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Saturday, July 30, 2011

How Americans Can "Get Up, Stand" Up Against Corporatocracy Rule


How Americans Can "Get Up, Stand" Up Against Corporatocracy Rule




Many Americans recognize that the United States is neither a genuine democracy nor a real republic in which elected officials actually represent the people. Instead, the United States is a corporatocracy in which Americans are ruled by a partnership of giant corporations, the extremely wealthy elite, and corporate-collaborator government officials. There are at least three major pieces to the puzzle of transforming corporatocracy tyranny into something closer to democracy. First, it is necessary but not sufficient that Americans be informed about the truths of corporatocracy rule. The good news is that despite the corporate media’s failure to reveal many important truths, polls show that the majority of Americans—either through the independent media or their own common sense—know enough about the Afghanistan and Iraq wars, Wall Street bailouts, and health insurance rip-offs to oppose corporatocracy policies here.

Second, in addition to awareness of economic and social injustices, it is also necessary to have knowledge of strategies and tactics that oppressed people have historically used to overcome tyranny. Third, a routinely overlooked piece of the puzzle is overcoming the problem of demoralization. There are a great many Americans who have been so worn down by decades of personal and political defeats, financial struggles, social isolation, and daily interaction with impersonal and inhuman institutions that they no longer have the energy for political actions.

Polls Reveal the Myth of U.S. Democracy

Americans, for quite some time, have opposed the U.S. government’s wars in Afghanistan and Iraq, but We the People have zero impact on policy. A March 10-13, 2011 ABC News/Washington Post poll asked, “All in all, considering the costs to the United States versus the benefits to the United States, do you think the war in Afghanistan has been worth fighting, or not?”; 31 percent said “worth fighting” and 64 percent said “not worth fighting.” When a CNN/Opinion Research Corporation Poll on December 17-19, 2010 asked, “Do you favor or oppose the U.S. war in Afghanistan?,” only 35 percent of Americans favored the war, while 63 percent opposed it. For several years, the majority of Americans have also opposed the Iraq War, typified by a 2010 CBS poll which reported that 6 of 10 Americans view the Iraq War as “a mistake.”

The opposition by the majority of Americans to current U.S. wars has steadily increased for several years. However, if you watched only the corporate media’s coverage of the 2010 election between Democratic and Republican corporate-picked candidates, you might not even know that the United States was involved in two wars—two wars that are not only opposed by the majority of Americans but which are also bankrupting the United States.

How about the 2008 Wall Street bailout? Even when Americans believed the lie that it was only a $700 billion bailout, they opposed it. Their opinion was irrelevant. In September 2008, despite the corporate media’s attempts to terrify Americans into believing that an economic doomsday would occur without the bailout of so-called “too-big-to-fail” corporations, Americans still opposed it. A Los Angeles Times/Bloomberg poll in September 2008, asked, “Do you think the government should use taxpayers’ dollars to rescue ailing private financial firms whose collapse could have adverse effects on the economy and market, or is it not the government’s responsibility to bail out private companies with taxpayers’ dollars?”; 31 percent of Americans said we should “use taxpayers” dollars while 55 percent said it is “not government’s responsibility.” Also in September 2008, both a CBS News/New York Times poll and a USA Today/Gallup poll showed Americans opposed the bailout. This disapproval of the bailout was before most Americans discovered that the Federal Reserve had loaned many trillions of dollars more to financial firms, other giant corporations, and foreign central banks (which, if this had been known, would certainly have upset even more Americans).

What about universal health insurance? Despite the fact that several 2009 polls showed that Americans actually favored a “single-payer” or “Medicare-for-all” health insurance plan, it was not even on the table in the Democrat-Republican 2009–2010 debate over health insurance reform legislation. And polls during this debate showed that an even larger majority of Americans favored the government providing a “public option” to compete with private health insurance plans. But the public option was quickly pushed off the table in the Democratic-Republican debate. A July 2009 Kaiser Health Tracking Poll asked, “Do you favor or oppose having a national health plan in which all Americans would get their insurance through an expanded, universal form of Medicare-for-all?” In this Kaiser poll, 58 percent of Americans favored a Medicare-for-all universal plan, and only 38 percent opposed it—and a whopping 77 percent favored “expanding Medicare to cover people between the ages of 55 and 64 who do not have health insurance.” A February 2009 CBS News/New York Times poll reported that 59 percent of Americans said the government should provide national health insurance. And a December 2009 Reuters poll reported that, “Just under 60 percent of those surveyed said they would like a public option as part of any final healthcare reform legislation.”

The Corporatocracy in Control

In the U.S. corporatocracy, as in most modern tyrannies, there are elections, but the reality is that in elections in a corporatocracy, as is the case in elections in all tyrannies, it’s in the interest of the ruling class to maintain the appearance that the people have a say, so more than one candidate is offered. In the U.S. corporatocracy, it’s in the interest of corporations and the wealthy elite that the winning candidate is beholden to them, so they financially support both Democrats and Republicans. It’s in the interest of corporations and the wealthy elite that there are only two viable parties—this cuts down on bribery costs. And it’s in the interest of these two parties that they are the only parties with a chance of winning. In the U.S. corporatocracy, corporations and the wealthy elite directly and indirectly finance candidates, who are then indebted to them. It’s common for these indebted government officials to appoint key decision-making roles to those friendly to corporations, including executives from these corporations. And it’s routine for high-level government officials to be rewarded with high-paying industry positions when they exit government. It’s common and routine for former government officials to be given high-paying lobbying jobs so as to use their relationships with current government officials to ensure that corporate interests will be taken care of.

The integration between giant corporations and the U.S. government has gone beyond revolving doors of employment (exemplified by George W. Bush’s last Treasury secretary, Henry Paulson, who had previously been CEO of Goldman Sachs; and Barack Obama’s first chief economic adviser, Lawrence Summers, who in 2008 received $5.2 million from hedge fund D. E. Shaw). Nowadays, the door need not even revolve in the U.S. corporatocracy. For example, when President Obama earlier in 2011 appointed General Electric CEO Jeffrey Immelt as a key economic advisor, Immelt kept his job as CEO of General Electric (which paid no federal taxes on over $14 billion dollars in profits last year).

The United States is not ruled by a single deranged dictator but by an impersonal corporatocracy. Thus, there is no one tyrant that Americans can first hate and then finally overthrow so as to end senseless wars and economic injustices. Revolutions against Qaddafi-type tyrants require enormous physical courage. In the U.S. corporatocracy, the first step in recovering democracy is the psychological courage to face the humiliation that we Americans have neither a democracy nor a republic, but are in fact ruled by a partnership of giant corporations, the extremely wealthy elite, and corporate-collaborator government officials.

Psychological and Cultural Building Blocks

Activists routinely become frustrated when truths about lies, victimization, and oppression don’t set people free to take action. But as a clinical psychologist who has worked with abused people for more than 25 years, it does not surprise me to see that when we as individuals or a society eat crap for too long, we become psychologically too weak to take action.

Other observers of subjugated societies have recognized this phenomenon of subjugation resulting in demoralization and fatalism. Paulo Freire, the Brazilian educator and author of Pedagogy of the Oppressed, and Ignacio Martin-Baró, the El Salvadoran social psychologist and popularizer of “liberation psychology,” understood this psychological phenomenon. So too did Bob Marley, the poet laureate of oppressed people around the world. Many Americans are embarrassed to accept that we, too, after years of domestic corporatocracy subjugation, have developed what Marley called “mental slavery.” But unless we acknowledge that reality, we won’t begin to heal from what I call “battered people’s syndrome” and “corporatocracy abuse.” A vitally important piece of the solution is overcoming the problem of demoralization and fatalism and creating the “energy to do battle.”

There exist solid strategies and time-tested tactics that people have long used to battle the elite. However, these strategies and tactics by themselves are not sufficient. For large-scale democratic movements to have enough energy to get off the ground, certain psychological and cultural building blocks are required.

Historian Lawrence Goodwyn has studied democratic movements and written extensively about the Populist Movement in the United States that occurred during the end of the 19th century, what he calls “the largest democratic mass movement in American history.” Goodwyn concludes that democratic movements are initiated by people who are not resigned to the status quo or intimidated by established powers, and who have not allowed themselves to be “culturally organized to conform to established hierarchical forms.” Goodwyn writes in The Populist Moment: “Democratic movements are initiated by people who have indi­vidually managed to attain a high level of personal political self-respect.... In psychological terms, its appearance reflects the development within the movement of a new kind of collec­tive self-confidence. ‘Individual self-respect’ and ‘collec­tive self-confidence’ constitute, then, the cultural building blocks of mass democratic politics.”

Without individual self-respect, people do not believe that they are worthy of power or capable of utilizing power wisely, and they accept as their role being a subject of power. Without collective self-confidence, people do not believe they can succeed in wresting power away from their rulers. There are many battlefields—from schools to the workplace—on which self-respect can be either won or lost and it is in the interest of the elite to make sure that their opponents lose sight of these multiple battlefields. If we don’t recognize a battlefield, we can lose an opportunity to create those cultural and psychological building blocks necessary for democracy.

People seeking democracy, in addition to individual self-respect, must also have collective self-confidence—the belief that they can succeed as a group—if their goal is to be achieved and sustained. They must have faith that, though imperfect in their decision making, they are capable of creating a freer and more just society than one orga­nized and controlled by the elite. Thus, in this battle against the corporatocracy, human relationships are vitally important. It is in the interest of the elite to keep people divided and distrust­ing one another. It is in the interest of people working toward democracy to build respectful and cooperative human relationships across all levels of society.

The Energy to Do Battle

Whether one’s abuser is a spouse or the corporatocracy, there are parallels when it comes to how one can maintain enough strength to be able to free oneself when the opportunity presents itself—and then heal and attain even greater strength. This difficult process requires:

Honesty that one is in an abusive relationship

Self-forgiveness that one is in an abusive relationship

A sense of humor about one’s predicament

The good luck of support, and the wisdom to utilize this good luck

It is a waste of our precious energy to beat ourselves up for having succumbed to corporatocracy abuse. Our energy is better spent redefining ourselves as human beings who have beliefs and values that define us more than our fears and greed (which the corporatocracy exploits to control us). We need to redefine ourselves as worthy of respect and capable of effecting change. And then we can use our energy to provide respect and create confidence in others, which will produce even more energy for ourselves. This is part of “liberation psychology,” in which critically thinking people can regain morale, discover the various ways people are energized, learn how to combat social isolation and build community, and understand how we can forge alliances among anti-authoritarians.

Critical to healing from “battered people’s syndrome” and “corporatocracy abuse” and gaining strength is a liberation from one’s fatal­ism, which has become an internal oppression. External oppression, left unchallenged, results ultimately in fatalism, which makes it less likely one will challenge oppression. One way of extricating from this fatalistic vicious cycle is through what Freire, Martin-Baró, and others have called conscien­tizacao or “critical consciousness.” With critical consciousness, an individual can identify both external oppression and self-imposed internal oppression—and free oneself from self-imposed powerlessness. Critical consciousness cannot be learned in a top-down manner. It is essentially a self-education process among equals. Liberation from fatalism and powerlessness is a process in which participants are not mere objects of instruction or of treatment. Instead of being acted upon, they are taking actions, learning, and then taking even more powerful actions.

Recent History and Realistic Hope

The lesson from history is that tyrannical and dehumanizing institu­tions are often more fragile than they appear, and with time, luck, morale, and the people’s ability to seize the moment, damn near anything is possi­ble. We never really know until it happens whether or not we are living in that time when historical variables are creating opportuni­ties for seemingly impossible change.

Until shortly before it occurred, the collapse of the Soviet empire seemed an impossibility to most Americans, who saw only mass resignation within the Soviet Union and its sphere of control. But the shipyard workers in Gdansk, Poland did not see their Soviet and Communist Party rulers as the all-powerful forces that Americans did. And so Polish workers’ Solidarity, by simply refusing to go away, provided a strong dose of morale across Eastern Europe at the same time other historical events weakened the Soviet empire.

Arrogance by oppressive authorities makes them miscalculate the fear and greed variables, important in keeping people passive. In the case of Hosni Mubarak, his greed and arrogance resulted in him not spreading enough of his loot around with enough thugs, so not enough of them cared about his fall from power. Once Egyptians lost fear and took action, they found even more courage. Arrogance of oppressive forces makes them a lot more fragile than they appear.

And in the United States, when it appeared to the elite that American workers and their supporters had become completely pacified, once again, arrogance by corporate-collaborator government officials resulted in miscalculation. In Wisconsin, for example, public employees had actually agreed to eat considerable crap, accepting a major increase in how much they would pay toward their pensions and healthcare benefits. But even those major concessions were not good enough for Wisconsin’s governor, who continued to demand the elimination of collective bargaining in key areas. Eliminating collective bargaining rights on health insurance, pension, and work safety is a blatant attempt to completely crush a union. By this “union death threat,” workers and union leaders were put in a position of having virtually nothing left to lose in terms of retaining a meaningful union. And when people feel they have nothing left to lose and let go of their fear, watch out.

Z


Bruce E. Levine is a clinical psychologist and author of Get Up, Stand Up: Uniting Populists, Energizing the Defeated, and Battling the Corporate Elite (Chelsea Green Publishing, 2011). His website is www.brucelevine.net.

Friday, July 29, 2011

A Mixed Economy: The Role of the Government


Government's Role in the Economy

While consumers and producers make most decisions that mold the economy, government activities have a powerful effect on the U.S. economy in at least four areas.

Stabilization and Growth. Perhaps most importantly, the federal government guides the overall pace of economic activity, attempting to maintain steady growth, high levels of employment, and price stability. By adjusting spending and tax rates (fiscal policy) or managing the money supply and controlling the use of credit (monetary policy), it can slow down or speed up the economy's rate of growth -- in the process, affecting the level of prices and employment.

For many years following the Great Depression of the 1930s, recessions -- periods of slow economic growth and high unemployment -- were viewed as the greatest of economic threats. When the danger of recession appeared most serious, government sought to strengthen the economy by spending heavily itself or cutting taxes so that consumers would spend more, and by fostering rapid growth in the money supply, which also encouraged more spending. In the 1970s, major price increases, particularly for energy, created a strong fear of inflation -- increases in the overall level of prices. As a result, government leaders came to concentrate more on controlling inflation than on combating recession by limiting spending, resisting tax cuts, and reining in growth in the money supply.

Ideas about the best tools for stabilizing the economy changed substantially between the 1960s and the 1990s. In the 1960s, government had great faith in fiscal policy -- manipulation of government revenues to influence the economy. Since spending and taxes are controlled by the president and the Congress, these elected officials played a leading role in directing the economy. A period of high inflation, high unemployment, and huge government deficits weakened confidence in fiscal policy as a tool for regulating the overall pace of economic activity. Instead, monetary policy -- controlling the nation's money supply through such devices as interest rates -- assumed growing prominence. Monetary policy is directed by the nation's central bank, known as the Federal Reserve Board, with considerable independence from the president and the Congress.


Regulation and Control in the U.S. Economy

Regulation and Control in the U.S. Economy

Regulation and Control. The U.S. federal government regulates private enterprise in numerous ways. Regulation falls into two general categories. Economic regulation seeks, either directly or indirectly, to control prices. Traditionally, the government has sought to prevent monopolies such as electric utilities from raising prices beyond the level that would ensure them reasonable profits. At times, the government has extended economic control to other kinds of industries as well. In the years following the Great Depression, it devised a complex system to stabilize prices for agricultural goods, which tend to fluctuate wildly in response to rapidly changing supply and demand. A number of other industries -- trucking and, later, airlines -- successfully sought regulation themselves to limit what they considered harmful price-cutting.

Another form of economic regulation, antitrust law, seeks to strengthen market forces so that direct regulation is unnecessary. The government -- and, sometimes, private parties -- have used antitrust law to prohibit practices or mergers that would unduly limit competition.

Government also exercises control over private companies to achieve social goals, such as protecting the public's health and safety or maintaining a clean and healthy environment. The U.S. Food and Drug Administration bans harmful drugs, for example; the Occupational Safety and Health Administration protects workers from hazards they may encounter in their jobs; and the Environmental Protection Agency seeks to control water and air pollution.

American attitudes about regulation changed substantially during the final three decades of the 20th century. Beginning in the 1970s, policy-makers grew increasingly concerned that economic regulation protected inefficient companies at the expense of consumers in industries such as airlines and trucking. At the same time, technological changes spawned new competitors in some industries, such as telecommunications, that once were considered natural monopolies. Both developments led to a succession of laws easing regulation.

While leaders of both political parties generally favored economic deregulation during the 1970s, 1980s, and 1990s, there was less agreement concerning regulations designed to achieve social goals. Social regulation had assumed growing importance in the years following the Depression and World War II, and again in the 1960s and 1970s. But during the presidency of Ronald Reagan in the 1980s, the government relaxed rules to protect workers, consumers, and the environment, arguing that regulation interfered with free enterprise, increased the costs of doing business, and thus contributed to inflation. Still, many Americans continued to voice concerns about specific events or trends, prompting the government to issue new regulations in some areas, including environmental protection.

Some citizens, meanwhile, have turned to the courts when they feel their elected officials are not addressing certain issues quickly or strongly enough. For instance, in the 1990s, individuals, and eventually government itself, sued tobacco companies over the health risks of cigarette smoking. A large financial settlement provided states with long-term payments to cover medical costs to treat smoking-related illnesses.


Direct Services and Direct Assistance in the U.S. Economy

Direct Services and Direct Assistance in the U.S. Economy

Direct Services. Each level of government provides many direct services. The federal government, for example, is responsible for national defense, backs research that often leads to the development of new products, conducts space exploration, and runs numerous programs designed to help workers develop workplace skills and find jobs. Government spending has a significant effect on local and regional economies -- and even on the overall pace of economic activity.

State governments, meanwhile, are responsible for the construction and maintenance of most highways. State, county, or city governments play the leading role in financing and operating public schools. Local governments are primarily responsible for police and fire protection. Government spending in each of these areas can also affect local and regional economies, although federal decisions generally have the greatest economic impact.

Overall, federal, state, and local spending accounted for almost 18 percent of gross domestic product in 1997.

Direct Assistance. Government also provides many kinds of help to businesses and individuals. It offers low-interest loans and technical assistance to small businesses, and it provides loans to help students attend college. Government-sponsored enterprises buy home mortgages from lenders and turn them into securities that can be bought and sold by investors, thereby encouraging home lending. Government also actively promotes exports and seeks to prevent foreign countries from maintaining trade barriers that restrict imports.

Government supports individuals who cannot adequately care for themselves. Social Security, which is financed by a tax on employers and employees, accounts for the largest portion of Americans' retirement income. The Medicare program pays for many of the medical costs of the elderly. The Medicaid program finances medical care for low-income families. In many states, government maintains institutions for the mentally ill or people with severe disabilities. The federal government provides Food Stamps to help poor families obtain food, and the federal and state governments jointly provide welfare grants to support low-income parents with children.

Many of these programs, including Social Security, trace their roots to the "New Deal" programs of Franklin D. Roosevelt, who served as the U.S. president from 1933 to 1945. Key to Roosevelt's reforms was a belief that poverty usually resulted from social and economic causes rather than from failed personal morals. This view repudiated a common notion whose roots lay in New England Puritanism that success was a sign of God's favor and failure a sign of God's displeasure. This was an important transformation in American social and economic thought. Even today, however, echoes of the older notions are still heard in debates around certain issues, especially welfare.

Many other assistance programs for individuals and families, including Medicare and Medicaid, were begun in the 1960s during President Lyndon Johnson's (1963-1969) "War on Poverty." Although some of these programs encountered financial difficulties in the 1990s and various reforms were proposed, they continued to have strong support from both of the United States' major political parties. Critics argued, however, that providing welfare to unemployed but healthy individuals actually created dependency rather than solving problems. Welfare reform legislation enacted in 1996 under President Bill Clinton (1993-2001) requires people to work as a condition of receiving benefits and imposes limits on how long individuals may receive payments.



Poverty and Inequality in the United States

From ,

Americans are proud of their economic system, believing it provides opportunities for all citizens to have good lives. Their faith is clouded, however, by the fact that poverty persists in many parts of the country. Government anti-poverty efforts have made some progress but have not eradicated the problem. Similarly, periods of strong economic growth, which bring more jobs and higher wages, have helped reduce poverty but have not eliminated it entirely.

The federal government defines a minimum amount of income necessary for basic maintenance of a family of four. This amount may fluctuate depending on the cost of living and the location of the family. In 1998, a family of four with an annual income below $16,530 was classified as living in poverty.

The percentage of people living below the poverty level dropped from 22.4 percent in 1959 to 11.4 percent in 1978. But since then, it has fluctuated in a fairly narrow range. In 1998, it stood at 12.7 percent.

What is more, the overall figures mask much more severe pockets of poverty. In 1998, more than one-quarter of all African-Americans (26.1 percent) lived in poverty; though distressingly high, that figure did represent an improvement from 1979, when 31 percent of blacks were officially classified as poor, and it was the lowest poverty rate for this group since 1959. Families headed by single mothers are particularly susceptible to poverty. Partly as a result of this phenomenon, almost one in five children (18.9 percent) was poor in 1997. The poverty rate was 36.7 percent among African-American children and 34.4 percent among Hispanic children.

Some analysts have suggested that the official poverty figures overstate the real extent of poverty because they measure only cash income and exclude certain government assistance programs such as Food Stamps, health care, and public housing. Others point out, however, that these programs rarely cover all of a family's food or health care needs and that there is a shortage of public housing. Some argue that even families whose incomes are above the official poverty level sometimes go hungry, skimping on food to pay for such things as housing, medical care, and clothing. Still others point out that people at the poverty level sometimes receive cash income from casual work and in the "underground" sector of the economy, which is never recorded in official statistics.

In any event, it is clear that the American economic system does not apportion its rewards equally. In 1997, the wealthiest one-fifth of American families accounted for 47.2 percent of the nation's income, according to the Economic Policy Institute, a Washington-based research organization. In contrast, the poorest one-fifth earned just 4.2 percent of the nation's income, and the poorest 40 percent accounted for only 14 percent of income.

Despite the generally prosperous American economy as a whole, concerns about inequality continued during the 1980s and 1990s. Increasing global competition threatened workers in many traditional manufacturing industries, and their wages stagnated. At the same time, the federal government edged away from tax policies that sought to favor lower-income families at the expense of wealthier ones, and it also cut spending on a number of domestic social programs intended to help the disadvantaged. Meanwhile, wealthier families reaped most of the gains from the booming stock market.

In the late 1990s, there were some signs these patterns were reversing, as wage gains accelerated -- especially among poorer workers. But at the end of the decade, it was still too early to determine whether this trend would continue.


A Mixed Economy: The Role of the Market


A Mixed Economy: The Role of the Market

A Mixed Economy: The Role of the Market

From ,

The United States is said to have a mixed economy because privately owned businesses and government both play important roles. Indeed, some of the most enduring debates of American economic history focus on the relative roles of the public and private sectors.

A Mixed Economy - Private vs. Public Ownership

The American free enterprise system emphasizes private ownership. Private businesses produce most goods and services, and almost two-thirds of the nation's total economic output goes to individuals for personal use (the remaining one-third is bought by government and business). The consumer role is so great, in fact, that the nation is sometimes characterized as having a "consumer economy."

This emphasis on private ownership arises, in part, from American beliefs about personal freedom. From the time the nation was created, Americans have feared excessive government power, and they have sought to limit government's authority over individuals -- including its role in the economic realm. In addition, Americans generally believe that an economy characterized by private ownership is likely to operate more efficiently than one with substantial government ownership.

Why? When economic forces are unfettered, Americans believe, supply and demand determine the prices of goods and services. Prices, in turn, tell businesses what to produce; if people want more of a particular good than the economy is producing, the price of the good rises. That catches the attention of new or other companies that, sensing an opportunity to earn profits, start producing more of that good. On the other hand, if people want less of the good, prices fall and less competitive producers either go out of business or start producing different goods. Such a system is called a market economy. A socialist economy, in contrast, is characterized by more government ownership and central planning. Most Americans are convinced that socialist economies are inherently less efficient because government, which relies on tax revenues, is far less likely than private businesses to heed price signals or to feel the discipline imposed by market forces.

A Mixed Economy - The Limits to Free Enterprise

There are limits to free enterprise, however. Americans have always believed that some services are better performed by public rather than private enterprise. For instance, in the United States, government is primarily responsible for the administration of justice, education (although there are many private schools and training centers), the road system, social statistical reporting, and national defense. In addition, government often is asked to intervene in the economy to correct situations in which the price system does not work. It regulates "natural monopolies," for example, and it uses antitrust laws to control or break up other business combinations that become so powerful that they can surmount market forces. Government also addresses issues beyond the reach of market forces. It provides welfare and unemployment benefits to people who cannot support themselves, either because they encounter problems in their personal lives or lose their jobs as a result of economic upheaval; it pays much of the cost of medical care for the aged and those who live in poverty; it regulates private industry to limit air and water pollution; it provides low-cost loans to people who suffer losses as a result of natural disasters; and it has played the leading role in the exploration of space, which is too expensive for any private enterprise to handle.

In this mixed economy, individuals can help guide the economy not only through the choices they make as consumers but through the votes they cast for officials who shape economic policy. In recent years, consumers have voiced concerns about product safety, environmental threats posed by certain industrial practices, and potential health risks citizens may face; government has responded by creating agencies to protect consumer interests and promote the general public welfare.

The U.S. economy has changed in other ways as well. The population and the labor force have shifted dramatically away from farms to cities, from fields to factories, and, above all, to service industries. In today's economy, the providers of personal and public services far outnumber producers of agricultural and manufactured goods. As the economy has grown more complex, statistics also reveal over the last century a sharp long-term trend away from self-employment toward working for others.

Wednesday, July 27, 2011

Studies Show Regulation Protects Health and Safety, Encourages Job Creation

OMB WATCH

Studies Show Regulation Protects Health and Safety, Encourages Job Creation

Posted on July 27, 2011

Three recently published studies discuss the relationship between regulations and economic development. One study focuses on the job-creation potential of an individual environmental rule, and another touts the economic benefits of clean energy investments. The third study debunks a widely quoted but inaccurate report on the economic costs of regulations. All three reinforce an argument that public interest advocates have made for decades: government standards and public investments in clean energy protect health and safety and encourage job creation.

A study published July 14, Why EPA’s Mercury and Air Toxics Rule is Good for the Economy and America's Workforce, describes the economic benefits of the U.S. Environmental Protection Agency's (EPA) proposed air toxics rule. Author Charles J. Cicchetti of Navigant Consulting finds that the air toxics rule would create more than 115,000 jobs by 2015 – eclipsing EPA's conservative estimate by nearly 80,000.

Cicchetti argues that the EPA's own cost-benefit analysis was scientifically sound but failed to account for possible inaccuracies in industry-supplied data and left out some secondary benefits of the rule, such as reduced health care and insurance costs. Sponsored by the Clean Air Council, the Environmental Law & Policy Center, the Conservation Law Foundation, and others, the study echoes one published by the Economic Policy Institute (EPI) in June. The EPI study estimated the rule could prompt the creation of up to 158,000 new jobs in the next four years.

A second report, this one peer-reviewed and published by the Union of Concerned Scientists, takes a close look at the economic impacts of clean energy investments in the Midwest. Entitled A Bright Future for the Heartland: Powering the Midwest Economy with Clean Energy, the July 19 report finds that if Midwest states invest in a clean energy strategy produced in 2009 by the Midwestern Governors Association (MGA), it could save the average household $78 per year on electricity and natural gas bills, create 85,700 new jobs in the region, and bring $1 billion in new income to farmers and clean energy companies. The Midwest was hit hard by the recent recession, and the study's authors indicate that the region has a "great renewable energy potential, a strong manufacturing base and the skilled workforce needed to realize that potential."

Also on July 19, EPI released a critique of a controversial study by Nicole and Mark Crain, which was commissioned by the Small Business Administration's (SBA) Office of Advocacy in 2010. Corporate interests and their allies in Congress have been incessantly repeating the Crains' faulty conclusion that regulations cost the U.S. economy $1.75 trillion per year.

In its critique, EPI noted that "[a] substantial majority of these costs—$1.2 trillion or 70 percent—are based on the author's use of an econometric regression analysis to determine the costs of 'economic' regulations, such as those rules affecting the financial industry." This means that, by EPI's assessment, the costs of health, safety, and environmental regulations would be a much smaller portion of overall regulatory costs than critics claim. These important social regulations are smart investments because the burden they place on the economy is minor while their far-reaching economic and quality-of-life benefits are great.

Because of its limited focus, Crain and Crain did not calculate the benefits of regulations – just their costs – making it difficult for the authors to accurately determine the true value of regulations. Furthermore, EPI found that the study relied on flawed methodology and incomplete data to reach its conclusions. Setting the record straight on Crain and Crain is important because congressional Republicans and business organizations like the U.S. Chamber of Commerce have been using the controversial estimate to support their attacks on critical air, water, food safety, and workplace safety standards that protect Americans from harm.

Independent studies that look at the costs and benefits of regulations are important because they double-check agency numbers and often consider additional factors that are outside of the agency's purview. When agencies perform their own cost-benefit analyses, they usually rely on industry-supplied cost numbers, and industries tend to overstate the potential costs of a new regulation. There is substantial evidence that once implemented, regulations do not cost nearly as much as anticipated. Therefore, independent studies help to inform agencies of the true expected costs of regulations. They also document the often overlooked benefits of public protections, offering yet more evidence that the American people do not have to – and should not be asked to – choose between job creation and safeguarding the health and safety of their families and communities.

Monday, July 25, 2011

Restaurants Where You Only Pay What You Can Afford? A Visionary Way to Bring Good Food to the Poor Is Taking Off

AlterNet.org


FOOD


Restaurants Where You Only Pay What You Can Afford? A Visionary Way to Bring Good Food to the Poor Is Taking Off

When the founder of Panera Bread opened his Panera Cares pay-what-you-can cafe, the model was a huge success.


This story first appeared on Shareable.

If you were to only judge the world by watching the news, you'd think we had collectively lost all of our humanity, our intergrity. Neverending wars, devastating environmental disasters, punishing austerity measures... all of which impact the poorer among us more than the richer. Rare is the voice that speaks for the underprivileged. But, if you listen hard enough, you might just hear a little whisper out there in the distance.

Among those voices, Panera Bread founder Ron Shaich might well be the loudest. Last year, Shaich began an experiment in Clayton, Missouri. He opened a Panera Cares pay-what-you-can café and it has been an unqualified success, so much so that he has since opened two more locations – in Dearborn, Michigan, and Portland, Oregon. The goal, now, is to open one per quarter in diverse communities around the country – the geographical logic being that the folks with more means can help offset those with less.

And that logic has been borne out. Using the slogan, “Take what you need, leave your fair share,” the cafés are doing just fine. Shaich claims that an estimated 60 percent of customers pay suggested retail price, 20 percent pay extra, and another 20 percent pay less or nothing. The net average comes out to approximately 80 percent of suggested retail price and the shops generate revenues well above their costs. Interestingly, there are no cashiers and cash registers to tally humility or generosity, only greeters and donation boxes to preserve dignity and collect offerings. Further still, some of those who can't contribute monetarily offer their time and effort instead which, in turn, lowers operating costs for the business.

And it's all because Shaich gets the bigger picture: “The vision for the Panera Cares cafe was to use Panera’s unique restaurant skills to address real societal needs and make a direct impact in communities. Thus, the Foundation developed these community cafés to make a difference by addressing the food insecurity issues that affect millions of Americans.” More than 50 million, to be exact.

Though some might brand the effort as socialism, Panera Bread – what with its $4 billion market cap and 60,000 employees – is more an example of conscious capitalism in action. And, with the Panera Cares Foundation, Shaich spreads the wealth one step further in an almost commons-based venture where food is a right, not a privilege. Here, the stakeholders are valued alongside the shareholders. But that's not all. Shaich also aims to triple-leverage Panera's resources by feeding people who can't feed themselves, training and funneling at-risk youth back into the mainstream, and setting an example for other corporations to do more than simply write a check. As a result, both private (funding) and public (people) assets are brought to bear in a successful partnership rooted in sharing.

The idea came after Shaich and his family spent some time volunteering in soup kitchens, food pantries, and bread lines – a regular occurrence for the Shaich family. What he found there was not good. He recalled, "Standing in line outside in a bread line is dehumanizing and robs the people of any dignity they have. And for what? The meal they receive is terrible. ... My idea was that you should be able to eat a nutritious meal with the same dignity as everyone else, in the same place as everyone else. It would let you hold your head up high, and rebuild a bit of your confidence."

Now that he's proven the model works, Shaich fields a multitude of phone calls from business owners wanting to know his secret. His four pillars are:

1. Make it non-profit – With this set-up, customers get that whatever extra they pay goes back into the community to support those in need. It gives them not only a certain ease, but a sense of participation in the cycle of sharing.

2. Make it real – If the customers know the real value of the items on the menu, they can feel comfortable paying full price or, perhaps, a bit more when they can. Shaich keeps it simple with soups, salads, and sandwiches.

3. Make it human – By putting a welcoming face out front, it's harder for customers to try to score a free meal just to “screw the man,” as Shaich puts it.

4. Make it authentic – Don't just talk the talk of a do-gooder. By also walking the walk, the customers and employees will take it seriously and actively support the venture.

Though it may well be the most successful and prolific, Panera Cares was not even close to being the first pay-what-you-can café on the scene. Shaich cites the SAME Café in Denver, Colorado, as providing some inspiration for him. Like Shaich, Libby and Brad Birky, the founders of SAME – which stands for So All May Eat – got to the idea by way of volunteering at food banks and shelters. Here, patrons can exchange an hour of service for either a meal or a gift certificate. Of course, they can also contribute cash or other in-kind donations to the cause. Libby Birky explained, “No matter their means, we treat people with dignity. They return the favor.” According to Brad, that dignity encompasses the food itself: “We cook simple, high-quality food. We reject the notion that only an elite deserves to eat well.”

At the forefront of the pay-what-you-can action stand Denise Cerreta and her One World Everybody Eats Foundation whose motto is to offer those in need “not a handout, but a hand up.” In 2003, she opened the One World community kitchen/café in Salt Lake City, Utah, from which the broader foundation blossomed. In those footsteps, other community kitchens with a pay-it-forward policy have followed, such as the Karma Kitchen in Berkeley, California, and The Forge in Abilene, Texas.

Flash forward to 2011 and, in addition to having helped SAME and hosting the annual One World Everybody Eats summit in Santa Fe, New Mexico, Cerreta has advised more than a dozen eateries in Alabama, New Jersey, Missouri, Texas, Michigan, Oregon, and Washington state, each with their own unique circumstances. Just as Shaich outlined, the volunteer element is key to the formula because it both provides a way for people with limited funds to contribute and a way for people with limited work experience to gain ground there. Cerreta said, “When a paid staff slot opens, we go straight to our volunteer list and hire from that roster.”

The community restaurant movement got a little extra oomph recently when rock star Jon Bon Jovi opened his Soul Kitchen in Red Bank, New Jersey. Sure, the suggested donation and volunteer option are both present. But, with a focus on more than just food, Soul Kitchen also emphasizes conversation and community as part of its mission which includes “eliminating hunger, building relationships, celebrating community action and unity, promoting sustainability, and extending encouragement and opportunity to those in need.” Part of the restaurant's manifesto explains the name: “At Soul Kitchen, a place is ready for you if you are hungry, or if you hunger to make a difference in your community. For we believe that a healthy meal can feed the soul.”

In Santa Rosa, California, Evelyn Cheatham took the reverse route and got to a slightly different place. The first step was setting up Worth Our Weight, a culinary apprentice program for at-risk youth. “Developing great lives through good food” is the order of the day there. The tuition-free, volunteer-run program accepts young people between the ages of 16-24 “who have faced major challenges in their lives, including foster care, difficulties with the law, homelessness, and significant family disruption.” Though Cheatham offers training in the culinary and restaurant management arts, imperative life lessons are gleaned, as well, including team work, accountability, mutual respect, and responsibility. Basically, WOW changes lives in deeply tangible ways.

Though they ask for a fair donation in exchange for the food they serve, the café, which is open a limited number of hours each week, operates at a net loss. Still, it provides an invaluable service as a community outreach tool and more. According to Cheatham, “The café is a natural component of the program. It sets the program apart from being a school. It is the natural extension of a vocational training program. The feedback from a customer provides us with an instant learning experience.” So popular are WOW's weekend brunches, celebrity chef Guy Fieri featured them on his Diners, Drive-Ins, and Dives – the first non-profit restaurant ever showcased on the Food Network show.

No matter what the means, the end goal is the same in each of these cases: feeding people as a community service. And, when nearly 15 percent of households in the U.S. are faced with food insecurity, that's no small goal. In fact, it's bigger than any one person, any one project. But, considering the fact that Americans waste upwards of 25 percent of their food, it's not hard to formulate an equation where everyone gets to eat. It simply requires using an algorithm rooted in the common good or, perhaps, springing from the undeniable reciprocity of the Golden Rule. That is exactly what is happening here. These folks at the heart of the movement understand the momentous task at hand and are intent upon doing their part to keep things moving forward. As Cerreta observed, “This is spiritual franchising. I want to create a big enough snowball that it keeps going without me.”

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Community kitchens, cafés, and restaurants to support around the U.S.:
A Better World Café - 19 South 2nd Ave., Highland Park, New Jersey
Café 180 - 3315 South Broadway, Englewood, Colorado
Comfort Café - 3945 Tennyson Street, Denver, Colorado
Community Table Café - 418 Cerrillos Road (in the Design Center), Santa Fe, New Mexico
Karma Kitchen - at Taste of Himalayas Restaurant, 1700 Shattuck Ave, Berkeley, California
Karma Kitchen - at Klay Oven Restaurant, 414 N. Orleans Street, Chicago, Illinois
La Cocina - 2948 Folsom San Francisco, California
One World Salt Lake City - 41 South 300 East, Salt Lake City, Utah
One World Spokane - 1804 East Sprague Ave., Spokane, Washington 99202
Panera Cares Community Café - 22208 Michigan Avenue, Dearborn, Michigan
Panera Cares Community Café - 4121 NE Halsey Street, Portland, Oregon
Potager - 315 South Mesquite St., Arlington, Texas
Ransom Café - 7485 Airport Blvd., Mobile, Alabama
SAME (So All May Eat) Café - 2023 East Colfax Ave., Denver, Colorado 80206
Soul Kitchen Community Restaurant - 121 Drs. James Parker Blvd., Red Bank, New Jersey
St. Louis Bread Company Cares - 10th Central Ave., Clayton, Missouri
Table Grace Café - 1611 1/2 Farnam Street, Omaha, Nebraska
The Forge - Abilene's Community Kitchen 2801 S. 1st Street, Abilene, Texas
Three Stone Hearth Community-Supported Kitchen - 1581 University Avenue, Berkeley, California
Worth Our Weight - 1021 Hahman Drive, Santa Rosa, California

Sunday, July 24, 2011

Why Medicare is the Solution - Not the Problem

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Why Medicare is the Solution - Not the Problem

by: Robert Reich, Robert Reich's Blog | Op-Ed

Bertha G. Milliard, 94, with nurse Ruth Collins, a nurse, during a home-care visit in Fort Fairfield, Maine, in November 2009. (Photo: Craig Dilger / The New York Times)

Not only is Social Security on the chopping block in order to respond to Republican extortion. So is Medicare.

But Medicare isn’t the nation’s budgetary problems. It’s the solution. The real problem is the soaring costs of health care that lie beneath Medicare. They’re costs all of us are bearing in the form of soaring premiums, co-payments, and deductibles.

Medicare offers a means of reducing these costs — if Washington would let it.

Let me explain.

Americans spend more on health care per person than any other advanced nation and get less for our money. Yearly public and private healthcare spending is $7,538 per person. That’s almost two and a half times the average of other advanced nations.

Yet the typical American lives 77.9 years – less than the average 79.4 years in other advanced nations. And we have the highest rate of infant mortality of all advanced nations.

Medical costs are soaring because our health-care system is totally screwed up. Doctors and hospitals have every incentive to spend on unnecessary tests, drugs, and procedures.

You have lower back pain? Almost 95% of such cases are best relieved through physical therapy. But doctors and hospitals routinely do expensive MRI’s, and then refer patients to orthopedic surgeons who often do even more costly surgery. Why? There’s not much money in physical therapy.

Your diabetes, asthma, or heart condition is acting up? If you go to the hospital, 20 percent of the time you’re back there within a month. You wouldn’t be nearly as likely to return if a nurse visited you at home to make sure you were taking your medications. This is common practice in other advanced countries. So why don’t nurses do home visits to Americans with acute conditions? Hospitals aren’t paid for it.

America spends $30 billion a year fixing medical errors – the worst rate among advanced countries. Why? Among other reasons because we keep patient records on computers that can’t share the data. Patient records are continuously re-written on pieces of paper, and then re-entered into different computers. That spells error.

Meanwhile, administrative costs eat up 15 to 30 percent of all healthcare spending in the United States. That’s twice the rate of most other advanced nations. Where does this money go? Mainly into collecting money: Doctors collect from hospitals and insurers, hospitals collect from insurers, insurers collect from companies or from policy holders.

A major occupational category at most hospitals is “billing clerk.” A third of nursing hours are devoted to documenting what’s happened so insurers have proof.

Trying to slow the rise in Medicare costs doesn’t deal with any of this. It will just limit the amounts seniors can spend, which means less care. As a practical matter it means more political battles, as seniors – whose clout will grow as boomers are added to the ranks – demand the limits be increased. (If you thought the demagoguery over “death panels” was bad, you ain’t seen nothin’ yet.)

Paul Ryan’s plan – to give seniors vouchers they can cash in with private for-profit insurers — would be even worse. It would funnel money into the hands of for-profit insurers, whose administrative costs are far higher than Medicare.

So what’s the answer? For starters, allow anyone at any age to join Medicare. Medicare’s administrative costs are in the range of 3 percent. That’s well below the 5 to 10 percent costs borne by large companies that self-insure. It’s even further below the administrative costs of companies in the small-group market (amounting to 25 to 27 percent of premiums). And it’s way, way lower than the administrative costs of individual insurance (40 percent). It’s even far below the 11 percent costs of private plans under Medicare Advantage, the current private-insurance option under Medicare.

In addition, allow Medicare – and its poor cousin Medicaid – to use their huge bargaining leverage to negotiate lower rates with hospitals, doctors, and pharmaceutical companies. This would help move health care from a fee-for-the-most-costly-service system into one designed to get the highest-quality outcomes most cheaply.

Estimates of how much would be saved by extending Medicare to cover the entire population range from $58 billion to $400 billion a year. More Americans would get quality health care, and the long-term budget crisis would be sharply reduced.

Let me say it again: Medicare isn’t the problem. It’s the solution.

Saturday, July 23, 2011

How To Trim the Deficit by Nearly $600 Billion: A Blueprint for Spending Less and Spending Smarter on National Security


Jul 21, 2011

How To Trim the Deficit by Nearly $600 Billion: A Blueprint for Spending Less and Spending Smarter on National Security


By BRYAN RAHIJA

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POGO and Taxpayers for Common Sense today unveiled a plan for reducing the deficit by $586 billion over the next decade that focuses on national security spending cuts.

The savings come from cutting unneeded weapons, reforms to the military's health care system, reeling in spending on service contracts, and reducing the number of U.S. troops stationed in Europe. The report notes that we could also reduce the deficit by downblending highly-enriched uranium and selling it on the market in its low-enriched form.

Here's a closer look at what Congress can do to reduce the deficit and how much of a reduction it would yield:

  • Reduce Department of Defense (DoD) service contract spending by 15 percent: $300 billion
  • Reduce non-DoD service contract spending by 15 percent: $73 billion
  • Reform DoD’s TRICARE health care system: $60 billion
  • Replace two of the three F-35 variants with the less expensive F/A-18 E/F models: $44 billion
  • Withdraw 20,000 troops from Europe: $30 billion
  • Decline to renew the procurement contract for the V-22 Osprey: $12 billion
  • Downblend highly-enriched uranium and sell it as low enriched uranium on the market: $23 billion

Be sure to check out the full report for a host of other ideas.

POGO Executive Director Danielle Brian issued the following statement:

“We’re giving Congress and President Obama a roadmap on where to start. These are realistic targets and don’t include the far more significant long-term savings of implementing enhanced administration and oversight of national security spending and contracting.”

And Taxpayers for Common Sense President Ryan Alexander had this to say:

“This is an assembly of solid numbers based on our collective expertise and experience. These should not be the hard choices—there is room for much more. The only way this country is going to climb out of our deep budgetary hole is to put everything on the table, and that includes defense spending, revenue, and entitlements. Eliminating the fat at the Pentagon will make our country fiscally stronger and more secure.”

As we've noted in our press release, the Senate's "Gang of Six" has proposed substantial cuts in defense spending as well—their plan, however, lacks specifics.

Read the POGO / TCS blueprint here.

Bryan Rahija edits POGO's blog.

Image: U.S. Air Force.