted this election, whether for Barack Obama, Jill Stein or even Mitt Romney, you did not vote for austerity. But that’s of little consequence to Obama and the Republicans. The two parties are currently drafting measures that will undermine Social Security, Medicaid and Medicare as the economy approaches the “fiscal cliff” at the end of this year when more than $600 billion in tax increases and spending cuts will kick in absent a new budget deal.

They hope to strike a “grand bargain,” but are bickering over how much to increase taxes and cut spending. The spotlight has been on the Bush tax cuts, which Obama campaigned on repealing for the rich, but this issue is a sleight of hand that distracts the public from the bipartisan plotting against your retirement income and healthcare.

Surely, you say, Obama will thwart the Republicans’ scheme to dismantle social welfare. After all, it’s well known that retirement programs are healthy. Social Security is solvent through 2033 and Medicare is solvent through 2024. Both can be strengthened for decades to come with relative tweaking.

Trusting a Democratic president with protecting the general welfare is ill-advised when the last one gave us NAFTA, welfare “reform” and the repeal of Glass-Steagall. Not only has Obama been gunning for retirement programs since 2008 (I’ll explain), he’s so hell-bent on reducing deficits that he’s willing to damage the economy. The Congressional Budget Office estimates if the economy plunges over the cliff, recession will hit in 2013. Interestingly, the CBO calculates that if all the tax cuts are left in place and no spending cuts are enacted the economy will grow by 4.4 percent next year and add 2.3 million full-time equivalent jobs. This would be the highest rate of growth since the late 1990s.

Now, it’s a stone-cold fact that the Democrats are willing to gut social welfare. Listen to New York Times chief political correspondent Matt Bai: “Mr. Obama, during his ‘grand bargain’ negotiations with the House speaker, John A. Boehner, in the summer of 2011, had already signed off on painful cuts to Medicare, Medicaid and Social Security.” Bai says there was “near unanimity” among Obama’s advisers and Harry Reid and Nancy Pelosi said “they would get behind it.” Paul Krugman’s assessment is harsher, saying Obama was “willing to sign on to … draconian cuts in key social programs.”

During the summer of 2011 the Obama White House and the Republican House played chicken over raising the federal debt ceiling. Bai says the two sides were haggling over the amount of cuts, not the question of bleeding retirement programs. Obama was willing to sacrifice $1 trillion in Medicare cuts over two decades, $110 billion in short-term Medicaid cuts, and acquiesced to “changing the Social Security formula so that benefits would grow at a slower rate.”

Mind you, the Budget Control Act Obama and Boehner eventually inked not only put the fiscal cliff in place, it cut spending for a second time in 2011. Over the next decade this will chop $900 billion in “non-defense discretionary spending.” This is wonk-speak for social programs, which will shrink to pre-1962 levels by 2021. Simply put, Washington already plans to roll back the Great Society – even before the fiscal cliff is reached.

But wasn’t Obama at the mercy of a Tea Party Congress threatening default unless he forked over $2 trillion in spending cuts? That’s what Bai argued last April: “Not only was [Obama] bent on avoiding a catastrophic debt default, but he needed to get out from under the debt issue, to demonstrate that he cared about reducing deficits before public concerns about government spending, stoked by rhetoric on the right, overwhelmed his presidency.”

There are more things wrong about this than a penguin in the desert. Allowing Republicans to use “economic blackmail” only emboldens them. The fiscal cliff is the third time the right is using mafia tactics – “Nice country you got here. Shame if something were to happen to it” – as Krugman describes it. The only way to call the right’s bluff is to allow the economy to go wobbly so Wall Street, the GOP’s masters, will bring their attack dogs to heel.

Also, notice that Bai thinks allowing a default is unthinkable, but pilfering food, medicine and money from more than 100 million Americans is perfectly fine. As for Bai’s contention that “public concerns about government spending” stoked by the right would overwhelm Obama’s presidency, it’s utter bullshit.

Take a look at this site, which covers 25 polls on public priorities going back to June 2010. When pollsters list options, which skew responses, the economy and jobs poll close to 50 percent as the top priority, trouncing the deficit, which averages in the low twenties. The latter figure, incidentally, is similar to the percentage of voters in the 2010 mid-term elections who said they supported the Tea Party. In six polls, the response was open-ended, which better reflects what the public thinks. Economy and jobs still notched 49 percent on average. The deficit and national debt was barely a blip, averaging 4 percent.

No matter how the data is sliced then, the deficit is an inside-the-Beltway obsession that at most inflames right-wing firebrands who are never going to support the Democrats.

Nate Silver crunched the numbers on the debt deal in July 2011 – if there’s only one lesson from this election, it’s that Silver’s number-crunching is unparalleled – and found House Republicans to be “extremely conservative on fiscal matters and … significantly out of step with the public as a whole.” As for the mix of spending cuts and tax increases Obama put on the table, it was “quite close to, or perhaps even a little to the right of, what the average Republican voter wants, let alone the average American.”

So why didn’t Obama tune out the chattering classes and stare down the Tea Party? It would have strengthened his standing with the public going into the 2012 election. From this evidence, it’s impossible to claim Obama is hostage to the right. The truth that remains, even if it seems improbable, is that Obama is a right-wing politician who has had the welfare state in his sights from day one.

Don’t take my word for it. Obama said it on January 15, 2009, in a “wide-ranging” interview with the Washington Post five days before his inauguration. The article was headlined: “Obama Pledges Entitlement Reform; President-Elect Says He’ll Reshape Social Security, Medicare Programs.” Obama said this was part of his legacy, declaring that he was “willing to spend some political capital” so that the “the hard decisions are made under my watch, not someone else’s.”

This was not idle chatter. Here is a sampling of what Obama said and did the next two years.

In February 2009 Obama held a “Fiscal Responsibility Summit” at the White House, in which he issued dire warnings of future generations being “saddled with our debts.”

In his 2010 State of the Union Address he proclaimed, “Like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don’t,” and called for a three-year spending freeze that fell heavily on social programs.

On February 18, 2010, Obama signed an executive order creating the “Simpson-Bowles Commission” tasked with making “recommendations that put the budget in primary balance.” In November 2010, right before the midterm elections, it proposed reducing corporate tax rates by 20 percent and on the wealthy by 30 percent while raising rates on middle incomes and the retirement age to 69. Remember, this was in the name of cutting the deficit.

This is before the Tea Party swept into Congress, so there was no pressure on Obama to appease the right. By adopting Tea Party talking points on spending and comparing government to a family – what family do you know that has 8,100 tons of gold reserves, a space program and embassies in some 200 countries? – Obama legitimized debt as a major concern going into the 2010 election.

A little more history. Obama ran in 2008 on repealing the Bush tax cuts. But he reneged on his promise just one month into his presidency even though he was gushing with political capital, the right was in disarray and the Democratic-controlled Congress was ready to pass it. (After campaigning in 2012 on abolishing tax cuts for households earning more than $250,000, Obama indicated he was willing to renege once more days after being re-elected.)

For his first term Obama followed the script penned by Larry Summers, his chief economic adviser in 2008 and the Clinton-era architect of the financial bubble that exploded four years ago. Writing on September 28, 2008 in the Financial Times, Summers outlined the Rosetta Stone for Obama’s presidency.

Summers’ article was published right after Lehman Brothers’ collapse, the financial Pearl Harbor that threatened the global economy. It was a classic case of The Shock Doctrine: using the meltdown to go after social welfare. He argued for a stimulus, while taking pains to mention, “We still must address issues of entitlements and fiscal sustainability.” He also said no “new entitlement programs or exploding tax measures,” which included “healthcare restructuring,” but not single-payer healthcare. Summers’ silences were notable: nothing about regulating finance, strengthening labor organizing or addressing the home foreclosure crisis.

Fiscal sustainability is simply a euphemism for cutting social spending to pay for deficit reduction. Economists like Dean Baker and Paul Krugman have demolished every rationale for deficit reduction under present circumstances: with interest rates below the rate of inflation, bondholders are paying the U.S. government to hold their money; reducing the deficit would strangle growth; the best way to reduce the deficit is through growth and inflation; and the plan to hack away $4 trillion in a decade will not reduce the national debt meaningfully.

Even if the deficit does need to be reduced, then the reasonable course is to have the Pentagon and wealthy pay for the two unfunded wars, Bush tax cuts and Wall Street crash that blew up the national debt. Which is why Obama’s song and dance about “shared sacrifice” is so grating – and probably music to granny-starver Paul Ryan’s ears. Obama and Boehner are wrangling over whether or not the Gulfstream set has to part ways with a 4.6 percent nudge in income tax, but they agree that grandma must skimp on food, heat and her meds. “Hey, we’re all in this together.”

Whatever your politics, you’ve probably been savoring the humiliation of “the biggest loser” Karl Rove, cackling over Bill O’Reilly’s lament that “the white establishment is now the minority” and sharing “White People Mourning Romney.” 

Well it’s time to wipe the gloating off our faces and get to work stopping Obama from stealing our healthcare and retirement income, otherwise it will be Wall Street’s turn to gloat. Yet again.

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November 21, 2012 · 10:00 am

What Happened to the Green New Deal?

Truth-out.org

by Arun Gupta

Out of the ashes of Obama’s green-collar vision, a worker-run business may point the way to the economy of the future.

Last election, Obama had an economic plan and wasn’t afraid to embrace government as a primary creator of jobs. With markets melting down, almost half a million people being fired a month, and automakers and banks emitting a death rattle, Obama presented a sweeping vision of tackling health care, global warming, a rogue Wall Street and reshaping the decaying industrial economy with a green-collar one. Liberals dubbed it a Green New Deal and fantasized about the land blossoming with solar panels, electric cars and high-speed trains as new regulations cut corporations down to size.

Obama botched the plan, however. He inflated hopes in 2008 that his policies would create 5 million green-collar jobs in a decade. He then skimped by allocating only $90 billion in stimulus money for clean energy, producing a measly 225,000 jobs after 18 months by the White House’s own estimates.

Republicans blasted Obama’s green economy as failed central planning imported from Europe. They believe the government that’s best is the one that governs the least. Its purpose is to spur the private sector, but how it does so is mysterious. This was Romney’s position, but it seems to have become Obama’s, as well. During the election campaign, the two mouthed the same invisible-hand mumbo-jumbo, offering little chance of reviving an ailing economy.

In the real world, corporations clasp onto the public teat like squealing piglets. Big business would starve if deprived of state-organized central banking, transport, electricity, water, sewage, courts, zoning, police, environmental remediation, customs and labor regulation. Pick an industry and you’ll find tailored public aid. Banks and car makers get bailouts; energy and forestry companies mine, drill and log public lands; the health care industry thrives thanks to the Food and Drug Administration (FDA), National Institutes of Health (NIH), Medicare and Medicaid; agribusiness soaks up crop insurance and subsidies; home construction is built on Fannie Mae, Freddie Mac and the Federal Reserve; and perhaps the largest part of the economy – the military-surveillance-police-and-prison sector – is assembled piece by piece by government.

Clearly, government policies create many millions of jobs. (That’s not counting 22 million government employees and an estimated 14 million other jobs created by government contracting and consumer spending by public-sector workers.) This is known as industrial policy. Every country does it, and the United States is no exception. We just tend to do it worse because it is heresy to question the god of the free market. If the public realized how much big business depended on public support, then there might be a loud clamor for more activist government.

The lesson is not that the Obama administration did too much to spur a green economy; it did too little. Answers to why the green-collar economy withered and where its future may lie can be found in the story of Serious Energy and workers from the former Republic Windows and Doors factory in Chicago.

A New Era

Obama’s green jobs plan had one missing element – labor. A healthy economy requires plenty of good-paying, stable jobs with benefits. However, the titans of Wall Street aren’t going to voluntarily give up profits so the proles can get better wages and social programs; the proles have to fight for it.

As if on cue, a glimmer of labor’s revival emerged after Obama’s election. On December 5, 2008, 240 workers at Republic Windows and Doors staged a sit-down strike after receiving notice that their factory would be mothballed. The workers, members of Local 1110 of the United Electrical, Radio and Machine Workers of America, raised expectations that a wave of labor militancy could turn the tide against runaway corporate power.

Soon, all the elements came together. Serious Materials, a clean-technology firm, purchased the bankrupt Republic plant, which specialized in manufacturing high-energy-efficiency windows. Serious Materials (since renamed Serious Energy) billed itself as a green-economy pioneer ready to revolutionize manufacturing with green products. Obama’s stimulus would open up the market for its goods. And Serious was intent on showing profits, sustainability and social responsibility were compatible by keeping the unionized workforce in place.

Serious was one of many companies that hitched its wagon to Obama’s plans to green old markets and catalyze new ones. Despite shifting business models, Serious flailed along with the green economy. Now, Serious is no Solyndra, the solar-panel manufacturer that defaulted on a $535 million taxpayer-backed loan. The Republicans successfully saddled Obama with Solyndra’s bankruptcy, turning it into “a case study of what can go wrong when a rigid government bureaucracy tries to play venture capitalist and jump-start a nascent, fast-changing market,” as he Washington Post called it. Serious shows the private sector can be just as wrong. Ten venture capital firms poured more than $140 million into Serious and have little to show for it.

But rising out of the ashes are the Republic workers. They’ve raised hundreds of thousands of dollars to purchase machine tools and lease factory space to open the New Era Windows Cooperative. Modeling themselves on cooperatives in Argentina’s recovered factory movement and Spain’s Mondragon, the New Era workers will collectively decide how to manage the business, what products to manufacture and what to do with the profits. While they make green windows, they hope to inspire other self-managed enterprises across the United States and could provide an alternative to free-market capitalism.

Ironically, if New Era succeeds, it will do so with zero government support. One might have expected both presidential candidates to heap praise on the cooperative. Romney could have touted the workers’ entrepreneurial initiative, while Obama could have pointed to it as a new model for domestic green manufacturing.

In terms of Serious and Solyndra, their breakdowns are par for the course. The clean-tech sector is littered with so many casualties it looks like a Civil War battlefield. It is an unavoidable part of the process, and the Obama administration made a big mistake in shrinking away from failures.

Josh Whitford, a professor of sociology at Columbia University who studies industrial policy, says, “Novel technologies are areas in which the rewards are very uncertain and where a lot of things will not pan out. Venture capitalists deal with this by funding lots and lots of companies in the hopes of hitting a winner. They expect a lot of their investments to fail. In fact, if none failed, they’d think they were too far from the ‘possibilities frontier.’”

Government’s goal, says Whitford, “is not to hit a big financial winner, but to promote policies judged to be socially beneficial. He explains, “In the case of industrial policy, the purpose is often to push a technological direction,” such as cutting-edge clean energy that benefits society by curbing greenhouse gasses. Government is up against the same constraints as venture capitalists, however. Whitford says it does not know which projects will succeed. “So, government should, like venture capitalists, be spreading resources around and betting on multiple horses in the hopes that some do win. If the government has no failures, it’s being too conservative.”

Windows of Opportunity

The story of Serious and the Republic workers begins in 2007. Serious Material was planning to market EcoRock, which it touted as requiring only 10 percent of the energy used to make standard drywall. It raised $50 million to build factories in the United States that could crank out 400 million square feet of EcoRock a year. It’s the type of project that excites wonks: Serious Materials would reinvent the archaic drywall industry, which spews out more than 20 billion pounds of carbon dioxide annually, with a stateside 100-kilowatt solar-power plant that would create hundreds of good-paying manufacturing jobs while eliminating nearly all greenhouse gas emissions.

To make the product viable, Serious was counting on Obama enacting a cap-and-refund carbon tax. As small-batch production of EcoRock costs nearly twice as much as regular gypsum drywall, it needed a carbon tax to entice contractors to use it. But the carbon-tax bill died in Congress, so EcoRock was doomed to the green-building niche. This added to Serious’ woes because it jumped into the building market just as the economy collapsed in 2008. Furthermore, EcoRock may be great for the environment, but not for the bottom line. As one report noted, it “does not insulate or curb power consumption in buildings.” In 2010, CEO Kevin Surace explained to Greentech media that Serious “never pulled the trigger” on constructing a full-scale factory because “Gypsum (drywall) plants are 75 vacant.”

“New construction is down 80 percent from the peak,” said Surace.

Flush with cash to build factories, Serious Materials pivoted to plan B: manufacture windows that slash heating and cooling by 40 percent. Even though home building was in the dumps, Serious calculated that it would “ramp up production [in 2009] by tenfold” because of anticipated demand. It had been in the windows business for a few years, and in 2008, it purchased Alpen Windows in Colorado. In 2009, it added the defunct Kensington Windows factory in Pennsylvania, where 150 workers had been booted out of work the previous year.

The real prize was the Republic factory. The workers there won $1.75 million in wages and benefits after a six-day-long sit-down strike. They were unemployed, however, joining more than 600,000 workers who lost their jobs in December 2008. With 4,000 news articles published on their fight, Serious was paying attention. At Serious’ headquarters in Sunnyvale, California, CEO Suracewatched the drama unfold and pondered riding to the rescue of the beleaguered facility.

An engineer and entrepreneur, Surace first considered the downside. He told Inc. magazine: ”The workers were up in arms. The equipment had been pillaged. The computers were destroyed. The customers didn’t want to buy. The records weren’t accurate. There was no management team. No one but the craziest person on earth would take over that.”

At Serious Materials’ holiday party that December, co-founder Marc Porat pushed Surace to consider the upside: “Think what can happen! We’re creating green-collar jobs. We’re creating an energy-efficient product. We’re hitting climate change. And it’s Chicago!”

“It will come to the White House’s attention,” said Porat. “It’s a perfect expression of their policy.” According to a detailed account in Inc., which named Surace “Entrepreneur of the Year” for 2009, the board of Serious Materials approved the acquisition of the idle factory based on “owning one of the largest window-glass facilities in the country, with a seasoned work force and a fabulous location.”

Not lost on anyone was the “public relations potential” of aligning with the Obama administration’s plan for a green-collar economy. The stimulus included $5 billion for the Weatherization Assistance Program. Much of this was for tax credits for energy-efficient retrofits that included windows. Serious was eager to cash in because its windows exceeded Energy Star ratings by up to 400 percent.

Surace became a rock star in the clean tech field, hit the TED circuit and shared stages with politicians. He gave Sen. Mark Udall (D-Colorado) a tour of Serious Energy’s Boulder facility, wielded scissors with Pennsylvania Gov. Ed Rendell for a “green ribbon-cutting ceremony” at the Kensington plant, and basked in the limelight with Joe Biden as the vice president heaped praise on the re-opened Chicago factory. Surace was on a mission to save the world from climate change with green windows and drywall that would generate serious greenbacks for Serious Materials’ investors.

Despite the grim economy, Serious hauled in $60 million from investors in 2009, one of the largest venture capital deals of the year, and its backers were salivating. In a newsletter from 2009, the Chicago-based Mesirow Financial, which pumped $15 million into Serious that year, wrote glowingly of how its “private equity investors” would benefit because $10.5 billion of stimulus money was in the pipeline “for home weatherization and federal building efficiency retrofits.”

Everything was going according to plan. As Serious collected factories, it boasted of “creating green collar jobs in plants across the country including … the President’s home town of Chicago,” wrote an Inc. editor. Inc. noted: “The Republic rescue has paid off handsomely in publicity … Aspiring vendors, curious dealers, and assorted well-wishers began stopping by the plant after its reopening. These days, salespeople rarely need to introduce Serious Materials to their prospects; the White House has already done that for them.” Revenue in 2009 reportedly increased by 50 percent; the company was employing more than 300 people, and in March 2010, Serious landed a coveted contract to upgrade the Empire State Building’s 6,514 windows.

Best-Laid Plans

Cracks were appearing in the façade, however. By the end of 2009, only 20 workers had been hired back at the old Republic plant, and Serious was spending $100,000 a week to keep the space open, which could hold 600 workers. Surace admitted the company had erred in thinking “we’d be hot and heavy into weatherization of thousands of homes in the Chicago area.”

Serious put its chips on weatherization, but the recession weakened its hand. The Department of Energy inspector general found that by December 2009, only 8 percent of the money had been spent “and few homes had actually been weatherized.” Because the $4.73 billion in the pipeline was divided into 58 spigots to cover every US state and territory, “State hiring freezes, problems with resolving significant local budget shortfalls, and state-wide planned furloughs delayed various aspects of the program.” On top of that, little money was being spent on windows like those built by Serious because weatherization also covered furnaces, insulation, water heaters, weather stripping, cooling systems and storm doors.

By the summer of 2010, Serious was back on the PowerPoint circuit, imploring funders for $56 million to become a player in the building management market. Its new model - the third in three years – was software “for monitoring and lowering energy consumption in commercial buildings.” Serious was acquiring more companies – software firms like Valence Energy and Agilewaves. It boasted of 60 customers in the wings and products that could deliver ”immediate energy savings of 10 to 15 percent with payback in one to two years.”

But Serious was trying to muscle in on the turf of heavyweights like Siemens, Honeywell and General Electric, so it was back to the drawing board. After changing its name, Serious Energy unveiled a new division and plan number four in November 2011. A spokesperson announced Serious Capital would finance energy efficiency retrofits of buildings for free: ”We install, at no cost to customers, energy conservation measures that will save energy,” they said, “and we become the agent for utility bill payments.” Serious Energy figured the revenue stream would allow it to pay the bills and lenders and leave enough for a tidy profit. For the third time, it was eyeing a government angle, committing to perform $100 million in retrofits as part of Obama’s Better Buildings Initiative.

The initiative is one of those so-called “public-private partnerships” that are economic quackery. The Better Building Initiative promises to cure every ill – “creating jobs, growing our industries, improving businesses’ bottom lines, reducing our energy bills and consumption, and preserving our planet for future generations” – with no pain in the form of taxpayer financing or altering business as usual. For Serious, the initiative made little difference. As Greentech Media pointed out, it was unclear how it was going to “get the backing to meet its stated goal of $2 billion in potential project financing.” Plus it would need to buy insurance as a hedge in case the savings did not materialize.

Once exalted as the poster child for exemplifying Obama’s vision of “green-collar jobs at the hands of a resurgence in American innovation,” Serious Energy shriveled into a new economy shell reminiscent of Enron, chucking aside manufacturing for software, finance and hedging. The venture capital taps were also running dry. Serious raised less than $20 million of its 2010 goal of $56 million, and less than $3 million of a $33 million round in 2011.

The free retrofit plan unraveled in weeks. In February 2012, Surace was canned, and Serious announced it was closing the Chicago factory. On February 23, it summoned the 38 remaining workers to “the offices of the notorious union-busting law firm Seyfarth and Shaw,” as Labor Notes put it. The workers were told they would get their 60 days pay under the law, but the factory would be cannibalized and the machines shipped to Serious’ plants in Pennsylvania and Colorado. Not given to taking things lying down, the workers sat down once more. Less than 12 hours later, they emerged victorious with a written agreement that the factory would operate for 90 days longer while Serious Energy looked for a buyer. As for Serious Energy, Porat says it is returning to its roots of producing soundproof drywall, a business he admits has very little to do with clean tech.

Working World

UE Local 1110 had no illusions that a white knight was in the wings, however. During a visit last May to the headquarters in Chicago, local President Armando Robles confided: “Nobody is going to buy the factory after two occupations. They don’t want troublemakers there.” Having shown themselves to be innovative risk-takers by winning two sit-down strikes that were technically illegal, the workers decided they would run the factory themselves. They joined forces with The Working World, which provides “investment capital and technical support for worker cooperatives,” and raised the money to buy the window-making equipment and establish the worker-run and -owned business.

The cooperative is still in the works. The big question is, can it blaze a path for labor to revive manufacturing? Small, worker-run cooperatives can’t replace an advanced industrial base, but they could democratize the US economy and employ millions in stable, living-wage jobs.

Networks of cooperatives could also provide a model to supplant the warmed-over Keynesianism beloved by liberals. Stimulating demand or creating public-works programs would still be effective today; Obama has done far too little of it. Trying to reshape the industrial base as happened under FDR (and that’s mainly because of World War II) is far more difficult because back then, US capital had limited options beyond the domestic market for consumers, factories and workers. That’s not the case in the globalized economy. The biggest US employer, Walmart, pays poverty-level wages to most of its 1.4 million workers. The most valuable corporation in the world, Apple, has only 13,000 US-based employees outside of its retail stores. And both source most of their goods from China.

The free-market solution is to subsidize corporations, a point upon which Romney and Obama agreed. For instance, states like Alabama, Tennessee and Mississippi already gift $300 million or more to automakers opening plants they were planning to build. Imagine if instead of padding the profits of Fortune 500 companies, the public sector funded tens of thousands of worker-run cooperatives. Many would go bankrupt, but that’s the price of innovation. The upside would be successful worker-run cooperatives rooted in communities. Such enterprises would be unable to move operations to Mexico or Malaysia, while abuse of employees that is far too common here would be almost impossible in democratic workplaces.

A new economy demands new answers, not the failed free market or nostalgia for a past that no longer exists. The New Era Windows Cooperative might just provide some of those answers.

Copyright, Truthout. May not be reprinted without permission.

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October 17, 2012 · 10:32 am

Romney Appeals to White Tribalism in Ohio

By Arun Gupta and Michelle Fawcett, The Progressive, October 15, 2012

SIDNEY, OHIO—At the Shelby county fairgrounds in Sidney, Ohio, on Oct. 10, a jumbotron showed a bus approaching. Image became reality as Mitt Romney’s bulbous white chariot glided into the rally of thousands. It was an impressive entrance, for those who are impressed by RVs.

Bounding up to a podium, Romney was ready to proselytize. Thousands of faces turned toward him in the chilly evening air. Word was that Romney’s conquest of Obama in the first debate had infused his robotic demeanor with passion. It was hard to see much evidence of that.

To polite applause, Romney blandly declared, “That’s an Ohio welcome. Thank you guys.” He tried to rouse the audience with a counter to Obama campaign chants of “Four more years,” and the crowd hesitantly recited “Four more weeks,” their tone as flat as the surrounding farmland.

No matter. Romney dove into his stump speech. It was the gospel of lower taxes, freer trade, stronger military, and drill, baby, drill, and the audience was receptive. He hit all the buttons, “jobs,” “small business,” “compete,” and “opportunities.” Some specifics drew hearty cheers: “Get rid of the death tax,” “get that pipeline in from Canada,” and “our military must be second to none.”

The crowd responded favorably because the ideas are presented simply and clearly. People are hurting, and Romney says he’ll create more jobs and put more money in your pocket. His message is he won’t do it through welfare, like Obama, but by encouraging American values like entrepreneurialism, strength, and self-sufficiency.

Author Thomas Frank calls this brand of politics “Pity the Billionaire … a revival crusade preaching the old-time religion of the free market.” Frank argues the post-Obama resurgence of the right is not about racism or culture wars, but a populist politics of resentment. The right, he explains, has effectively defined the economic crisis as “a conspiracy of the big guys against the little,” and their solution is “to work even more energetically for the laissez-faire utopia.”

It’s not either-or as Frank contends, however. The right is invoking “producerism,” telling Americans bruised by the downturn that your pain is due to social factors, which are presented as coded racial categories.

Political Research Associates, a group of scholars who study right-wing movements, defines producerism as a call to “rally the virtuous ‘producing classes’ against evil ‘parasites’ at both the top and bottom of society.” The concept stretches back to the Andrew Jackson era, and weaves “together intra-elite factionalism and lower-class whites’ double-edged resentments.” Today, the parasites at the top are liberals, bureaucrats, bankers, and union “bosses”; the ones below are “welfare queens,” teachers, Muslims, and “illegal aliens.” They are all taking money from the hard-working Americans in the middle.

By historical standards Romney should be a Walter Mondale, a candidate who has lost even before the race begins. But he is effectively utilizing the politics of white resentment because of Obama’s dismal economic record. Tens of millions of low-wage workers feel their world is coming apart and they don’t know whom to blame. To them, change may mean lower wages, fewer hours, no health care, or a lost home. Romney plays on fear by linking it to Obama. In Sidney he said, “The president seems to be changing America in ways we don’t recognize,” which elicited chants of “USA! USA! USA!”

It’s not that the United States is inherently right wing, as many commentators claim. In Ohio, autoworkers say there is almost universal support among their co-workers for Obama because the auto bailout saved their jobs. But the bailout affected less than 1 percent of all U.S. jobs. In a recent poll the president has the support of only 35 percent of white working-class voters compared to Romney’s 48 percent.

The Romney rally was stunningly white. Among the estimated 9,000 people, it was hard to find more than a handful who looked to be Black, Latino or Asian. Attendees complained about welfare and high taxes destroying the country. Romney fed the resentment by claiming Obama was going to “raise the tax on savings,” “put in place a more expensive death tax,” and raise taxes on “a million” small businesses.

Democrats dismiss Romney as a snake-oil salesman. Joe Biden pointed out in the debate against Paul Ryan that the GOP counts billion-dollar hedge funds as small businesses. That’s true, but it doesn’t account for the popularity of their ideas. You see, the Republicans have turned small business into a catch-all group the way “working class” once served that function for the left.

According to the Federal Reserve Bank of Cleveland, the number of self-employed and employer firms – those with employees other than the owner – numbered 15.7 million in 2009. It’s likely that most are kitchen table, garage or laptop operations, but that’s beside the point. Republicans are courting millions of Americans whose livelihood depends on unswerving faith in the market.

Of the five people we talked to who told us their profession, four said they were a small-business owner. They did not seem to think of themselves as workers, but as frustrated entrepreneurs. When Romney says he’s going to help small business expand and stop Obama from increasing taxes on small businesses they think he’s speaking to them. They hope Romney will return the nation to its natural free-market state – free from regulations, bureaucrats and welfare – in which hard-working Americans like them achieve the success they deserve.

Why shouldn’t they believe this rhetoric? The Democrats mimic the right even when they control all of Washington. Obama says he will make business more competitive, cut taxes, sign trade deals, bomb the world into democracy and drill, frack and mine for energy. The Democrats’ dilemma is they are in the pocket of Wall Street, but need votes from groups that want the economic pie to be sliced more evenly. The result is liberals worship the same free-market god as conservatives, but have no conviction about it.

Absent an alternative, many voters veer right because they are reaching for the only lifeline they see. “Energy independence” and “a military second to none” are not just catch phrases. They provide millions of decent-paying jobs for the white working class.

This is not to say Romney voters always understand what they are voting for. Talking to some was like walking Through the Looking Glass, where backwards is forwards. Supporters repeatedly ascribed to Romney positions that are the exact opposite of what he advocates. Or they swallow lies about Obama that contradict their own experience. This suggests that racial identity often outweighs rational self-interest. Romney again made this a direct appeal, capping his speech by saying, “We’re taking back America.”

Ron Elmore, a small businessman who sells education supplies, preferred Romney because he would “get America going in the right direction again.” Elmore said he was struggling to get by and believed Romney would help his business by increasing education funding.

Two 16-year-olds, Jennifer Poling and Caitie Johnson, called themselves Romney backers. Johnson said, “There’s too many people today who depend on the government.” Poling said her mother is a “hardcore Obama” supporter because Romney is against women’s rights. Poling, though, shrugged off the right’s explicit anti-abortion politics, saying, “I don’t think they [Congress] will let Romney pass any laws against abortion.”

Jeff Doresch, who owns a small business detailing cars, was angry. “Obama is shutting us all down. He’s destroying us with tax increases.” When asked how his taxes had fared under Obama, Doresch responded, “They’ve stayed the same.”

Eighteen-year-old Andy Egbert and 16-year-old cousin Troy Kloeppel’s family owns 5,000 head of beef cattle. Egbert said, “Romney is going to make more jobs for the middle class instead of sending them overseas to China.” Kloeppel supported Romney because he was opposed to welfare fraud: “It’s a great system if it’s not abused.” Egbert chimed in, “A lot of people are lazy and are paid to do nothing.”

Jason, a local soybean farmer, said, “I like everything about Romney.” Why didn’t he like about Obama? “No Obamacare,” he said before quickly departing.

A businessman worth a couple hundred million dollars was telling a white audience that a president who is changing the country “in ways we don’t recognize” was stealing their money for job-killing programs like Obamacare. In a warm-up talk, Ohio Gov. John Kasich railed against “bureaucrats” and “California rules.”

The audience knew what they meant. “We” – white America – are besieged by liberals using our tax dollars on undeserving poor, dark people. This attitude is often expressed as a crude or violent desire to eliminate the other, such as with the spate of “chair lynchings.” At the rally one vendor hawked toilet paper with Obama’s face on each sheet. Another sold buttons that read, “Forget your cats and dogs, spay and neuter your liberal.” Jeff Doresch said, “With Obama, if there’s another four years, it will be like when Hitler was here.” A few hours west of Sidney, near Fort Wayne, Indiana, a highway billboard showed a picture of armed commandos with text that read, “The Navy SEALs removed one threat to America … The voters must remove the other.”

But it’s not just about aggression. In his one effective moment, Romney painted a vision of a beloved, exclusionist community. He told a story about an American flag that went up in the Challenger, which was recovered intact after the shuttle exploded and that “was like electricity … running through my arms” when he touched it. He turned the secular symbol into a holy one that embodies “who we are.” Romney said, “We’re a people given to great causes. We live our lives for things bigger than ourselves.” That “who,” was people in the military, “a single mom,” “a dad taking on multiple jobs.” Finally, he said, “We’re taking America back.”

There’s little doubt that Romney will double down on decades of bipartisan policies that benefit plutocrats. But that’s not what the audience in Sidney heard. Romney offered an easy-to-grasp explanation that spoke to their years of suffering, their unease with the present state of affairs and their anxiety about the future.

An election or two down the road the appeal to white tribalism may no longer work due to shifting demographics, but it could triumph this November.

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June 8, 2012 · 12:40 pm

The Silver Lining in Walker’s Victory (Truthout)

Thursday, 07 June 2012

By Arun Gupta and Steve Horn, Truthout

A nameplate in front of Wisconsin Gov. Scott Walker. (Photo: Narayan Mahon / The New York Times)

The right is riding high, but workers and progressives may finally realize that change happens through collective action, not electoral politics.

Wisconsin Gov. Scott Walker did not win the June 5 recall vote because a parade of Daddy Warbucks stuffed his suit full of six-figure checks. The Democratic challenger Tom Barrett did not lose because he raised a scant $4 million to Walker’s $30 million war chest.

Walker won because he had a vision, however brutish, and he forged a rich-poor alliance that supports it. Barrett lost because he stood for nothing, because the Democrat Party shuns organized labor, because labor retreats from street politics even when they have the upper hand and because progressives confuse elections with movements.

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June 6, 2012 · 2:59 pm

Wisconsin’s recall election: an ominous crucible of US politics (Guardian)

The right threw resources into Scott Walker’s anti-union fight, while the Democratic party stood by. That’s a recipe for defeat.


Wednesday 6 June 2012 10.16 EDT

Wisconsin Governor Scott Walker waves as he celebrates his victory in the recall election against Democratic challenger Tom Barrett. Photograph: Darren Hauck/Reuters

Forget the old saw, “All politics is local.” There is a kettle’s worth of tea leaves to read in Wisconsin Governor Scott Walker’s triumph over Democratic challenger Tom Barrett. The acrimonious 5 June recall election is a perilous omen for President Barack Obama’s re-election bid and a faltering labor movement.

Upon taking office in January 2011, Walker went gunning for public sector unions and social programs. He inadvertently ignited six weeks of animated protests as hundreds of thousands of people flooded the Capitol of Madison, eager to stick a wrench in Walker’s plans to turn the clock back on public healthcare, education and labor organizing.

Since the “Wisconsin uprising” began, the Tea Party movement and organized labor have clashed in three separate state-wide elections. Republicans snagged a critical state supreme court post in April 2011. That August, the GOP clung to a razor-thin majority in the state senate by holding four of six seats up for recall. Having pummeled the Democrats again, by a 53-46% margin, Walker and the right are riding high. The only bright spot for Democrats is that they appear to have captured one of four state senate seats, giving them a 17-16 majority.

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January 29, 2012 · 3:58 pm

Buying Elections (RT)

Russia Today talks with Craig Holman, Seton Motley and Arun Gupta on January 23 asking: How have Super PACs changed the face of campaigns? Are there too many Super PACs? How have they changed the tone of the debate? Do the ads they produce really help Americans figure out who is a better candidate? And can voters see who’s spending these unlimited amounts of money on campaigns?

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November 9, 2011 · 9:02 am

The American Dream As We Know It Is Obsolete (Alternet)

Why progressives need to think beyond the mantra of creating a “middle class America.”

We’ve hit 14 occupations thus far. The latest ones being Charleston and Huntington, West Virginia, and Lexington, Kentucky. One common refrain is “the American Dream” is no longer possible, it’s dead or it’s a nightmare. The American Dream is shorthand for the middle class utopia. It’s the post-WWII ideal of well-paying working class jobs that can support a family, which have full benefits, and hope that the next generation will be better educated, have more opportunities and greater prosperity.

It’s a powerful mythology that ignores how socially deadening post-war society was. It was based on American Apartheid, virulent anti-Communism and suffocating notions of sexuality. Poverty was still widespread at home, Cold War militarism and the rise of advertising boosted the economy and plunder from the underdeveloped world allowed for increasing standards of living at home.

In the following article published before the occupy movement began I argue against the idea that “saving” the middle class should be the center of political or social struggles. Now, this is highly relevant to the Occupy movement because many people we have interviewed think we can just return to this post-war fantasy with a few policy tweaks and an election or two.

Just as the current crisis festered over many decades and is thus deeply rooted in our socio-economic system, creating a new world means radically restructuring our society and social relations, something that is not going to happen overnight or by electing some Democrats.

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September 6, 2011 · 9:44 am

Islamophobia: The Network that Hates (The Indypendent)

September 6, 2011 issue

By Arun Gupta

American history is no stranger to opportunists posing as experts on fifth columnists or foreign subversives plotting to undermine our hallowed way of life.

Nearly a century before Sarah Palin, there was Seattle Mayor Ole Hanson. Months after the 1919 Seattle general strike, Hanson resigned his post, penned Americanism Versus Bolshevism, in which he warned that “the preaching and teaching of anarchy, syndicalism, sabotage and Bolshevism is being carried out throughout the nation,” and cashed in with a lucrative speaking tour.

During the McCarthy era, in addition to the infamous junior Senator from Wisconsin, there was a legion of self-styled experts on the grave threat posed by the monolithic Communist menace. FBI Director J. Edgar Hoover scrutinized in Masters of Deceit the Marxist method of “divide and conquer” so as to “soften up a democracy.” In The Politician, candy manufacturer and John Birch Society founder Robert Welch labeled FDR, Truman and Eisenhower as knowing agents of the Communist conspiracy. Fred Schwartz of the Christian Anti-Communist Crusade, “once suggested that communists promote abortion, pornography, homosexuality, venereal disease and mass murder … as a way to weaken the moral fiber of America and pave the way for a communist takeover,” according to Political Research Associates, a group of scholars and journalists that studies the right.

Historian Richard Hofstader argued in The Paranoid Style in American Politics that panic over foreign subversion stretches back hundreds of years. In the late 18th century, Scottish scientist John Robison stoked hysteria in the fledgling United States with his tract on the Illuminati, claiming it was formed “for the express purpose of rooting out all the religious establishments and overturning all the existing government of Europe.”

This dime-store Manichean resurfaced with dismal predictability after the Sept. 11 attacks with a new class of demagogues, ones who specialize in spreading Islamophobia. While anti-Muslim hostility found root in the fertile soil of American nativism, Islamophobia has become a national pastime thanks to the funders, think tanks, fear mongers and right-wing media and politicians promoting it.

Experts play a crucial role in the network as they receive  the funding to produce hyped-up reports on nonexistent threats. The reports are disseminated through the right-wing media and prominent evangelical ministers, often becoming part of the mainstream debate.

Having established a solution — that Islam, and by implication Muslims, need to be politically and socially restricted because they are a danger — Islamophobe activists search for a problem such as the “Ground Zero Mosque,” while politicians stroke the bigotry for votes.

The efforts came to fruition in 2010 with media disinformation, hate-spewing rallies and numerous attacks on mosques in the lead up to the 9/11 anniversary. Islamophobes also inspired Anders Breivik, the radical Christian extremist who confessed to slaughtering 77 people in Norway on July 22, saying he wanted to save Europe from a Muslim takeover.

FUNDERS

In its new report, Fear, Inc.: The Roots of the Islamophobia Network in America, the Center for American Progress describes the funders as the “lifeblood” of the network. It notes, “seven charitable groups provided $42.6 million to Islamophobia think tanks between 2001 and 2009 — funding that supports the scholars and experts.”

Donors Capital Fund — Contributed more than $17 million to the Clarion Fund in 2008, which helped pay for a DVD the Clarion Fund distributed, Obsession: Radical Islam’s War Against the West, to more than 28 million swing-state voters before the 2008 presidential election.

Richard Mellon Scaife foundations — Labeled the “Funding Father of the Right” by the Washington Post, Scaife is worth an estimated $1.2 billion and chairs three foundations that contributed $7.88 million to three Islamophobic groups, including the David Horowitz Freedom Center.

Lynde and Harry Bradley Foundation — The foundation that bears the deceased brothers names (both of whom were members of the John Birch Society) started bankrolling neoconservatives in the 1970s, backed Wisconsin Gov. Scott Walker’s attack on labor unions and provided $5.37 million in funding to anti-Muslim organizations.

Newton D. & Rochelle F. Becker Foundation — With a mission that includes “combating media bias against Israel and the Jewish people, Israel advocacy, and democracy defense,” this and another related foundation and trust have spread $1.14 million among seven different groups including ACT! for America.

Russell Berrie Foundation — Contributed $3.11 million to the Islamophobe network, with nearly 90 percent going to the Counterterrorism & Security Education and Research Foundation.

Anchorage Charitable Fund and William Rosenwald Family Fund — These two related funds have pumped $2.82 million in various organizations, including $2.32 million to the Middle East Forum.

Fairbrook Foundation — Controlled by Joyce and Aubrey Chernick, whose estimated fortune is $750 million. Investigative journalist Max Blumenthal writes, “Chernick has provided funding to groups ranging from the Anti-Defamation League (ADL) and CAMERA, a right-wing, pro-Israel, media-watchdog outfit, to violent Israeli settlers living on Palestinian lands and figures like the pseudo-academic author Robert Spencer, who is largely responsible for popularizing conspiracy theories about the coming conquest of the West by Muslim fanatics seeking to establish a worldwide caliphate.”

MISINFORMATION EXPERTS

Frank Gaffney — A Reagan-era defense department official, Washington Times columnist and founder of the Center for Security Policy, which published Sharia: The Threat to America, and created stop911mosque.com in 2010. Gaffney accuses the Obama administration of perpetrating “official U.S. submission to Islam,” and claims conservative groups have been infiltrated by Islamists and deems Gen. David Petraeus guilty of submission to sharia.

David Yerushalmi of the Society of Americans for National Existence (SANE) — Counsel for the Center for Security Policy, Stop the Madrassa and Stop Islamization of America, Yerushalmi co-authored Sharia: The Threat to America, which warns the Muslim Brotherhood is “effectively imposing shariah blasphemy laws in America” by demanding “tolerance of its medieval religious practices” and “repress[ing] free speech.” Apparently one of the Brotherhood’s insidious methods meant to achieve the “seditious goals of its civilization jihad” in America is through the Muslim birth rate.

Daniel Pipes of the Middle East Forum — Having served on the U.S. Institute for Peace as a Bush appointee, Pipes is the dean of Islamophobes. His organizations include Campus Watch, Islamist Watch and the Legal Project. Pipes calls for increased police profiling of Muslims and Arabs, writes that 10 to 15 percent of all Muslims are Islamists and “must be considered potential killers,” and supports a public ban of the veil because it’s a “terrorist-enabling” garment.

Robert Spencer of Jihad Watch and Stop Islamization of America — Director of the website Jihad Watch, his work and website were cited a whopping 162 times by Anders Breivik in his 1,500-page manifesto. Spencer describes himself as “a frequent Fox News contributor,” and believes Islam is the “only major world religion with a developed doctrine and tradition of warfare against unbelievers.”

Steven Emerson of the Investigative Project on Terrorism — Accused of fabricating evidence and using front groups to funnel millions of dollars to other outfits in his control, Emerson says Islam “sanctions … planned genocide as part of its religious doctrine.” Rep. Peter King has praised Emerson for his “expertise.”

POLITICAL FIGURES

Rep. Peter King
Newt Gingrich
Sarah Palin
Rep. Allen West
Rep. Michele Bachman

ECHO CHAMBER AND THE RELIGIOUS RIGHT

Fox News
Washington Times
Rush Limbaugh
Glenn Beck
Pat Robertson
John Hagee
Ralph Reed
Franklin Graham

‘ACTIVISTS’

Pamela Geller and Stop Islamization of America — An offshoot of Stop Islamization of Europe, SIOA was formed in 2009 by Pamela Geller and Robert Spencer. It claims “We are now in a new phase of a 1,400-year-old jihad against the kafirs (all non-Muslims everywhere),” and the consequences of “ignorance about Islam, its doctrine and purposes … can be nothing short of national extinction.” It was behind the “Leave Islam” ad campaign that ran on buses in New York City and Miami.

Brigitte Gabriel and ACT! for America — Head of the “largest grassroots national security organization in America” and author of They Must Be Stopped (guess who “they” is), Gabriel has been described as a “radical Islamophobe” by the New York Times. She has said Arabs “have no soul” and thinks Muslims should be prevented from seeking political office. She is a regular guest on Fox News and claims to have advised Rep. Peter King in his public hearings on “Radicalization in the American Muslim Community.”

David Horowitz and the Freedom Center — A highly effective inhabitant of the Islamophobe swamp, Horowitz has said “Middle Eastern Muslims are ‘Islamic Nazis’ who ‘want to kill Jews, that’s their agenda,” and his Freedom Center has funneled $1 million to Robert Spencer’s Jihad Watch since 2007. The center operates multiple outlets and projects promoting Islamophobia, including FrontPage Magazine and Jihad Watch websites, the NewsReal blog, “Islamo-Facism Awareness Week” on hundreds of college campuses, and a weekly lunch forum and yearly conference that provide a platform for notable anti-Muslim bigots.

EVENTS

Anti-Sharia Bills
In the past year, the anti-sharia movement has gathered a full head of steam in the Deep South and Southwest, which is apparently in danger of being overrun by the Taliban. Arizona, Louisiana, Oklahoma and Tennessee have passed laws banning the use of Islamic law in state courts, which is unconstitutional, while some two dozen states have seen similar legislation introduced since 2010. David Yerushalmi has been the driving force behind the anti-sharia movement in part by developing a template for state-level bills, which have been cut and pasted from his text in at least three different states.

Hearings on Muslim ‘Radicalization’
Rep. Peter King, R-N.Y., chair of the House Homeland Security Committee, convened hearings in March 2011 on alleged radicalization within the Muslim-American community. He has said there are “too many mosques in this country,” 85 percent of which are “ruled by the extremists,” and “we should be looking at them more carefully and finding out how we can infiltrate them.” King also authored Vale of Tears, a fictional account of Muslim terrorist attacks on Long Island that he called “half truth.”

‘Stop the Madrassah’
A purported community coalition that opposed the Khalil Gibran International Academy, New York City’s first Arabic dual-language school. Through Fox News, and New York’s right-wing media, Pamela Geller, Daniel Pipes and others demonized principal Debbie Almontaser as a “9/11 denier” and “jihadist,” and fomented anti-Muslim sentiment in general. Mayor Bloomberg forced Almontaser to resign in 2007, starved the school of funds and support, and announced the school’s closure in April 2011.

‘Ground Zero Mosque’
Neither a mosque nor located at Ground Zero, Park51 is planned to be an Islamic cultural center in lower Manhattan. Pamela Geller lit the Islamophobic fires with a May 2010 post on her Atlas Shrugs blog, calling Park51 “Islamic domination and expansion … It’s a stab in the eye of America.” By the summer, regular demonstrations at Ground Zero picked up the vicious rhetoric — portraying Islam as the enemy, with all Muslims wanting to “conquer unbelievers,” with the “mega-mosque … an Al Qaeda triumph.” While protests quickly faded after the 9/11 anniversary, the center was injected into the national discourse and Republican candidates around the country continue to shrilly denounce it as a wedge issue. Meanwhile, civil liberty groups have documented an increase in mosque attacks, saying “the anti-mosque and anti-Muslim sentiment expressed in the opposition to Park51 was not an isolated incident.”

(Credit: CAPAF Research)

This report used numerous sources, particularly Fear, Inc.: The Roots of the Islamophobia Network in America.

Photo credits: Richard Mellon Scaife, post-gazette.com; Frank Gaffney, Center for Security Policy; Rep. Michele Bachman, Flickr/gageskidmore; Rep. Peter King, peteking.house.gov.

Design credit: Mika Tarkela.


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