Gar Alperovitz's Blog, page 5

Wall Street Journal embracing the democratization of wealth?

Just three years ago, I worked with the staff here at the Democracy Collaborative to write this article, which made a very basic point about the way systemic solutions to economic inequality were treated by the business paper of record, the Wall Street Journal.  As you can see, business structures that directly democratized ownership of the economy received short shrift:

But three years later, as the crisis of inequality continues to deepen—and after Piketty and Corbyn and Sanders and Pope Francis—the WSJ seems to have changed its tune.  The system question—that is, the question of how the ownership of capital should be structured in society that purports to be a democracy—is clearly on the table in a remarkable long essay published this past Saturday, written by the authorized biographer of Margaret Thatcher.

The piece begins with the simple imperative: “If Western countries want to disprove the dire forecasts of Karl Marx, we must think creatively about how to make the middle class more prosperous and secure.“

Let that sink in for a minute. The threat, according to this featured piece in the Wall Street Journal, is not just Marxists and their ideas, but the possibility that they might be right about capitalism after all. The author strikes the same note in his conclusion:

 […] Marx did have an insight about the disproportionate power of the ownership of capital. The owner of capital decides where money goes, whereas the people who sell only their labor lack that power. This makes it hard for society to be shaped in their interests. In recent years, that disproportion has reached destructive levels, so if we don’t want to be a Marxist society, we need to put it right.

And what is the alternative that this author sees as the way forward to avoid the hypothetical looming dictatorship of the proletariat?  Simply put, the author insists that we need to “take ownership much more seriously,” and put democratic control back into corporate governance:

Why are so few companies owned by the people who work for them, and why do both liberal and conservative political parties not offer greater incentives, such as tax advantages, for this to change? It is extraordinary that the joint stock company, the foundation of modern commercial and industrial wealth, is still so little influenced by the views of shareholders. This is perhaps most evident in the preposterous salaries paid, particularly in the U.S. and Britain, to top executives of public companies. If the owners of these companies truly exercised authority over what is theirs, this wouldn’t happen. If these enterprises had grown over the last 20 years at the same rate as pay for the men who run them (it usually still is men), no one would be talking of a crisis of capitalism.

But even more strikingly, the author goes beyond the idea of shareholder democracy, and insists on a large-scale push to imagine and implement the democratization of wealth, not through redistribution, but through newly revitalized forms of cooperative and democratized ownership and control of our economic institutions:

The Victorians were more imaginative than we are about principles of mutuality—credit unions, building societies, the cooperative movement. Such organizations feel creakier in an age when people want larger sums, faster. But is it really beyond the skill of our great modern business brains to develop these concepts and adapt them to modernity?

Admittedly, this is a single article that does little in the long run to correct the systemic bias revealed in the graphs above: the WSJ is by no means running regular coverage of the growing number of experiments in community wealth building and democratized cooperative ownership that are emerging throughout the nation (yet). But the oddity of the WSJ, bastion of capitalism’s most defended ideological heights, running such a forceful indictment of the current system and its tendency to reproduce and deepen levels of inequality inimical to democracy cannot be ignored: the system question may not quite be on the table in the mainstream media in the way it ultimately needs to be, but it’s getting close.

 

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The New New Deal: Gar Alperovitz on Radio Open Source with Christopher Lydon

Originally posted on Radio Open Source/90.9 WBUR Boston on September 24, 2015.

Produced in partnership with The Nation. Available in podcast form on iTunes.

An American conversation with global attitude.

This week with the new economist Gar Alperovitz and Felicia Wong, the head of the Roosevelt Institute, Radio Open Source explores the creation of an economic platform in search of a 2016 candidate. What would a presidential candidate have to say this summer to win over the discouraged workers, the house-poor, the indebted students, the indigent elderly?

Featured from the Radio Open Source website:

Today even as the economy is growing the gains are topsy-turvy: in the latest economic expansion (from 2009 to 2012), incomes for the bottom 90% actually sank while the top 10% rose more than 100%.

When FDR first conjured a “new deal” for American workers, amid economic ruin far worse than our own, he was still a candidate. It was June 1932, and he was accepting the nomination of the Democratic Party. His speech was long on specifics: public-works projects, the reduction of tariffs, distress and debt relief — all toward “more equitable opportunity to share in the distribution of national wealth.”

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The Clean Power Checkerboard

Originally published on TruthOut on September 10, 2015.

With President Obama’s announcement of the Clean Power Plan, almost 50 new fronts are going to open up in the battle for energy democracy. It’s time for an all-out mobilization with potentially far-reaching consequences.

Following the landmark Supreme Court ruling in 2014 affirming the Environmental Protection Agency’s right to reduce carbon pollution, President Obama has introduced a major program in the lead-up to the Paris climate talks at the end of this year that seeks to significantly reduce carbon emissions from US power plants, targeting a 32 percent drop from 2005 levels by 2030. This is a substantial executive action in a hostile legislative context, although many climate activists rightly demand far more ambitious targets.

What few have noticed is that the implementation phase of the Clean Power Plan is where things could start to get very interesting as there are almost certainly going to be very important opportunities for powerful local organizing.

Basically, the EPA will be mandating reductions on a state-by-state basis, and then each state will be responsible for hitting those targets – or the federal government would step in, via the proposed Federal Plan, and do it for them if they refused or were unwilling to meet the targets. In certain ways, the approach resembles the Affordable Care Act, but given the flexibility in the strategies states can pick to cut their emissions, there is going to be a great deal of unexpected room to begin demanding, at the state level, plans that get the climate job done while also moving toward a more democratic economy.

This is potentially true even in states politically hostile to the notion of government regulation, where even mentioning the fact that climate change is caused by humans remains ludicrously taboo in political discourse. Savvy climate activists in these conservative states might well push for a “cap-and-dividend” plan – in response to the conservative fear that the federal government will otherwise step in. Rather than turning the right to pollute into a financialized commodity to be traded by Wall Street and between giant corporations as “cap-and-trade” does, such a plan would promise to transfer the fees imposed on polluters directly to every citizen.

From the climate perspective, this could be one way to do an end run around red-state opposition – it’s harder to side with the fulminations of climate denialists when your carbon reduction dividend check reliably arrives in the mail every year. From an economic standpoint, such a move would put what amounts to a first step toward auniversal basic income on the table in a very practical way. Indeed, the deep red state of Alaska has no problem with this traditionally socialist principle when it comes to the annual checks each resident receives from the Alaska Permanent Fund (a publicly owned fund that collects and invests proceeds from oil and mineral extraction in the state).

In many states, however, it might well be possible to do far better. Many grassroots environmental justice groups are rightly angry that the featured status of cap-and-trade arrangements in the Clean Power Plan means essentially that polluters disproportionately harming poorer, predominantly Black and Brown communities (where dirty power plants tend to be located) are likely going to be allowed to pay for the privilege of perpetuating this harm. But what if it were possible in certain states to force dirty power to help finance its own displacement, and to do so in a way that started to address persistent economic marginalization along class and race lines?

In these states, the checkerboard is slightly more open: Here, a push might be made not for strategies like cap-and-dividend that generate funds earmarked for anyone whatsoever, but to earmark funds for the communities that face the most harm in the current energy system. The goal, too, would be to directly build up an alternative. Carbon dividends could be used to finance low-income community solar, for instance, with community benefit provisions directing the jobs created into community-based or cooperative businesses built to intentionally create opportunities where they are most needed. The Clean Power Plan requires, at least nominally, the inclusion of low-income communities in the formulation of state plans. Moving toward a community-based, democratized energy system could make those provisions more than just empty token gestures.

Finally, in a few states the politics might align to really open a path clear across the checkerboard. Elsewhere in the world, we’ve seen pessimism give way to populist efforts to build very different energy systems: Cooperative ownership of wind turbines, for instance, played a major role in the development of a renewable sector in Denmark. Germany’s Energiewende, while not without its problems, has shown that ambitious planning around energy transition is a real possibility – and this policy regime is now being supplemented by popular activist movements that support remunicipalizing large portions of the electrical system. Nor is this kind of thing impossible in the United States; they’re successfully doing it in Boulder, Colorado, for instance.

With Obama’s mandated reductions necessary, but not sufficient to meet key Intergovernmental Panel on Climate Change (IPCC) targets to avoid the worst effects of climate change, we’re going to need local pressure and local momentum to go beyond what the EPA has set out. The Clean Power Plan is an invitation to the states to reinvent their energy systems.

On the new clean power checkerboard, it’s entirely possible, given the right strategic mobilizations, that three or four breakout states will fully embrace a transition to renewables aligned with economic justice and democratic ownership. Another 10 or 15 states might achieve substantial progress to align more modest carbon reductions with the growth of a community-centered energy economy. And even in the states that will inevitably fight tooth and nail for their right to continue ignoring the threat of climate change, new approaches to a democratized energy system may be able to begin to help shape the federal option that will be imposed on the holdouts.

A state-by-state checkerboard strategy can be powerful: Same-sex marriage seemed like a political impossibility at the start of the millennium; 15 years later, it’s the law of the land. In the New Deal era, much of what ultimately became Roosevelt’s signature social and economic programs was a product of the checkerboard strategy as well, prototyped in the local “laboratories of democracy.” A strategic breakthrough at the state rather than federal level might one day make it possible to tell a similar story about the fight for a just energy transition.

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The War Was Won Before Hiroshima—And the Generals Who Dropped the Bomb Knew It

Originally published in The Nation on August 6, 2015.

Visitors to the National Air and Space Museum—America’s shrine to the technological leading edge of the military industrial complex—hear a familiar narrative from the tour guides in front of the Enola Gay, the plane that dropped an atomic weapon on the civilians of Hiroshima 70 years ago today. The bomb was dropped, they say, to save the lives of thousands of Americans who would otherwise have been killed in an invasion of the Home Islands. Hiroshima and Nagasaki were largely destroyed and the lives of between 135,000 and 300,000 mostly Japanese women, children, and old people were sacrificed—most young men were away at war—as the result of a terrible but morally just calculus aimed at bringing an intractable war to a close.

This story may assuage the conscience of the air museum visitor, but it is largely myth, fashioned to buttress our memories of the “good” war. By and large, the top generals and admirals who managed World War II knew better. Consider the small and little-noticed plaque hanging in the National Museum of the US Navy that accompanies the replica of “Little Boy,” the weapon used against the people of Hiroshima: In its one paragraph, it makes clear that Truman’s “political advisors” overruled the military in determining the way in which the end of the war in Japan would be approached. Furthermore, contrary to the popular myths around the atomic bomb’s nearly magical power to end the war, the Navy Museum’s explication of the history clearly indicates that “the vast destruction wreaked by the bombings of Hiroshima and Nagasaki and the loss of 135,000 people made little impact on the Japanese military.”

Indeed, it would have been surprising if they had: Despite the terrible concentrated power of atomic weapons, the firebombing of Tokyo earlier in 1945 and the destruction of numerous Japanese cities by conventional bombing had killed far more people. The Navy Museum acknowledges what many historians have long known: It was only with the entry of the Soviet Union’s Red Army into the war two days after the bombing of Hiroshima that the Japanese moved to finally surrender. Japan was used to losing cities to American bombing; what their military leaders feared more was the destruction of the country’s military by an all-out Red Army assault.

The top American military leaders who fought World War II, much to the surprise of many who are not aware of the record, were quite clear that the atomic bomb was unnecessary, that Japan was on the verge of surrender, and—for many—that the destruction of large numbers of civilians was immoral. Most were also conservatives, not liberals. Adm. William Leahy, President Truman’s Chief of Staff, wrote in his 1950 memoir I Was There that “the use of this barbarous weapon at Hiroshima and Nagasaki was of no material assistance in our war against Japan. The Japanese were already defeated and ready to surrender.… in being the first to use it, we…adopted an ethical standard common to the barbarians of the Dark Ages. I was not taught to make war in that fashion, and wars cannot be won by destroying women and children.”

The commanding general of the US Army Air Forces, Henry “Hap” Arnold, gave a strong indication of his views in a public statement only eleven days after Hiroshima was attacked. Asked on August 17 by a New York Times reporter whether the atomic bomb caused Japan to surrender, Arnold said that “the Japanese position was hopeless even before the first atomic bomb fell, because the Japanese had lost control of their own air.”

Fleet Adm. Chester Nimitz, Commander in Chief of the Pacific Fleet, stated in a public address at the Washington Monument two months after the bombings that “the atomic bomb played no decisive part, from a purely military standpoint, in the defeat of Japan…” Adm. William “Bull” Halsey Jr., Commander of the US Third Fleet, stated publicly in 1946 that “the first atomic bomb was an unnecessary experiment…. It was a mistake to ever drop it…. [the scientists] had this toy and they wanted to try it out, so they dropped it…”

Gen. Dwight Eisenhower, for his part, stated in his memoirs that when notified by Secretary of War Henry Stimson of the decision to use atomic weapons, he “voiced to him my grave misgivings, first on the basis of my belief that Japan was already defeated and that dropping the bomb was completely unnecessary, and secondly because I thought that our country should avoid shocking world opinion by the use of a weapon whose employment was, I thought, no longer mandatory as a measure to save American lives…” He later publicly declared “…it wasn’t necessary to hit them with that awful thing.” Even the famous “hawk” Maj. Gen. Curtis LeMay, head of the Twenty-First Bomber Command, went public the month after the bombing, telling the press that “the atomic bomb had nothing to do with the end of the war at all.”

The record is quite clear: From the perspective of an overwhelming number of key contemporary leaders in the US military, the dropping of atomic bombs on Hiroshima and Nagasaki was not a matter of military necessity. American intelligence had broken the Japanese codes, knew the Japanese government was trying to negotiate surrender through Moscow, and had long advised that the expected early August Russian declaration of war, along with assurances that Japan’s Emperor would be allowed to stay as a powerless figurehead, would bring surrender long before the first step in a November US invasion, three months later, could begin.

Historians still do not have a definitive answer to why the bomb was used. Given that US intelligence advised the war would likely end if Japan were given assurances regarding the Emperor—and given that the US military knew it would have to keep the Emperor to help control occupied Japan in any event—something else clearly seems to have been important. We do know that some of President Truman’s closest advisers viewed the bomb as a diplomatic and not simply a military weapon. Secretary of State James Byrnes, for instance, believed that the use of atomic weapons would help the United States more strongly dominate the postwar era. According to Manhattan Project scientist Leo Szilard, who met with him on May 28, 1945, “[Byrnes] was concerned about Russia’s postwar behavior…[and thought] that Russia might be more manageable if impressed by American military might, and that a demonstration of the bomb might impress Russia.”

History is rarely simple, and confronting it head-on, with critical honesty, is often quite painful. Myths, no matter how oversimplified or blatantly false, are too often far more likely to be embraced than inconvenient and unsettling truths. Even now, for instance, we see how difficult it is for the average US citizen to come to terms with the brutal record of slavery and white supremacy that underlies so much of our national story. Remaking our popular understanding of the “good” war’s climactic act is likely to be just as hard. But if the Confederate battle flag can come down in South Carolina, we can perhaps one day begin to ask ourselves more challenging questions about the nature of America’s global power, and what is true and what is false about why we really dropped the atomic bomb on Japan.

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The Next System Project at Left Forum 2015

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Socialism, American-Style

Originally published in the New York Times on July 23, 2015.

THE great 20th-century conservative economist Joseph Schumpeter thought the left had overlooked a major selling point in pressing the case for public — i.e., government — control over productive capital. “One of the most significant titles to superiority,” he suggested, was that public ownership produced profits, which means not having to depend on taxes to raise money.

The bulk of the left never took up Schumpeter’s argument. But in an oddly fitting twist, these days the mantra of public control in exchange for lower taxes has been embraced by a surprising quarter of the American political leadership: conservatives.

The most well-known case is Alaska. The Alaska Permanent Fund, established by a Republican governor in 1976, combines not one, but two socialist principles: public ownership and the provision of a basic income for all residents. The fund collects and invests proceeds from the extraction of oil and minerals in the state. Dividends are paid out annually to all state residents.

Texas is another example of conservative socialism in practice. Almost 150 years ago the Texas Permanent School Fund took control of roughly half of all the land and associated mineral rights still in the public domain. In 1953, coastal “submerged lands” were added after being relinquished by the federal government. Each year distributions from the fund go to support education; in 2014 alone it gave $838.7 million to state schools. Another fund, the $17.5 billion Permanent University Fund, owns more than two million acres of land, the proceeds of which help underwrite the state’s public university system.

Similar socialized funds — sometimes called sovereign wealth funds — are common in other conservative states. The Permanent Wyoming Mineral Trust Fund, with a market value of more than $7 billion accumulated from mineral extraction, is almost a direct expression of Schumpeter’s doctrine: Socialized ownership has helped to eliminate income taxes in the state.

Such “socialism, American style,” can produce odd reversals of conservative-liberal political alignments. One of the largest “socialist” enterprises in the nation is the Tennessee Valley Authority, a publicly owned company with $11 billion in sales revenue, nine million customers and 11,260 employees that produces electricity and helps manage the Tennessee River system. In 2013 President Obama proposed privatizing the T.V.A., but local Republican politicians, concerned with the prospect of higher prices for consumers and less money for their states, successfully opposed the idea.

Although state forms of public ownership have not been a major goal of the modern left, activists have begun to pick up on the idea that owning wealth in ways that benefit local communities is important. In Boulder, Colo., climate-change activists have helped win two major victories at the polls in a fight to municipalize the current utility owned by Xcel Energy. Publicly owned utilities also commonly return a portion of their profits, socialist style, to the city or county to help supplement local budgets, easing the pressure on taxpayers.

There are, in fact, already more than 2,000 publicly owned electric utilities that, along with cooperatives, supply more than 25 percent of the country’s electricity, now operating throughout the United States.

In one of the most conservative states, Nebraska, every single resident and business receives electricity from publicly owned utilities, cooperatives or public power districts. Partly as a result, Nebraskans pay one of the lowest rates for electricity in the nation.

The list goes on. More than 450 communities have also built partial or full public Internet systems, some after significant political battles. Roughly one-fifth of all hospitals are also currently publicly owned. Many cities own hotels, including Dallas — where the project was championed by the former Republican mayor Tom Leppert. Some 30 states directly invest public funds in promising start-up companies.

Moreover, contrary to conventional opinion, studies of the comparative efficiency of modern public enterprise show rough equivalency to private firms in many cases. (They aren’t perfect, of course: Many public agencies, boards and corporations that control enterprises are not fully accountable or transparent in their operations.)

With skepticism about capitalism growing among minorities and young voters, will we see more such endeavors in the future? Pendulums have a way of swinging, sometimes very sharply, when big economic tsunamis hit. It is possible that in the next big crisis, both sides might see the wisdom and practical benefits of public ownership, and embrace Joseph Schumpeter’s point even more boldly than they do today.

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Building Bridges: The Next Economic System with Gar Alperovitz and Ed Whitfield

Building Bridges: Your Community and Labor Report

National Edition

Produced by Ken Nash and Mimi Rosenberg

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Getting Serious About the Next Economic System

With

Gar Alperovitz, author, What Then Must We Do? and The Next

American Revolution: Beyond Corporate Capitalism and State

Socialism

In an era when systemic critique of the economic and political institutions of the United States is poised on the edge of mainstream consciousness: the realities of a changing climate, an irrationally destructive financialized economic system, a long and steady historical trajectory concentrating political power along with wealth, are becoming impossible to ignore. How can we consciously come together around this opportunity to offer a coherent vision of what a “next system” might look like? Gar Alperovitz is a leading proponent and practician of local socialized Alternatives to the current economic system. He here summarized some of the Concrete experiments in social change happening and being proposed across the country including Worker cooperatives, municipal and state economic enterprises, state and municipal banks, land trusts, and single payer health insurance and lays out a new initiative to expand visibility and support for an alternative economic system: The Next System Project : New Political-Economic Possibilities for the 21st Century.

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The Building Blocks for a Just Economic System

with

Ed Whitfield, Co-Managing Director of the Fund for Democratic

Communities speaks and writes on issues of cooperatives and

economic development while continuing to be interested in issues

of war and peace, as well as education and social responses to

racism and is active in the call by the Southern Grassroots

Economies Project (SGEP) to develop a Southern Reparations

Loan Fund

More and more people are disenfranchised from and disenchanted by our

economic system with its long and steady historical trajectory concentrating

political power along with wealth amongst the few, and a monstrous

apparatus of prisons and policing that are increasingly prevalent. And, Ed

Whitfield is one of the theoreticians/activists who offers us a coherent vision of what building a “next system” might look like. Whitfield talks about his work in the South and beginning to build for a far for equal and justice society.

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Building Bridges is regularly broadcast live over WBAI,

99.5 FM in the N.Y.C Metropolitan area on Mondays from

7-8pm EST and is streamed, and archived cast at

www.wbai.org

Building Bridges National Edition is regularly broadcast over:

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as well as internet stations:

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For archived Building Bridges Programs go to

our website:

www.buildingbridgesradio.org

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Economics Of Sustainability Conference

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Why democratic ownership matters if we care about class

Originally published in Classism Exposed on May 18, 2015.

I often open my lectures by explaining that the current distribution of wealth in the United States—with the richest 400 people owning more of the country than the poorest 180 million combined—is, essentially, a medieval arrangement, with a vast underclass and a tiny elite.  After one talk, a medieval historian approached me to offer a correction—today’s distribution of wealth is, in fact, far more unequal than anything seen in the Middle Ages.  Nevertheless, the fact remains that we are living in profoundly unequal times, and without addressing this fundamental imbalance in who owns our economy, we are going to be stuck with a politics that answers to the rich, rather than the needs of the poor or even the (shrinking) middle class.

Such a transformation is obviously not going to be quick or easy: it is the work of at least a generation or two.  But there are thousands of small (and even some medium-sized) projects across the country that understand the necessity of this transformation, and are working to democratize wealth in the here and now by building cooperative and community owned economic institutions.  It’s my belief that such work lays important groundwork—building skills, ideas, experience and creating shared values—for the larger scale transformations we’ll ultimately need to really address the problem.  But even at a small scale, we can see clearly how ownership translates into power.

Consider the Prospera network in the San Francisco Bay Area: five worker cooperatives all incubated by a central non-profit, and all working to empower the Latina women housecleaners who collectively own each cooperative. (A sixth co-op, in the food sector, is in the early stages of development.)

Domestic labor often reveals the realities of class in a particularly dramatic way, with low-income workers, largely women, working directly for the wealthy in the latter’s own homes.  Abuse and exploitation are all too common, as the work is done in private situations with little regulation, and the precariousness of the low-wage workers in the sector is magnified for many by their exposure to the violence of deportation.

But by coming together in a worker cooperative, these workers have been able to push back against this: owning a cooperative together gives the stability, the support, and the power to set their own conditions of work, not just in terms of hours and pay, but around important ecological and health issues, too—owning their own company gives them the power to choose eco-friendly cleaning supplies rather than suffering from long-term exposure to more toxic ones.

Brought together in relations of mutual support both within each cooperative business and as a larger network of institutional skill and memory, the workers can overcome the pervasive atomization and isolation which all too often characterize the lives of the precarious working class.  And by determining their own working conditions, the cooperative’s power spreads beyond their individual workplaces—the threat of a good example they provide can help provide a base for broader sectoral reform and regulation.

All of this comes through ownership and cooperative organization: The challenge for all of us concerned about the undemocratic structure of concentrated wealth in our country today is to build a path to scale up and generalize these kinds of hopeful experiments—step by step, over time, and on steadily to ever greater impact.

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We need a new economic system

Originally published in AlJazeera America on May 20, 2015.

As the 2016 election begins to come into focus, economic populism appears to be the order of the day. The Center for American Progress, the Campaign for America’s Future and National People’s Action, Hillary Clinton, Bernie Sanders, Bill de Blasio and the Roosevelt Institute have all in the last few months released programmatic calls to action highlighting the need to tackle economic inequality. This is, of course, laudable — it’s not every day that virtually the entire spectrum of Democratic Party insiders and outsiders concurs that our increasingly unequal distribution of income and wealth is a central problem to be addressed. But are calls for reform and redistribution enough?

I am opposed to very little of what is being presented in these various platforms and proposals. They are, for the most part, perfectly sensible ideas — such as financial transaction taxes, increases to the minimum wage and using government funds to build and repair infrastructure such as roads and railways — that would be, for the most part, noncontroversial if we were living in an era of sensible politics. But the fundamental fact is that we are not.

Instead, we are living in the era in which the corporate institutions at the core of our politics, along with the radical financial inequalities our system now produces, have undermined the power relationships that once allowed for traditional reforms. The labor union — the fundamental institutional power base for tempering the excesses of a corporate economy — is regrettably in terminal decline, down to 6.6 percent of workers in the private sector. Long-term structural shifts in the political economy have rendered the program of regulation and reform more or less inoperative. How long, for example, did it take for the banks to undo and neutralize even the modest post-financial crisis attempts to regulate their activities? Just four years, to judge from their recent success gutting new derivatives regulations before the Securities and Exchange Commission could even implement them. Only when contradictions emerge between different segments of an otherwise consolidated pro-corporate bloc — as they have around net neutrality and LGBTQ inclusion — we may be able to achieve a few victories here and there.

But such modest contradictions between corporate actors will not open up the political space needed to confront the underlying systemic drivers of increasing economic inequality. It’s commendable that economic inequality is on the Democratic Party’s agenda for 2016, but what’s missing is an understanding of the magnitude of this problem in the current context — that any real change will require not just regulatory redistribution, but a fundamental shift in the dynamics of wealth accumulation. The long-term economic trajectory is one that continues to return an indefensibly low share of income to working people even in an era of increased productivity, and that has maintained a more or less constant proportion of families below the poverty line since the 1970s — not to mention continuing to pump dangerous amounts of carbon into the atmosphere and incarcerating an obscene and unprecedented number of Americans. If we want to reverse this trajectory — if we want an economy that delivers democratic rather than plutocratic outcomes — we need to democratize the economy.

 

If this sounds radical, it is — in the sense of that word’s origin, as something that goes to the root of the problem. In a system in which political power flows, ever more unabashedly, from wealth, the increasing hyperconcentration of that wealth is the root cause that needs to be treated — and while educational disinvestment, crumbling infrastructure, and low wages are all important and pressing problems to tackle, they remain symptoms of the underlying dysfunction.

But this idea that we urgently need to democratize ownership of the economy is not really all that “radical” in the normal sense. It does not reject all private ownership; it merely demands that more people share in it, and that the public undertake new ownership strategies. Even in the recent flood of proposals for reform and regulation, elements of such a next system shine through. Economist Joseph Stiglitz’s “Rewriting the Rules” report for the Roosevelt Institute, for instance, suggests that a public option for mortgages could do much to address the deficiencies in a home-financing landscape where public welfare too often bows to private profit. Stiglitz also recommends a public option for savings banks, organized through the post office, and a public option in health care (“Medicare for all”). These and other kinds of public enterprises, designed to be owned democratically by the nation as a whole, would not aim simply to regulate the consequences of the profit-maximizing behavior of corporations — they would aim to displace them.

Further suggestions in other documents go straight to the heart of the relationship between labor and the ownership of capital. Remarkably, democratic socialist Bernie Sanders, in his presidential campaign economic agenda, and former Treasury Secretary and centrist’s centrist economist Lawrence Summers, writing inside the Beltway for the Center for American Progress, agree that worker ownership, including worker cooperatives, can and should be encouraged through federal policy initiatives.

At the local level in the “laboratories of democracy,” this kind of shift —toward models for economic development that prioritize democratic cooperative and community ownership — is already well under way and picking up steam. In Mayor Bill de Blasio’s New York City, the formation of worker cooperatives in economically marginalized communities is now a funded component of his administration’s business-development strategy.  Following the example of Cleveland, cities such as New Orleans, Rochester, New York, and Jacksonville, Florida, are pushing to develop community-owned cooperative businesses as part of municipal efforts to use the procurement of large non-profits to anchor inclusive local economic planning. Cities such as Chattanooga, Tennessee, have developed world-class municipal broadband networks that far outperform the paltry services on offer from the reigning corporate incumbents. And thanks to superb grass-roots organizing, the voters of Boulder, Colorado, are moving forward with an ambitious plan to deprivatize their local energy utility.

Efforts to democratize the ownership of our economy are becoming an increasingly mainstream part of our national conversation. The Next System Project, which I co-chair along with former presidential environmental advisor Gus Speth, is an attempt to do what we feel is necessary as a next step — take all these elements, promising local models and isolated policy proposals, and begin the careful work of knitting together broad, pluralistic conceptions of what a transformed system might look like. Without a systemic approach, acknowledging and aiming squarely at the basic ownership patterns that underlie the inequality we see manifesting in so many tragic ways, we run the risk of just tinkering around the edges. Ultimately, the clarification of a new systemic direction is also critical to political organizing and other activist strategies. A new momentum is quietly building, and it’s not a moment too soon.

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