What Would a Real Socialist President Do?
Clark, Jack
What Would a Real Socialist President Do? JACK CLARK In the Still unfolding national debate about the economy, everything opposed by the extreme Right and the Republican Congressional caucus (the...
...That, in turn, will improve the quality of the services they provide to children, the elderly, and the infirm...
...The administration has funded a limited number of municipalities to take over and rehabilitate foreclosed houses in particularly hard-hit neighborhoods...
...The Economic Policy Institute has proposed a public jobs program as part of a five-point agenda that includes repairing the safety net and aiding state and local governments...
...Both periods of full employment reduced poverty significantly...
...Businesses expand their payrolls when they see an opportunity to sell their products and services...
...These partnership programs could become a prototype for state and regional planning for full employment...
...Its failure lay in its inability and unwillingness to rein in capitalist excess...
...Governments contract for human services and for a lot of other work, and these contracts can set standards for good wages and decent working conditions...
...Full employment was declared national policy in 1946 and 1978 and established, along with price stability, as one of the two major goals of the Federal Reserve...
...The United States and China between them have invested nearly $300 billion in highspeed rail since the beginning of this crisis—the U.S...
...Robert Kuttner has written extensively on how northern Europeans build career ladders and better pay into the work of caring for the very young and the very old...
...The financial sector is too big...
...One final point should be kept in mind on financial reform: don't leave it to the experts...
...With carbon emissions costing more through a cap-and-trade regime, there could be a significant growth market for solar collectors and wind turbines...
...The Campaign for America's Future has noted that we are actually importing wind turbines...
...Investing in the green economy makes sense for many reasons—most important, as Steel Workers president Leo Gerard and other union leaders have argued, as a way of reviving the U.S...
...dollars while sending us finished goods...
...Housing The housing bubble caused the current crisis, and continuing turmoil in the housing market threatens the fragile recovery...
...The health care bill took an important step in the right direction with student loan reform...
...Here are a few proposals of the sort that we used to call "transitional...
...Other nations (most notably but not exclusively China) have been content to buy U.S...
...The holders of the mortgage notes continue to collect payments on fictitious home values, based on bubble prices that will never return...
...The experts who tell us that we can't afford to do these things are the same wise men (and they are mostly men) who assured us that the crisis couldn't happen because our financial system was so sophisticated...
...Like prevailing wages in construction, living wage ordinances set a floor on wages for contractors receiving public funds and helped lift wages in the area...
...The Democrats cut out the financial middle broker, allowing the federal government to lend directly, and they used the savings to increase Pell grants in the same bill...
...The Obama administration is proposing to fund the National Low Income Housing Trust Fund at one billion dollars, using TARP (Troubled Assets Relief Program) funds...
...Banks could redline and effectively strangle entire urban neighborhoods...
...Address urgent issues of global climate change...
...Long ago, Karl Marx distinguished between use value and exchange value...
...They don't have enough income...
...projected rates of growth, he says (in deadpan), will achieve full employment sometime in the second Palin administration...
...By continuing to buy U.S...
...For example, the Apollo Alliance proposes investment in a broad range of energy-related activities: retrofitting older buildings for greater energy efficiency, increasing investment in public transportation, and manufacturing renewable energy components such as wind turbines and solar cells...
...Combine that with an official rate of 10 percent unemployment and stagnant wages...
...Profit-maximizing corporations distort the economy and the polity...
...An active policy for affordable housing can counter that trend...
...For minority youth, unemployment is at depression-era levels now...
...Yet, in this area, as in many others, administration officials have been overly solicitous of the financial sector that caused the crisis...
...The country's wrenching hurt comes from a severe, periodic crisis in the capitalist economy...
...Jobs Even with falling housing prices, a growing share of the population cannot afford housing...
...Federal programs aimed at bringing down mortgage payments for distressed homeowners focus on interest rate manipulations and on direct subsidies to lenders...
...It's still a good question...
...Increasing the income of the working poor and near-poor is morally right and has the added benefit of being very good economics...
...If I live in my home, however, it makes no sense for me to treat it as an ATM and the major source of retirement security...
...Since Ronald Reagan's presidency, each administration has pursued a strong dollar to support the financial sector at the direct expense of manufacturing...
...Community-based, nonprofit organizations (unions have played this role on occasion) have a largely successful history in building, rehabilitating, and maintaining affordable housing...
...As union density declined, the Great Compression reversed...
...Transportation Secretary Ray LaHood is actively promoting more livable communities with good public transportation and many activities within walking distance...
...Turning over more housing finance to a functioning nonprofit sector would also shrink the big banks...
...Barack Obama recognized this exact point in a May 2009 interview with the New York Times...
...We'd do well to recall that distinction in housing policy...
...But these neighborhoods tend to become gentrified, with little or no housing for the working class and the poor...
...Compact, transit-friendly neighborhoods become increasingly important as we seek to reduce our carbon footprint...
...What would we do today if we could...
...Public funding would not entirely displace private bonds, but the availability of a public option would reduce both the power and size of private finance...
...human resources managers call the welfare office and even the nearest prison to find job applicants whom they would turn away in a slower economy...
...While homeowners led the growth, the share of renters with severe burdens remained much larger...
...As Baker notes, this requires no new federal funding and no bureaucracy...
...Popular movements forced changes that improved our society and benefited the economy...
...They can't even understand them...
...Government policy for more than a generation has made it nearly impossible for workers to win union recognition and bargain with resistant employers...
...Public policy needs to support that growth...
...In 1946, Lord Beveridge defined full employment as a goal for the postwar British welfare state: every job seeker should be able to find a job...
...Federal policy needs to be directed toward affordable housing—with an emphasis on affordable rental housing...
...That's a good start...
...Only a public jobs program will bring them into the job market...
...Ah, yes, let us marvel at the brilliance of the Wall Street Masters of the Universe...
...The economy exists to serve people, not the other way around...
...But it's what we need now...
...Unemployment rates actually rise briefly as full employment approaches because people who had been too discouraged to look for work come back into the labor market...
...A broad range of social policies can provide greater dignity and professionalism to the largely female work force in the caring professions...
...The trade deficit is a much greater threat to our living standards than the federal debt, which gets far more attention...
...In that situation, the power of workers grows...
...Employers become creative and sometimes desperate to fill jobs...
...Herb Stein, Richard Nixon's chief economist, once remarked that a tendency that cannot go on forever won't...
...If the Democratic Socialists of America were larger and more influential, its button proclaiming...
...Don't leave it to the experts...
...Many Americans will still aspire to home ownership, and public policy can support that goal, but rental housing will and should remain a major part of our housing stock...
...They need jobs, and the country needs something close to full employment...
...McDonald's bids up wages...
...Johnson decided that would be too expensive...
...In the United States, union strength was tied very closely to what economists call the Great Compression, the lessening of inequality from roughly 1946-1975...
...Another charade to attack business and bring on socialism...
...New York Times columnist David Brooks is no Tea Party hero, but he serves as a civilized voice for Republican outrage...
...Twice in the last fifty years, in the mid 1960s and in the late 1990s, the U.S...
...Excessive policy enthusiasm for home ownership in the last two administrations fostered an ethos of every home owner as real estate speculator...
...Poorer people spend more of their income, thus creating demand for other jobs...
...economy approached genuine full employment...
...Why can't we begin to reverse global warming...
...Unions have begun to insist that candidates go beyond campaign promises and stand with them on the picket lines...
...Robert Kuttner points out that fifty years ago banks could deny a mortgage to a woman or an African American...
...Obama wants to redistribute wealth...
...The unionization of home care workers certainly helps to raise wages...
...The current international trade situation reflects Stein's axiom...
...More proof that the Democrats want to expand government instead of letting the market cure our ills— that's socialism...
...Wall Street reaps enormous benefits from a highly valued dollar...
...Faux is correct that either we will manage a decline in the value of the dollar or we will see it crash...
...By promoting green jobs and manufacturing, public policy can further undercut the leading role of the financial sector...
...A modest tax (0.125 percent) on stock transactions would slow down high-volume trading that contributes nothing to the economy...
...On housing policy, we could go much further...
...Our highly valued currency is a massive subsidy to Wall Street at great cost to the real economy...
...A much larger federal effort could fund cities and community development corporations to take over foreclosed houses—thus transforming the current excess supply into a steady pool of available and affordable housing...
...This initiative could and should become a permanent program...
...In this economic climate, businesses won't see the growing demand that drives new investment...
...Thirty-two years ago, Michael Harrington wrote in these pages, "What Socialists Would Do in America—if They Could...
...It's the politics that is complex...
...Our response should be that although Obama's proposals deserve our critical support, his policies are not nearly that good...
...Indeed, advisers to Lyndon Johnson, including Daniel Patrick Moynihan and Michael Harrington, urged that the war on poverty include a massive public jobs program...
...Propose government spending to counteract the worst economic crisis since the 1930s...
...Full employment needs to be understood as a political demand even more than an economic one...
...Yet, in his reconfirmation hearings, Ben Bernanke could not even remember that achieving full employment is one of his mandated goals...
...Now people have a right to raise the most fundamental questions about how society can and should be organized, and socialists have a duty to help formulate those questions...
...Stimulus dollars for U.S...
...Socialists continue to believe what we have always believed: that we need to shape the economy to meet human needs...
...Yet we know that experts serve the Republican and even Tea Party causes, too...
...But there is a more fundamental issue...
...Building the labor movement is critical to the creation of a better society...
...Full employment has been largely absent from mainstream media discussions...
...Why can't we provide health care for all our citizens...
...currency, they keep prices of their exports to the United States low and prices of our exports to them high...
...Obama is not a socialist, but I am" would be a boon to our national debate...
...Government policy— from the Employee Free Choice Act to executive orders barring labor law violators from federal contracts—can change that...
...share of that is only $8 billion...
...And since fair market rent would be far lower than current mortgage payments, note holders would probably be motivated to negotiate lower payments...
...Just say no to such policies...
...That sounds a bit like the Tea Party, whose people tell us that the experts on global warming, on health care, on macroeconomics, are all lying...
...If they were enacted and if people could see them work, the country might be ready for further leftward movement...
...The late Robert Lekachman wrote often in these pages that as a technical matter, achieving full employment is rather simple...
...Deposits of public funds bring high profits to financial institutions, so steering deposits toward community banks, labor banks, and credit unions could promote the growth of a more diverse financial sector...
...green economy is too small to "pull the global supply chain...
...Funded at $40 billion per year for three years, it would put one million people to work...
...Why can't the richest nation in the history of the world provide decent jobs and affordable housing for all...
...He's a socialist, cry Sarah Palin and Joe the Plumber...
...Government did fail...
...Partnerships involving labor, local businesses, community leaders, and the public sector at the local level have had some success in several states...
...Dean Baker estimates that the bursting of the housing bubble cost $8 trillion in wealth, an average of $110,000 for every homeowner in the United States...
...While daily headlines inform us of an oversupply of housing, the Harvard University-MIT Joint Center for Housing Studies revealed in its October 2009 report that the number of Americans paying more than half their annual income for housing rose from 13.8 million in 2001 to 17.9 million in 2007...
...Proposals for a federal infrastructure bank would create long-term public financing for roads, bridges, highspeed rail, and urban transit...
...Improving Jobs We should also upgrade the jobs that we know will grow...
...JACK CLARK In the Still unfolding national debate about the economy, everything opposed by the extreme Right and the Republican Congressional caucus (the two can hardly be separated) is labeled as socialism...
...dollar represents the next potential bubble...
...Economic forecasters see a slow decline in the jobless rate, and Paul Krugman warns that 8 percent unemployment may be the new normal...
...Dean Baker, an economist with as solid a claim as anyone to having predicted the bursting of the housing bubble, proposes a very simple change in the law: in foreclosure proceedings, the court can order that the current owner has the right to remain in the property by paying a fair market rent...
...We need a finance sector that can collect our savings and turn them into loans and investments...
...National policies to promote a green economy can stimulate jobs in the new clean technologies and support a range of local initiatives to promote jobs across manufacturing sectors—and they can also discourage tax subsidy wars among states that only multinational corporations can win...
...manufacturing sector...
...Planning for full employment also means supporting key sectors of the economy that can create jobs...
...Carl Pope, one of the founders of the Apollo Alliance, notes that the U.S...
...In the United States today, few people share our full perspective, but in many policy areas, we can move toward a society that fosters greater equality and greater democratic decisionmaking in the economy...
...Financial Reform Details matter, but I am going to focus on broader arguments that will be relevant whatever happens in Congress this summer...
...She is correct, though, in saying that not every city using solar energy can be a solar energy production center...
...When proposals to relieve some small measure of human suffering are raised, they rally with their Tea Party compatriots to declaim that what Obama proposes is socialism...
...ACORN, the late and unfairly maligned community organizing group, put together "living wage" campaigns across the nation in the last decade to make government contracting a leader in improving work...
...Repeal the Bush tax cuts...
...Jack Clark served as national secretary of the Democratic Socialist Organizing Committee, one of Democratic Socialists of America's parent organizations, from 1973-1979...
...It's time to manage a decline in the dollar's value, which would make imports more expensive for us and our exports less expensive abroad...
...job creation support the growth of the Chinese green jobs sector...
...Joan Fitzgerald documents in Emerald Cities how local economies can promote a green economy...
...As Jeff Faux has recently argued, the current value of the U.S...
...Public investments can nurture new green economies (like Toledo, Ohio's move to convert from auto glass to glass for solar energy) or support older and still successful industries (food processing in central Pennsylvania, machine tools in Wisconsin...
...Not many months before this present crisis broke out, Brooks and Harold Meyerson served as right/left discussants on the PBS NewsHour...
...Many politicians in both parties wrongly insist that we can't afford to spend money on creating jobs...
...In the past, government policy directly expanded the finance sector with schemes like the guarantees to banks for student loans...
...Over time, working at the state and local as well as the federal levels, we could increase the percentage of the housing market controlled by nonprofit, community institutions, either through direct ownership or through lending by community development corporations, community credit unions, or labor banks...
...He currently lives in Washington, D.C...
...Meyerson suggested that it was time for Congress to regulate banks with particular attention to derivatives...
...Obviously, the "Buy America" provisions for federally funded projects need to be stronger...
...It would also generate as much as $100 billion a year, even with exemptions for pension funds...
...For years, we have run a huge imbalance in trade...
...We don't need finance as a leading sector of the economy—we should shrink it...
...That's the central Keynesian insight, and the first George Bush correctly derided the supply side alternative as "voodoo economics...
...Taking into account the number of young people entering the labor market, we need more than ten million jobs...
...Regulate them," Brooks scoffed...
...The owner would lose title to the property but would be allowed to remain for up to five years as a tenant...
...The Obama administration has correctly put an emphasis on the creation of green jobs...
...As the sophistication of these devices increases and the cost of electricity declines, export markets for renewable technologies become feasible...
Vol. 57 • July 2010 • No. 3
