Democracy at Work: A Cure for Capitalism by Richard Wolff

Wolff introduces this book with the example of FDR triangulating between a Marxist union movement and Wall Street, which allowed him to create a fair amount of social democracy, including Social Security. He contrasts this will the recent crisis, where the only solution tried was bailing out the banks while doing nothing for the borrowers, who he sees as blameless, although I must admit that no one held a gun to my head when applying for too much consumer or housing credit, almost always in a cooperative credit union or government housing program. At least government helped when it came time to wipe out that debt, plus some medical debt as well. The answer Wolff proposes to Capitalism is the Worker Self Directed Enterprise (WSDE), which would make production, distribution and governmental decisions with local communities.

Chapter 1 shows where Capitalism is failing. The key feature in capitalism is not private ownership of the means of production but the fact of the labor surplus, where workers produce more for capital than they are paid in wages. Workers are divided into productive and unproductive. As a cost analyst, I am not sure this a distinction with a difference. Distribution is not productive, but you cannot get paid without it. Capitalism itself yields inequality, cyclical downturns and environmental devastation, as did state capitalism.

Keynesian interventions and regulations helped manage the pumps from the end of the war through the 70s, including and especially labor peace, although Capitalists fought back with Taft-Hartley and the Red Scares of the new right, from the Birchers to the Moral Majority. From then, the Neo-Liberals dominated both parties if they wanted to win, through the Obama presidency. The book was written before the insanity of Trump. Automation, women working, trade and outsourcing and immigration served the interests of executives who, in my analysis were given incentives to encourage these trends (and generally control worker pay) by the tax cuts and reforms of Ronald Reagan and George W. Bush. Without wage growth that kept up with productivity, borrowing became necessary, leading us to the Great Recession, which was caused when Asset Backed Securities and speculation in the NYMEX oil market collapsed (which Wolff missed).

Chapter 2 focuses on government responses. Wolff covers the interplay between ABS default at Credit Default Swaps ruining the credit market. Sadly, there are still those right wingers who think loans to poor people from Fannie and Freddie did them in. They won’t believe Richard. He also covers TARP bailouts and stimulus. (I gave Chrysler and GM a plan for using the bailout for effective employee-ownership. Not even the UAW gave me a response) Richard thought taxing the rich, especially corporations would help. It was not tried either. Here is where Wolff brings up the role of neo-liberal tax cuts in the last 50 years, and the right-wing argument that doing so restrains government waste (which it never has). Still no mention of the incentive to cut pay or keep it at inflation. Instead, he mentions that government debt hurt the ability of government to deficit spend its way out of the Great Recession. Instead, from Greece to the UK, the world turned to austerity. aka trickle up (which in the UK probably fueled the Brexit). He then describes the U.S. socializing losses and its too big to fail monetary policies in the wake of the crisis, yet jobs programs (nor mortgage debt forgiveness never materialized.

Chapter 3 concludes Part I by reiterating that private capitalism depends on labor surpluses generated by workers and is unstable. State socialism became state capitalism, with bureaucrats rather than workers controlling the worker surplus. Crisis has made more state control an option, but no good means of doing so has been worked out (Could Dodd-Frank be strong enough, unlikely).

Wolff does not address the reason that capitalists claim a right to the labor surplus, the assumption of risk by their investors. They exercise fiduciary responsibility over the company in their names. Indeed, they have enacted laws that make this a requirement of their jobs, with all other decisions
subordinate to that end. In that rationale, workers are mere factors of production, discardable at will.

It seems we have not moved much beyond slavery after all. State capitalists have a responsibility only to the state, but because they were responsible to everyone, they were responsible to no one except the Party. This was effective, but not enough to guarantee success. The politically connected could fail without fear of loss of position, so they did unless someone was watching, or at least succeeded on their own schedule.

In WSDEs, workers have both a fiduciary responsibility to themselves and a moral one. They are no longer factors. Indeed, in both socialism and capitalism, they bear more risk than the capitalists admit. Most workers do not have the wealth that would stop them from having to work and even if they did, until all medical and human services are automated, solidarity demands continued labor.

Workers have the most at stake. Investors only risk money and can move money into and out of various investments with a keystroke on their computer, or even let the computer do their thinking for them. Workers are giving up a day of what cannot be replaced, a day in their lives. That is more valuable than money, especially as one gets older. They also cultivate social relationships. While management considers them expendable, they and their follows have economic lives because they have jobs. Often, they cannot work for anyone else, so unless their employer provides all of the money and services they need to sustain themselves, they truly are slaves. Capitalists, on the other hand, both private and state, take all the goodies they can. Investors receive a ”normal” return, workers get as little as possible to keep them working and capitalists keep the rest, with CEOs often packing capitalist boards or party bosses with cronies who will give them all that they can steal. It is time for them to go.

Chapter 4 describes how capitalists distribute the surplus generated by employees, from sales personnel to shareholders and CEOs. In such firms, the board are the capitalists who make the decisions. The goal of decision making is profit maximization (including growth and market share), which can include automation, controlling labor markets and prices. Workers might use a union to alter decisions, but the capitalists generally call the tune and see to their own interests first, both in the company and in politics, which creates policy that hurts workers, who have less time and money to counter the bosses. Labor provided a counter-weight, which is why capitalists have-sought to decimate it. Even in 2007-09, public sector growth was resisted in favor of subsidized private sector growth. Since the book was written, Obama geeked in 2010 regarding letting taxes go up for the wealthy and the economy stayed stagnant. Indeed, further austerity actually hurt the recovery, although it did set the stage for the 2013 tax bill which let taxes on the rich go back up. Since then, the economy has been growing.

Chapter 5 deals with the problems of state capitalism. First, Wolff delineates the main differences between capitalism and socialism. Capitalism has the means of production owned privately (including, I would add, the employees), keeping the labor surplus for itself and using markets for supply and distribution. Socialism distributes labor surplus to the people and relies on central planning. There have been many socialist and communist experiments in the 20th century, from the welfare socialism of the Scandinavian countries to the Communism of Russia and China, which devolved into what Michael Harrington of DSA called Bureaucratic Authoritarianism or what Lenin called State Capitalism. Regardless, worker democracy has never been tried. Capitalists and Bureaucrats own and control the labor surplus, less taxes or social services, because of this lack of democracy. It is the difference between making lives better for the slaves and ending slavery (which is hardly ever totally successful, even in socialism - at least not so far).

Part III begins with Chapter 6 and an examination of Worker Self-Directed Enterprises. Wolff differentiates between the direct democracy of production workers in WSDEs and both capitalist and state capitalist boards of directors, who reserve all decision making to themselves. Only direct democracy has the workers control the means of production, according to Wolff. He contrasts WSDEs with ESOPs, which also have decision making boards (and in my experience, are not at all radicalized), worker-managed enterprises, which still delegate decisions to management and cooperatives, which have to do more with joint ownership than decision making by every productive worker. Coop boards function like any board of directors. Wolff is not a fan of representative democracy by workers, although if workers are self-aware enough, there are likely some things that can be done with representation and others where direct votes are required. I suspect most arrangements will not be adjusted very often, even in a WSDE.

Chapter 7 starts with a description of how decision making occurs in WSDEs. Some decisions are made by both productive workers, who make up the board and others by both productive workers and enablers. Frankly, I am not sure there needs to be a difference as direct production declines and customer contact workers, who are enablers, take on more of the creative edge responsible for profitability. Is market research not essentially the first step in production? If someone cleaning the shop floor between shifts enables production workers to not do so, are they not as essential? I suspect so. Some of this is Marxian orthodoxy showing up where it is probably no longer required. Indeed, if employees are not essential to the operation, the position should be abolished.

Wolff talks about how WSDEs may seek to make more such enterprises, but rather than reproducing by fission, I would suggest example and radicalization of other workers is the more essential goal. The question of managers is discussed. Wolff suggests rotating workers into these positions, as opposed to hiring them. I like simply electing them, from the CEO to the shop foreman, although before election, having candidates for these jobs (and there is always someone who wants to be the boss) bid for the position in open auction until the bidding gets to an agreed upon floor, with an election by the workers supervised to determine who gets the job.

Most WSDE’s will not clone themselves. Indeed, they should expand vertically along both the company supply chains from resource extraction to home delivery and the personal supply chain from education to housing to retirement (workers control the means of consumption), while avoiding horizontal integration to keep the market honest like it has not been for a long time. It will fall upon socialist consulting firms to help facilitate both new WSDEs and to convert existing companies to this technology, although such firms will have to walk the talk as well.

Wolff describes two kinds of employees in WSDEs, production employees and everyone else from cleaning crew to managers. Production employees would serve on the board and would allocate the labor surplus, while the remaining enablers would also participate in deciding on all other issues. Again, I am not sure how often issues need to be decided after setting up systems and how much can be delegated to management or to some representative body. If we are doing our jobs as socialists, the workers will be empowered to decide who decides.

Wolff compares technological change between private capitalism, state capitalism and WSDEs. Private capitalists do incorporate some technology changes, but also block innovation as well if the innovation would be expensive or hurt other products or related industries. This is why Europe and the US get different carburetors. Capitalists do the minimum. State capitalists do likewise unless it affects the state. WSDEs will have more than the Board make some of these decisions, especially about labor saving, Wolff suggests a government bureaucracy might be established to cushion the blow of innovation.

Both private capitalists and state capitalists have horrible environmental records. CEO benefit and investor profit maximization is hurt by taking up extra funds protecting the environment. Workers live closer to the environmental hazards their jobs create. They would be a more effective force in limiting pollution (although that is not universally the case if they feel their jobs are on the line because a co-worker is ratting them out). Better and cheaper pollution prevention and a strong government or industrial association to mandate their uses (and sponsor new technology) seems essential to me.

Wolff talks about how to compress minimum and maximum pay in WSDEs, suggesting rotation is the answer. I suggest an equal base wage for everyone, with additions for family size, which should be subsidized by the government in business taxes and using stock grants and dividends to reward innovation, educational attainment, longevity and management position, among other factors, would be dealt with. I have a whole essay on pay equity that does so on bindneranalytics blogger account, but let me briefly sketch some points.

Instead of setting them up in a new WSDE as Wolff suggests, innovators could be given cash bonuses for their inventions rather than higher salaries (most innovation is a riff off of existing technology that the WSDE would already own) and/or additional preferred shares based on the future profitability of the invention. Every instance may be voted on by the member directors or they could set up and vote on a system that consistently implements such decisions. They would decide which strategy they want to employ. With luck, such arrangements will both attract the best workers to these new enterprises and create better products and more profitability. This would force capitalist firms to adopt similar systems and essentially convert to WSDEs, although there are other ways to speed this up.

There is also the question of both layoffs and innovation. Should there be a fund for paying workers while they are retrained? Should it be governmental using taxes from WSDEs? I propose it could or workers could live off of the dividends from accumulated shares. Workers with enough shares could simply retire (with any mortgage held by the WSDE forgiven or paid while the worker is in transition). Indeed, if it does not make sense to retrain a worker, early retirement for whole cohorts is a good option. Should they continue to vote their shares? For that matter, should voting be warm body (with each worker having one voting share and earning a new preferred share each month, with or without dividend reinvestment) or should all shares be voting. WSDEs would make these decisions based on how much experience is important to making the right decisions for the whole. The more we need a bias for experience, the more share accumulation and retiree voting should be considered (like in the NFL). The more innovation is important, the less experience needs to be given preference. Wolff suggests that setting up new WSDEs could be a response.

Likewise, WSDEs could hire future workers while or at the beginning of either technical training or the third year of college, paying their tuition, living expenses, a stipend and maybe even some stock, at the discretion of the WSDE. This will give WSDEs the best employees, again forcing capitalists to follow suit. It also takes away any claim that members deserve higher salaries for their educations that they or their parents did not pay for. They may be given stock upon degree completion to provide a bit of extra income, as the market would for a while, but base wages would stay flat. If the work obligation incurred for this education (less any tax benefits provided by the government) does now work out, a government loan program would take the debt off of the WSDE’s hands and any stock grants would be cancelled or taken to lower the value of the debt.

Chapter 8 addresses ownership and markets. Socialism exists at the marco and micro level. Wolff suggests that one of the failures of the Soviet state was ignoring micro-level transformation. In WSDEs, the State could actually own the means of production, the WSDE members could or there could be conventional share system with some shares sold on the market. There could also be a mix. I do not favor state or outside ownership, especially if the WSDE or company offers employee-owners mortgage services, because without such ownership lending can be done at zero interest. Of course, WSDEs would decide for themselves. If there are shares, however, there will be share voting. If experience is important, then voting shares would be granted monthly (and if dividends are reinvested, additional shares would be added as well). Of course, this would make ownership top-heavy. To reduce this effect, voting shares would be granted less often, say one after the probationary period and another one every five or ten years, with preferred non-voting shares granted each month. Any outside investors would receive non-voting shares unless part of a reciprocal arrangement between WSDEs who provide services for each other (say, the local electric company). For absolute equality, everyone would get only one voting share. Again, WSDEs would decide. What should be mandatory is insurance of WSDE investments. A third of shares should be traded to an insurance fund to make members whole if the WSDE fails for whatever reason and to intervene if 18% of voting shares suggest to the insurance fund that management is failing or corrupt, so that the fund would take control of the WSDE to investigate and help members resolve the situation.

On the question of product markets, WSDEs could rely on central planning or on the commercial markets (which would likely be free for the first time with capitalism gone). On some projects, like rebuilding the transportation system, I would suggest partnerships between federal, state and local government, WSDEs, car companies and road construction companies, utility companies and any non WSDE employers to build electric cars with underground roadways, central computer control and energy from the ceiling (like electric trains) and interlocking share ownership where appropriate to govern the operation and to assure that retirees can use the system for free by cashing out preferred shares in both their WSDE and the electric company. The network would be national but ownership would be localized.

For most things, my axiom is that to secure control of the means of production, we must first give workers control over the means of consumption, not individually but collectively. If we can show that the cash and prizes are better collectively, workers will want to form WSDEs and use them to improve their lives. Currently, it is not vital because most workers think they have good or at least the best jobs they can get. This goes way beyond voting for a free cafeteria for breakfast and lunch (although it is always a good idea) or free business suits to WSDE owned home construction WSDEs and WSDE financing of them at zero interest, rather than using a credit union. This carries over into medical services, education and other governmental social services and even time shares at the beach and overseas (and airline vouchers). Implicitly, workers are given cash for these things and WSDEs could decide to continue, or we could build a cashless society and freeze out the financial sector entirely.

If there is any takeaway from this review, it should be ”Workers control the means of Consumption.”

Chapter 9 addresses Economic and Political Democracy. Capitalism does not like democracy and is designed to keep workers so busy that they really cannot if they want to. WSDEs will be smarter than that and will give workers practical experience in workplace democracy that can be extended to the political side (although I suspect some WSDEs will include representative governance, maybe through unions or professions to do the day to day decisions that management can’t do, although cash and prizes will likely be voted on directly, as well as CEO and management hiring). This is quite a difference from the forced authoritarianism of both private and state capitalism, which usually bleeds into our politics. Democracy will reverse the trend, at least to the extent that WSDEs do not absorb government services.

Even with workers in the majority, private and state capitalists kept control, as the election of Donald Trump, which happened after this book was published, as well as a long line of neo-liberals of both parties in the White House and Congress, illustrates. Economic issues, with the exception of minor changes to tax policy, are never discussed, with the Affordable Care Act being the shining exception, but even that was trapped by the Capitalists in a bill from the conservative Heritage Foundation that kept all the industries happy Usually, the parties use non-economic issues to distract the masses, especially issues like abortion where there is no real room for action by either side. That issue and raw racism is what we have now descended to, as well as the intervention by Russian Oligarchs, who the right wing now try to protect.

Wolff contrasts how FDR could use the CIO and radicalized workers to move along the recovery from the Great Depression. Obama had less luck because the capitalist hegemony gave him less room to work, especially with McConnell doing their bidding. Of course, many of FDRs innovative programs and more are now a part of the permanent government structure. His biggest problem, we now know, was in his own White House with Larry Summers counseling against mortgage forgiveness and on letting the Bush tax cuts expire in 2010. It turns out that once 2013 came around, with Summers gone, Obama was able to outmaneuver Grover Norquist and the Freedom Caucus and allow taxes on the top 2% of earners return to Clintonian levels (plus additional taxes from the Affordable Care Act). Since then, with rich people having less money to spend on shit investments, the economy has come creeping back and mortgages are finally no longer under water.

It is important to note that Capitalists with government in their back pockets have frustrated union organizing and ignored wage and hour (including peonage) and workplace safety laws, have passed ERISA to limit employee-ownership and Taft-Hartley to limit union-ownership. Reversing all of this must be a priority.

Chapter 10 talks about WSDEs in Modern Society. Capitalists engage not only monopsony in hiring workers and purchasing supplies (especially overseas), but in displacing smaller firms with larger monopolies and oligopolies. I would add franchises to the list, as these are how product distribution risk and labor organization are averted). WSDEs would collaborate and reverse this trend. Of course, I would simply try to take the larger firms over, probably splitting them up regionally and making them part of WSDEs. Their supply chains too. I would not forgo dividend payments to WSDE members, for reasons stated above, but would instead press for preferred financing at the Federal Reserve Discount Window to fund conversion costs. Wolff suggests WSDEs would be smaller (the Distributists do too). I disagree. He compares workers in capitalist firms with WSDEs in reaction to investment that might take jobs. I suspect that workers in capitalist firms will vote with their feet rather than resist in their old employments. Indeed, I suspect that Capitalists will have to start copying WSDEs, especially once WSDEs of larger size, say General Motors, are converted.

Wolff talks about differing economic flows between WSDEs and capitalist firms. On infrastructure they might be alike but different on public education (training worker board members v. drones), assuming WSDEs don’t absorb public education or send their kids to religious schools or charter schools (in either case they should demand a seat on individual school boards). Production location decisions will be different. WSDEs will work with local governments on Smart Growth. Capitalists demand concessions in order to come and to stay and may outsource or move anyway. Just look at the NFL, which, along with local governments representing the taxpayers and stadium workers, should become a WSDE (including retirees). Wolff and I agree that the WSDE can be exported to overseas firms, although I would do so by having multi-nationals become WSDEs and buy their supply chains, as well as encouraging by example (or just changing the market).


Wolff returns to differentiating production workers and enablers and stresses the need for political skill in defining limits between the two. I am still not sure they can be separated. I worry more about the Kelso model, which gives each member of the workers family capital credit to buy and then vote shares, which gives larger families more of a vote than smaller ones. Each worker should be equal. Production, however, demands less and less of the enterprise, especially when the creative work is done here and the labor is performed in Asia. In a multi-national WSDE, the Asian workers would be the entire board unless non-production workers are included. As long as the production workers have the same standard of living and voting power, I do not worry about appropriation of labor. Indeed, sales personnel are as expert as designers in what sells and why, whether you are selling pants or spacecraft. Should the community be involved in WSDE decision making? Yes, in joint ventures, especially in transportation, education, land use and fire protection (to the extent the WSDE does not absorb these functions, in which case the former government workers would be WSDE voting members as board members or enablers, although if you look at the enterprise as including the means of consumption the distinction has to vanish).

Chapter 11 addresses Program and Personnel for Increasing WSDEs. Wolff suggests a federal jobs program to provide money to form WSDEs on a New Deal model. I suspect most of the infrastructure needed to do that already exists (just like we already have DOE power plants, a Highway Administration and a General Services Administration). Starting new agencies is not required. Funding them is and electing people who will fund them is crucial. Of course, taxation on the wealthy has gotten the economy moving faster than it was when the book was written. Still, local Workforce Investment Boards, Chambers of Commerce, Community Colleges and One Stop Job Centers could take WSDEs on as a project, possibly with SBA assistance or loans. Indeed, with loans, money would not even have to be appropriated. Existing Community Colleges could be given a how-to course on WSDEs with concrete instructions and checklists of things to consider. Indeed, if the course addressed financing, SBA money could be foregone or just one option. This could be offered WIB by WIB or college by college without any obstruction from Trump, McConnell or the House Freedom Caucus and its Randian Speaker.

Other options suggested include working with Cooperative Movements, Trade Unions and I would add ESOPs. Indeed, instead of working with them to pass legislation, they could be clients in converting their enterprises to WSDEs one at time. WSDE Organic Intellectuals would be part of that first wave of consultants who learn by doing, not just by advocating and studying. This movement cannot, as yet, win at the ballot box. We must first Occupy Capitalism in growing this movement. Then we can equalize the Social Security Employer Contribution for Old Age and Survivors Insurance (every worker gets the same credit) and then using a portion of that credit to either buy Employer Voting Stock (for eventual WSDE conversion) or buy into the WSDE insurance fund, which would pay dividends to them (as well as to widowed survivors of WSDE members). We don’t have the votes yet, but we will, probably in a political party combining progressive Democrats, Libertarians and Greens. Once the racism of Trump kills the Republicans, the Neo-liberal Republicans and Democrats will join forces and the rest of us will head for the exits. Becoming a third party is lunacy. Being another major party must be the goal. To get there, however, we need economic power.

That is the second take away: Occupy Capitalism

How we do it is important. In 1992, Boris Yeltsin was using a DC consulting firm to help him convert State Capitalist firms to employee-owned ones. I was at IBM at the time and faxed them a memo on how to convert and manage these firms, including share distribution. I am not sure if they used my scheme or someone else’s, but their plan included the provision that the shares should be available for sale as opposed to being held for retirement or at least until resignation. I implied the latter and that one provision ruined Russia, because the stocks were valued at about the cost of a bottle of vodka, which they were traded for, giving rise to the Oligarchs and Vladimir Putin. Details matter, although I think making WSDEs keep all the shares in the hands of workers (and maybe retirees) and not letting them be sold outside of retirement or transfer to a new employer must be one of them.

The Problem of Corporate Income Taxes

This Note is in response to piece by Howard Gleckman on TaxVox by the Tax Policy Center, which you can read at http://www.taxpolicycenter.org/taxvox/would-workers-benefit-corporate-tax-cut-not-much

The corporate income tax was formerly referred to as the corporate profits tax, which made who paid for it obvious. The argument that cutting taxes leads to more investment makes about as much sense as saying that cutting taxes on the wealthy, especially dividends and capital gains, leads to investments that spur the economy and employment is true, but not in a good way, unless massive deficits eat up these cuts as bond purchases. This leads us to wonder, why not raise taxes and increase government purchases and transfer payments instead?

The private sector has only so many solid investment opportunities and unless interest rates are sky rocketing, they are adequately funded, usually in response to increases in aggregate demand. Investments do not drive such demand. I am sure Mr. Mnuchin would never tell a private sector client to invest in plant and equipment without a strong customer base. If he would, Goldmann Sachs is better off without him. But as an Executive Producer, he angeled blockbusters, some of the biggest selling movies in Hollywood history. He did not release that cash because no one had the money to go to the movies.

The reality is that whe the bosses and investors pay lower taxes, they get to keep more money, not from investing but by driving labor costs down through outsourcing, job cuts or keeping more of a share of productivity gains than are given to workers in higher wages. In the last 45 years, wages have increased by 11% of total growth, although productivity rose 73.4%. 62% went to the owners of capital. Prior to 1973 these figures tracked together.  http://www.epi.org/productivity-pay-gap/ That would be how to split the taxes.

Lower wages lead to more consumer debt use and we know what that led to. Lower capital gains taxes led to speculation in housing and Internet start-ups, which were also a key factor in the last three recession, starting from the 1986 tax reform to the Clinton-Gingrich capital gains cuts to the Bush cuts, which tracked to the S&L Crisis, the Tech Bust and the Great Recession.

Of course, the question would be moot if employee-owened corporations and cooperatives were a universal phenomenon. Then the workers are the investors and the investors are the workers. Either way, of course, the tax would be paid by the consumer. Of course, if the consumer were also the members of the cooperative and they provided all government social and educational services (including mental healthcare for criminals), as well as their own infrastructure and public safety, then there would be little taxpaying going on at all. Any that did occur would be funded from a Subtraction VAT (with off-sets for providing those services) and a land value tax to compensate people who are left out of the cooperative system, who would simly buy services from the cooperative itself, including the governmental ones. These too would be funded by the liquidity provided by sales.

Any income tax, goods and services tax, corporate profits tax or hidden subtraction VAT can be considered an element of price. Consumers pay the entire price. A GST simply brings that price forward. Income taxes, although funded by the customers (all those movie tickets Mnuchin got a piece of) would still be paid by the wealthier players in the game, if only because accounting for them as part of the Subtraction VAT so that the correct higher rate is paid would violate their privacy and not having a progressive income tax would give them too much of the pie, even more than their current undeserved share.

Dividend and capital gains taxes are lower than normal tax rates because tax is paid by the corporations they own, but only on profits, not wages. Shifting to VAT (both GST and Subtraction) would tax labor and capital at the same rate, allowing income taxes to do the same as a surtax that investors and executives could pay, except that doing so forces disclosure off too much information on their financial affairs. There is no bar for the CEO of Comcast/Univeral from owning Disney stock, but he certainly does not want his board and investors knowing that he might do so. I am sure the CFO, the talent and the CIO all feel the same way.

Tax reform should put in VATs, equalize all income tax rates, which only the rich would pay, and encourage employee-ownership, bot at home and abroad, by diverting some of the retirement taxes included in the Subtraction VAT toward purchasing employer voting stock. The new owners will give the same deal to their overseas brothers and sisters and the problem of how much the rich get (eventually nothing) and dealing with overseas capital will take care of themselves.

And to think, it used to be the Marxists who had no plan. The shoe is on the other foot.

Realignment

The two party system is a function of single member winner take all districts. Adopt proportional representation at the state level and we will look like PR. Many parties, 97% turnout. The LP and GPUSA may one day join coalitions (hard to imagine, they are used to being purists, which is why they are minor) and gain enough followers to be a major party, but only if we shift to proporational.
I used to be in charge of information for the DC Statehood Party, including member records and analysis. We had twice the voters as we did active registrants (most of our membership did not vote having moved or died and DC never purges so it can stop citizen initiatives). Actually, we had 2 Democrats for each party member in our voting base. Three times nothing is still nothing, even after we merged with the Greens.
Trump may drive out the non-racists from the GOP, turning it into a minor party. The Libertarian Republicans, maybe the LP and the Neo-Liberal DLC types could easily grab the White House in 2020 unless opposed by a coalition of Democratic Socialists Bernie Bots), Democratic Greens, Greens and some of those Libertarians in what would be a battle of ages (old v. young). Actually, it will be a battle for the ethnic vote. If the left can Occupy Capitalism and build a base in the workplace, it will have a better chance.

Comments from this weekend’s debate on abortion

There are two rationales for justifying limiting abortion. The one I fear most people are following is loyalty to Church teaching. In the United States, that is not an adequate reason. The obligation to impose Catholicism on secular countries was removed by Vatican II. Such matters of discipline and practice are not dogma so saying that the Church could not change such things at the Council is simly wrong. If the Church cannot force us to Catholicize the United States, it certainly can’t require that we adopt doctrine into law. Doctrine can inform us, it cannot compel us and it certainly cannot compel the national government. Even before Vatican II, JFK affirmed that a Catholic President is not required to do the Pope’s bidding. Mario Cuomo and the Catholic politicians who followed have affirmed the demands of pluralism. Of course, they do a disservice to the Church by not also explaining the constitutional law reasoning behind Roe and the other privacy decisions. It is incumbent on the hierarchy and Catholic advocates to listen to these explanations, else they are sowing discord for pride’s sake.

The hierarchy and the movement need education about just that point. You mention Dred Scott, (who was freed, by the way). The mistake of the case came not from changing the Court but enacting the 14th Amendment, which defined personhood and which, according to Roe, left out the unborn (even though abortion bans had started). Congress can alter the terms, sir. Put up or shut up.

Sin is a matter of conscience and I am not encouraging anyone to have an abortion. Nor are Biden or Pelosi. What takes courage is to go against Republican orthodoxy and do something about the issue beyond fundraising and volunteering for their candidates. Doing so in the name of the Church is scandalous. Enact that $1000 per month per child tax credit and I will reevaluate what I think about your motives.

Slavery was not just a matter of conscience, it was a function of the slave power. White people who dissented in the south were beaten and exiled, if they lived. Add you equate slavery with abortion then the amendment which at least attempted to give freemen rights was also used to justify legal abortion. In both cases, it was a question of state government power imposing moral choices on others. You are confusing moral scorn with freedom of conscience. The moral scorn that banned abortion and sodomy also abused blacks and Latinos and imposed the Slave Power on others in the antebellum south.
Support for the poor is socially decided, as well as individual. In a democratic country you don't get a right of conscience to avoid paying taxes for this. Don't elevate your preference for dine and dash tax policy to a moral viewpoint.

Cardinal McCarrick led a panel that decided no more using Eucharist as a political pawn. By the way, what happened to Sebelius, who was denied Communion, amounted to sedition because she vetoed a law that was unconstitutional on its face, which is her obligation as defined by her oath of office. For someone appointed by a foreign power at the recommendation of its ambassador to use their sacred offices to interfere with the constitutional operations of our government borders on sedition. It only is not because the Sedition Act expired. Of course, promoting abortion is excommunicated. Allowing it is not promoting it. You can allow driving without giving people free gas or cars. You are not talking about really doing something about abortion anyway. You are out to promote the Republican Party or are their fool. Either way, resisting Trump or the GOP (which is not God's Own Party is not a sin, nor is holding the contention that Roe is settled law. Congress can alter personhood, not SCOTUS.

Catholic politicians do not support abortion, it is a constitutional, not a legislative question. They do support the premise that it is not an issue that should be legislated at the state level but have not explained that well to the hierarchy, either publicly or privately. That is a shame. Not supporting mob rule by conservatives at the state level is not supporting abortion, it is opposing mob rule, even if the mob is led by bishops. They don't support the compromise legislation above because it helps their fundraising too, but I contend that they would do better to compromise than the GOP.

One of the reasons Obama won Catholics is that we made this argument online constantly. People got.it. Hillary did not. Now that you have a pro-life President and Congress, don't bother trolling every discussion on NCR. Show us your bill and tell us who will sponsor it and when the Judiciary Committee is holding hearings. If you can't do that, quit moralizing on our politics, trolling NCR and wasting our time. Or admit that the best Congress will do is the status quo and join me and others in fighting for a living wage for families, which will do more for the unborn than any bill I just showed you how to draft. Get the GOP to cooperate with you or quit damning us for supporting the other guys. Your serial calumny is no longer tolerable.

The right to abortion is about abortion but constitutionally it is not about rights at all, except the right to be left alone by the government. The real meat of the decision is and always shall be a limitation of the POWER of state government to impose moral choices on its citizens. I will argue limiting state power every day of the week and twice on Sunday. Slavery is another pro-life diversion. The 14th Amendment at least attempted to limit the Slave Power from reintroducing virtual slavery on Freemen. As long as federal troops were on hand, it stood. The rule of law is stronger now and we are taking down the monuments to that power. The last one is the racist immigration system. It will take an election, but we will do it.

Supporting abortion is a term of art. It is not just allowing abortion to be legal (as if Catholic politicians had a choice, even about judges, because vehemently pro-life judges are usually inferior legal thinkers). It is taking the position that abortion is a positive good that society should encourage. Some zero population growth Greens actually take that position, but it is individual, not a required party plank. The right to abortion is part of a larger right to engage in conduct that the legislature has no business regulating in a free society. Not wanting a theocracy, even a Catholic one, is not a requirement of the faith. Sadly, Pelosi and Biden have done nothing to educate the hierarchy on why Roe says what it says. Doing so publicly may alienate some Catholic voters, but probably not the amount they fear.

The second rationale is that the unborn are persons who need to be protected. This is the only rationale that meets consitutional muster. Abortion can no longer be related simply as a banned medical practice where doctors are fined and women seek the procedure clandestinely or self-induce (although self-inducing is easy with certain drug combinations that could be ordered from China if abortion is banned). The Supreme Court ruled that unless the personhood of the fetus (or embryo) is recognized, the states have no compelling interest to violate the rights of women to be left alone in this matter. In the United States, law is permissive (Amendment 9) and while states have sovereign power (Amendment 10) it is limited by due process and equal protection (Amendment 14).

There is no statute permitting abortion, no law that allows abortion to be repealed or supported or opposed by Catholic legisltors and politicians. As long as the pro-life movement acts as if there is such a law, we will laugh at them. The only way to limit abortion is to advance the pesonhood of the unborn into earlier in the pregnancy. Any regulation that follows from such a change in law must conform to the due process rules that apply to everyone. Rules applying only to abortion will be struck down. The Congress is the only competent forum for such a change in the status of the unborn. State have proven time and again their incompetence in this area and there is a string of decisions on racial and sexual matters that affirm this point.

An Amendment is impossible. There are too many pro-choice states that would block it's ratification.
Congress can restrict abortion under section 5 of the Fourteenth Amendment. Doing so would be considered a final compromise and would end the controversy and the ability of the Republicans to rally pro-life donors and volunteers.

Actually, regardless of discussion, you cannot pass a law if you don't do complete work and say how violators will be punished. Law is not a statement of societal values. Many of the pro-life movement seem to think it is. They want that pro-life label and are afraid that if we are not a pro-life nation, God the Ogre-will surely punish us. No. Jesus said when asked about the moral failings of the people killed by the fall of the tower of Siloam that this disaster was not punishment from God (neither were Katrina or Harvey).

If you want an abortion law, it must be federal. States cannot grant personhood, regardless of what libertarians believe, the 14th Amendment is quite clear. Congress has enforcement authority on who is and is not a citizen or because of Roe, a person. The first step is to accept the venue for argument. Should be easy, you might have the votes.

Now that we have the venue, Congress, and the question they can adjudicate, when are the unborn legal persons, we can answer that question, which includes penalties. Note that legal people who are killed by contract deserve that the killer and the person who ordered the murder both be brought to justice. Under equal protection, whether that person is a fetus or a 50-year old man, the penalties must be the same. If not, the discussion is over

There will be unique circumstances for the unborn. If the child is doomed due to genetic faults such that it would be stillborn, there should be no legal consequence for inducing labor for the health of the mother (the Church disagrees, but we are discussion civil, not canon law and the argument that one must follow the other is relativistic Catholicism). In general, a child 25 weeks into gestation can survive with assistance (although that cannot be mandatory either), so the child should be protected. Earlier it can't survive or will be sick.

That is the likely place the debate will end. We could state that all abortions after week 20 must be by induction only (no fetal pain need be treated). Anything before 20 weeks brings up the question of miscarriage. If a fetus or embryo is a person at a certain number of weeks, than all fetuses of the same age are persons. If you can write legal language that passes equal protection rules (as would be required if you tried to not punish mothers) that can recognize the personhood of those aborted but not those miscarried, than you can ban abortion i the first trimester. If you cannot, then you must cry uncle on the first trimester or even on up to week 20. Gone are the days when abortion was banned by sanctioning doctors for bad medical practice rather than taking a life. You are all in. Personhood or bust with murder as the charge and carrying the same penalties. If you want to keep asserting your point, write a bill or accept the status quo. All proposals must be constitutional.

Labor Day: Occupy Capitalism

Some years, I simply repost prior year columns and take the day (OK, so I take most days off). This year, however, I have something to post.

In the past year, I have been participating in the DC DSA Socialist Book Club. For the last few years, I have been reading more socialist literature, much of which I have reviewed on this blog, starting with Michael Harrington’s last labor of love, Socialism, Past and Future with three reviews waiting on my end table to write.

Harrington’s book was notable in pointing out that Social Democrats in Europe had profound success in socializing the gains of capitalism but had no idea how to move forward to owning and controlling the means of production. Likewise, book after book has prescriptions on what to do in the event that Socialists gain power, but most cannot move beyond the rather unsettling suggestion that the state own capital, albeit with cooperative control of the enterprise, which is never detailed, although Richard Wolff gets close.

It is both true and Marxist truism that how socialism is governed will be up to the workers themselves, however it is the job of the present to suggest some ideas, like how to distribute profit, whether the firm should be controlled by production workers or whether engingineers, sales, distribution and management gets a vote, whether we should practice warm body voting or share voting (it depends) and how managers, especially CEOs are selected and compensated.

That just starts the list, which also includes training doctors, growing food, housing, running an aerospace firm and international cooperative economics. Long time readers know that I have some ideas in this area, the latest being that the first step in Socialism is for workers to control the means of consumption. You can find them all at  http://bindneranalytics.blogspot.com/

Labor has not done well since I joined the labor force when Ronnie was president. Workers are doing even worse under King Donnie. Gutting the Department of Labor seems to be a right of passage for Republican presidents. Getting power is essential, but eight years of an administration friendly to our cause barely got our heads above water. There was no hope of laying the groudwork for Socialism, even when Speaker Pelosi held the gavel. There are simply too many Democrats in the pocket of Capitalists and that is not likely to change. The Greens are no laternative, since their fundraising is to anemic to ever gain a majority. I won’t even mention the weakness of the Socialist and Communist parties.

What shall we do (to paraphrase the famous questions in socialist cirles)? If we cannot win in politics (and we really cannot), then we must take over industry. If our ideas are not better when implemented in a modern company, then history has truly ended and there is no alternative (TINA). I am betting there is. We simply need customers. My recent reading shows that there are plenty of potential customers, from ESOPs to Cooperatives, who might find our ideas useful (some of them are undoubtedly in play in some firms). My experience is that many firms in this class are still run on hierarchical models with pay systems to match. There is plenty of room to grow. It is time for us to Occupy Capitalism, not by sitting it but by giving them a call and taking their money as consultants. If our ideas have merit, there will be more and more clients and our influence will grow, so much so that the leaders of these firms will fund our candidates (and may become them) and THEN we can enact the laws we need to encourage socialism through political means.