Confessions of a former Libertarian: My personal, psychological and intellectual epiphany

SALON

Sunday, Jan 26, 2014 07:00 AM EST

Confessions of a former Libertarian: My personal, psychological and intellectual epiphany

 

I was a Buddhist concerned with world suffering -- and I could no longer reconcile my humanity with my ideology

 
Scott Parker

Topics: Editor's Picks, Liberalism, Libertarianism, Philosophy, Buddhism, Politics News

A photo of the author 

 

 

 

During college, a friend admitted he was confounded by my politics. He didn’t know how to reconcile my libertarianism with my other commitments. We were Buddhists and vegetarians, and I knew exactly what he meant. The tension centered around compassion. He wanted to know how someone concerned with the world’s suffering wouldn’t adopt a more compassionate political perspective.

It was a reasonable question, one that I asked myself regularly. My stock answer was that while I supported compassion in the form of assistance to those in need, I opposed the clumsy government mechanisms we relied on for it, not to mention the veiled coercion behind them — where did anyone get the right to enforce their values at the barrel of a gun (meaning taxes), no matter how noble those values might be?

Pretty by-the-books stuff. Libertarianism represented to me a matrix of freedom that could be collapsed onto any particular set of individual values. It was a simple formula to live by: If enough people value X, those people will pay for X, whether or not X = someone else’s interest. Government intervention was at best superfluous to this outcome and at worst distorting of the collective will (measured as the aggregate economy).

When my friend offered the natural response, What if people fail to provide enough for those in need?, I resorted to the tried-and-true strategy of telling him the problem wasn’t a problem. The real problem was taxation or regulation or minimum wage or a failed incentive structure. If people were in need it was because government was preventing the market from providing for them.

What’s interesting to me now is not why this kind of thinking is wrong but why it was once so attractive to me.

I found my way to libertarianism in my teen years when I began reading some of its introductory texts and was attracted to the internal consistency of its policies. If you accepted that the individual was sacrosanct and the government’s only role was to protect the individual, everything else pretty much followed. Unlike mainstream liberalism and conservatism, which were constantly engaged in negotiations between social and economic freedoms, libertarianism was systematically clean and neat. So much so that I quickly stopped concerning myself with how ideas played out in the world. The ideas themselves were enough.

As a kid, you learn to refute anyone’s “theory” by snidely mocking — “In theory, communism works.” When I was in college, I knew that communism did not work, even in theory, and I was happy to tell you why. Only libertarianism worked in theory.

That in switching the terms of the joke I made myself its butt was, regrettably, lost on me. When the lens of ideology grows so thick it’s all a person sees, a sense of humor is often the first thing to be occluded.

So what accounts for my transition from orthodox libertarianism to an unremarkable liberalism? At the risk of putting the cart before the political horse, I’m not an isolated reasoning subject and individual actor but a complex and conflicted human in various social and environmental contexts, and the reasons I abandoned libertarianism are personal and psychological as well as intellectual.

It felt good to be libertarian. I could win political debates (to my satisfaction) by applying the internally consistent reasoning I so admired to any issue. My reluctance to compromise was a virtue that straightened my posture. I took my rigidity as a sign not of narrow-mindedness but of integrity, the consequence of careful advancement from first principles. This particular kind of coherency put me self-satisfactorily and peacefully to sleep on many nights.

But it also sometimes felt bad to be a libertarian. I didn’t like that people I cared about regularly thought I was a smug asshole. I didn’t like that so often in debates I sounded to myself like a smug asshole. Not my intentions — say what you will about the positions, I always held them sincerely — but the words themselves. They didn’t sound compassionate, as it got harder and harder to remind myself they really were supposed to be.

The ideological purity at the heart of libertarianism was so true that I was certain only good effects could follow from it. The plainness of this was apparent enough that I was actually perplexed when others didn’t see it on face value. Whenever an interlocutor pointed to a real-world counterexample I was ready with a distinction between the applied and the perfect libertarian policy.

But the truth an ideologue is at pains to accept is that no life can live up to ideology. We are a messy species living messy lives. And we are lucky for this. The intellectual libertarian wants the world to be the kind of ideal world it never can be. He (and it’s often he) is unable to live with ambiguity and compromise. The beautiful (it is a kind of beauty) logical edifice of libertarianism is built on the faulty premise that this is the kind of world that is built on logical edifices.

The discomfort I felt with libertarianism was the discomfort of my ideas not aligning with my experiences. My thoughts and feelings were at odds. The feeling nagging me was that I couldn’t reconcile my humanity with my ideology any more than my friend could for me. Over time, that feeling became a reason in its own right.

I saw, as many libertarians see, a world tangential to this world we live in, which is the world I always felt like I belonged to.

More Scott Parker.

Pressure to Raise Pathetic Minimum Wage Is on the Rise Across the Land

  Economy  

AlterNet / By Steven Rosenfeld

Pressure to Raise Pathetic Minimum Wage Is on the Rise Across the Land

 

A growing coalition of progressive organizations is pushing hard to get the minimum wage on 12 state ballots.

Photo Credit: Jodie Gummow

 

 

 

January 24, 2014  |  

 

 

After years of hard times and recent organizing by growing coalitions of worker organizations and progressive groups, 2014 may see some of the biggest state minimum wage increases in years.

In 2013, 13 states and handful of cities raised the legal hourly minimum wage after those locales saw campaigns uniting low-wage workers, unions, clergy and Democrats. While most of these increases did not raise wages above the $9 rate for hourly workers, they still increased paychecks for an estimated 4.5 million workers—mostly women—and should inject an extra $2.7 billion into their pockets this year, economists said.

This year a mix of elected Democrats and seasoned organizers are seriously pushing for even bigger increases in a dozen states including Massachusetts, Maryland, Hawaii, Illinois, Arkansas, Alaska, South Dakota and California. According to analysts, these and other states are likely to raise their minimum wages, either from legislative action in coming months or from votes on statewide ballot questions where Democrats are betting that the issue will lead to higher turnout and be a factor in congressional races.

This growing momentum is apart from stalled minimum wage bills in Congress to raise the current federal minimum wage, now at $7.25 per hour, to $10.10. While President Obama is expected to make inequality the centerpiece of his 2014 State of the Union speech next week, his previous calls for raising the wage have been ignored by House Republicans. That political stalemate shifts the focus back to the states.

“This year we are going to see far more meaningful measures passed at the state level,” said Jack Temple, a policy analyst with the National Employment Law Project. “A lot of states are going for at least $10 an hour, or in some cases $11 an hour. Last year, we saw states raising their minimum wages for the first time since the recession.” 

“It remains to be seen if these measures will be turnout drivers in 2014, but past research we commissioned in 2006 showed that minimum wage ballot questions increased voter turnout among Democratic and swing voters,” said Justine Sarver, executive director of the Ballot Initiative Strategy Center. “Minimum wage increases appeared on the ballot in seven states [Arizona, Colorado, Florida, Missouri, Montana, Nevada and Ohio] in 2004 and 2006. All of these measures passed, with five receiving more than 65 percent.”

This populist progression will unfold in a series of steps at state legislatures in coming months, in ballot questions legislators may put before voters, and in ballot campaigns where sponsors gather qualifying petition signatures, especially if lawmakers don’t act.

“Raising it to $10 a hour on its own is not a one-stop fix for solving poverty,” Temple said. “But raising the minimum wage is one of the most urgent steps that states can take to boost living standards for low-wage workers.”

Many Paths To Action

The new year has seen several incumbent Democratic governors (Hawaii, Illinois, Minnesota and Maryland) saying that their legislatures should raise their state minimum wage above the federal floor of $7.25 an hour, which was last raised in 2009. (The federal minimum wage for tipped workers, $2.13 an hour, was last raised in 1991.)

Those governors, some facing re-election this year, will join other states where legislators will be considering minimum wage hikes in coming months. In Hawaii, for example, a key state senator who opposed a larger increase last year is now supporting it—as he is running for governor against the incumbent, said Drew Astolfi, state director of Faith Action for Community Equity Hawaii.

“In Hawaii, we have the highest cost of living of any state, but the minimim wage has been stagnant for many years,” he said. “Many people here work two jobs to get by. The second one is minimum wage.” 

In Michigan, the 2014 Democratic candidate for governor has called for raising the wage, but the legislature has not acted on wage increases, he said. In the meantime, organizers are planning to launch a ballot campaign, which also is what Idaho activists are doing, hoping their legislature will act but not counting on it.

“Idaho is in a crisis,” said Raise Idaho’s Anne Nesse. “We have the lowest per capita wages in the United States according to the Department of Labor, and we lead the nation in in the percentage (7.7 percent) of minimum wage jobs. Many citizens are working for $8.00 per hour as well, or $9.00…. The initiative law that we are fighting for is modest in a cold hard-to-survive in environment.” 
 
Some states don’t have the option of pursuing ballot campaigns. In Maryland, organizers will revive the issue after its defeat last year and have been lobbying key lawmakers for months. Earlier this week, Democratic Gov. Martin O’Malley said raising the wage to $10.10 by 2016 was his top priority, but his Senate’s Democratic president had doubts. In New Mexico, organizers are hoping its legislators will put a statewide increase on the fall ballot, after Albuquerque raised its wage last year. Bills have also been introduced in at least four other states—New Hampshire, West Virginia, Delaware and Rhode Island—NELP’s Temple said.

In other states, a two-track process is unfolding at the statehouse and with petition drives. In Massachusetts, activists submitted enough petition signatures to get the legislature to take up the issue. But if they don’t pass a strong enough proposal, or add unacceptable items to that legislation, then organizers can collect more signatures and put their ballot proposal before voters, said Lewis Finter, Massachusetts Communities Action Network director. “The Senate passed a good bill,” he said. “Our House of Representatives hasn’t taken it up yet… our House Speaker… said he wanted to add some ‘reforms.’” 
  
Then there are efforts in ballot initiative states where organizers are all but certain to turn in enough qualifying petitions to put the question before voters. Alaska will vote on its wage increase next August, the same time a marijuana legalization question will be on the ballot. In Arkansas and South Dakota, organizers are collecting signatures, Temple said. In addition, there’s a ballot campaign in Washington, DC, to raise their wage to $12.50, index it for inflation and increase the minimum wage for tipped workers. The District’s City Council raised their wage to $11.50 late last year, but left out tipped workers, he said, prompting the renewed campaign.

In Chicago’s upcoming March primary elections, voters will be asked if the city should require employers with annual gross revenue above $50 million—meaning Walmart, McDonald’s, Walgreens and others—to pay $15 an hour. “We’re confident that this referendum is sparking a serious and urgent conversation about why the city of Chicago, and all levels of government, must tackle growing inequality and the poverty crisis by the wages of low-income workers, said Scott Vogel, a spokesman for the Raise Chicago coalition and SEIU Healthcare Illinois.

In California, where the legislature raised the wage last year to $9 an hour, a maverick entrepreneur known for anti-immigrant stances is sponsoring an initiative to raise it to $12. Silicon Valley multi-millionaire and ex-gubernatorial candidate Ron Unz said a higher minimum wage would make people less dependent on state welfare programs and would make current low-wage farmwork more attractive to U.S. citizens.

Motivating Voter Turnout

But for most of the country, the issue is being driven by progressive coalitions, including labor unions, social workers, clergy and Democrats. Democrats are hoping the campaigns will motivate voters who typically sit out of non-presidential year elections to vote this fall. New York Rep. Steve Israel, who chairs the Democratic Congressional Campaign Committee has said a dozen House races could see higher turnout based on the issue.  
  
“Ballot measures can be used to create enthusiasm for voting, particularly in midterm elections where many important voters such as women, young people and people of color are less likely to turn out,” said Sarver of the Ballot Initiative Strategy Center. “We think voters will support these initiatives.”

Nationwide polls taken last summer by Hart Research Associates found 80 percent of Americans—a mix of Democrats, Independents and Republicans—backed raising the federal minimum wage to $10.10 and adusting it for the cost of living in future years. Senate Democrats and the Obama admininistration have called on Congress to increase it to that amount, which would be a dollar higher than most of the state-based raises in 2013. However, that proposal has not gone anywhere in recent years.

Hart’s polling found that candidates who embrace raising the minimum wage will get a big reward from voters, Temple said, saying the issue was a “candidate differentiator” that increased a candidate’s support by 36 percent. But that was only if a candidate actively campaigned on the issue and constantly reminded voters of his or her stance.

“This doesn’t work like magic,” Temple said. “You don’t just put it on the ballot and have voters rush out and support it. A candidate has to really lean into this. If they think this will drive voter turnout, the crucial piece will be if they link themselves to this issue.”

Steven Rosenfeld covers democracy issues for AlterNet and is the author of "Count My Vote: A Citizen's Guide to Voting" (AlterNet Books, 2008).

Our Focus Must Be to Reduce Poverty and Not Inequality

THE PUBLIC INTEREST

Number 137, Fall 1999

"Reducing poverty, not inequality"

By MARTIN FELDSTEIN     According to official statistics, the distribution of income has become increasingly unequal during the past two decades. A common reaction in the popular press, in political debate, and in academic discussions is to regard the increase in inequality as a problem that demands new redistributive policies. I disagree. I believe that inequality as such is not a problem and that it would be wrong to design policies to reduce it. What policy should address is not inequality but poverty.

The difference is not just semantics. It is about how we should think about the rise in incomes at the upper end of the income distribution. Imagine the following: Later today, a small magic bird appears and gives each Public Interest subscriber $1,000. We would all think that this is a good thing. And yet, since Public Interest subscribers undoubtedly have above average incomes, that would also increase inequality in the nation. I think it would be wrong to consider those $1,000 windfalls morally suspect.

Pareto principle vs. Gini coefficient

When professional economists think about economic policies, they generally start with the principle that a change is good if it makes someone better off without in making anyone else worse off. That idea, first suggested by the Italian economist Vilfredo Pareto, is referred to as the Pareto principle. I find it hard to see how one could disagree with such a principle, which is why it is the widely accepted foundation for the evaluation of economic Policies.

Not all policies can be evaluated in reference to the Pareto principle. There are policies that make some people better off while making others worse off. The desirability of such a policy depends on how much the gainers gain, how much the losers lose, and the initial income and circumstances of the individuals involved. But that difficult evaluation is not my concern here. I am interested only in evaluating changes that increase the incomes of high--income individuals without decreasing the incomes of others. Such a change clearly satisfies the common-sense Pareto principle: It is good because it makes some people better off without making anyone else worse off. I think such a change should be regarded as good even though it increases inequality.

Not everyone will agree with me. Some see inequality as so intolerable that they regard increasing the income of the wealthy as a 'bad thing," even if that increased income does not come at anyone elses expense. Such an individual, whom I won describe as a 'spiteful egalitarian," might try to reconcile this with the Pareto principle by saving, " It makes me worse off to see the rich getting richer. So if a rich man gets $1000, he is better off and I am worse off. I dont have fewer material goods, but I have the extra pain of living in a more unequal world." I reject such arguments and stick to the basic interpretation of the Pareto principle that if the material well-being of some individuals increases with no decrease in the material well-being of others, that is a good thing even if it implies an increase in measured inequality.

I would note that one can reject spiteful egalitarianism and still favor redistributive policies and tax progressivity. Such redistributive policies reflect an assumption that the social value of incremental income (in economic terminology, the social marginal utility of income) declines as income rises - i.e., that an extra $100 of income means less to a millionaire than to someone whose income is $10,000. Of course, many economists reject such comparisons on the grounds that there is no way to compare how much pleasure two different individuals get from money or from the goods that money buys. But analyses that conclude that all increases in inequality are bad imply something much stronger: that the social value of incremental income to a rich person is actually negative.

More formally, economists and other policy analysts often use the "Gini Coefficient" as a measure of income inequality. ⁽¹⁾ The Gini Coefficient measures the concentration of incomes in the nation, with a higher Gini Coefficient value implying more concentration. A feature of the Gini Coefficient is that an increase in the incomes of the rich with no change in the incomes of others will raise the Gini Coefficient. The common procedure of regarding a higher Gini Coefficient as a deterioration of the national condition is equivalent to treating the social marginal utility of high incomes as negative - i.e., that something bad has occurred when the well-to-do become better off.

In rejecting the criticism of inequality per se, and in asserting that higher incomes of the well off are a good thing, I am not referring to the functional arguments that some have offered in defense of inequality. Such analysts argue that an unequal distribution of income may contribute to general economic growth, and therefore to the poors standard of living, by increasing the national saving rate. Alternatively, they contend that inequality is a reflection of Schumpeterian innovation, which eventually helps most, if not all, individuals in the economy. I am also not defending high incomes because the affluent support charitable causes or "high culture." All of this may be true, and even convincing to someone who doesnt care about the well-being of the wealthy or who gives negative weight to their increased well-being. But I am not relying on such arguments here, because I want to stress that there is nothing wrong with an increase in the well-being of the wealthy or with an increase in inequality that results from a rise in high incomes.

The rich get richer

There has been a relatively greater increase in higher incomes in recent years in the United States and in some other countries. Some part of the rise in top incomes reflects the fact that the cut in top marginal tax rates in 1986 caused high-income taxpayers to shift the form of their compensation to taxable cash from fringe benefits and other nonobservable forms of compensation. But there have also been real increases in the pretax incomes at the top. It is important to understand why.

The increase in higher incomes has been the result of four principal factors. First, there are now more individuals with advanced education and enhanced marketable skills, and market forces reward these high skills relatively more than they did in the past. Thus individuals have a strong incentive to acquire these skills and to select occupations in which such skills are rewarded. Second, entrepreneurial activities are on the rise. The creation and growth of new businesses has been an important source of the larger number of individuals with high incomes and significant wealth.

Third, high-wage individuals work increasingly long hours. We all know about investment bankers, lawyers, and other highly paid professionals who are now working 70 or more hours a week, twice the weekly hours of a typical employee. Dora Costa, an economic historian at MIT, has recently reported that this observation is part of a more general trend toward longer working hours for higher paid employees, a reversal of the earlier tendency of those with lower wages to work longer hours. The result: measured inequality has increased.

Finally, declines in the cost of capital, reflecting an improved fiscal outlook and perhaps a decrease in perceived financial risk as a result of lower inflation, translate into higher stock and bond prices, an additional source of increased wealth for those with higher incomes. Each of these four sources of higher incomes for those at the upper end of the distribution is, I would argue, a good thing in itself. They add to the income or wealth of those individuals without reducing the incomes and wealth of others.

Mismeasuring poverty

The real problem on which national policy should focus then is not inequality but poverty. I have in mind the incomes of those in the bottom decile or quintile of the income distribution. After discussing the problems of measuring poverty, I will consider three possible sources of poverty - unemployment, a lack of earnings ability, and individual choice - and what can be done about them.

Of course, measuring the incomes of the lowest income group is not a simple task. Cash income overestimates the number of the poor. A broader measure that includes in-kind benefits like health care and housing suggests much less poverty. There is also a problem in classifying someone as poor if his income is only temporarily low.

More generally, sociologists who have actually studied the poor directly and spoken with them about their living conditions (a research method that economists use too little) have been puzzled by how the poor could live on so little income. Those who have gained the confidence of the poor discover the answer: the underground economy. The true incomes of many of those with very low measured incomes are actually higher than the data indicate. Such individuals do not report their total income since doing so might reduce their eligibility for cash and in-kind transfers.

This is a major problem for studies of the incomes of the poor. Careful studies of income distribution are most reliable when they look at the wage distribution of the middle classes, an unfortunate fact since the most interesting questions are about the very poor and the very rich, for whom data are simply not very good.

A separate issue that plagues attempts to measure trends in poverty and in income levels more generally is the difficulty of measuring changes in the cost of living. A growing body of research suggests that the consumer price index (CPU and related official measures overstate the rise in the true cost of living and, therefore, understate the rise in real personal incomes. Even if the bias in the CPI is as little as 1 percent a year, the cumulative effect over two decades is to understate the growth of real incomes by more than 20 percent.

These measurement difficulties should make us cautious about attempting to assess changes in the extent of poverty over time. Nevertheless, poverty today is a real and serious problem in the United States and other countries. I will thus consider three sources of poverty and the policies that might be directed to counter them.

Unemployment and poverty

There exists a small, but serious, amount of very long-term unemployment in the United States that creates poverty and hardship. Its extent goes beyond the measured amount of long-term unemployment since most individuals who have been out of work for considerable periods of time in the United States are classified as "not in the labor force" rather than unemployed. But, although this long-term nonemployment is a problem and a source of poverty, it is not a cyclical problem that is amenable to expansionary monetary or fiscal policy.

Current long-term unemployment is very different from the unemployment of the Great Depression when a large fraction of the labor force was unemployed and out of work for a year or longer. The current long-term unemployment is also very different from the cyclical unemployment that we see now in the United States. Most cyclical unemployment spells are short, ending in less than 10 weeks. During such spells of unemployment, the decline in consumption is very small. Unemployment insurance generally replaces more than half of the lost net income of those who receive benefits, and the earnings of second earners in the household of the unemployed help to stabilize total household income. While the unemployed may not have access to formal lines of credit, they are often able to defer payments during part or all of their unemployment spells.

The situation is, of course, different in Europe where unemployment rates tend to rise during recessions but not to fall during a recovery. Cyclical unemployment there becomes long-term unemployment because of the adverse incentives in the European system of unemployment benefits and welfare payments.

Reform of the American unemployment system in the 1980's led to a decline in the rate of unemployment. One important aspect of those reforms was subjecting unemployment benefits to the personal income tax, a reform that obviously did not affect the poor (who do not pay income tax). However, this measure did reduce the very high replacement rates that previously made it possible for some individuals in higher-income households to have more net income by being unemployed than by working.

Lack of earning ability

The most commonly recognized reason for poverty in the United States is the inability of poor individuals to earn more than a very low hourly wage. This low earnings ability, is often attributed to inadequate schooling or training.

It is clear that inadequate schooling can limit an individuals earning ability and that the obvious remedy is more or better schooling. Many economists and educators who are studying how to improve our educational system have concluded that decentralization and competition are essential. Research by Larry Katz and Claudia Goldin of Harvard shows that the historic spread of high-school education and vocational education in the United States reflected decisions of local governments rather than the actions of the states or federal government. Research by Caroline Hoxby and others shows that the quality of local public education today improves (as measured by graduation rates, continued education, post-school wages, etc.) where competition flourishes due to a larger number of school districts or a greater availability of nonpublic (typically parochial) education. The importance of competition has increased interest in vouchers to promote individual choice.

A second reason for low earnings ability is inadequate training. Experience suggests that on-the-job training is best. The German system of formalized apprenticeships appears to allow Germany to escape the high youth-unemployment rates that plague much of Europe; the system may also reduce poverty in later years. In the United States, in contrast, minimum-wage legislation limits the ability of individuals with low skills, low education, and low ability to obtain on-the-job training. Although someone who comes to a job with good ability and skills can both earn the minimum wage or more and also obtain additional skills through on-the-job training, an employer cannot afford to pax the minimum wage and provide training to those with the lowest skills.

The evidence on government-sponsored training programs for the middle-aged unemployed is very discouraging. For women, participation in training programs raises employment and wages by more than the cost of the training, but the impact on employment and poverty for the trainees is very small. For men, the results are even worse: The gains from training are less than the costs.

The problem of low human capital as a source of poverty is not just a matter of schooling and training, but also low cognitive ability. As I read the evidence, while variations in cognitive ability (IQ) close to the mean score do not have much impact on individuals wage rates, individuals with extremely low levels of cognitive ability (IQ levels below 80) have a very hard time earning a decent wage rate. This is not a fashionable view. Americans like to think that all men and women are quite literally created equal and that education can therefore solve the problem of low human capital and low earnings. Unfortunately, however, very low cognitive ability is likely to be a serious cause of poverty that cannot be remedied by education and training. Only when this is accepted will it be possible to develop appropriate new policies.

Finally, there are those for whom low earnings ability reflects pathologically dysfunctional life styles - drug abuse, alcoholism, and mental illness. Policies that deal with these specific problems, if they are successful, will do much to reduce human suffering as well as to alleviate poverty.

The role of individual choice

Not all poverty can be attributed to involuntary unemployment or to the lack of earning ability. Individual choices, rational or irrational, can lead to poverty. Some individuals who are in poverty may be making considered choices. For example, some individuals may choose leisure (not working or working very little) over cash income even though this leaves them poorer than they otherwise would be. Choosing not to work may be an increasingly important source of poverty. Over time the standard of living that is possible without working has increased for some segments of the population as a result of the rise in the real value of cash and in-kind welfare benefits. Often the real value of these welfare benefits has increased more rapidly than the real value of wages available to low-skilled workers, increasing the likelihood that the appeal of such benefits would exceed the attractiveness of work. This is reinforced to the extent that transfer rules reduce the incentive to work. Reducing such voluntary poverty requires reexamining the structure of welfare programs. 

Not all individual choice is properly described as "considered" or " rational," and some individuals may choose poverty in error. In other words, they may think that they are making a rational decision (what economists would call a "utility maximizing" decision) when in fact their facts are wrong. Some of those individuals may think that they will not like work (or the combination or work and the money that it brings) as much as they currently like staying at home but would discover the opposite if they went to work. Moreover, these individuals may not recognize that they will advance in their jobs, shifting over time to more appealing work or at least to higher incomes. A policy of "tough love" that forces such individuals to enter the world of work for an extended period of time may be the best way to overcome this problem.

1. See, for example, the papers discussed at the Federal Reserve conference, "Income Inequality: Issues and Policy Options" (Federal Reserve Bank of Kansas City, 1998), at which an earlier version of the current essay was presented.

What Would a Down-to-Earth Economy Look Like?

Ecosystems  |  New Economy  |  Community

What Would a Down-to-Earth Economy Look Like?

 

How did we end up with Wall Street when models for a healthy economy are all around us?

by David Korten

 

 

posted Jan 17, 2013

 

 

Photo by Thomas Hawk.

With proper care and respect, Earth can provide a high quality of life for all people in perpetuity. Yet we devastate productive lands and waters for a quick profit, a few temporary jobs, or a one-time resource fix.

Our current expansion of tar sands oil extraction, deep-sea oil drilling, hydraulic fracturing natural gas extraction, and mountaintop-removal coal mining are but examples of this insanity. These highly profitable choices deepen our economic dependence on rapidly diminishing, nonrenewable fossil-energy reserves, disrupt the generative capacity of Earth’s living systems, and accelerate climate disruption.

A global economy dependent on this nonsense is already failing and its ultimate collapse is only a matter of time. For a surprisingly long time, we humans have successfully maintained the illusion that we are outside of, superior to, and not subject to the rules of nature. We do so, however, at a huge cost, and payment is coming due.

To secure the health and happiness of future generations, we must embrace life as our defining value, recognize that competition is but a subtext of life’s deeper narrative of cooperation, and restructure our institutions to conform to life’s favored organizing principle of radically decentralized, localized decision making and self-organization. This work begins with recognizing what nature has learned about the organization of complex living systems over billions of years.

Our Original Instructions

Some indigenous people speak of the “original instructions.” Chief Oren Lyons, of the Onondaga Nation, summarizes the rules in “Listening to Natural Law” in the anthology Original Instructions:

“Our instructions, and I’m talking about for all human beings, are to get along … with [nature’s] laws, and support them and work with them. We were told a long time ago that if you do that, life is endless. It just continues on and on in great cycles of regeneration. … If you want to tinker with that regeneration, if you want to interrupt it, that’s your choice, but the results that come back can be very severe because … the laws are absolute.”

Decision-making would be local and the system would organize from the bottom up.

Modern neuroscience affirms that the human brain evolved to reward cooperation and service. In other words, nature has hard-wired the original instructions into our brain. Extreme individualism, greed, and violence are pathological and a sign of physical, developmental, cultural, and/or institutional system failure. Caring relationships are the foundation of healthy families, communities, and life itself.

We are living out the consequences of our collective human failure to adhere to the original instructions—the organizing principles of healthy living systems readily discernible through observation of nature at work. These are the principles by which we must rethink and reorganize human economies.
So how would nature design an economy? An economy is nothing more than a system for allocating resources to productive activity—presumably in support of life. In fact, nature is an economy, with material and information exchange, saving, investment, production, and consumption—all functions we associate with economic activity. Absent human intervention, as Lyons says, “It just continues on and on in great cycles of regeneration.”

Nature surrounds us with expressions of the organizing principles that make possible life’s exceptional resilience, capacity for adaptation, creative innovation, and vibrant abundance. Earth’s biosphere and the human body are two magnificent examples.

		Wall Street		Nature
Defining value		Money		Life
Primary performance indicators		Growth, financial returns, flows, and assets		Life's abundance, health, resilience, and creative potential
Primary dynamic		Competition to maximize self-interest		Cooperation to optimize self- and community interest
Decision-making power		Global, top-down, centralized, and concentrated		Local, bottom-up, and distributed
Time frame		Immediate return		Sustained yield
Local character		Uniform		Diverse
Resource control		Monopolized		Shared
Resource flows		Global, linear, one-time use from mine to dump		Local, circular, perpetual use, zero waste
Deficits of concern		Financial		Social and environmental
Measure of efficiency		Returns to financial capital		Returns to social and natural capital
Growth		Infinite growth of money and material consumption		A stage in life's endless regenerative cycles of birth, growth, death, and rebirth

 

The Economy of the Biosphere

Earth’s exquisitely complex, resilient, and continuously evolving band of life—the biosphere—demonstrates on a grand scale the creative potential of the distributed intelligence of many trillions of individual self-organizing, choice-making living organisms. Acting in concert, they continuously regenerate soils, rivers, aquifers, fisheries, forests, and grasslands while maintaining climatic balance and the composition of the atmosphere to serve the needs of Earth’s widely varied life forms. So long as humans honor the original instructions, the biosphere has an extraordinary capacity to optimize the capture, organization, and sharing of Earth’s energy, water, and nutrients in support of life—including human life.

In nature, species and individuals earn a right to a share in the bounty of the whole as necessary to their sustenance through their contribution to the well-being of the whole. Over the long term, those that contribute prosper, and those that do not contribute expire. The interests of the whole are protected against rogue behavior by natural limits on the ability of any individual or species to monopolize resources beyond its own need to the exclusion of the needs of others.

Individuals and species may compete for territory and sexual dominance, but the amount of territory or number of mates nature allows an individual or species to claim is local, limited, and subject to continuous challenge. Until humans began to create the imperial civilizations characteristic of our most recent 5,000 years, the idea that any species, let alone a few individual members of a species, might claim control of all of Earth’s living wealth to the exclusion of all others was beyond comprehension.

The Economy of the Body

The human body is a more intimate demonstration of the creative power of life’s organizing principles. The individual human body comprises tens of trillions of individual living cells, each a decision-making entity with the ability to manage and maintain its own health and integrity under changing and often stressful circumstances. At the same time, each cell faithfully discharges its responsibility to serve the needs of the entire body on which its own health and integrity depend.

Working together, these cells create and maintain a self-organizing human organism with the potential to achieve extraordinary feats of physical grace and intellectual acuity far beyond the capability of any individual cell on its own. Each decision-making, resource-sharing cell is integral to a larger whole of which no part or system can exist on its own. Together they create regulatory mechanisms internal to the whole that work to assure that no part asserts dominance over the others or monopolizes the body’s stores of energy, nutrients, and water for its exclusive use. Resources are shared based on need.

All the while, the body’s cells self-organize to fight off a vast variety of viruses, cancer cells, and harmful bacteria, adapt to changing temperatures and energy needs and variations in the body’s food and water intake, heal damaged tissues, and collect and provide sensory data to our conscious mind essential to our conscious choice making.

Another of the many impressive expressions of the body’s capacity to self-organize is the process by which our cells continuously regenerate while maintaining the body’s integrity as a unified organism. The cells lining the human stomach have a turnover of only five days. Red blood cells are replaced every 120 days or so. The surface of the skin recycles every two weeks. The cells of the body are constantly reproducing, growing, and dying.

A Human Economy Based on Nature

If nature were in charge of creating an enduring human economy, she would surely apply the same principles she applies in natural systems. Her goal would be a global system of bioregional living economies that secure a healthy, happy, productive life for every person on the planet in symbiotic balance with the non-human systems on which we humans depend for breathable air, drinkable water, fertile soils, timber, fish, grasslands, and climate stability. Each bioregional economy would meet its own needs for energy, water, nutrients, and mineral resources through sustained local capture, circular flow, utilization, and repurposing. Decision making would be local and the system would organize from the bottom up. Diversity and redundancy would support local adaptation and resilience.

To Change Our Direction, It's Time to Follow Nature's Lead
 

It takes humility to recognize that what we’ve called progress isn’t always for the better. Sometimes nature’s original idea was a better one.

This should be our goal and vision. With the biosphere as our systems model, we would design our economic institutions and rules to align with nature’s rules and organizing principles. We would replace GDP as the primary measure of economic performance with a new system of living system indicators that assess economic performance against the outcomes we actually want—healthy, happy people and healthy, resilient natural systems. These indicators might be based on Bhutan’s Gross National Happiness Index. We would redirect the time, talent, and money we currently devote to growing GDP, material consumption, securities bubbles, and Wall Street bonuses to producing the outcomes we really want.

We would favor local, cooperative ownership and control. Organizing from the bottom up in support of bioregional self-reliance, our economic institutions would support local decision-making in response to local needs and opportunities. Cultural and biological diversity and sharing within and between local communities would support local and global resilience and facilitate life-serving system innovation.

The result would be an economy based on a love of life that honors the original instructions and conforms to the organizing principles of nature, real markets, and true democracy. The challenge is epic in its proportion and long overdue.
We are Earth’s children; she is our mother. We must honor and care for her as she loves and cares for us. Together we can forge an integral partnership grounded in the learning and deep wisdom of her 3.8 billion-year experience in nurturing life’s expanding capacities for intelligent self-organization, creative innovation, and self-reflective consciousness.

---

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David Korten wrote this article for What Would Nature Do?, the Winter 2013 issue of YES! Magazine. David is board chair of YES! Magazine. He holds MBA and Ph.D. degrees from the Stanford University Graduate School of Business and served on the faculty of the Harvard Business School. His books include Agenda for a New Economy and the international best seller When Corporations Rule the World.
Interested?

• From Soap to Cities, Designing from Nature Could Solve Our Biggest Problems
  Can a boat be designed to clean the water? How does a spider manufacture resilient fiber? We need products that don’t harm us or the environment, and nature’s already done the research.
• Vandana Shiva: Everything I Need to Know I Learned in the Forest
  Today, at a time of multiple crises, we need to move away from thinking of nature as dead matter to valuing her biodiversity, clean water, and seeds. For this, nature herself is the best teacher.
• Four Steps to Less Wasteful Communities
  The individual actions we take to reduce waste are important. But to stem the avalanche of stuff, we also need system-wide solutions.

Hey Dems: You really have to give Third Way credit -

The Democratic Strategist

Hey Dems: You really have to give Third Way credit - they have unified the Democratic coalition in a way no-one else could possibly have done.

I mean, wow, when you think about it, it's really pretty rare when Democrats from virtually every single sector of the party can find a solid common ground. After all, when's the last time can you remember a single analysis being attacked in The New Republic, The American Prospect and The Nation, all at the same time? When's the last time you remember a thesis being rejected by Democratic-oriented Think Tanks ranging all the way from the generally pro-Obama Center for American Progress to the very progressive Economic Policy Institute? When was the last time one Washington Post Op-Ed was not only repudiated by essentially all progressives in the Democratic coalition but also by a wide range of Democratic "centrists" including (implicitly) Obama himself, former members of DLC and the Clinton inner circle and even by Democratic politicians who are formal honorary co-Chairs of the same organization that penned the analysis.

It really is a genuinely unique achievement. Those Third Way guys really did nail those crazy lefties. To quote Woody Allen, they punched them solidly in the fist with their nose and kicked them right in the knee with their groin.

Now granted, the Third Way guys have back-pedaled with admirably breathtaking speed. In a concession that must have caused them genuine and acute physical pain, they now insist that they really do respect and admire Elizabeth Warren and Bill DeBlasio as valuable members of the democratic coalition (although they have carefully refrained from explicitly repudiating the view implied in the Op-Ed that Warren is probably more than a little nuts and wants to drive the Democratic Party over a "populist cliff"). They now unctuously complain-- in faux-humble "aw, gee wiz, come on guys" style--that all they really wanted to do with that editorial was just to present their very serious perspective about Democratic economic policy.

Well, OK, let's take them at their word. If that's really, really, really what Third Way wants to do, then here are two things that they should immediately and permanently stop doing:

1. Stop name calling. Calling the Obama-centric Center for American Progress "the left", as they did in one recent Washington Post op-ed is not just so damn silly that to any informed Democrat it's laughable; it's also deliberately intended to brand CAP's ideas with a false political label that will discredit them with people who know nothing at all about the groups' actual positions. Equally, saying that Elizabeth Warren and Bill DeBlasio represent "fantasy-based Blue-state populism" and are pushing the party over a "populist cliff" isn't debating their specific views on policy, it's deprecating them as individuals.

2. Stop creating straw men. In Third Way's recent Op-Ed pieces, one common thread is that they never directly attack the specific policy proposals issued by actually-existing pro-Democratic groups like the Center for American Progress, the Economic Policy Institute, the Congressional Progressive Caucus or any of the other real-world center-left or progressive-left think-tanks and organizations. Instead their repeated modus operandi is to create an exaggerated caricature of an imaginary "crazy left-wing" position that they wish their opponents actually held, slap a label on it they themselves invent (e.g. the "Have It All" philosophy) and then proceed to wallop the straw man they themselves have created.

Let's be clear: an organization that aspires to be a genuine part of the Democratic coalition simply can't engage in this kind of divisive behavior and then, when they are criticized, turn around and whine that all they really want to do is to seriously debate policy. It's not just a transparently false claim, it's deeply and profoundly insulting to the entire Democratic audience they are presumably trying to convince. It assumes Democrats - people like you, the readers of The Democratic Strategist -- are so utterly stupid that you can't tell the difference between schoolyard taunts and make-believe battles with fabricated straw men on the one hand and serious policy debates and honest engagement with opposing ideas on the other.

I mean, really, it's not at all hard to tell the difference between the two approaches. As Ed Kilgore pointed out in his response to the latest Third Way op-ed, institutions with serious reputations as centers of thoughtful moderate or "centrist" thinking - groups like the Brookings Institution -- have played a constructive centrist role for decades. Progressives frequently and passionately disagree with their conclusions but they continue to respect their intellectual honesty and commitment to reasoned debate.

So here's a very simple acid test for Third Way: the next time you guys want to go out and write an op-ed, hire an outside copy-editor to remove every single damn instance of name-calling and every single fabricated, straw-man opponent from your piece. Instead, identify the very specific policy proposal or legislative bill you disagree with, demonstrate that it really represents a significant point of view within the Democratic coalition, quote directly from the document you are criticizing and then explain your dissent without directly attacking the individuals or group who wrote the document but focus rather on the specific ideas you believe wrong in the proposal itself. 

If you can't do this, then don't complain if no one takes you seriously when you claim that all you really want to do is to seriously debate Democratic policy. 

On the other hand, of course, now that I think about it for a moment, maybe I'm really wrong about this. Maybe you guys should just keep on doing exactly what you're doing. There are all kinds of important policy issues that currently divide the Democratic coalition and which inevitably but unfortunately weaken Democratic unity. It's a real and important contribution to the Democratic coalition to generate the kind of massive intra-party unity that you guys have generated as a counter-weight to these divisive pressures - even if it is a massive intra-party unity that is directed directly against yourselves.

P.S. Oh, and by the way, if you want to create a serious dialog with Democrats, you might also want to consider using a different platform than the Wall Street Journal. The sincerity and plausibility of your critique is not particularly enhanced when it appears alongside editorials channeling old Ayn Rand novels and paid ads promoting offshore bank accounts in remote Pacific islands.

Posted by James Vega on December 20, 2013 1:26 PM

Reich's 10-Point Program to Reduce Inequality

THE DEMOCRATIC STRATEGIST

The Daily Strategist

 
January 15, 2014

Reich's 10-Point Program to Reduce Inequality

by staff, January 15, 2014 06:14 AM EST

Former Secretary of Labor Robert Reich has emerged as one of the more lucid policy journalists, with a knack for translating complex economic reforms into language that connects with everyday voters, as well as policy wonks. A recent short and simple entry from his blog, via Reader Supported News, "The Lousy Jobs Report and the Scourge of Inequality" rolls out an appealing menu of ten policy reforms in this excerpt:

Businesses won't create new jobs without enough customers. But most Americans no longer have enough purchasing power to fuel that job growth.

That's why it's so important to

(1) raise the minimum wage at least to its inflation-adjusted value 40 years ago - which would be well over $10 an hour,

(2) extend unemployment benefits to the jobless,

(3) launch a major jobs program to rebuild the nation's crumbling infrastructure,

(4) expand Medicaid to the near-poor,

(5) enable low-wage workers to unionize,

(6) rehire all the teachers, social workers, police, and other public service employees who were laid off in the recession,

(7) exempt the first $20,000 of income from Social Security payroll taxes and make up the difference by removing the cap on income subject to the tax.

And because the rich spend a far smaller proportion of their earnings than the middle class and poor, pay for much of this by

(8) closing tax loopholes that benefit the rich such as the "carried interest" tax benefit for hedge-fund and private-equity managers,

(9) raise the highest marginal tax rate, and

(10) impose a small tax on all financial transactions.

One of the major political parties adamantly refuses to do any of this, and the other doesn't have the strength or backbone to make them.

Make a ruckus.

If a war on inequality is indeed the Democrats' best strategy for 2014-16, then Reich's agenda makes good sense.

DECLARATION of PRINCIPLES: Socialist International

Socialist International

 

DECLARATION of PRINCIPLES

Adopted by the XVIII Congress, Stockholm, June 1989

I. Global Change and Future Prospects

1. The idea of Socialism has caught the imagination of people across the world, promoted successful political movements, decisively improved the lives of working men and women, and contributed to shaping the 20th century.

However, justified satisfaction about the realisation of many of our goals should not prevent us from clearly recognising present dangers and problems. We are aware that essential tasks still lie ahead which we can master only through common action, since human survival increasingly depends upon the joint efforts of people around the world.

2. Current economic, technological, political and social changes reflect a profound transformation of our world. The fundamental issue we now face is not whether there will be change in future years, but rather who is going to control it and how. The socialist answer is unequivocal. It is the people of the world who should exercise control by means of a more advanced democracy in all aspects of life: political, social, and economic. Political democracy, for socialists, is the necessary framework and precondition for other rights and liberties.

3. All the peoples of the world should be involved in the process of transforming our societies and promoting new hope for humankind. The Socialist International calls on all men and women committed to peace and progress to work together in order to translate this hope into reality.

4. The challenge of global change opens up enormous possibilities:

- The internationalisation of the economy and wide-spread access to information and new technologies can, if brought under democratic control, provide a basis for a world society better suited to cooperation. It is obvious that a world family is no longer a utopian dream, but, increasingly, a practical necessity.

- The technological revolution can and should be used to preserve the environment, create new employment and provide the means to liberate people from routine work rather than ruthlessly impose unwanted idleness.
- On the basis of suitable and humane democratic structures, freedom, equality, security and prosperity can be achieved within the framework of a democratic world society.

5. However, many current trends also give rise to unprecedented threats:
- Proliferation of the technologies of destruction promote a precarious balance of terror where there are inadequate guarantees for the security of humankind.

- The physical conditions for life on the planet are threatened by an uncontrolled urban and industrial expansion, the degradation of the biosphere, and the irrational exploitation of vital resources.

- Hunger, famine and death threaten whole regions and communities in the South, even though the world has enough natural and technical resources to feed itself.

6. This transformation of social and economic structures is at least as dramatic and far-reaching as the transition from laissez-faire to the corporate capitalism and colonialism of pre-World War I days. The social cost of these transformations - unemployment, regional decline, destruction of communities - has affected not only the very poor but also working people in general.

7. The rapid process of internationalisation and interdependence in the world economy has given rise to contradictions within existing political, social and national institutions. This growing gap between an international economy and inadequate international political structures has been a contributory factor to the poverty and underdevelopment of the South, as well as to mass unemployment and new forms of poverty in many areas of the North.

8. Real progress has been made since World War II in vital areas such as decolonisation, the growth of the Welfare State and, more recently, disarmament, where the first hopeful steps have been taken. However, age-old injustices remain. Human rights are still violated, racial and sex discrimination are rife, and individual opportunities in life are still determined by the region and class in which people are born.

9. Faced with such crucial issues, the Socialist International reaffirms its fundamental beliefs. It is committed, as ever, to the democratisation on a global scale of economic, social and political power structures. The same principles and political commitments which socialism has always held have to be attained in a world that has changed radically since the Frankfurt Declaration of 1951.

10. The Socialist International was founded a hundred years ago in order to coordinate the worldwide struggle of democratic socialist movements for social justice, human dignity and democracy. It brought together parties and organisations from different traditions which shared a common goal: democratic socialism. Throughout their history, socialist, social democratic and labour parties have stood for the same values and principles.

11. Today the Socialist International combines its traditional struggle for freedom, justice and solidarity with a deep commitment to peace, the protection of the environment, and the development of the South. All these issues require common answers. To this end, the Socialist International seeks the support of all those who share its values and commitment.  

II. Principles

Freedom, Justice and Solidarity

 
12. Democratic socialism is an international movement for freedom, social justice and solidarity. Its goal is to achieve a peaceful world where these basic values can be enhanced and where each individual can live a meaningful life with the full development of his or her personality and talents and with the guarantee of human and civil rights in a democratic framework of society.

13. Freedom is the product of both individual and cooperative efforts - the two aspects are parts of a single process. Each person has the right to be free of political coercion and also to the greatest chance to act in pursuit of individual goals and to fulfil personal potential. But that is only possible if humanity as a whole succeeds in its long-standing struggle to master its history and to ensure that no person, class, sex, religion or race becomes the servant of another.

14. Justice and Equality. Justice means the end of all discrimination against individuals, and the equality of rights and opportunities. It demands compensation for physical, mental and social inequalities, and freedom from dependence on either the owners of the means of production or the holders of political power.

Equality is the expression of the equal value of all human beings and the precondition for the free development of the human personality. Basic economic, social and cultural equality is essential for individual diversity and social progress.

Freedom and equality are not contradictory. Equality is the condition for the development of individual personality. Equality and personal freedom are indivisible.

15. Solidarity is all-encompassing and global. It is the practical expression of common humanity and of the sense of compassion with the victims of injustice. Solidarity is rightly stressed and celebrated by all major humanist traditions. In the present era of unprecedented interdependence between individuals and nations, solidarity gains an enhanced significance since it is imperative for human survival.

16. Democratic socialists attach equal importance to these fundamental principles. They are interdependent. Each is a prerequisite of the other. As opposed to this position, Liberals and Conservatives have placed the main emphasis on individual liberty at the expense of justice and solidarity while Communists have claimed to achieve equality and solidarity, but at the expense of freedom.

Democracy and Human Rights

 

17. The idea of democracy is based on the principles of freedom and equality. Therefore, equal rights for men and women - not only in theory, but also in practice, at work, in the family and in all areas of social life - are part of the socialist concept of society.

18. Democratic socialists strive to achieve equal rights for all races, ethnic groups, nations and denominations. These rights are seriously in question in many regions of the world today.

19. Forms of democracy of course may vary. However, it is only possible to speak of democracy if people have a free choice between various political alternatives in the framework of free elections; if there is a possibility for a change of government by peaceful means based on the free will of the people; if individual and minority rights are guaranteed; and, if there is an independent judicial system based on the rule of law impartially applied to all citizens. Political democracy is an indispensable element of a socialist society. Democratic socialism is a continuing process of social and economic democratisation and of increasing social justice.

20. Individual rights are fundamental to the values of socialism. Democracy and human rights are also the substance of popular power, and the indispensable mechanism whereby people can control the economic structures which have so long dominated them. Without democracy, social policies cannot disguise the dictatorial character of a government.

21. There can be no doubt that different cultures will develop their own institutional forms of democracy. But whatever form democracy assumes - nationally or internationally - it must provide full rights for individuals and for organised minority opinions. For socialists, democracy is of its very nature pluralist, and this pluralism provides the best guarantee of its vitality and creativity.

22. Freedom from arbitrary and dictatorial government is essential. It constitutes the precondition whereby peoples and societies can create a new and better world of peace and international cooperation - a world in which political, economic and social destinies will be democratically determined.

 

The Nature of Socialism

23. Democratic socialists have arrived at the definition of these values in many different ways. They originate in the labour movement, popular liberation movements, cultural traditions of mutual assistance, and communal solidarity in many parts of the world. They have also gained from the various humanist traditions of the world.

But although there are differences in their cultures and ideologies, all socialists are united in their vision of a peaceful and democratic world society combining freedom, justice and solidarity.

24. The national struggles for democratic socialism in the years to come will show differences in policy and divergences on legislative provisions. These will reflect different histories and the pluralism of varied societies. Socialists do not claim to possess the blueprint for some final and fixed society which cannot be changed, reformed or further developed. In a movement committed to democratic self-determination there will always be room for creativity since each people and every generation must set its own goals.

25. In addition to the principles which guide all democratic socialists, there is a clear consensus among socialists on fundamental values. Despite all diversity, it is common ground that democracy and human rights are not simply political means to socialist ends but the very substance of those ends - a democratic economy and society.

26. Individual freedom and basic rights in society are the preconditions of human dignity for all. These rights cannot replace one another, nor can they be played off against each other. Socialists protect the inalienable right to life and to physical safety, to freedom of belief and free expression of opinion, to freedom of association and to protection from torture and degradation. Socialists are committed to achieve freedom from hunger and want, genuine social security, and the right to work.

27. Democratic socialism also means cultural democracy. There must be equal rights and opportunities for the different cultures within each society as well as equal access for everyone to the national and global cultural heritage.

III. Peace

Peace - A Basic Value

28. Peace is the precondition of all our hopes. It is a basic value of common interest to all political systems and necessary for human society. War destroys human life and the basis for social development. A nuclear holocaust could spell the end of human life as we know it.

29. A lasting peace cannot be guaranteed through nuclear deterrence nor through an arms race with conventional forces. Therefore disarmament and new models of common security are imperative.

30. What is now essential is the achievement, not merely of military stability at the lowest possible level of defensive weapon systems, but also a climate of mutual political confidence. This can be developed through cooperation on projects for our common future and a new emphasis on peaceful competition between societies with different political, economic and social structures.

31. Peace is more than the absence of war. It cannot be based on fear or on ephemeral goodwill between the Superpowers. The fundamental economic and social causes of international conflict must be abolished by the achievement of global justice and by the creation of new institutions for the peaceful resolution of conflicts around the world.

32. The establishment of a New International Economic and Political Order is an essential contribution to peace. This should involve respect for national sovereignty and the right to national self-government, negotiated settlement of conflict, and suspension of arms supplies to the parties in conflict. There must be both global and regional systems for cooperation and peaceful conflict resolution in all parts of the world. These could be brought about through the action of the UN, complementing agreements between the Superpowers.

33. Peace is equally a necessity within nations. Violent ways of handling conflicts destroy opportunities for development and human rights. Education for peace and disarmament must be intensified.

34. The militarisation of relations between nations of the South has become a serious threat to the future of humanity, as are the tensions between East and West. In some cases the major powers, with their tendency to globalise conflict, have engaged in proxy struggles in countries of the South. In others, the arms merchants of both East and West have contributed to raising the level of violence in the South as they sought political advantage or profit. It is undeniable that every war in the past four decades has been fought in those regions of the world. Social, economic and other causes of conflict in the South must be eliminated.

Initiatives for Peace

35. Democratic socialists reject a world order in which there is an armed peace between East and West but constant bloodshed in developing countries. Peacekeeping efforts must focus upon putting an end to these confrontations. Europe has a unique role in this process. For decades it has been the most likely battlefield for armed conflict between East and West. Europe can now become the area in which a new climate of mutual trust and restraint can develop and grow.

36. Initiatives for peace require that different socio-economic systems and nations cooperate with one another on projects for confidence building and disarmament, justice in the South and protection of the planet's biosphere. At the same time, they should engage in peaceful competition in the fields of wealth creation, welfare and solidarity. Societies should be prepared to learn from one another. It must become the norm for the different systems to trade, negotiate and work together. There should also be a place for frank and open exchange of views, in particular where issues of human rights and peace are at stake.

37. East-West cooperation in the common struggle to close the gap between North and South and for the protection of the environment are perhaps the areas of greatest potential for fruitful action to build human solidarity regardless of frontiers and blocs.

IV. North and South

Globalisation

38. Recent decades have been characterised by an accelerating internationalisation of world affairs, or globalisation. Oil shocks, exchange rate fluctuations and stock market crashes are directly transmitted between the world's economies, North and South. New information technologies disseminate a mass culture to every corner of the world. Financial decisions by multinational corporations can have far-reaching effects overnight. National and international conflicts are generating huge and growing refugee movements of continental and intercontinental dimensions.

39. Further, globalisation of the international economy has shattered the bipolar division of the world which dominated the era of the Cold War. New industrial powers have emerged in the Pacific rim and, until recent setbacks, the rapidly developing Latin American nations. There are also new international forces such as China and the Non-Aligned Movement. Interdependence is a reality. It is more important than ever to establish multilateral institutions with a more equal role for the South under the aegis of the UN.

40. At a global level, economic crisis and conservative deflationary policies have brought the return of mass unemployment to many of the advanced economies. They have also had a destructive effect on poor countries. They have wiped out export markets, sharpened the debt crisis and undone progress already made. At the same time, such regress in the South, combined with the necessity to service enormous debts, closed huge potential markets to the North. Thus the declining living standards of the debtor nations became a factor promoting unemployment in the creditor nations.

41. A transformed global economy must involve the growth centres of the South in a radically new way if it is to advance the development of either South or North. Programmes to stimulate economic and social development in the South can and must become a vehicle for stimulating the world economy as a whole. Such issues must feature as integral parts of global macro-economic strategies.

42. In Africa, the continuation of the apartheid regime in South Africa is not only a crime against the majority of the people of that nation but has subverted the economic efforts of the Front Line States and had a negative impact throughout the entire continent. There, as elsewhere, the fight for human rights and democracy goes hand in hand with the battle for economic and social justice.

43. Africa and Latin America are in particular faced with an intolerable debt problem which precludes the investments and imports which are needed to ensure development and provide jobs for rapidly growing populations. Global action to alleviate the debt burden is a precondition for progress. It must be a central goal of East-West cooperation in the common search for North-South justice.

The Environmental Challenge

44. A critical and fundamental challenge of worldwide dimensions is the crisis of the environment. ln both the North and the South, the ecological balance is jeopardised. Every year, animal and plant species are being exterminated while there is increasing evidence of a depletion of the ozone layer. In the North, irresponsible industrialism destroys forest areas; in the South, the rain forests which are vital to the survival of the whole world are shrinking with alarming speed. In the rich countries, soil pollution is increasing. In the poor countries, deserts are encroaching upon civilisation. Everywhere clean water is in short supply.

45. Since environmental destruction extends across national frontiers, environmental protection must be international. It is, above all, a question of maintaining the relations between natural cycles, since ecological protection is always more economical and more responsible than environmental renovation. The best and cheapest solutions to the crisis are those that change the basic framework of production and consumption so that environmental damage does not occur in the first place.

46. We advocate joint international efforts to replace all environmentally damaging products and processes by alternatives which enhance nature. The transfer of technology from North to South must not be allowed to become a matter of exporting ecologically unacceptable systems, or the toxic wastes of rich economies. Renewable energy sources and decentralised supply structures should be encouraged in both North and South. Moreover, there must be an international early warning system to identify environmental threats and catastrophes which cross national frontiers.

47. These environmental problems affect the whole world community as well as doing harm to the developing countries. Without multilateral assistance and cooperation, poor nations cannot solve them. For these reasons it is crucial to achieve a substantial transfer of resources through development aid.

48. Such policies are compatible with qualitative economic growth, in the North and South, in order to meet the social and economic responsibilities of the future. Social investment in ecological reconstruction - which many experts count as an expenditure without benefits and which is not computed as part of the Gross National Product - is one of the most positive investments a society can possibly make.

Social Control of Technological Development

49. The technological revolution which has already begun in the advanced industrial economies will profoundly change the conditions of the environment and resource management within the life-time of the present generation. Moreover, the impact of this change will be experienced worldwide. Micro-electronics, robotics, weapons technology, bio-engineering - plus innovations which are not yet dreamed of - will transform the circumstances of both individuals and the structures of society in the world as a whole.

50. Technology is not simply a matter of objective science or inanimate machines. It is always guided by particular interests and designed according to human values, whether implicit or explicit. It has to be brought under social control in order to use the positive opportunities offered by new technologies for humankind, to minimise the risks and the dangers of uncontrolled developments and to prevent socially unacceptable technologies.

51. Social progress requires, and inspires, technological progress. What is needed is technology appropriate to the different conditions, experiences and levels of development prevailing in the North and in the South. There must be a substantial transfer of suitable technology - and of basic technological know-how - between North and South. The North has much to learn from the experience of the South, especially its use of low-waste technologies. There should be social dialogue, and democratic political control of the context in which new technologies are introduced. This should ensure that their availability:

- contributes to autonomous development in the countries of the South, mobilising their resources rather than wasting them, and creating new jobs rather than increasing unemployment;

- humanises labour, promotes human health, and enhances safety in the workplace;

- facilitates economic rights and increases the scope for popular decision-making in working life.

52. In order to ensure that these standards are met throughout the world there must be institutions and procedures for assessment of technology. Innovation should be introduced in accordance with social needs and priorities as expressed through democratic debate and decision-making.

53. Manipulation of human genetic material and exploitation of women through new reproductive technologies must be prevented. Likewise ways must be found to protect humanity from nuclear danger and chemical risk.

Disarmament and Development

54. Disarmament agreements between the Superpowers will do more than remove the threat of annihilation from the planet. With such agreements in place, many of the resources now wasted on thermonuclear, chemical, biological and conventional weapons could be released for investment in economic and social development programmes in the South. Disarmament between the East and West should be linked with programmes for justice between the North and South.

55. A proportion of the substantial funds which the highly industrialised countries of the West and the East would save as a result of negotiated disarmament should be utilised to create a multinational fund to promote a secure and sustainable development in the countries of the South.  

V. Shaping the Twenty- First Century

Political and Economic Democracy

56. Recent events have made the achievement of political, economic and social democracy on a world scale more feasible than ever before. Democracy represents the prime means for popular control and humanisation of the otherwise uncontrolled forces which are re-shaping our planet without regard for its survival.

57. Human rights include economic and social rights; the right to form trade unions and to strike; the right to social security and welfare for all, including the protection of mothers and children; the right to education, training and leisure; the right to decent housing in a liveable environment, and the right to economic security. Crucially, there is the right to both full and useful employment in an adequately rewarded job. Unemployment undermines human dignity, threatens social stability and wastes the world's most valuable resource.

58. Economic rights must not be considered as benefits paid to passive individuals lacking in initiative, but as a necessary base from which to secure the active participation of all citizens in a project for society. This is not a matter of subsidising those on the fringe of society, but of creating the conditions for an integrated society with social welfare for all people.

59. Democratic socialism today is based on the same values on which it was founded. But they must be formulated critically, both assimilating past experience and looking ahead to the future. For instance, experience has shown that while nationalisation in some circumstances may be necessary, it is not by itself a sovereign remedy for social ills. Likewise, economic growth can often be destructive and divisive, especially where private interests evade their social and ecological responsibility. Neither private nor State ownership by themselves guarantee either economic efficiency or social justice.

60. The democratic socialist movement continues to advocate both socialisation and public property within the framework of a mixed economy. It is clear that the internationalisation of the economy and the global technological revolution make democratic control more important than ever. But social control of the economy is a goal that can be achieved through a wide range of economic means according to time and place, including:

- democratic, participative and decentralised production policies; public supervision of investment; protection of the public and social interest; and socialisation of the costs and benefits of economic change;
- worker participation and joint decision-making at company and workplace level as well as union involvement in the determination of national economic policy;

- self-managed cooperatives of workers and farmers;
- public enterprises, with democratic forms of control and decision-making where this is necessary to enable governments to realise social and economic priorities;

- democratisation of the institutions of the world financial and economic system to allow full participation by all countries;

- international control and monitoring of the activities of transnational corporations, including cross-frontier trade union rights within such corporations.

61. There is no single or fixed model for economic democracy and there is room for bold experimentation in different countries. But the underlying principle is clear - not simply formal, legal control by the State, but substantial involvement by workers themselves and by their communities in economic decision-making. This principle must apply both nationally and internationally.

62. In societies structured in this fashion, and committed to genuine economic and social equality, markets can and must function as a dynamic way of promoting innovation and signalling the desires of consumers through the economy as a whole. Markets should not be dominated by big business power, and manipulated by misinformation.

63. The concentration of economic power in few private hands must be replaced by a different order in which each person is entitled - as citizen, consumer or wage-earner - to influence the direction and distribution of production, the shaping of the means of production, and the conditions of working life. This will come about by involvement of the citizen in economic policies, by guaranteeing wage earners an influence in their workplace, by fostering open and accountable competition both domestically and internationally and by strengthening the position of consumers relative to producers.

64. A democratic society must compensate for the defects of even the most responsible market systems. Government must not function simply as the repair shop for the damage brought about by market inadequacies or the uncontrolled application of new technologies. Rather the State must regulate the market in the interests of the people and obtain for all workers the benefits of technology, both in work experience and through the growth of leisure time and meaningful possibilities for individual development.

Culture and Society

65. Education is crucial for the development of a modern, democratic and tolerant society. The goals of education which we advocate, are:
- information, learning and knowledge;

- the passing of a spiritual and cultural heritage from generation to generation;

- the preparation of the individual for life within society on the basis of equal opportunity for all;

- helping each individual to develop his full personal potential.

66. The values of freedom, social justice, solidarity and tolerance must be central messages in the process of education.

We advocate tolerance and cooperation between different groups in multicultural societies. Cultural diversity enriches rather than endangers our societies. Cultural uniformity is a threat to freedom and democracy.

67. Special attention must be given to the relations between different generations. Elderly people in particular need the respect and support of the young. They need a guaranteed income through social security and public pension, homes and nursing in the community, room for cultural and social activities, and the right to live their old age in dignity.

The Role of Men and Women in Modern Society

68. Inequality between men and women is the most pervasive form of oppression in human history. It may be traced almost to the origin of the species itself and has persisted in almost every socio-economic order to the present time.

69. Recent years have seen a new surge of feminist consciousness, both within and outside the socialist movement, leading to the emergence of one of the most important social movements of our time. In part, the renewal of feminism occurred as the women of the most advanced welfare States came to realise that, despite the progress made in many fields, they were still often relegated to subordinate positions in occupational and political structures.

70. The social costs of economic crises, at national and international levels, have been borne to a disproportionate degree by women. Poverty, unemployment, homelessness and low-wage exploitation have all contributed to this effect. In some areas of the South, the overcoming of patriarchal attitudes is a fundamental precondition for both the vindication of the rights of women and the achievement of sustainable economic development.

71. The Socialist International supports the struggle of women for equal rights and opportunities everywhere in the world. In some countries there has been progress, while in others the struggle for equality is only beginning. Equality and justice for women is a crucial element of a just and peaceful world. The UN has played an important role in facilitating the emergence of a global feminist consciousness which links the women of the South and the North.

72. The Socialist International specifically endorses the following measures:

- legislation and positive action programmes which guarantee full equality between men and women;

- support for programmes to promote education, vocational training and professional integration for girls and women;

- legislation to ensure equal pay for work of equal value;
- dissemination of information and practical assistance for family planning;

- good facilities for child care;

- public backing for full and equal participation of women in the social and political activities of every country by positive steps which ensure women's representation at all levels of decision making.

73. Women constitute slightly more than half of the population on our planet. Justice and equality for them is a sine qua non of international justice and equality.

A New International Culture for Political Dialogue

74. The increasing interdependence of the world leaves little space for fundamentalist controversies and hostilities. Common survival and development demand both cooperation and civilised forms of dispute even between antagonistic political forces and ideas. We therefore reject and condemn any form of religious or political fundamentalism.

75. Communism has lost the appeal that it once had to parts of the labour movement or to some intellectuals after the October Revolution or during the struggle against fascism.

The crimes of stalinism, mass persecution and the violation of human rights, as well as unsolved economic problems, have undermined the idea of communism as an alternative to democratic socialism or as a model for the future.

76. The Socialist International supports all efforts aimed at the transformation of communist societies through liberalisation and democratisation. The same support must apply to the development of decentralised market mechanisms, struggles against bureaucratisation and corruption and, above all, the realisation that human rights and political openness are important elements of a dynamic and progressive society.

77. Detente, international cooperation and peaceful competition create an atmosphere in which the most promising of the present initiatives may prosper. The Socialist International wants to promote a culture of international dialogue. All sides must cooperate in mutual trust where there are basic common interests, and argue openly and frankly where the commitment to human rights, democracy and pluralism is at stake. Socialists want to play a prominent role in that dialogue.

A New Model for Growth

78. In order to generate employment and prosperity all across the world, there is a need for ecologically balanced development. Growth which is not designed to meet ecological and social imperatives runs counter to progress, since it will cause environmental damage and destroy jobs. The market system alone can never ensure the attainment of the social goals of economic growth. It is the legitimate function of democratic economic policy to promote development which opens up future opportunities while improving the quality of life.

79. To achieve these objectives on a global basis, it is imperative to establish a genuinely new international economic order. This must reconcile the interests of both industrialised and developing countries. A fundamental reform of financial relations must create the conditions for international economic cooperation. A more equitable international economic order is necessary not only for reasons of solidarity, but also in order to create a more efficient, productive and balanced world economy.

80. The priority in the case of international debt must be to write down, write off or capitalise the debts of the poorer countries. Institutional arrangements are needed to stabilise both the terms of trade and the export earnings of the countries of the South by establishing internationally supported commodity funds. The North must open its markets to the products of the South, and end its policy of subsidising exports from the North.

81. As productivity rapidly increases due to new technologies, it is also necessary to redefine working life. The aim must be to humanise working conditions by both appropriate production technologies and workers' participation. Employment should be created by investment in social services and in environmental reconstruction, as well as by public spending on the development of new technologies and on improving infrastructure. By contrast, conservative economic policies in many industrialised countries have allowed for mass unemployment, thus jeopardising social justice and security, and giving rise to new manifestations of poverty in the rich world. It is of paramount importance that governments take on in practice their overall responsibility to provide for full employment.

82. In many cases, a reduction of working hours can help achieve a fair distribution of both paid jobs and work at home between men and women. It also increases the leisure time of workers, farmers and employees, thus giving them more time for other activities.

Solidarity between North and South

83. Economic development is unquestionably a priority for the South. This is not to say that there is a simple formula for ending poverty in the developing countries, be it socialist in origin or not. Economies need a reduction in trade barriers, improved access to markets and the transfer of technology. They need the opportunity to develop their own scientific resources - for example, in the area of biotechnology - and to end dependence on second-hand technologies.

84. Where the poorer countries are concerned, traditional development assistance remains vital. Many of them, in different regions of the world, need land reforms, incentives to farmers to achieve a sustained food supply, and support for cooperative traditions within their rural cultures. But, increased food production alone will not end hunger and famine. Sadly, in some cases, an increase in export agriculture can destroy traditional patterns of food supply, at one and the same time adding to farm output and hunger. It must be the task of the political system to guarantee both the right to food and employment.

85. The debt crisis has led to a net financial flow away from developing countries to industrialised ones. The UN development target of 0.7% of GNP in official development assistance, which is twice the current rate, must be achieved without delay. Internationally coordinated efforts are urgently needed to alleviate the burden of the external debt of developing countries.

86. Programmes of cooperation with the South must support development goals which relate to economic growth as well as a fair distribution of income. Aid programmes must focus on the development of the poorest groups. They should help to transform stultifying social structures and improve the situation of women in society. Specific programmes for children are of the greatest importance. Assistance through cooperatives and popular movements serves to promote democratic development.

87. A broadly based approach to development is also an important factor in stemming the massive tide of migration to the big cities of the South, many of which are threatened by uncontrollable population growth and are becoming huge megapolitan slums.

88. Enhanced South-South relations form an important path for economic progress. A substantial growth in trade between the nations of the South will contribute to their well-being and will enhance their prospects of dealing with the crises which arise from dramatic changes in production and occupational structures. Close economic links and rapidly growing markets in the developing world are a vital prerequisite of any positive development of the world economy.

89. An open world economy can stimulate development in the South. But it can also bring vulnerability. Thus, the North should not pursue economic and trade policies which impose drastic reductions in living standards and erode the bases of stable democracy.

90. Inequality and dictatorship are the enemies not only of human rights, but also of genuine development. Social and economic democracy cannot be regarded as luxuries which only the rich countries can afford. Rather, they are necessary for any country to make progress on the road of development. That is why the strengthening of democratic socialism in the South is so crucial. In this context the recent expansion of the Socialist International in the South, especially in Latin America and the Caribbean, is a good omen for both North and South alike.

91. Ending poverty in the South is also a common project for the North. It can promote disarmament, and create both wealth and jobs in the advanced as well as the developing countries. This is central to the strategy of socialists in dealing with wide-ranging economic change during a period of crisis and transition at world level. It is also an integral part of democratic socialist proposals for new economic and social structures which can bring the world peacefully and prosperously into the 21st century.

VI. With the Socialist International Towards a Democratic World Society

The Unity of International Socialism

92. At a time of rapid internationalisation, the goals of democratic socialism cannot be attained in just a few countries. The fate of people living in many different parts of the world is more interlinked than ever before. The various socialist parties of the world must therefore work together, both in their individual national interest and in their common international interest. The Socialist International, whose history dates back to 1864, was re-established in 1951 to serve this purpose.

93. Although it unites movements with long-standing national histories, the Socialist International is not a supranational, centralised organisation. It is an association of independent parties with common principles whose representatives want to learn from one another, jointly promote socialist ideas and work towards this objective at international level.

94. The purpose of the International is to facilitate this work of solidarity and cooperation, while being aware of the fact that there are different ways of promoting the basic values of a pluralist democratic socialism in different societies. Each member party is itself responsible for the manner in which it puts the decisions of the Socialist International into effect in its own country.

95. In recent years, the membership of the Socialist International has become more genuinely international, with very marked growth in Latin America and the Caribbean, and new members in other continents. It is the goal of the Socialist International to cooperate with all democratic socialist movements throughout the world.

96. Since the Frankfurt Declaration of the Socialist International in 1951, the world has become closer in economic and social terms, but not in terms of democratic community and solidarity. It is now clear that the socialist movement - as it looks towards the 21st century - is becoming more truly internationalist in outlook and in practice.

A New Democratic Order

97. The international challenge is nothing less than the beginning of a new, democratic world society. We cannot allow blocs, nations and private corporations to shape the political structure of the planet as a mere by-product of their own self-interest.

98. Strengthening the United Nations is an important step in the creation of this new, democratic world society. Where there is a consensus among the major nations, significant peace-making and peace-keeping initiatives are possible. The UN specialised agencies, like the WHO, and UN organs like UNDP and UNICEF, have demonstrated that the governments and citizens of various nations can work effectively together in pursuit of common international goals.

99. It is unrealistic to assume that justice and peace can be legislated in a world of fundamental inequality where many millions barely cling to life while a favoured few enjoy a standard beyond the dreams of most of their fellow human beings. Socialist struggles in the original capitalist nations made gains in welfare and solidarity, which in turn made the extension of democracy possible in individual countries. Likewise the work of abolishing international inequality will be a crucial step forward on the road to a democratic world society.

100. There is no illusion that this ideal can be quickly accomplished. However, the creation of a pluralist and democratic world, based on consensus and cooperation, is a necessary condition for the advance of humankind. This is both a challenge and an enormous opportunity. The Socialist International is ready to meet the challenge and to strive for a world in which our children can live and work in peace, in freedom, in solidarity and humanity.

We are confident that the strength of our principles, the force of our arguments and the idealism of our supporters will contribute to shaping a democratic socialist future into the 21st century. We invite all men and women to join us in this endeavour.