Is the Wealth of the Rich Legitimate? Part 2

In a previous post I argued that the wealth of the rich (more precisely: of capitalists) could not be justified by reference to the principle that "each person deserves that amount of wealth that reflects her productive contributions". Capitalists need not do anything productive in order to be capitalists. The pure capitalist earns everything from owning and nothing from working (that is, to the extent that a capitalist can be said to earn from working, she is to that extent not a pure capitalist).

But, as I discussed in the previous post, this story about desert and productive contributions is only one among many. Another (perhaps the most popular?) story that's told to legitimate the wealth of capitalists is that their wealth is a reward for having taken bold risks. Or, put another way, since the capitalist risks her capital when she invests it in some business venture, she deserves exclusive rights to all of the returns above and beyond costs paid out for raw materials, wages for workers, etc.

This story is told so frequently that it almost seems odd to question its plausibility. But how plausible is it?

Let's try to first figure out exactly what its saying. Is it saying that people should be rewarded in proportion to how much risk they take on? That can't be right. That would mean that the riskier I behave, the more I should be rewarded (whether or not the risk pays off). But, of course, it's a fact about risks that they can turn out for better or for worse (otherwise they wouldn't be risks). Risks always involve some element of luck and chance wherein the risk could turn out badly. But nobody in their right mind would say that the mere fact that I've taken on some risk (whether or not it pans out) means that I should be rewarded. For example, no one would say that some particular capitalist, just because they take on risks, deserves a return on their investment. If I, for example, invest in a business that has a 10% chance of succeeding, and it doesn't succeed, nobody thinks that this entitles me a cash "reward" of any kind.

But if that's not what's meant by "reward for risk", what is? Perhaps what's meant is that the capitalist's riches are her reward for having taken a risk that ended up panning out. If I bet against the odds and win, then it looks like what I get is my reward. Why not say the same about capitalists whose investments pay off?

There are several things to say here. First, it's just false that risky capitalist activity actually gets higher rewards when it pays off. Sometimes it does, sometimes it doesn't. And lots of capitalist activities aren't risky at all. An investment need not be risky to be very lucrative. If some public asset (a natural monopoly, say) is privatized and I get ownership of it, I may be able to charge fees and earn big profits even though there is virtually no risk. Or, consider that many financial institutions are, and they know that they are, "too big to fail."

We must also take into account that risk context sensitive in various respects. What may be risky for me (given my situation) may be less so for you (given your situation). Imagine a working class person who saved money for years to open up a small coffee shop. This is surely a risky activity since she will need to take out big loans on a project that could very easily go bust (and it's not as if they have millions to spare if it does). Now, imagine that I invest $40 million of a $140 million fortune in relatively low-risk securities that turn out to pay out big dividends. Instead of risking my capital on start-ups, I put it all in well-established, multinational corporations. So, I'm reaping large cash "rewards" from my investments, much larger (even in proportional terms) than the returns a successful small coffee shop owner will ever earn. But I am taking on very little risk whereas the newly petit bourgeois coffee shop owner is taking on a great deal of risk. There are innumerable examples of this sort. What they show is that capitalism doesn't, as a matter of fact, distribute wealth in accordance with the principle that riskier bets (that pan out) receive larger cash rewards than those that involve less risk.

But this isn't likely to satisfy defenders of the "risk and reward" view of why the capitalist's earnings are legitimate. They will probably reply by offering two different objections. The first has to do with the idea that capitalism is a fair game where the winner deserves to take all the spoils of victory. The second has to do with incentives and innovation. I'll examine (and refute) each in turn.

The first objection is as follows. Capitalism can be thought of as a fair game in which everyone (legally speaking) has a chance to be a successful capitalist. As long as the rules of this game are fair, then whatever outcome results from it is legitimate. So, for example, when I play blackjack and the casino hasn't rigged the game in their favor, and both the casino and I have consented to play the game, whatever I take home in winnings is legitimately mine. Capitalism, you might think, is the same way. If I risk $10 million on a risky investment and it pans out, why aren't I entitled to (or deserving of) all of the cash returns in the same way that I'm entitled to the cash returns of the game of black jack? In fact, wouldn't taxing the capitalist's profits be similar to stealing a gambler's winnings, even though she made a fair bet in both cases?

There are a number of things to say here. We might ask whether the "game" of capitalism really is fair (I shall argue that it isn't, and that the gambling/investing metaphor is misleading). But even if it is fair, we might still ask whether it makes sense to structure our economy like a winner-take-all casino game. I shall argue that there are deep problems (both structural as well as normative) with allowing the economy to be run like a casino.

Let's examine the fairness of the "game of capitalism." First, recall where capitalism comes from (read Part 8 of Capital for a detailed historical analysis): the expropriation and killing of indigenous peoples and European peasants, the forcible seizure and enclosure of commonly owned land, colonial domination and forced labor, the enslavement of human beings, and so on and so forth. And we could add that capitalism didn't leave imperialism, violence, oppression, racial domination, coercion, theft, and expropriation behind after the 17th and 18th century: these have been permanent features of the system throughout its existence. So the "game" is rigged from the start. There has never been a "level playing field" from which to begin the game.

But, suppose that there was a level playing field. Would that fix capitalism's problems? Would that mean that the "game of capitalism" is actually procedurally fair? I think not. First of all, not everyone can play the game of capitalism. In order to play, you must have something to invest (because that's one of the rules of the game). Now, defenders of capitalism will say that nobody is legally excluded from playing the game. But that's clearly a flawed argument. First of all, it's a fact that lots of people, indeed the vast majority of people, do not have the discretionary funds to play the game. David Schweickart makes the second point forcefully as follows.

Suppose you and I flip a fair coin; we each bet a dollar per round; heads I get your dollar, tails you get mine. The game is "fair" in the sense that we both face the same odds at any toss of the coin. However, a complication arises when we look at the game in light of its initial conditions. If I enter the game with $20 and you with $10, you are twice as likely as I to go bust. If you do go broke, and another player enters with $10, he will be three times more likely to be cleaned out than will I (because my initial stake has been supplemented by your losings)... So the large investor, although he has more to lose, is less likely to lose than is the small investor. Add to this that wealth gives one access to information, expert advice, and opportunities for diversification that the small investor lacks, and we see that the balance between magnitude of loss tilts toward the wealthy.

What this shows is that even textbook "ideal" capitalism isn't a fair game.

But there are further problems with this game, even if it was "fair". First of all, it presupposes that some people are playing the game--the capitalist investors--while others, who own no capital to invest, do the work--the workers. And while the capitalists are busy playing the casino-like game of capitalism, workers have no say in what is going on. Yet, and this is key, they stand to lose even more than the capitalists if the bet fails. That is, if a capitalist investor loses $10 million on a deal, but still has $3 million back at home, it's not as if he will be going hungry any time soon. But if 2,000 workers lose their jobs, we can be sure that they don't have million dollar nest eggs sitting at home waiting to be spent. Unemployment, as millions of Americans know first hand, can be absolutely devastating--particularly when wages and benefits are so meager even during periods of full-time employment. Capitalists, of course, stand to lose more in absolute dollar terms, but because of the diminishing marginal utility of money, it means much less to them. Think of the way that the economic crisis has gone thus far. The reckless, profit-driven investments of the financial sector produced a global crisis that has had devastating effects on working class living standards at the same time that it has primed the pumps for austerity administered from above. The point is this: casino capitalism is unfair because it presupposes a class of working people who can't play the game but, nonetheless, stand to lose a great deal if the capitalist's gambles don't pan out.

Imagine a capitalist who replies to a labor union as follows. "I risked all of my capital on this business, so who are you to collective bargain to get a piece of it? That's unfair because I assume all the risk, yet you want to share in the rewards." Now, we've already seen that this doesn't work because the workers do share in the risk--the risk of losing their job--even though they are guaranteed none of the winnings. But we can also add that it's not as if the workers were asked to share in the risk. It's not as if the boss will ever say: look, if you like, we can make this a worker-owned and worker-run collective in which we all share the risk (and the profit) equally. So it doesn't make sense to complain that workers share none of the risk.

One further thing to say regarding the idea that our economy is best thought of as a casino-like game in which the winner takes all. It is not clear that it makes any sense to structure basic economic institutions in this way at all. The economic system should exist to draw on the mutual benefits that we get from social cooperation. What we can accomplish together is far greater than what we can accomplish alone: that should be the basic organizing principle of any just economic system. The casino-style setup, however, exploits the fact that an economy requires mass participation, takes this mass participation for granted, and then haphazardly doles out lump sums to individuals who happen to get a good roll on the dice. That makes no sense to me. Let's use the power of economies of scale and increased productivity to maximize human capabilities, to meet socially recognized needs, to do great things together that we couldn't have done alone. Rather than being trapped inside a casino that I never asked to enter in the first place, I'd rather be a member of a self-governing community in which the condition for the free development of each individual is the free development of all.

But there is one last objection to my argument--which has to do with incentives and innovation--that I mentioned above. It goes as follows. A flourishing society requires that people take risks, innovate, try out new methods and techniques, and produce new things that may not ever pay off. I agree so far, but the objection isn't finished. It continues: in order to get people to take risks and innovate, they must be motivated by large cash rewards. And that means that capitalism is the only system in which innovation and risk-taking can flourish, because without the big cash rewards that the market hands out to successful businesses people wouldn't be motivated to innovate.

First of all, we've seen that capitalists don't need to do any innovating at all. They can pay someone else to do it. Capitalism--where there is private ownership of the means of production which are run in order to enrich the owners--does not distribute wealth in accordance with who is the most innovative or who takes on the most risk to make some socially useful good. There is no close connection between being a capitalist and being an innovator. R&D departments--many of them subsidized by public funds (this is called "externalizing costs")--do that. Much R&D is located within universities--which are more feudal, guild-like institutions than they are capitalist.

Second, it is demonstrably false that people need huge cash rewards in order to innovate and do great things. Great scientists, great novelists, great musicians and artists, and so forth rarely do what they do out of a single-minded focus on cash reward. Think of those who develop open-source software. I think it is true of a lot of people that if they were guaranteed a basic standard of living, they would be happy to spend a large portion of their time developing open-source, free software for the betterment of all. There are too many examples here to count. People, of course, want an adequate standard of living in which they don't want for any basic necessities, in which they have adequate leisure and a degree of discretionary spending. But that doesn't mean they have to have huge million-dollar rewards to socially-useful things.

Finally, capitalism thwarts a ton of really important innovation while it privileges others. Many know about the strange murder of the electric car. There are other examples of this kind --particularly green technologies that aren't profitable or undermine the profitability of natural resource extraction. In fact, we may never know how many great ideas are out there that haven't been given a try simply because capitalist production can't earn a profit off them (or because they take too much long-term planning or upfront investment, as is the case with much green technology). To be sure, there is a place for competition to determine who should win socially-produced funds for some new innovative project. But that doesn't require capitalism. Despite encroachment from corporations and moneyed interests, grant funding for scientific projects doesn't involve capitalist markets or profits.

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Is the Wealth of the Rich Legitimate? Part 1

Is the wealth of the rich in contemporary capitalist societies legitimate? Of course not. But the rich have a vested interest in making sure that the majority of the population --who aren't rich-- think that their wealth is legitimate. It hardly matters whether it's aristocratic privilege, family lineage, racial or sexual supremacy that makes a group dominant. It remains true that dominant groups almost always try to preserve the basis of their own dominance.

Dominant groups typically have two (analytically distinct, but in practice interwoven) means of maintaining dominance. The first is obvious. Dominant groups typically monopolize control of the means of exerting physical repression. If you push too hard against the status quo, dominant groups will always (if possible) push back with physical repression in order to protect their dominant status.

But dominant groups never maintain their dominance through naked violence alone. They have another means at their disposal: ideology. That is, dominant groups stabilize their rule by telling stories about why their rule is legitimate. Think of the "divine right" of Kings, the "positive good" doctrine that purported to justify the dominance of Slave owners, the so-called "civilizing mission" that Colonization attempted to carry out, the supposedly "scientific", technical expertise of bureaucrats. The stories the rich tell about the supposed legitimacy of their wealth are a key part of this long tradition of lying to the masses to protect privilege and power.

What are those stories? The most common one is that the rich deserve their wealth because they work hard to produce it. Because the wealthy (the "job creators"!) make such important productive contributions to society, the story goes, they deserve every cent they earn. Another story is that the rich deserve their wealth because they undertake a great deal of risk when they invest it. Yet another story that is told, perhaps the least plausible of all of them, is that the rich deserve their wealth because they sacrifice more than others (by saving and foregoing consumption). Finally, there is the claim that the wealth of the rich is legitimate because they are legally entitled to it in a regime of private property where ownership titles are distributed by way of voluntary exchanges.

Now, in practice these legitimating narratives are often run together and interwoven. The war of ideas is never as clear cut and organized as academic discourse aims to be. But for our purposes --that is, for the purpose of showing that all of these stories are pure fiction-- we'll examine them each separately in a series of blog posts (of which this is the first). In examining each, I'll follow closely along the lines of the arguments put forward in David Schweickart's excellent book Against Capitalism. Anyone interested in seeing a detailed, rigorous refutation of every familiar argument in favor of capitalism would do well to pick up a copy. In what follows, we'll just examine the first. The other stories will be taken up in subsequent blog posts.

The first story says that the wealth of the rich is legitimate because it is their reward for making productive contributions to society. A more technical way to say this would be the following: in a "purely competitive free market" what the wealthy earn directly corresponds to their marginal productive contribution in the economy. In neoclassical economic theory --which is little more than an elaborate way of cheerleading for (rather than critically analyzing) capitalism-- this is called the "marginal productivity theory of distribution." As an early defender of this view puts it, "the natural effect of capitalist competition is... to give each producer the amount of wealth that he specifically brings into existence."

Before we show why capitalism is not a system in which each receives according to what each produces, we need to do a bit of table setting. In order to produce anything at all, two things are required: labor and means of production (e.g. factory equipment, instruments, technical knowledge, land, space, etc.). It is a fact about capitalist societies that the vast majority of those who labor for a living do not own the means of production they use at work. The owners of the means of production are usually distinct from the group uses those means. Up to this point we've been talking about "the rich" or "the wealthy" --but to be more precise we're actually interested in capitalists (i.e. that group who earns a living by owning, rather than using, the means of production).

Now, everyone knows that those who labor (by using means of production) to produce goods make productive contributions to society. Auto workers, for example, use their own two hands to build cars that wouldn't have existed if they hadn't built them. Their productive contribution is clear, and so it is with all workers in society. But what we want to know is whether capitalists actually make any productive contributions to society in order to receive their income. If they did, and if capitalism rewarded their productive contributions proportionately, it would look like their wealth was pretty legitimate.

But what is the productive contribution of capitalists in our economy? Notice that we can't just define their productive contribution in terms of what they receive from the market, since that is circular. We want to know whether the market actually gives each what they deserve. So we can't very well say that what people deserve is what the market gives them --that begs the question. What we're trying to figure out is whether the market actually distributes according to productive contribution.

Some will say that the contribution capitalists is their entrepreneurial spirit and innovating attitude. Others will say that capitalists do a lot of work co-ordinating and managing the productive process. No doubt ingenuity and creativity are required to make a capitalist firm successful. Even a socialist society would require ingenuity, innovation and "entrepreneurial" spirit of some kind or other. Likewise, co-ordination and workplace organization are essential. But notice that capitalists can simply pay someone else to do all of the innovating, all of the managing, and all of the co-ordinating. And they often do. If I'm a capitalist, I can hire a management consultant, an industrial engineer, and a research and development team to do all of the managing, organizing and innovating. But I'm still a capitalist --and I'll still earn handsome sums of cash for myself (indeed, I'm in a position to earn far more than anyone else in the entire firm even though I don't do any real work). So in this case, where's the productive contribution that supposedly legitimizes my massive sums of wealth?

Some will say that what I'm doing is "providing capital". After all, we said that two things --means of production and labor-- were needed to produce goods. We know that workers make contributions by laboring to produce things. But it is, of course, true that the means of production (e.g. capital, the factory space, instruments, etc.) add value to the final product. And capitalists, by definition, own and control the means of production. So aren't they performing an essential productive function by providing it? Couldn't we say, then, that this is productive contribution that justifies capitalist wealth?

But let's think about this for a moment. What exactly is going on when a capitalist provides capital? They are doing nothing more than "allowing it to be used". They are doing no more than granting permission to make use of an already existing material thing --e.g. factory equipment, raw materials, etc. But, as Schweickart points out:

...an act of granting permission, in and of itself, is not a productive activity. If laborers cease to labor, production ceases in any society. But if owners cease to grant permission, production is affected only if their authority over the means of production is respected. If it is not, then production need not diminish at all. Workers can continue doing exactly what they were doing before --producing corn and bread and steel and machine tools and all the other commodities required by their society. Whatever the owners are doing when they grant permission for their assets to be used, it should not be called 'productive activity'.

To drive the point home, consider the following example.

Suppose a government suddenly nationalizes the means of production, then does nothing else but charge workers a tax to make use of it. We wouldn't say, would we, that the government is engaging in productive activity, or that the tax is a return for the government's productive contribution? Not even if the tax rate is exactly equal to the marginal product of the productive labor.

But some will reply here that there's a difference between providing physical means of production (e.g. raw materials, tools, factory equipment, etc.) and providing capital investment funds to finance a productive endeavor. Surely providing an already existing material thing --whether it be factory tools, land, etc.-- is not a productive activity. It is no more than granting permission. But isn't financing production by lending capital a productive activity that takes a great deal of skill? Schweickart gives us an excellent example here: "Consider a person with a chest full of cash, eager to invest. How he acquired it need not concern us. We want to understand how his disposal of it will increase production. To produce something, there must be brought together equipment, raw materials, and laborers. Let our investor lend his money to an entrepreneur who purchases these necessaries. The laborers are set to work with the machinery and raw materials, and soon goods are produced. It is all quite simple. But notice, this is also a matter of granting permission. The workers, the raw materials, and the machinery already exist. The workers could begin production themselves, except that property rights intervene. They cannot gain access to the machinery and raw materials, for these things are the property of others. To use them, one must have permission, which the entrepreneur secures by means of her borrowed capital." But permission is only needed if one respects the authority of the legal titles to ownership of the things needed to produce. So the workers could produce just as well without permission if they didn't respect that authority. It follows, then, that permission is in no way a productive contribution.

Take another of Schweickart's examples:

Suppose, instead of relying on our friend with the chest full of money, the government simply rolled out its presses to produce the same quantity of crisp bills and gave them to our entrepreneur. Exactly the same production would result. But would we want to call the printing of the money a productive activity? That would surely be misleading, perhaps dangerously so, tempting officials to believe that rolling the presses longer and longer would miraculously generate wealth.

The point of all of this is that "providing capital" is not a productive activity. But if that's true, then we are forced to conclude that capitalists, qua capitalists, make zero productive contributions even though the market gives them the lion's share of the surplus created by society. As even John Kenneth Galbraith put it,

No grant of feudal privilege has ever equaled, for effortless return, that of the grandparent who bought and endowed his descendent's with a thousand shares of General Motors or General Electric. The beneficiaries of this foresight have become and remain rich by no exercise or intelligence beyond the decision to do nothing, embracing as it did the decision not to sell.

Or, if you'd like another example, examine a graph showing real wages for workers and worker productivity from 1973 to the present. What you'll notice is that productivity goes way up whereas wages stagnate. Someone reaped all of the difference and got filthy rich, but it wasn't the workers who were producing more and more each year. Again, we see that market distributions don't reflect productive contributions.

So what explains the fact that capitalists own the vast majority of wealth in our society? They don't receive this wealth as a result of any productive contribution they make. When they earn interest or dividends on their invested wealth, they need not do anything productive at all. When they make millions from arbitrage, they haven't done anything productive whatsoever. So in virtue of what do they earn such vast sums of wealth? In virtue of their ownership. Whereas the vast majority of us have no choice but to earn a living from the work that we do, capitalists earn their riches merely by owning things. But if the vast majority --the 99%-- does 100% of the productive activities in society, how could be legitimate that the unproductive 1% owns and controls the lion's share of the wealth produced? Good question.

So, what I've shown is that a certain argument, i.e. that capitalism distributes wealth according to productive contributions, is false. In a series of upcoming posts, we'll look at other fairy tales told by the rich to protect their wealth and power.

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Greek Capitalism's Safety Valve

It would have been an understatement to say that Papandreaou's government was hemorrhaging legitimacy and credibility in its final weeks.

The task, then, for the Greek ruling class (and the EU) is to ensure that this massive loss of legitimacy attaches only to Papandreou (and PASOK), and not to the entire Greek state as such. This is the function of the electoral mechanism in Greece. Only 2 years ago, Papandreou and PASOK rode into power, winning in a landslide due to the growing unpopularity of the Right in the context of deep economic crisis. Now, 2 years later, the Right, indeed the very same morons who were rejected when Papandreou took power, stands poised to do the same thing. The consensus seems to be that the current "unity" government in Greece is little more than a face-saving device meant to by time until general elections are held (when, it is expected, the Right will re-gain power due to the (justifiable) unpopularity of PASOK).

What we see here is that the electoral mechanism in Greece, far from giving the Greek people the opportunity to self-govern, is little more than a safety valve for the Greek status quo. When the steam builds up to such an extent that an explosion of social struggle seems on the horizon, the safety valve ensures that some of that pressure is released and dissipated. Thus, when the government looks on the brink of collapse, when it has squandered the confidence of the vast majority of the working population, it does not immediately amount to a loss of confidence in the system as such; it only seems to immediately impugn the sitting government.

In the midst of the rule of any particular government, of course, it is clear that real democracy is non-existent. The government --whether Right or center-Left-- will push through austerity measures meant to protect the assets of the EU ruling classes. They don't care what the population thinks --they'll pursue austerity one way or another. Of course, it behooves a sitting government to at least try to convince the population that austerity is necessary, or to scare them with doomsday talk of what would happen if Greece were to leave the EU. So they'll do that because it's prudent --but when push comes to shove they're going to ram through austerity whether or not the population consents to it.

The media discussion of the appointment of Papademos is interesting. The consensus seems to be that he is, in some thoroughly apolitical sense, the "most qualified" for the job. But who is it that is supposed to be convinced that he is "most qualified"? And what job, for whose benefit, is he supposed to be doing? Papademos was chosen because he would win the backing of the the EU's ruling class (what's euphemistically called "the market") and its political leaders (particularly Sarkozy and Merkel). Hence there has been a "collective sigh of relief" among political elites and ruling class investors. Papandemos's "job" is to find a way to ram through austerity in order to avoid a default so that the profit-seeking investments of the EU ruling classes (in Germany and France in particular) are protected. What are Papademos's qualifications? "Papademos, 64, was seen by many, both inside Greece and internationally, as the best choice to steer Greece through its worst post-war economic crisis due to his technocratic credentials and perceived financial expertise."

So let's take stock of what's been said above. Papandemos applied for a job and won it. His employer is a conglomeration of the EU ruling classes and their political representatives. The description of his office is to find a way to ram through austerity in order to protect the assets of his employer. His (ostensibly non-political) qualifications are that he is a deft technocrat with lots of "financial expertise".

So, democracy doesn't even enter into it. When Papandreou called a referendum on austerity, he was excoriated by business, the business press, and the business-backed politicians alike. The ruling classes panicked (i.e. "markets plummeted"). But now that democracy is off the table, everybody's happy. Now that a technocrat trusted by EU Capital is at the helm, it's all good.

But just imagine: what if the system couldn't simply switch out different ruling class representatives, dumping one as a fall out guy and picking up another who promises "change", when the going gets tough? It's clear that the system would have a far more difficult time legitimating itself. We get to "decide once in three or six years which member of the ruling class is going to misrepresent the people in parliament...", but we don't --if we play by the rules of established electoral procedures-- get to actually decide whether we should be dominated by a ruling class at all. For my part, I'm hoping that the growing extra-electoral political struggles --in the streets, in the public squares, in the universities, in the workplaces, in government ministries-- continue to grow. That's the only hope the Greek people have of conquering for themselves the power to meaningfully self-govern.

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Occupy Paris (1871)

"The Commune, they exclaim, intends to abolish property, the basis of all civilization! Yes, gentlemen, the Commune intended to abolish that class property which makes the labour of the many the wealth of the few. It aimed at the expropriation of the expropriators. It wanted to make individual property a truth by transforming the means of production, land and capital, now chiefly means of enslaving and exploiting labour, into mere instruments of free and associated labour." -Karl Marx "The Civil War in France" (1871)

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Thomas Friedman: "Imperial Messenger"

I love it.

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Papandreou Steps Down; "Unity Government" Formed

Papandreou set the ball rolling on Monday with a shock announcement that Greece would hold a referendum on the terms of its October bailout deal which calls for further fierce austerity measures.

The move stunned fellow European leaders, sent global markets into a tailspin and earned the Greek prime minister a humiliating dressing-down by France and Germany on Wednesday ahead of a G20 meeting.

Hastily retracting the proposal, Papandreou then turned disaster into temporary victory by winning a nail-biting confidence vote early Saturday by offering to step down in favour of a unity government.

The Greek people, meanwhile, battered by two years of stringent austerity measures that have crippled the economy and sent unemployment soaring, appear to have had more than enough of their squabbling leaders.

"The people are suffering at the moment and they [politicians] are not budging," said Marianna, a shopkeeper.

"A unity government with whom? With the same people? We will have the same results," she said gloomily.

"Papandreou. Samaras. They are all the same," said Takis Karalambos, as he sipped coffee outside a market in Athens.

Read the rest of the Al Jazeera article here.

The call for a referendum on the brutal EU austerity proposal set off a firestorm among EU leaders, all of whom have severe cases of "demophobia". The European ruling class made their disgust known as well as markets plummeted after the announcement of a referendum was made.

But no sooner than Papandreou had announced the referendum, he'd retracted it in favor of an arrangement favored by the EU, particularly the French and German governments: form a "unity" government with the Right-wing parties in parliament in order to more effectively push through the brutal austerity measures recommended by the EU proposal.

Of course, Greece is a capitalist country. That is to say, Greece is not democratic in any genuine sense --the control of the means of production (and all of the social and political power that this ownership and control entails) is private rather than democratic. But even the political realm --where ostensibly democratic parliamentary processes prevail-- recent events prove that there is no real democracy.

Think about what's happened. The EU ruling elites, who are looking first and foremost to protect their profit-seeking investments in Greek debt, were horrified when they learned that their favored policies would be submitted to the Greek people for approval by way of referendum. They were horrified both because the masses of Greek workers would have a voice in policy and because they knew that Greek workers, quite reasonably, would value their own standard of living more highly than the profit margins of the EU ruling class.

The vitriol of the EU ruling classes has now been translated into concrete consequences. Papandreou called off the referendum after being openly and explicitly excoriated by the political represntatives of European Capital, particularly Merkel and Sarkozy. And, following their lead, a "unity" government is being formed with the Right (who, predictably, is far more aggressively pro-austerity than PASOK).

Here we see the capitalist system for what it truly is. It not a system sensitive to the needs and interests of ordinary Greek working people, for it is administering deep cuts to their standard of living. It is not a system that allows the majority of the population to have a voice in decisions that have huge effects on their lives, because the recent strong-arming of the EU proves that the will of Capital prevails over the will of the Greek people. Read the financial papers --in Greece, democracy is the enemy and the rule of technocratic EU elites is the solution. And neither is capitalism a system that is rational, since it is undermining itself by eroding the conditions for future capital accumulation by pursuing austerity.

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Voluntarist Currents in the Occupy Movement

Check out American Leftist for an excellent roundup (and commentary) on recent events relating to Occupy Oakland. I won't weigh in specifically on anything that's going on there, simply because I don't know enough about the situation on the ground there. I would, however, like to make a rather general argument about the occupy movement as a whole and what it needs to do push the struggle to the next level.

First, all eyes were on Oakland because of the size of the protests, the numbers of people drawn into the movement, and the explicit call for a general strike. As countless commentators have reminded us, the last gen strike in the US was in Oakland in 1946. We've clearly entered a new era of class struggle not seen in a generation or more. Class struggle, on order to be such, has to draw large numbers of working people into a fight against some segment of (or, better, against the entire) ruling class.

Likewise, OWS was able to defend itself from Bloomberg's bid to destroy it because it mobilized huge masses of people, many of them union workers, to defend Zuccotti Park in its moment of need.

Succinctly put, the most exciting thing about the entire occupy movement is that it is --quite explicitly-- about drawing the whole 99% into the fight against the 1%. It's primary strength is that it is a mass movement against a political and economic system of, by, and for the 1%.

It goes without saying that this is an exciting time to be on the Left (and I mean the real Left, i.e. the anti-capitalist Left). Finally, a movement has broken through and challenged the legitimacy of the system through direct actions of various sorts, unpermitted protests and marches, occupations of public space, and now strikes and labor actions.

Still, countless challenges and obstacles remain. How, for example, can the continued occupation of a public space help us to win the changes we're fighting for? And, in cities where the authorities have physically prevented an encampment from taking hold, to what extent is it important to continue trying to occupy a public space on the model of OWS? Or, if occupations are meant to be a spring board for growing mass demonstrations (and, potentially, even mass strikes), how do we get from here to there? Finally, how do we build successful general strikes that have the potential to shut down entire cities? These are not easy questions to answer.

However, in a context where newly radicalized people have had their expectations about what's possible raised astronomically, there are bound to be folks who think that must be easy answers to these questions. There are bound to be folks whose legitimate excitement is driving them toward a position of impatience. This is understandable. All of us surely feel this way to some extent or other. I can say, for one, that this movement has electrified me politically in a way that no other movement has.

Nonetheless, I think we need to focus on how we got where we are in order to see where we need to go. As I described above, we didn't get where we are by way of small-scale provocations attempted by folks who feel that they can, through sheer will-power, force the movement into a more radical direction. That is, we didn't get here by way of voluntarism. Voluntarism is a politics that takes it to be possible for a small group, or even an individual, to more or less will a large-scale social change into existence through clever actions or provocations.

The trouble with voluntarism isn't that the individuals attracted to it lack motivation, political energy, or enthusiasm for changing the world. They have all of that and more --and that is not what I aim to criticize. The trouble with voluntarism is that it presupposes a perspective on social change that is problematic. As I described above, progressive social change happens when masses of people --in open defiance of the powers that be-- pour out onto the streets, occupy parks and factory, blockade capital flow, etc. In short --it happens because of some accumulation of people power that has the potential to threaten the powers that be. The 1% in Chicago, for example, isn't afraid that a small group of activists might roam the city performing street theater, banner drops, or other spontaneous or unpredictable actions. The 1% in Chicago is afraid of a mass movement drawing tens of thousands of working class people into the streets to oppose its continued dominance. That is why Rahm cleared out Grant Park by force and arrested hundreds of protesters.

But, and I'm speaking exclusively about the movement in Chicago at the moment, I think some occupiers have drawn the conclusion that because mass actions aimed at occupying Grant Park were met with police repression, they were failures. Because those actions didn't successfully "take the horse", some are now beginning to wonder whether mass movements are actually the way to change things. Understandably, this has led some to veer toward voluntarism, wherein the way forward involves pulling off unpredictable, small-scale and spontaneous actions (rather than public, mass actions drawing in as many participants as possible). In other words, this sense that we were defeated has led some to lower their expectations about what is possible. I think that perspective is understandable, but it should be re-thought. We have no reason, given what's happening all over the world right now, to doubt that a mass movement is both possible and worth fighting for.

I think we have good reason to be excited about the two failed attempts to take Grant Park. Those attempts weren't unqualified failures at all --both actions drew out more than 5,000 people to march, without a permit, through the heart of Chicago's financial district. Both actions won the movement international attention and coverage. And both actions, where over 300 people were arrested in defiance of the police order to clear the park, have elevated sympathy for movement among ordinary Chicagoans. A crew of nurses got arrested in defiance of the City's hard-line refusal to grant OC a space. A poll after the second attempt to camp at Grant Park revealed that 79% of Chicagoans stood in support of the movement, with only 8% opposed. Those actions were not failures. We should not lower our expectations in their wake --we should collectively assess them so that we can learn from their mistakes.

But why didn't those actions succeed in winning Occupy Chicago an encampment? It's hard to say exactly. For one, we would have needed more people there to actually force the cops to back down from mass arrests. The second attempt to take the horse was voted on 4 days before it went down --and as of the Friday before the action there was still no official flyer, no official Facebook group, no organized publicity or outreach. And nonetheless 6,000 people turned out. It could have been much bigger if we'd have had more time to consciously build the event by handing out leaflets at subway stations, making posters and flyers, etc. One lesson we should learn from the second attempt to take the horse is that the more time we get to build an event the bigger it has the potential to be.

We need the movement to be big if its going to succeed. OWS didn't hold Zuccotti Park because it was the perfect strategic location in all of Manhattan. It held the park because a hundred thousand people turned out to defend it. The cops, and the powerful billionaire mayor who called on them to attack OWS, were forced to back down by the sheer numbers of people who turned out to defend it. That is our fundamental strength as a movement of, by, and for the 99%: we are the vast majority of society!

So, whatever we decide to do to take this movement to the next level, it has to take stock of this fundamental fact: our strength is in numbers. If some folks want to organize small-scale, spontaneous actions meant to raise awareness and critical consciousness, they should go for it. If some want to do banner drops, small-scale bank protests, street theater, public guerrilla art projects, etc. etc. they should be cheered on for their enthusiasm and fighting spirit. But we also have to be clear: these actions are only worthwhile if they encourage more people to join and participate in the movement as a whole. Any action meant to substitute itself for a mass movement is a step in the wrong direction. Any action that discourages mass participation, is a waste of precious time and energy. Any action that isn't building toward the kind of mass 99%-strong occupy movement we all need is counter-productive.

We can't let discouragement or impatience get in the way of fighting for the kind of movement we need. Voluntarism is tempting, but revolutionary patience is what we need. Not passivity, not complacency, not conservatism. Just a sober, patient perspective that enables us to see that building this movement will not be easy. I'm not suggesting that we set aside our sense of urgency. On the contrary, I think we have to be patient in order to think through and discuss precisely how we can convert all of the excitement, energy, and urgency into a victory for our side!

Neither I am saying that we must "work within the system" or ask for modest demands. On the contrary, I am suggesting that we need to think through how to build this movement as big as possible so that it has the power and militancy to challenge the foundations of the system itself.

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Occupy Oakland Shuts Down Port

Here. The MSNBC article includes a quote that says that the intent is to "halt the flow of capital." YES! The best info on offer, however, seems to be on twitter. Also, see here for other updates and suggestions for Left coverage of OccupyOakland. I've been following this closely all day. Inspiring stuff!

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Is the Problem the 1% or the System?

The occupy movement has brought the issue of class power to the forefront in an unprecedented way. The entire framing of the movement's politics --the 99% against the 1%-- speaks against a political and economic system dominated by a wealthy ruling class. If the media was all-consumed by the ideologically-tendentious issue of deficit reduction only a few months ago, that focus has been shattered (or at least destabilized) by the rapid proliferation of occupy movements from Portland, OR to Orlando, FL.

But within the movement, questions remain. The vast majority of participants agree that the 1% enjoys a concentration of economic and political power that is highly unjust. A key goal of the movement everywhere is to challenge the entrenched power of an unelected dominant group --the 1%-- that lords over us. There is also a sense that the 1% is responsible for the crisis (and should therefore be made to pay for it). Among the most popular chants at Occupy Chicago are "banks got bailed out, we got sold out!" and "how to fix the deficit? tax, tax, tax the rich!".

But it is also commonplace for participants to argue that the problem is our broken economic and political system. This is an argument familiar to many on the Left who have argued that it is the internal contradictions of capitalism, not a failure of regulation or a climate of greed, that produced this economic crisis. But on the face of it, this emphasis on the system doesn't appear to cohere with the "dominant group" perspective that pins responsibility for the crisis --and the push for austerity-- on the ruling class (the 1%). Why? Because the "it's the system" perspective seems to suggest that the ruling class isn't responsible for the crisis in the sense that they made imprudent or unethical decisions. The "it's the system" perspective emphasizes the ways in which the system pushes individuals in the ruling class to act in ways that produce deep recessions and crises.

So, is it the system that's the root of the problem? Or is it the dominance of the ruling class? You probably saw this one coming, but I'm going to argue that this is a false dilemma. It is both the system and the dominant group within that system that is at the root of crisis.

Before I say what I think about this, I'd like to flag the fact that these questions have a long history in the Marxist tradition. The system vs. dominant group question was taken up in the famous Miliband-Poulantzas debate that raged in the pages of New Left Review in the 60s and 70s. This sparked several other debates internal to the Marxist tradition on the question of the state, the most interesting of which (in my view) being the arguments among German Marxists in the 1970s involving Hirsch, Offe, Altvater, and others. For an excellent introduction to these debates, see Simon Clarke's overview here, or read Martin Carnoy's The State and Political Theory (esp. chapter 5).

First, let me say a little bit about the 1% as a dominant group. We all know that the 1% has colonized the political system in the US for its own purposes. This is uncontroversial. The 1% spends vast sums each election cycle funding the candidates of both major parties. Presidential campaigns are simply a struggle between the Democrats and Republicans to garner more support and funding from corporate elites. The 1% also spends vast sums on PR and propaganda (this includes political advertisements as well as ostensibly non-political commercials, e.g. an Exxon-Mobil ad that ends with the jingle "Energy for a stronger America"). We can also add here that the 1% spends vast sums on pro-business interest groups (e.g. the US Chamber of Commerce, etc.). In addition to dominating the election system, the 1% also spends vast sums on lobbying efforts to fight for legislation friendly to their interests. Even when popular demands for reforms surface, the 1% uses its influence and power to mold reform proposals to fit its interests as much as possible. Consider, for instance, the Sherman Act, which was ostensibly passed to break up industrial monopolies, but ended up being used to break unions rather than business cartels. Or, take the following example. Commenting on the popular demand for a public Commission to regulate railroad corporations, an earlier U.S. Attorney General said that:

It satisfies popular clamor for a governmental supervision of railroads, at the same time that that supervision is almost entirely nominal. Further, the older such a Commission gets to be, the more inclined it will be found to take the business and railroad view of things. It thus becomes a barrier between the railroad corporations and the people and a sort of protection against hasty and crude legislation hostile to railroad interests... The part of wisdom is not to destroy the Commission but to utilize it. (quoted from Charles E. Lindblom's excellent Politics and Markets).

It is also well-known that government and industry interpenetrate one another through revolving-door arrangements. The person regulating a particular industry ends up as a highly-paid employee of that industry. High-ranking officials in a particular industry wind up with the public job of regulating that same industry (only to wind up, once again, with a cushy position in private industry afterward). This is a basic feature of how the political system in the US functions. Virtually all elected officials are either already wealthy businesspeople before they get elected, or they become wealthy business people in the course of their tenure.

There's still more to say here, however, about the various ways that the ruling class has colonized the state to serve its interests. Businesspeople have, as Charles Lindblom famously argued in Politics and Markets, a privileged position within government. They are not just another "special interest group". They stand above all other "interest groups" because of their position in society. They have direct access to governing politicians in ways that no other citizens have. Why? Because business leaders are, more or less, unelected public officials who make big decisions about the direction of our society, whether it be decisions about investment, employment, wages and benefits, location of factories and production, etc.

In any society, certain basic decisions must be carried out. Decisions must be made about what is to be produced, how it will be produced, according to what organizational structure, by whom, etc. Decisions must be made regarding the investment of capital in production, the allocation of resources, whether to use certain technologies, the amount of money devoted to innovation, etc. Decisions must be made regarding where plants and factories will be located, how many workers they will employ, whether workers will be laid off if profits fall, etc. Decisions must be made about how much compensation and bonuses executives should be paid. All of these decisions must be made by someone, no matter what kind of society we live in. And what's more --these are hugely important decisions that have massive consequences for the well-being and life chances of all of us. They have a huge impact on the standard of living, employment levels, wages, economic growth, prices and so forth.

But who makes these decisions in our society? Unelected business people. The majority of us do not have any say in these matters. The majority has no means of making the unelected public officials of the 1% accountable to our interests. This is not a new development. By definition, a capitalist society is one in which the basic structure of the economy --the means of production-- is privately owned and controlled by a small class. The productive instruments, the resources, the capital and so forth are all privately owned and controlled by a small class of owners --the 1%. According to our present legal/political system, to allow the democratic will of the people to determine these decisions would be to interfere with the private property of the 1%. Genuine democracy of, by, and for the people is incompatible with the private property of the 1%. In other words, the class power of the 1% is fundamentally at odds with the ideal of a democratically self-governing society.

So, business people (or, if you like, the ruling class, or the 1%) are basically unelected public officials. They make decisions of huge importance for all of us. Unsurprisingly, then, elected officials take the class power of the 1% seriously. They know that if business turns against their government, bad consequences will follow: rises in unemployment, stagnant growth due to a failure to invest, capital flight, etc. They know that they must try to induce (not command) business --with tax breaks, subsidies, lax regulations, etc.-- to fulfill its function in the system so that the economy does well according to its own standards. Whether elected officials in capitalist societies like it or not, they must take seriously the structural economic imperative to make the 1% happy. This is an example of how the power of the 1% places constraints upon what governments can and cannot do.

Governments have, since the very beginning of capitalism, taken on a basic supportive role vis-a-vis business. Costly investments in fixed capital and infrastructure, because they are not profitable in the short term, are often taken on by government in order to grease the axles of private businesses. Likewise with "early federal policy on banks, canals, and roads; governmental profligacy in indulgences to railroads; the judicial interpretation of anti-monopoly legislation to restrict unions rather than industry; the deployment of Marines to protect American enterprise in Latin America; the use of public utility regulation to protect business earnings; and the diversion of fair trade laws from their ostensible public purposes to the protection of monopolistic privilege" (Lindblom, p.174).

This leads us into a discussion of the system. Thus far, we've seen how the State in capitalist society is a class State. We've seen the multiple avenues through which a dominant group, i.e. the ruling class, can directly influence the actions of government. When government officials aren't themselves former (or current, or future) ruling class members, they are subject to the influence of corporate campaign finance, intense lobbying efforts, as well as influence generated by the concentrated economic power of business people. We've also seen that the class power of the 1% places constraints on what governments can and cannot do, no matter how strong its popular mandate from the people. But now I'd like to connect this discussion to an indictment of the system.

The first thing to say is that the sorry state of affairs discussed above didn't come about by accident. Nor did it come about in a vacuum. It is not the result of a co-ordinated conspiracy by people who know one another personally and communicate regularly about how to maintain their dominance. This state of affairs is the result of hundreds of years of capitalist development.

Capitalism is a system in which the basic structure of the economy is privately owned and used for the sole purpose of accumulating profit. Whether capitalists like it or not, they are compelled to maximize profit. They are forced, on pain of insolvency, to compete against other capitalist firms in order to survive. And winning out in competition means accumulating large profits, and reinvesting those profits in expanded production to accumulate still more profit. "Accumulate, accumulate, accumulate!" more or less summarizes the basic priorities of the system.

When the accumulation process is interrupted, the system seizes up and goes into crisis. There are many different reasons why interruptions occur, but one important reason is overproduction. Overproduction occurs when capitalists accumulate more capital, resources, or means of production than they can profitably make use of. So, when sufficient profitable investment opportunities are not forthcoming, what do capitalists do? They hoard their capital and try to wait out the storm. It doesn't matter whether mass unemployment or food shortages ensue: in periods of economic crisis the ruling class will hoard its wealth until profitable investment opportunities re-emerge.

So, in order for a capitalist system to function (in order for people to have jobs, in order for people to be able to purchase the necessities of life, in order for tax revenues to be generated to fund government salaries, the legal system, roads, the military, etc.) the accumulation process must be in full swing. When accumulation is disrupted, crisis ensues and the vast majority suffers as a result.

Now, at this point, we have to ask: if the above is true, what does it say about the basic function of the State in capitalist societies? The answer should be clear. The capitalist State's function is to cultivate and maintain favorable conditions for accumulation. In short, the fundamental role of the State in capitalism is to secure the conditions for profitability.

Let's expand upon this a bit. We've already established that the State is structurally dependent on the accumulation process. That is, the State is funded through resources derived from the private accumulation process (collected via taxation). Moreover the viability of a particular governing group within the State is dependent upon economic "success" (as opposed to stagnation and crisis). In this context, State officials are compelled --by their own institutional self-interest-- to try to ensure that the accumulation process runs smoothly. If they don't, they are liable to face sharp drops in tax revenues as well as other bad economic consequences (e.g. unemployment, stagnation, capital flight, etc.). This is what politicians --from both corporate parties-- mean when they talk about "creating a good business climate", or adopting policies that are "pro growth". This need to ensure that the accumulation process continues is what drove the construction of the Interstate Highway System as well as other big public works projects in U.S. history. The goal was to socialize the costs overhead and infrastructure to encourage private investment for profit. Likewise, this basic role is what explains the massive bailouts of financial institutions, the giveaways dolled out through "quantitative easing", and the big tax breaks handed out by Obama and the Democrats. Governing officials are trying to find ways to jump start the accumulation process --no matter what the human cost.

So, as we've seen, the function of the State is to secure the conditions for the accumulation of profit. But in order to do that well, the State has to act in the interests of the capitalist class as a whole. And what is in the interest of the capitalist class as a whole may not be the same as what is in the interest of some particular capitalist firm. Recall that capitalists confront one another in the marketplace as rivals in competition. Let us add here the Marxist complaint that capitalist production is anarchic, haphazard and unplanned. Although the capitalist class a whole may act together to secure legislation on shared goals (e.g. union-busting), there will a lot that they disagree on, given that their priority is maximizing their own profit and bumping off competitors. What this makes clear is that the self-interest of a particular capitalist firm may not coincide with the class interest of all capitalists.

But the basic role of the State is to ensure that the accumulation process runs smoothly, i.e. to serve the interests of the capitalist class as a whole. Thus we should expect the capitalist State to periodically do things that buck the will of a particular capitalist firm. In fact, this happens all the time. Alternatively, because of special direct access and influence to State officials, sometimes capitalists are able to persuade governing officials to serve the interests of their particular firm more than the interests of the capitalist class as a whole. The point is that there may be a contradiction here: between the basic function of the state and the ways that particular members of the ruling class influence the state directly.

This isn't the only contradiction. The State in capitalist societies involves electoral competition. That means that different factions of establishment groups, organized into dominant political parties, compete against one another to determine which will head up the State. Regardless of which of them governs, of course, the basic function of the State remains the same. But the cycle of elections every four years in the U.S. means that particular governing officials can be removed from office and replaced by others. Thus, governing officials are compelled to seek popular support in order to reproduce their own power. In a word --their continued existence as public officials requires that they seek legitimation from the public. That doesn't mean that the rule of State officials must actually be legitimate --it merely means that their rule must appear to be so. If a governing party does not secure legitimation, it threatens to lose power to representatives from another establishment party. So, for reasons of self-interest, elected officials in capitalist societies must try to make it appear as if they are uniquely qualified to fulfill their role in the system. The need to secure legitimation also means that the State must speak in the language of universality and general interests. When it advertises itself publicly, it will always say that it stands for generalizable interests and popular goals --as opposed to the goals and particular interests of the capitalist class. If the capitalist state advertises itself as what it really is, it would not be able to secure legitimation. Thus, as Claus Offe puts it, "the State can only function as a capitalist state by appealing to symbols and sources of support that conceal its nature as a capitalist state; the existence of a capitalist state presupposes the systematic denial of its nature as a capitalist state."

However, in periods of social struggle, sometimes governing officials are compelled to grant concessions to popular movements in order to secure legitimation. But many --indeed the vast majority-- of reforms demanded by the population brush against the grain of the accumulation process. This reveals a profound contradiction in capitalist societies, i.e. the contradiction between accumulation and legitimation.

On the one hand, the capitalist State has to secure legitimation from the population. That doesn't mean that it has to actually be legitimate --it means that it is compelled to secure the appearance of being legitimate. In periods of intense struggle, this means granting concessions to popular movements (because otherwise it would reveal that the State doesn't serve the interests of the majority). But granting concessions or passing reforms contradicts the need to ensure that the accumulation process runs smoothly. Hence the contradiction and all of the instability that comes with it.

Austerity is an excellent example of how this contradiction manifests itself. Take Greece, where a nominally "socialist" party is in power. Presumably, it is not part of the party's program that their basic goal is to gut the welfare state and lower working-class living standards. Presumably the party is committed in writing to favoring basic center-Left demands, including maintenance of the welfare state. But, nonetheless, the ruling PASOK government in Greece is caught between the need to secure legitimation and the need to secure the conditions for the accumulation of profits. Through its actions, however, we see very clearly which conjunct of the contradiction has a stronger pull on the government. PASOK has pushed through a punishing program of deep cuts, austerity, layoffs, union busting, and tax increases on workers. But it is doing all of this in order to try to protect the profits of the European ruling classes and to re-establish the conditions for steady accumulation. But in doing this, the Greek state is showing itself for what it is: a class state. Hence, it is losing legitimacy by the day. As a PASOK MP describes the situation,

"The anger over the austerity measures is so deep that many PASOK MPs no longer dare to appear in public. “We can’t even leave our homes to go to a taverna any more,” the Guardian quotes an anonymous MP of the governing party as saying. “You’re called a pig or a traitor for passing measures none of us wanted to pass. It’s not a life.”

I don't doubt that many of the PASOK MP's didn't want to pass the punishing austerity packages. But they passed them nonetheless, because of the web of power relations in which the State is situated. The EU, dominated by French and German capital, has been pushing hard to protect the assets of the European ruling classes. They have made economic threats: capital flight, economic misery, inflation, isolation, etc. They have made political threats some of which hint at the possibility of military coercion and "regime change" if their harsh conditions are not met. At the same time, PASOK is under the tutelage of domestic Greek capital as well. Whatever the aims of the PASOK government officials themselves, the systemic pressure --and the pressure of tremendously concentrated class power coming from France and Germany-- are forcing them to put profits over the vast majority of the population.

So let us take stock of what's been said above. How is the dominance of the 1% related to the system? The 1% are dominant in virtue of their role within the system. If the particular individuals in the 1% simply disappeared, others would take their place and the problems would remain. Their position of dominance is facilitated by the structure of the system in such a way that we can only oppose their rule if we oppose the system that makes it possible. Furthermore, we see that the particular interests of individual members of the 1% sometimes contradict the overall interests of the whole 1%. This fact is, again, true because of the competitive, anarchic nature of capitalist production. This compels ruling class members to push very hard for subsidies, tax breaks, no bid contracts, etc. and milk the government for money and favors. This would be true even in a perfectly competitive "free" market, because the very nature of the capitalist system compels them to do this.

Finally, the connection between the dominance of the ruling class and the capitalist system explains why it is pointless to expect moral suasion to move the 1% to change its ways. The system isn't in crisis merely because of callousness and greed --though these vices are no doubt highly prevalent among the 1%. The system is in crisis because of its irrational drive to accumulate for its own sake in the face of growing contradictions and environmental limits. And the ruling class is forced --by competition-- to participate in this mad race toward destruction. Appealing to their conscience is pointless --we need to change the system. You don't ask Kings to be more benevolent and less cruel --you demand that they be dethroned. Likewise, we shouldn't ask that our rulers be more "socially conscious" or "less greedy". We should instead demand that the system that facilitates their dominance be overturned.

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From the Archives: Agitational Material for the 99%

PinkScare is a radical Left blog rooted in socialist politics. Topics of posts range from social movement strategy, Black liberation and anti-racism, struggles in the Global South, feminism and sexual politics, Marxism, critical analysis of news, political theory, economics and history. Readership has been soaring in recent weeks, so I've decided to re-post material from the archives that may be of interest:

• Lessons from the struggle in Wisconsin. How the Democrats sold us out.
  
• Rahm Emanuel vs. Teachers
  
• Socialist politics and the fight against racial oppression. Cornel West on Marxism and anti-racism.
  
• Marx on Freedom and Equality. Hegel and Marx on Freedom.
  
• Is there a Right to Private Property? What do we want, Private Property or Freedom?
  
• The Case for Taxing the Rich
• Lenin and the early Bolsheviks on democracy
• What does it mean to be Middle Class? How is it different from Working Class?
• The ideal of a socialist city.
• Feminism or Feminism(s)?
• Socialist approaches to understanding the recession.
• How to argue about taxes (and how not to).
• How to argue against austerity.
  

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What is a General Strike?

What is a general strike?

A general strike is when a large number of coordinated workers in different industries (in a locality or in an entire country) all stop working at the same time. When workers stop doing their jobs, the system grinds to a halt. The goals of general strikes have been different in different times and places, but they are always aimed at forcing powerful groups (bosses, employers and their friends in government) to bend to the will of the working majority. Goals of past general strikes have included: recognition of collective bargaining rights, better wages and conditions, increased political power for the working majority, and the overthrow of capitalism (i.e. and end to the private ownership of the means of production by a small elite).

Could a general strike happen in the United States?

It already has happened here! General strikes --and struggles of all kinds against oppression and exploitation-- are a huge part of the history and heritage of the United States. Though we're not taught it in school, there have been several big general strikes in US history: 1877 Great Railroad Strike, 1877 St. Louis General Strike, 1892 New Orleans General Strike, Seattle 1919, The Great Textile Strike of 1934, 1934 Minneapolis Teamsters Strike, Toledo 1934, 1934 San Francisco General Strike and the 1946 Oakland General Strike. You'll notice from a quick glance at these dates that there was an explosion of labor militancy during the 1930s. This period of increased struggle put the fear of God in the 1% who worried that they might lose power. Thus, after WWII the U.S. ruling class clamped down hard on working class militancy through a campaign of red-baiting, purges, criminalization of strike action, union-busting, and outright repression. The 1% would use the same tactics to crush the Black Power movement. By the end of the 1960s, workers wages stagnated and declined for the first time since the 1820s. Thus began a long one-sided class war from above against the working majority. Wages are still stagnant today while unemployment levels soar toward historic highs (16.5%). Unsurprisingly, in this context the question of a general strike is back on the agenda and has re-entered the discourse as a feasible option.

What role does the general strike play internationally?

There are many countries in the world where general strikes are occurring or being planned as we speak. In Western Europe, the general strike is a key tactic of the working class in fighting back against cuts and austerity. The May '68 movement culminated in a general strike that involved over 10 million workers stopping work all at the same time. General strikes were a part of the Portuguese and Iranian Revolutions during the 1970s. General strikes were used by workers in Poland in the early 80s against the Stalinist regime that exploited them. General strikes played a key role in ousting Mubarak in the Egyptian Revolution --and the key to the success of the revolution lies in the capacity of workers to shut the system down. Occupy activists in the U.S. are (self-consciously) part of a global movement. We need to take a look at what our sisters and brothers in the global 99% are doing right now to fight back against their respective ruling classes --and that means taking the idea of a general strike seriously.

What could a general strike do for the occupy movement in the US?

The occupy movement is a global phenomenon that has electrified millions of people in the 99% all around the world. People said it couldn't happen here in the US --but it is. People are determined to fight back against cuts, austerity, layoffs, and war. They stand together against a system that places the profits of the 1% above the needs and interests of the vast majority. The occupy movement stands for genuine democracy from below --it stands for empowering the 99% to take control of society and run it in the interests of the majority. But how do we get from here to there? The occupation of public spaces --where free debate and grassroots democracy can flourish-- are key part of the struggle. But we also need to think about how to leverage the promise of occupied parks and public spaces to take the struggle to the next level. Workers' central role in economic production gives them an unparalleled social power--by use of the strike weapon--to paralyze the system like no other social force. The next logical step for the occupy movement is to consider using strike action --co-ordinated work stoppages by ordinary working people of the 99%-- to force the 1% to take us seriously. The 1% is banking on the fact that this is going to be a cold winter. The last thing they want is for us to actively disrupt the profit system that forms the basis of their power. A general strike can do just that --because the 1% does not pick up their own trash, nor do they pilot their own private jets. They need us to co-operate in order to maintain their dominance. A general strike sends a clear message: we will no longer co-operate and toil for a system that oppresses us.

Is a "colorblind" general strike movement possible?

Absolutely not. We need to be clear here: colorblindness, the view that race is "divisive" and undermines the unity of the movement, is a form of racism itself. Colorblindness, by definition, is blind to the reality of racial oppression and therefore plays a role in reproducing it. What's more, the idea that anti-racism is "divisive" is music to the ears of the 1%. They can divide a movement with racists in it --but they can't divide a movement that stands together against all forms of oppression. The last thing that the 1% wants is a movement of, by and for the entire 99% that stands firmly and uncompromisingly against racism. Furthermore, a successful general strike depends upon dense networks of solidarity. But solidarity cannot be built on a foundation of sexism, racism, homophobia, xenophobia or oppression. Solidarity is only possible when all workers fight together and promise to stand up for one another in accordance with the principle that an injury to one is an injury to all. One final thought. We sometimes encounter a caricatured version of the working class in the US according to which it is nothing but brawny, white men. That is false. Today, the majority of the working class in the US is women. The working class is disproportionately people of color. The working class is every bit as diverse and different as this movement needs to be if it going to stand together and win. Our sisters and brothers of color are being forced to endure this recession in a particularly acute way. As Malik --the co-founder of Occupy the Hood-- puts it: "when white people get a cold, black people get the flu". The entire 99% is hurting bad --but the pain of people of color as a group is particularly intense. We need to stand together for the good of all of the 99%. The potential for the Occupy movement to unite and assuage the social and economic misery of whole 99%--and especially of those who face special oppression-- is unprecedented. The time to get involved is now. This is what Fred Hampton was talking about back in 1969. Power to the people!

If we're for a general strike, what can we do to build it?

General strikes are not easy to pull off --they take countless hours of hard, unglamorous organizing work. But tireless organizing for the betterment of humanity is what the occupy movement is all about. So we can do this. What's the first step? There is no ready-made rulebook for how to proceed, but there are several things that we can do to encourage escalation via strike action. First off, general strikes don't spontaneously materialize because someone puts out a call for one. Putting mass strikes together requires that we work with the labor movement. This requires establishing relationships of solidarity between the movement and labor unions --particularly those unions who are under attack and have the strongest incentives to get involved in the movement. Right now transit workers and teachers are being scapegoated, attacked, punished and threatened with layoffs. Postal workers are facing mass layoffs. These facts should help orient those establishing links between the movement and organized labor. The key is to establish links with the rank and file workers of unions in order to make the argument for escalation via strike action. If the rank and file workers themselves are ready to push the struggle forward, their leaders will have no choice but to follow their lead. Solidarity --and the involvement of the labor movement-- is what stopped Bloomberg from destroying OWS. We need to learn from that experience and build on it. But we can also do other things --besides working directly with the labor movement-- to get the idea of a general strike out into public discourse: we can start discussions about general strikes (e.g. what they are, why they're important) in all kinds of social spheres --in workplaces, schools, streets, churches, neighborhoods, on buses and trains, in union halls, listservs, social media, homes, General Assemblies, committee meetings, etc. If you're moved by what you've read here, pass the world along and make the argument that working people have a potential social power like no other --to withhold their labor and force the rich and powerful 1% to take note. Only when we learn about our own history --and our own power-- can we have the constructive collective discussions that grease the axles of workers struggle. Publicize, talk about it, make fliers, post about it on Facebook, tweet that you're for a gen strike, join a revolutionary socialist organization, talk to ordinary people on the street. Don't wait --the time is now!

Is the general strike a "silver bullet"?

Hardly. We can expect a general strike to meet with the same state violence and repression that the Occupy movement has met with thus far. But our strength is in numbers --and in our capacity to shut the system down by withholding our labor. We should be careful not to romanticize the mass strike and make it sound like its the answer to all of our problems. It's not. But it is the next logical step in the progression of our movement. We --the 99%-- have enormous power when we stop doing what the system requires of us. We make this system run, we do the work in this society. It is our right to protest and occupy public spaces to begin the discussion about a new kind of society. But is also our right to withhold our labor and grind the system --which we know serves the needs and interests of the 1%-- to a halt. The ruling class can't ignore us when we stop doing the work that makes their position of dominance possible. A mass strike is a serious weapon in the tactical toolbox of the 99%. We must start talking about using it. Less abstractly: we must start talking about how one could be built in the here and now. We should consider learning from our sisters and brothers that inspired the world by fomenting the Arab Spring. We have a world to win!

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More on Chicago's "Prog" Mayor

Mayor Rahm Emanuel on Tuesday defended the Chicago Police Department’s weekend decision to forcibly remove Occupy Chicago protesters who refused to leave Grant Park and acknowledged that he was consulted before the arrests were made.

Emanuel has a reputation for being a bit of a control freak and that’s not about to change after what happened Saturday night.

On Tuesday, the mayor acknowledged that he was in “consultation and conversation” with Police Supt. Garry McCarthy before police took roughly 175 demonstrators into custody roughly two hours after Grant Park’s mandatory closing time.

“There’s a very specific law as it relates to closing down the park. There was conversation between the Police Department and the protesters about respecting that — and it starts at 11 o’clock — about vacating Grant Park,” the mayor said at an unrelated news conference.

read the rest here.

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COINTELPRO Version 2.0

Here. (Hat tip to American Leftist)

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Friedman: Rahm's a Progressive

Professional blow-hard Thomas L. Friedman has a column on Rahm Emanuel with the title "A Progressive in the Age of Austerity." It displays an encyclopedic lack of knowledge about the world, and about Chicago in particular. I hesitate to even bother saying why this article is nothing but a steaming pile of shit. There are far more important things to do these days. But here goes.

First off, we're not stuck living in an "age of austerity". Look around the world right now! All over the globe, people are fighting back, organizing, and gathering in massive, unprecedented numbers to participate in a historic social movement that stands squarely against austerity. The entire point of the movement is to reject the idea that the vast majority must foot the bill for a crisis caused by a system that services the interests of the 1%. In order not to be excited by what's going on, you'd either have to be frightened by it (as ruling class persons and their ideologists surely are), or you'd have to lack a pulse. Maybe both are true in Friedman's case, I'm not sure.

Second, to call Rahm a "progressive" --precisely because he's for austerity-- is to evacuate the term of any intelligible meaning whatsoever. To be fair, it has been watered down so much already that Friedman didn't have to try very hard. But the absurdity of Friedman's main contention is still hard to ignore. He suggests that Rahm is pushing austerity "with a human face" and thus evinces cunning and a willingness to try "innovative ideas". It's on this basis that he's supposed to be a "new progressive" or something.

This is nonsense. Isn't Rahm's most recent public statement on this issue something to the effect that progressive supporters of the Democrats are "fucking retarded"? Leave it to a hack like Friedman to try to polish a turd.

Rahm's police force showed up to OccupyChi on Saturday night with riot gear, batons, guns, knives, horses, and other instruments of repression. Their message was clear: there's nothing to see here, stop protesting and go home. CPD, of course, was called upon to scatter the protest and draw down the movement. This is one of the major functions of police forces in contemporary capitalist societies --when needed, they will always be used to pacify struggle, repress legitimate protest, break strikes, and, if necessary, murder dissidents. On Saturday, the CPD followed the lead of their counterparts in other cities (and countries) and acted on orders to put a stop the movement by arresting over 200 participants. They didn't succeed, of course. OccupyChi continues to grow. But the CPD showed everyone --as if we needed any more evidence-- whose interests it represents when push comes to shove. Officially, this is Rahm's town- he hand-picks the Chief of Police himself.

So Rahm is no progressive. He's a staunch defender of the status quo and he mans a political Machine of, by, and for the 1%. And to be clear: it's not as if Saturday night is the only bit of evidence we have that Rahm is no lefty. Aside from being consistently identifying with the Right-wing of the lowly pro-business Democrats, Rahm has also been in and out of the private sector. He worked on Wall Street himself as a member of the group that the entire Occupy movement sets itself against --the 1%. Let us not even get into his war on teachers and public education in Chicago, his love affair with privatization, his bid to host a NATO/G8 summit this May, his numerous "progressive" sound bites like "fuck the UAW", etc., etc. The guy is a total menace to ordinary working people and, by extension, the Left.

But am I surprised that Friedman belched this filth onto the pages of the New York Times? Nope. Am I surprised that the paper published such tone-deaf non-sense in times such as these? Hardly.

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Making Common Cause Against Wall Street

Here.

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