Solidarity Time: The Young People Occupying
Wall Street Are Standing Up for All of Us

By Carl Davidson
Keep On Keepin’ On

The actions of thousands of young people in New York City’s financial district, simply calling themselves “Occupy Wall Street,” is now entering a second week, with many camping out overnight in the area’s parks. How long its will continue and whether its numbers will swell is anyone’s guess, but the response of the NYPD in arresting and otherwise restricting them is already banging heads with our First Amendment rights to peacefully assemble.

“At Manhattan’s Union Square, police tried to corral the demonstrators using orange plastic netting,” reports the Sept 25, 2011 Washington Post. “Some of the arrests were filmed and activists posted the videos online. One video appears to show officers using pepper spray on women who already were cordoned off; another shows officers handcuffing a man after pulling him up off the ground, blood trickling down his face.”

Most of the youth are students, but many are also unemployed and underemployed young workers. And a small but important grouping of staffers and activists with NYC’s trade unions have also made their way downtown to spend a few hours helping out.

The students certainly have a just cause. While the denizens of Wall Street have bailed themselves out and paid themselves huge bonuses with trillions from the public treasury, these young people are saddled with a degree of crushing debt to pay for their educations that would have been unthinkable 40 years ago. If they manage to graduate, they face a financial burden large enough for a home mortgage-all before they start their first full-time jobs, assuming their lucky enough to find one that pays a living wage.

But these youth and students are fighting for more than their own immediate concerns. They have raised a whole range of demands-Medicare for All, defending social security, for passing the various jobs bills in congress, opposing racism and sexism, ending the wars, and abolition of the death penalty in the wake of the recent unjust execution of Troy Davis.

They are the cutting edge of a new popular front against finance capital.

Young rebels often manifest a moral clarity that awakens and prods the rest of us. Through their direct actions, they become a critical force, holding up a mirror for an entire society to take a look at itself, what it has come to, and what choices lay before it. The historic example is the four young African American students that sat at a lunch counter and ordered a cup of coffee in Greensboro, North Carolina back in 1960.

The Wall Street protests are thus a clarion call to the trade unions and everyone concerned with economic and social justice. While the youth are clearly a critical force here, when all is said and done, they are not the main force. That power resides in labor and in the wider communities. It’s in the hands of everyone that’s part of an emerging progressive majority for peace and prosperity, everyone that wants a U-Turn against the country’s current path to more wars and deeper austerity.

It’s time to exercise that power and lend a hand with active solidarity. More actions are in the works, including an occupation and encampment on Freedom Plaza in Washington, DC starting Oct. 6, following the ‘Rebuild the Dream’ DC conference focused on a renewed labor-community coalition for the 2012 election.

It’s going to take more than votes to push back the right wing and its Wall Street allies. It’s going to take some serious ‘street heat’ as well.

The Hot Potato Too Many Beltway Wonks Avoid:
The Need to Tie Job Creation to Industrial Policy

By Carl Davidson
Keep On Keepin’ On

If you want to be a good policy advocate for jobs these days, two starting points will help you a lot. One is to take off your national blinders and see the economy globally. The second is to grasp how the need for revenues to finance the creation of new jobs can best be filled by increasing taxes on unproductive wealth.

A good example of the problem is Robert’s Samuelson’s ‘Job Creation 101’ op-ed column in the Sept 12 Washington Post. If we simply follow his lesson plan, we would end up creating new jobs in the third world—and doing so mainly at the expense of the wrong people at home.

Samuelson begins his argument wisely enough by stressing how increasing demand for goods and services creates jobs, and government has to have a hand in it. But then he goes astray:

“If government taxed, borrowed or regulated less, that money would stay with households and businesses, which would spend it on something else and, thereby, create other jobs. Politics determines how much private income we devote to public services.

“To this observation, there’s one glaring exception. In a slump, government can create jobs by borrowing when the private economy isn’t spending.”

On the first point, tweaking taxes so both people and businesses have more cash to spend glosses over the matter of where and how the money is spent. Using extra income to pay down your Visa Card doesn’t help job creation much. And if you spend it at Wal-Mart or other big box stores, you’ll create some demand to hire more workers in China or Malaysia, but not much here.

On the second point, it’s not always wise to create jobs simply by borrowing. It certainly adds to the revenues of the banks and bondholders.  But it’s much smarter to go after unproductive pools of capital with progressive taxation. The proposal for a financial transaction tax on Wall Street speculators is an excellent example.

The rule-of-thumb is to tax activities you want to discourage, such as unproductive gambling in derivatives, while subsidizing efforts you want to encourage, such as new green manufacturing startups. It’s called ‘industrial policy,’ and it’s why some countries that have one, like China and Germany, are weathering the economic storms better than others.

If Obama’s new jobs program is going to be thwarted by a hostile Congress anyway, those politicians who are serious about creating jobs would do well to fight for the best options-direct government programs that fund increasing local demand for local labor and raw materials.  If we had every county in the country funded to build a wind farm or solar array as a public power utility, it would be a good start. So would the building of the new and massive ‘Smart Grid’ power lines for clean and green energy.

When finance capital’s opposition in Congress rears its head to crush something that makes perfect sense to everyone else, then we’ll learn exactly who is part of the problem and who is part of the solution. If we get political clarity here in a massive way, we’ll be in a much better position to assemble the popular power required to get what we really need.

Yes, We Need a Jobs Program, But One
That Doesn’t Tinker Around the Edges

By Carl Davidson
Keep On Keepin’ On

Our regional daily newspaper, the Pittsburgh Post-Gazette, to its credit, came out with an editorial today, Aug. 22, 2011, urging President Obama to push for a substantial jobs program over Republican opposition.

“Action on jobs: Obama must push hard to get people back to work” is the headline, and a key point stresses “Mr. Obama now needs to offer proposals equal to the size of the problem. That means bold strokes, not half-measures. If his Republican antagonists in Congress are determined to stand in the way of getting Americans back to work, the president must say so publicly — and then go over their heads to enlist the nation in his effort.”

Terrific, a good framing of the question. Unfortunately, however, once you get into the substance of the piece, it turns into a muddle. The Post-Gazette offers up a hodgepodge of proposals that tinker around the edges of the problem-more tax cuts and credits for jobs created, more unemployment benefits, and oddly, more trade deals, even though these deals mostly result in net job losses.

Here’s the heart of the matter. In a down economy, jobs are created by increasing demand, by more customers with bigger orders coming to a firm’s doors. The problem is that consumer demand has taken a nose dive when the credit bubble burst. People don’t have money to spend. They’re cutting back on everything, and trying to unload their debt. This means business-to-business orders shrink as well. Companies may be cash-rich and have high profits, but with no increase in orders or customers at their door, they aren’t likely to hire people to do nothing just to get a tax credit.

This is where government has to become the key customer. It has to make huge productive purchases for local work and local materials to build productive infrastructure-county-owned green energy plants, new and improved schools, modernized locks and dams, Medicare for all, investment in young students and veterans like we did with the GI Bill, investment in research in new industries, and so on.

Most important, to work well, it can’t be nickel-and-dimed to death. It has to be on the scale of the expenditures for World War 2. That’s when the ‘multiplier effect’ can kick in, and related growth in manufacturing can take off in turn. And it has to be paid for by going to where the most appropriate money is, imposing a financial transaction tax on unproductive and destabilizing speculation by Wall Street.

The best the P-G does on this matter is to support Obama’s proposal for an ‘Infrastructure Bank,’ but urges him to find a way to bypass a GOP roadblock in Congress.

But even that is too passive. It says, in effect, here’s a small pot of money. If you want to repair some roads, come and get some.

What we really need is something like the New Deal’s Tennessee Valley Authority and Works Progress Administration, but on steroids, a TVA-WPA-CCC 2.0. We need to pass John Conyer’s HR 870 Full employment Bill. We need the Dept. of Energy and the Dept. of Labor to go to every county in the country with a fully funded proposal to build new green energy wind farms and solar power arrays as public energy utilities, hiring local workers at union scale, with no obstacles to a union election. And that’s just for starters.

Yes, we need a serious jobs program. But it’s time for everyone who utters that phrase to get serious themselves. Why? Because it’s going to take a massive upsurge in class struggle to get it by removing those standing in the way.

[Carl Davidson is a Steelworker Associate and a retired computer technician living in Beaver County.  His ‘Keep On Keepin’ On’ column appears in Beaver County Blue, website of the 4th CD Progressive Democrats of America.]

Shock Doctrine as a Two-Way Street:
The Approaching Winter of Our Discontent

By Carl Davidson
Keep On Keepin’ On

Watching the rebellions of the young and poor continue in London and now spread to other industrial centers in the UK raises an interesting question: Will the Arab spring and the European summer lead to a fall and winter of discontent here in the USA?

All the makings for it are here. We have impoverished communities of the unemployed where there are huge numbers of young people who have never had a regular job of any sort. Now that any form of taxing the rich for funding a jobs program like that proposed by Rep. John Conyers’ HR 870 has been declared ‘off the table,’ it doesn’t appear likely to change, either.

Add to that the GOP’s ‘Shock Doctrine’ (with an assist from the White House) of creating a neoliberal deficit hoax to take from the working class and give to Wall Street, and you spread deeper misery across all of Main Street.

Now the AFL-CIO, thank goodness, is calling for a new round of mass actions against austerity and in defense of the tattered safety net. Add to that the October2011.org project, where the peace and justice movement is planning to camp out in downtown DC’s Freedom Plaza until all the troops are brought home from the wars.

It’s a perfect storm shaping up.  Hopefully, many of our young unemployed and under-employed will be drawn to these events. But any police outrage could set off a chain reaction like those in London-we’ve seen this many times in our history.

We have a few decent politicians facing up to the problem, like the 80 votes of the Congressional Progressive Caucus behind the People’s Budget. But our top political class has declared their efforts ‘off the table,’ too.

In brief, they’re telling us our views don’t count and we have nowhere to go.
That’s what the bigwigs in London thought, too. Now they’re all in a tizzy about riots and violence. In contrast, in one NBC report, a young man in Tottenham was asked if rioting really achieved anything:

“Yes,” said the young man. “You wouldn’t be talking to me now if we didn’t riot, would you? Two months ago we marched to Scotland Yard, more than 2,000 of us, all blacks, and it was peaceful and calm and you know what? Not a word in the press. Last night a bit of rioting and looting and look around you.”

Of course, many small shops and working-class homes, unfortunately, are being harmed in the UK events. Street heat is best when the target is narrowed on the upper class, and you keep the moral high ground. That way you can draw even more millions into relatively peaceful assembly with powerful and lasting implications. But when long-ignored social dynamite explodes, things don’t always work out that way, with the well-controlled niceties of a tea party, no pun intended.

It is right to rebel against outrages and unjust conditions imposed from above. The ‘Shock Doctrine’ is a two-way street, and once it erupts, more than you might think will know which side of the barricades to gather on.

Jobs and GOP ‘Dialectics’: Turning Things Into Their Opposites

By Carl Davidson

Beaver County Blue

People sometimes either groan or laugh when they hear the term ‘dialectics,’ a word which some people use to bamboozle others into thinking they know something when they don’t.

But here’s a great ‘laughing out loud’ example inspired by a few lines for Mike Hall’s current post on the AFL-CIO blog today, Aug. 2:

“The 4,000 furloughed Federal Aviation Administration (FAA) workers and 90,000 workers on airport construction projects stalled by the Republican shutdown of the FAA are worrying about how they will pay their bills in the coming weeks.

“But the only worry House Republicans have is how they are going to spend their six-week summer vacation. House Republicans leaders adjourned the House last night until Sept. 7 without taking action on reauthorizing an FAA bill so the agency—shutdown since July 22—could reopen and construction funds move down the pipeline again.”

So here’s a great example of Republican ‘dialectics’, their ‘Jobs Plan’ of turning real jobs into their opposites, non-jobs. It’s easy to laugh at, if it didn’t mean so much suffering for so many working-class families. I suppose we could say there’s a ‘unity of opposite’ there, too.

One thing that burns me up more than GOP nonsense, though, are many of the mainstream media pundits who don’t have any idea on how to ask a decent follow-up question. When our right wing lawmakers (and their White House allies) go on at length about cutting this and slashing that, taking money from low-income and middle-income workers and giving it to the super-rich, there always comes a point where they assert, ‘and this will create jobs!.’

Back in my youth I taught logic for a year at the University of Nebraska. Full disclosure here: I actually appreciate real dialectics, and other rules of argument. But one point I often made to my students: An assertion is not an argument.

Now why can’t our media pundits say, ‘Wait a minute here, Congressman (or other policy wonk). You’re cutting both spending and jobs, reducing overall demand. Then you assert this creates jobs? Can you tell us exactly how that works? Especially when it’s mainly demand that creates jobs? An assertion is not an argument.”

If I heard it just once on CNN, it would make my day.

My logic course back in 1965 was for incoming freshman.  Wouldn’t it be great if news anchors could at least reach that level, even if it’s too much to expect of Congress and the White House? All the more reason we have to rely on our own labor-oriented blogs and news services. We know how to make use of decent dialectics, and put a spotlight on the foolish versions of our adversaries.

Lies, Blue Smoke and Mirrors: The Neoliberal-Tea Party Jobs Plan at Work

By Carl Davidson

File this under the ‘Why is Anyone Surprised Dept?’ 

This morning’s Pittsburgh news media lets us know that more and more Pennsylvanians are unemployed. Particularly,  it’s in ‘Unemployment rate up in Pennsylvania’ in the Pittsburgh Business Times by Paul J. Gough.

What’s interesting is how it gets spelled out:

“Pennsylvania’s unemployment rate rose slightly in June as the Commonwealth followed an upward trend of national jobless data that has been rising since the spring.

“The state’s unemployment rate was 7.6 percent in June compared to 7.4 percent in May, according to data released Thursday afternoon by the Pennsylvania Department of Labor & Industry. That translated into a net of 2,600 jobs lost to a total 6.3 million people employed in Pennsylvania. Specific data for Pittsburgh won’t be released for several weeks, but unemployment increased in Pittsburgh to 7 percent in May, the most recent month where data is available.

“Much of the decreases were due to 7,800 jobs cut in education, health and social services. Also losing jobs were financial (2,000 jobs), leisure and hospitality (1,400 jobs), and professional/business services (1,700 jobs).”

What this means is that our GOP governor’s plan is working as designed. He and others of his ilk are determined to slash government spending on social services and the work force that provides them.  Now if we combine this with taking money from low-income and middle-income workers, and give it to the superrich as tax cuts, we can help the ‘recovery’ of the wealthy by reducing consumer demand from the rest of us.

Now put these two planks together, and you have the GOP-Blue Dog-Tea Party plan for employment, and as we can see, it’s working rather well.

Of course the numbers are going in the opposite direction from what they’ve been claiming will happen. Maybe we just need even more layoffs and even less spendable income at the bottom, and then we’ll really see things take off!

Now Obama’s problem is buying into this. But if he’s going to sell it beyond the business press, it’s going to need a sales team with a lot of lies, blue smoke and mirrors.

What is Finance Capital? Quick Reply to a friend who needed an answer in a hurry for a meeting of workers:

Capital divides into two, productive and speculative. Productive is when you and a few folks get a bright idea for a new product, and pool or borrow money to start producing your product, take it to market, and make money. In short, you create wealth. Speculative capital in financial markets is when you and your friends cash your checks at the end of the week and go to the casino. You may or may not come home with more money—most will not—but no new wealth is created in any case.

To draw out the analogy, the casino’s ‘house cut’ on all the bets, winner and losers, is what the financial transaction tax does. If you make it high, it discourages gambling, which is a social good.  Taxes that are too high on productive capital, however, discourage new wealth creation indirectly, so we want to keep it low—or even give subsidies to new green manufacturing startups.

Ask any business person, in a down economy, which would they rather have—more customers and purchase orders, or more tax cuts? In a heartbeat, they’ll tell you more customers, and they won’t give a damn whether the purchase order comes from government or not. Tax cuts are way down on the list. Demand creates jobs, not diddling with tax codes.

It’s Carl’s ‘down and dirty definitions,’ but I hope they help!

Going to one of the hundreds of meetings around the country called by Van Jones and MoveOn.org?

What should we do when we get there? First, listen, assess views and count. But if you don’t have a strategy, you’re part of someone else’s strategy.

Overall, we are going into these things to develop a popular front vs neoliberalism and its rightist allies. That means organizing forms at the grassroots with platforms that that can unite a progressive majority—Progressive Democrats of America, Working Families Party, Greens in some cases—and then using these as a base community to build broader coalitions with labor and community and youth groups outward and upward.

We have to develop these base organizations and coalitions, using central labor councils where appropriate, to have both an electoral and a mass action capacity to put heat on the local reps of the more backward forces. At key goal is to build the strength of the Congressional Progressive Caucus.

For jobs, we push HR 870 and mass local meetings to define its local specifics and to fight for the tax policies that will fund it, framing it with a ‘jobs not war’ and ‘windmills not weapons’ outlook.

All that we already agree on. Once we get into these meetings, take stock, we can make adjustments and additions or subtractions. Let me know how things work out.

Why we still need a serious clean energy and green manufacturing stimulus on the scale of WW2 spending Dept.

Paul Krugman hits the nail on the head in today’s 7/11/11 NYT:

“Excuse No. 4: We tried to stimulate the economy, and it didn’t work.

Everybody knows that President Obama tried to stimulate the economy with a huge increase in government spending, and that it didn’t work. But what everyone knows is wrong.

Think about it: Where are the big public works projects? Where are the armies of government workers? There are actually half a million fewer government employees now than there were when Mr. Obama took office.

So what happened to the stimulus? Much of it consisted of tax cuts, not spending. Most of the rest consisted either of aid to distressed families or aid to hard-pressed state and local governments. This aid may have mitigated the slump, but it wasn’t the kind of job-creation program we could and should have had. This isn’t 20-20 hindsight: some of us warned from the beginning that tax cuts would be ineffective and that the proposed spending was woefully inadequate. And so it proved.”

I’m printing out this quote, and together with a bunch of labor activists, I’ll drop it off today at my Blue Dog Congressman’s office. Since I doubt it will do much good with him, I’ll pass it around to everyone else, preparing for bigger and tougher vattles to come.

Carl Davidson ranting:

Watch CNN reporting on the economy this afternoon, and many prior similiar shows, I’m sick of the airheads, both commentators and guest economists, who refuse to say the simple truth that in a down economy, jobs are produced BY INCREASING DEMAND!  It’s demand, stupid!  Business hires more workers when they have more customers and can’t keep up with the orders. Tax and regulation adjustments are way back on the list.  What’s more, they can’t get it through their heads that there are not a zillion consumers sitting around with piles of money just waiting to buy things, if only the righ got one more tax cut. Consumer buying capacity has shrunk, and not the GOP airheads want to shrink demand by government to boot.

We need WPA/CCC 2.0, a massive green jobs and clean energy stimulus, not the half-hearted one that got half-hearted results earlier on.

Where are the jobs? You’ve been doing you damnest to destroy them by ignoring or short-changing the demand side, that’s where they are.

This is no rocket science. But it doesn’t fit the neoliberal line, so it gets squished in the media. Makes me want to throw things at the TV and throw out any politician who repeats this crap.