Archive for March, 2013

Judo Inequality

“Think about it this way. We’re killing people in foreign lands in order to extract 200-million-year-old sunlight. Then we burn it . . . in order to boil water to create steam to drive a turbine to generate electricity. We frack our own backyards and pollute our rivers, or we blow up our mountaintops just miles from our nation’s capital for an hour of electricity, when we could just take what’s falling free from the sky.”

– Sungevity founder, Danny Kennedy –

From “The Secret to Solar Power,” (New York Times, August 9, 2012), by Jeff Himmelman

Subconsciously but in good conscience, Danny Kennedy has framed a solar version of the new “Judo Economy” paradigm. In his “Judo Economy” energy framework, massive amounts of naturally incoming energy are reflected and redirected without impacting and hollowing out the earth’s layered crust, breaking up shale formations, absorbing and contaminating fresh water supplies, or inciting earthquake and volcanic instability. Naturally occurring momentum is deployed as a positive force to society’s advantage as opposed to boxing with the inevitable and unmovable, absorbing one crushing body blow after another. (more…)

State-Wrecked: The Corruption of Capitalism in America | New York Times

By David A. Stockman

The Dow Jones and Standard & Poor’s 500 indexes reached record highs on Thursday, having completely erased the losses since the stock market’s last peak, in 2007. But instead of cheering, we should be very afraid.

Over the last 13 years, the stock market has twice crashed and touched off a recession: American households lost $5 trillion in the 2000 dot-com bust and more than $7 trillion in the 2007 housing crash. Sooner or later — within a few years, I predict — this latest Wall Street bubble, inflated by an egregious flood of phony money from the Federal Reserve rather than real economic gains, will explode, too.

Since the S.&P. 500 first reached its current level, in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold (to $3.2 trillion from $500 billion). Yet during that stretch, economic output has grown by an average of 1.7 percent a year (the slowest since the Civil War); real business investment has crawled forward at only 0.8 percent per year; and the payroll job count has crept up at a negligible 0.1 percent annually. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth of the “bottom” 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.

So the Main Street economy is failing while Washington is piling a soaring debt burden on our descendants, unable to rein in either the warfare state or the welfare state or raise the taxes needed to pay the nation’s bills. By default, the Fed has resorted to a radical, uncharted spree of money printing. But the flood of liquidity, instead of spurring banks to lend and corporations to spend, has stayed trapped in the canyons of Wall Street, where it is inflating yet another unsustainable bubble.

When it bursts, there will be no new round of bailouts like the ones the banks got in 2008. Instead, America will descend into an era of zero-sum austerity and virulent political conflict, extinguishing even today’s feeble remnants of economic growth.

THIS dyspeptic prospect results from the fact that we are now state-wrecked. With only brief interruptions, we’ve had eight decades of increasingly frenetic fiscal and monetary policy activism intended to counter the cyclical bumps and grinds of the free market and its purported tendency to underproduce jobs and economic output. The toll has been heavy.

As the federal government and its central-bank sidekick, the Fed, have groped for one goal after another — smoothing out the business cycle, minimizing inflation and unemployment at the same time, rolling out a giant social insurance blanket, promoting homeownership, subsidizing medical care, propping up old industries (agriculture, automobiles) and fostering new ones (“clean” energy, biotechnology) and, above all, bailing out Wall Street — they have now succumbed to overload, overreach and outside capture by powerful interests. The modern Keynesian state is broke, paralyzed and mired in empty ritual incantations about stimulating “demand,” even as it fosters a mutant crony capitalism that periodically lavishes the top 1 percent with speculative windfalls.

The culprits are bipartisan, though you’d never guess that from the blather that passes for political discourse these days.

Read the full op-ed from The New York Times.

MONDRAGON Corporation, winner at the Boldness in Business awards organized by the Financial Times

In the Drivers of Change category. In competition with six other companies from all over the world selected by the jury of the prestigious awards organized by the Financial Times and Arcelor Mittal.

MONDRAGON Corporation has won the Drivers of Change category at the Boldness in Business awards, organized on an annual basis by the London-based daily newspaper the Financial Times (FT) and the Indian corporation Arcelor Mittal (AM). The awards ceremony was held yesterday, 20 March, at the exclusive RIBA (Royal Institute of British Architects) building in London. Representatives from businesses worldwide were present, together with the Chief Executives of the FT and AM, Lionel Barber and Lakshmi Mittal respectively, and the Mayor of London, Boris Johnson. (more…)

The corporate ‘predator state’ | The Washington Post

By Katrina vanden Heuvel

Bipartisan agreement in Washington usually means citizens should hold on to their wallets or get ready for another threat to peace. In today’s politics, the bipartisan center usually applauds when entrenched interests and big money speak. Beneath all the partisan bickering, bipartisan majorities are solid for a trade policy run by and for multinationals, a health-care system serving insurance and drug companies, an energy policy for Big Oil and King Coal, and finance favoring banks that are too big to fail.

Economist James Galbraithcalls this the “predator state,” one in which large corporate interests rig the rules to protect their subsidies, tax dodges and monopolies. This isn’t the free market; it’s a rigged market.

Wall Street is a classic example. The attorney general announces that some banks are too big to prosecute. Despite what the FBI called an “epidemic of fraud,” not one head of a big bank has gone to jail or paid a major personal fine. Bloomberg News estimated that the subsidy they are provided by being too big to fail adds up to an estimated $83 billion a year.

Corporate welfare is, of course, offensive to progressives. The Nation and other media expose the endless outrages — drug companies getting Congress to ban Medicare negotiating bulk discounts on prices, Big Oil protecting billions in subsidies, multinationals hoarding a couple of trillion dollars abroad to avoid paying taxes, and much more. (more…)

Meet the New Left: Small-Business Owners | The Nation

By William Greider

A promising new force is finding its voice in progressive politics, though it is still widely ignored or misunderstood. These overlooked progressives are small-business owners and entrepreneurs who are not usually confused with left-wing activists. It does seem improbable: roughly half of small-business people are Republicans, only a third or so identify themselves as Democrats, and some certainly fit the old stereotype. The GOP idolizes business folks as free-market, small-government conservatives. On the left, they are frequently dismissed as small-minded right-wingers.

But if you listen to them more closely, you will hear jarring expressions of distinctly liberal opinions. And they express salty disgust for the US Chamber of Commerce and the National Federation of Independent Business, which claim to speak for the little guys on Main Street. Actually, these little guys accuse the US Chamber and the NFIB of identity theft.

The American Sustainable Business Council, along with several other like-minded groups, is determined to counter this corporate-financed propaganda by enabling small-business owners to speak for themselves. Simple as that may sound, it has great potential to alter political alignments and clear the way for a future economy based on very different principles and values. The old stereotype has lost its relevance. (more…)

More US unions are now running their own businesses | MSNBC

by Ned Resnikoff

A handful of American unions aren’t content to just negotiate with the boss—instead, they’re cutting the boss out of the equation entirely.

For example, the United Steelworkers union (USW) is starting a handful of co-ops across the rust belt in collaboration with the Basque Mondragon Corporation; a sprawling federation of cooperative businesses, in which all of the workers have an equal share in the company and get to vote to determine corporate governance. In Mondragon, company management in the federation is answerable to a democratically Governing Council and General Assembly consisting of all employees. Since 2009, USW has been working to import the cooperative network’s model of workplace democracy into some American pilot programs.

Amy Dean, a fellow with the Century Foundation, tracks the USW’s progress in a recent article for Yes! magazine. The steelworkers union, writes Dean, is currently “helping to launch the Pittsburgh Clean and Green Laundry Cooperative, a new industrial laundry.” Additionally, it is supporting the Cincinnati Union Cooperative Initiative in Ohio, which “has two projects in the pipeline: a railway manufacturing co-op and a cooperative for retrofitting buildings for energy efficiency.”

Read the article from MSNBC’s The Ed Show.

Mondragon: Spain’s giant co-operative where times are hard but few go bust | The Guardian

by Giles Tremlett

José María Ormaetxea is the co-founder of Spain’s seventh biggest industrial group, but he potters around Mondragon in a Ford Fiesta and lives in an ordinary flat in this industrial town tucked into a valley in the country’s northern Basque region.

“Imagine how rich he could have been if he had founded a different sort of company,” said Kepa Oliden, a local newspaper reporter from this town of 23,000 people. “But you won’t find anyone driving a Rolls-Royce in Mondragon.”

Visitors also find little of the new poverty sweeping through other parts of Spain, for up the steep slopes of what locals jokingly call the “sacred mountain” lies the headquarters of the Mondragon Corporation, the remarkably recession-proof company that Ormaetxea helped found in 1956.

There is little flashy about the offices of the Basque country’s biggest industrial company, but then there is nothing normal about what is now the world’s biggest workers co-operative … with global sales of €15bn (£13bn).

Whereas workers at other Spanish companies must answer to shareholder needs – often by sacrificing their jobs – that is not true at Mondragon, which acts as the parent company to 111 small, medium-sized and larger co-ops.

And as Spain struggles through double-dip recession, fierce austerity and 26% unemployment, this is one company that is not about to collapse. Nor has it shed many jobs, with the workforce remaining steady at around 84,000 people worldwide – about a sixth of them outside Spain.

Read the full article from The Guardian.

Why Unions Are Going Into the Co-op Business | Yes! Magazine

Yes Magazine Coop CoverThe steelworkers deal that could turn the rust belt green.
by Amy Dean

“Too often we have seen Wall Street hollow out companies by draining their cash and assets and hollow out communities by shedding jobs and shuttering plants,” said United Steelworkers (USW) President Leo Gerard in 2009. “We need a new business model that invests in workers and invests in communities.”

Gerard was announcing a formal partnership between his 1.2-million-member union and Mondragon, a cluster of cooperatives in the Basque region of Spain. (more…)

Subscribe

Subscribe to the RSS Feed