Meet Occupy Wall Street's Favorite Banker

By Ryan Holeywell
SolidarityEconomy.net via Governing Magazine

Jan 4, 2012 - Try to find a bank president that’s beloved by supporters of the Occupy Wall Street movement. It’s not impossible. You’ll just have to travel to North Dakota.

Meet Eric Hardmeyer, who bears the unlikely distinction of being perhaps the only banker in America who, in addition to being embraced by Wall Street protesters, has been exalted by the likes of Michael Moore, Mother Jones magazine, and the Progressive States Network, among other progressive stalwarts.

That’s because Hardmeyer heads the Bank of North Dakota (BND), the country’s only publicly-owned state bank. The institution, located ironically enough in a solidly red state, has become the darling of progressives who have become frustrated with corporate banks they say helped cause the financial crisis and resulting credit crunch.

Now, state lawmakers nationwide are pushing for the North Dakota model to be replicated in their home states. Since 2010, state lawmakers in at least 16 states have introduced bills to create a state bank, something similar, or study the issue, according to a study by the National Conference of State Legislatures. So far, momentum is slow. The movement has yet to produce another Bank of North Dakota, but advocates are hoping to raise the issue again in 2012 legislative sessions. Their pitch: publicly-owned banks can help create jobs, generate revenue for the state, strengthen small banks, and lower the cost of borrowing for local governments by offering loans below market rate.

Hardmeyer, who was named bank president in 2001, hasn’t always been such a well-known figure. But his profile has been raised over the last year – including in Bloomberg BusinessWeek -- and now he regularly fields calls from state lawmakers and other officials inquiring about his institution. “There hasn’t been a big push anywhere that I’m aware of until recently,” said Hardmeyer in a late December interview with Governing.  “They’re interested in how it works, why it works, [and] what the roadblocks are.”

The bank was formed in 1919 with $2 million in bonds as a response to farmers who found they couldn’t get credit from out-of-state banks in Chicago, Minneapolis and New York. Today, the bank helps implement state economic development programs, lends money to businesses, serves as the depository of state funds and also functions as a "banker's bank" that performs tasks like check clearing for smaller institutions.

Much of the renewed interest in the bank stems from the same frustration driving the Occupy Wall Street movement, and Hardmeyer’s institution has come to represent something of an anti-bank. After all, advocates argue, the best way for taxpayers to occupy a bank is to own it. Instead of being bailed out by the government, Bank of North Dakota actually pays dividends to the state that shore up its coffers. Bloomberg Businessweek reported that since 1945, it has sent $555 million to the state general fund.

Instead of tightening up lending in response to the recession, BND actively tries to facilitate loans that traditional banks shy away from. “With this institution [and] its mission, it comes with a higher degree risk than what a traditional bank might be willing to tolerate,” Hardmeyer said.

When floods destroyed affordable housing in Minot, N.D. last year, the bank developed programs to help finance rebuilding. And as the western half of the state struggles with strained infrastructure in the wake of an oil boom, BND programs are helping to ensure capital is flowing to fund much-needed projects.

Yet BND doesn’t operate as a charity, and its finances are remarkably strong. Bloomberg Businessweek reported that it earned a profit of $62 million in 2010 – the seventh consecutive year it turned a record profit – and it has profited every year since at least 1971. Standard & Poor’s just increased BND's credit rating. The returns on its assets have consistently been larger than those of similarly-sized private banks, and a smaller portion of its loans have gone delinquent, according to a report by the Federal Reserve Bank of Boston. The bank has likely benefited more successful lending, lower costs and its tax-exempt status.

Yet most North Dakotans interaction with the bank is minimal. The institution operates from a single location in Bismarck, doesn't have ATMs, and doesn’t generally serve as a consumer bank. It lacks federal oversight, its loans aren’t insured by the FDIC, and its staff members are considered state government employees.

What it does do is partner with smaller, local banks throughout the state on various loan programs. In a typical transaction, a smaller bank would originate a loan, and BND could guarantee part of it or buy down the interest rate. The effect is that a business loan that might otherwise not have been made – or that might have only happened at a high interest rate -- can suddenly be offered at a reasonable price, prompting business growth and job creation.

The main intent is for the bank to serve as an economic development tool, said Hardmeyer. It works closely with the state’s commerce department, economic development corporations, and the legislature to develop programs that serve the mission. It’s overseen by a triumvirate of state officials that include the governor, the attorney general, and the agriculture commissioner, while the legislature sets its budget.

Many BND fans see North Dakota’s economy, currently enjoying a best-in-the-country jobless rate of just 3.4 percent and believe a similar publicly-owned bank could help fix financial problems elsewhere. But Hardmeyer himself downplays that optimism, pointing out that although his bank plays an important role in the state economy, North Dakota's boom likely has more to do with the energy sector. The Fed concurs: “With the possible exception of the Great Depression, BND’s contributions to stabilizing the state economy and finances appear to have been relatively minor.”

Still, advocates remain undeterred in their desire for public banks. “I’d much rather have my risk be put in a public institution than trust these bankers in Wall Street, who have proven themselves untrustworthy,” said Marc Armstrong, executive director of the Public Banking Institute, one of the issue's leading champions.

But there are serious challenges to the creation of a new state bank. One is the initial cost of capitalizing one. Another is the opposition from existing banks. The president of the community banks' trade association calls the model “socialistic.”

“Why don’t we just relabel the state capitols the Kremlin?” Camden Fine, president of the Independent Community Bankers of America, told Bloomberg BusinessWeek. (Ironically, the Fed wrote that BND may actually be strengthening the role of community banks in North Dakota and limiting the presence of the big banks that they often struggle to compete with).

Meanwhile, the big banks would inevitably fight the measure, since they don't want to lose out on the opportunity to serve as the depository for state funds. “They’re the biggest lobby every in the history of mankind,” Armstrong said. In a conference call with activists last year, North Dakota State Sen. Tim Mathern said that if the bank didn’t exist, the state likely wouldn’t be able to create one in today’s political climate.

And there are some potential downsides to a state-owned bank. One of the greatest concerns is that a state official could somehow become involved in making lending decisions. That doesn’t happen in North Dakota, Hardmeyer insists, stressing the bank’s independence and the business-first mentality of its bankers.

Critics also say that public banks created today could disrupt the economy, since public funds would likely be withdrawn from existing commercial banks. And they cite the ever-present risk to state taxpayers of guaranteeing the deposits.

It's no surprise that several public banking efforts have stalled relatively quickly.

A Massachusetts commission that generated significant attention recommended against a state bank in August, citing the start-up costs, risks, and existing network of quasi-public lenders. And last year, California Gov. Jerry Brown vetoed legislation calling for a study to consider the viability of a state bank.

Yet backers of public banks remain optimistic. They argue that the concept is so different from the existing idea of banking that they it will likely take several legislative sessions for the movement to gain steam.

The DVD of Michael Moore's Capitalism: A Love Story featured the Bank of North Dakota. A short introduction on BND's creation is provided in this clip below.

This article was printed from:

By Naomi Klein
SolidarityEconomy.net via The Nation, Nov 9, 2011

There is a question from a gentleman in the fourth row.

He introduces himself as Richard Rothschild. He tells the crowd that he ran for county commissioner in Maryland’s Carroll County because he had come to the conclusion that policies to combat global warming were actually “an attack on middle-class American capitalism.” His question for the panelists, gathered in a Washington, DC, Marriott Hotel in late June, is this: “To what extent is this entire movement simply a green Trojan horse, whose belly is full with red Marxist socioeconomic doctrine?”

Here at the Heartland Institute’s Sixth International Conference on Climate Change, the premier gathering for those dedicated to denying the overwhelming scientific consensus that human activity is warming the planet, this qualifies as a rhetorical question. Like asking a meeting of German central bankers if Greeks are untrustworthy. Still, the panelists aren’t going to pass up an opportunity to tell the questioner just how right he is.

Chris Horner, a senior fellow at the Competitive Enterprise Institute who specializes in harassing climate scientists with nuisance lawsuits and Freedom of Information fishing expeditions, angles the table mic over to his mouth. “You can believe this is about the climate,” he says darkly, “and many people do, but it’s not a reasonable belief.” Horner, whose prematurely silver hair makes him look like a right-wing Anderson Cooper, likes to invoke Saul Alinsky: “The issue isn’t the issue.” The issue, apparently, is that “no free society would do to itself what this agenda requires…. The first step to that is to remove these nagging freedoms that keep getting in the way.”

Claiming that climate change is a plot to steal American freedom is rather tame by Heartland standards. Over the course of this two-day conference, I will learn that Obama’s campaign promise to support locally owned biofuels refineries was really about “green communitarianism,” akin to the “Maoist” scheme to put “a pig iron furnace in everybody’s backyard” (the Cato Institute’s Patrick Michaels). That climate change is “a stalking horse for National Socialism” (former Republican senator and retired astronaut Harrison Schmitt). And that environmentalists are like Aztec priests, sacrificing countless people to appease the gods and change the weather (Marc Morano, editor of the denialists’ go-to website, ClimateDepot.com).

Most of all, however, I will hear versions of the opinion expressed by the county commissioner in the fourth row: that climate change is a Trojan horse designed to abolish capitalism and replace it with some kind of eco-socialism. As conference speaker Larry Bell succinctly puts it in his new book Climate of Corruption, climate change “has little to do with the state of the environment and much to do with shackling capitalism and transforming the American way of life in the interests of global wealth redistribution.”

Yes, sure, there is a pretense that the delegates’ rejection of climate science is rooted in serious disagreement about the data. And the organizers go to some lengths to mimic credible scientific conferences, calling the gathering “Restoring the Scientific Method” and even adopting the organizational acronym ICCC, a mere one letter off from the world’s leading authority on climate change, the Intergovernmental Panel on Climate Change (IPCC). But the scientific theories presented here are old and long discredited. And no attempt is made to explain why each speaker seems to contradict the next. (Is there no warming, or is there warming but it’s not a problem? And if there is no warming, then what’s all this talk about sunspots causing temperatures to rise?)

In truth, several members of the mostly elderly audience seem to doze off while the temperature graphs are projected. They come to life only when the rock stars of the movement take the stage—not the C-team scientists but the A-team ideological warriors like Morano and Horner. This is the true purpose of the gathering: providing a forum for die-hard denialists to collect the rhetorical baseball bats with which they will club environmentalists and climate scientists in the weeks and months to come. The talking points first tested here will jam the comment sections beneath every article and YouTube video that contains the phrase “climate change” or “global warming.” They will also exit the mouths of hundreds of right-wing commentators and politicians—from Republican presidential candidates like Rick Perry and Michele Bachmann all the way down to county commissioners like Richard Rothschild. In an interview outside the sessions, Joseph Bast, president of the Heartland Institute, proudly takes credit for “thousands of articles and op-eds and speeches…that were informed by or motivated by somebody attending one of these conferences.”

The Heartland Institute, a Chicago-based think tank devoted to “promoting free-market solutions,” has been holding these confabs since 2008, sometimes twice a year. And the strategy appears to be working. At the end of day one, Morano—whose claim to fame is having broken the Swift Boat Veterans for Truth story that sank John Kerry’s 2004 presidential campaign—leads the gathering through a series of victory laps. Cap and trade: dead! Obama at the Copenhagen summit: failure! The climate movement: suicidal! He even projects a couple of quotes from climate activists beating up on themselves (as progressives do so well) and exhorts the audience to “celebrate!”

There were no balloons or confetti descending from the rafters, but there may as well have been.

* * *

When public opinion on the big social and political issues changes, the trends tend to be relatively gradual. Abrupt shifts, when they come, are usually precipitated by dramatic events. Which is why pollsters are so surprised by what has happened to perceptions about climate change over a span of just four years. A 2007 Harris poll found that 71 percent of Americans believed that the continued burning of fossil fuels would cause the climate to change. By 2009 the figure had dropped to 51 percent. In June 2011 the number of Americans who agreed was down to 44 percent—well under half the population. According to Scott Keeter, director of survey research at the Pew Research Center for People and the Press, this is “among the largest shifts over a short period of time seen in recent public opinion history.”

Even more striking, this shift has occurred almost entirely at one end of the political spectrum. As recently as 2008 (the year Newt Gingrich did a climate change TV spot with Nancy Pelosi) the issue still had a veneer of bipartisan support in the United States. Those days are decidedly over. Today, 70–75 percent of self-identified Democrats and liberals believe humans are changing the climate—a level that has remained stable or risen slightly over the past decade. In sharp contrast, Republicans, particularly Tea Party members, have overwhelmingly chosen to reject the scientific consensus. In some regions, only about 20 percent of self-identified Republicans accept the science.

Equally significant has been a shift in emotional intensity. Climate change used to be something most everyone said they cared about—just not all that much. When Americans were asked to rank their political concerns in order of priority, climate change would reliably come in last.

But now there is a significant cohort of Republicans who care passionately, even obsessively, about climate change—though what they care about is exposing it as a “hoax” being perpetrated by liberals to force them to change their light bulbs, live in Soviet-style tenements and surrender their SUVs. For these right-wingers, opposition to climate change has become as central to their worldview as low taxes, gun ownership and opposition to abortion. Many climate scientists report receiving death threats, as do authors of articles on subjects as seemingly innocuous as energy conservation. (As one letter writer put it to Stan Cox, author of a book critical of air-conditioning, “You can pry my thermostat out of my cold dead hands.”)

This culture-war intensity is the worst news of all, because when you challenge a person’s position on an issue core to his or her identity, facts and arguments are seen as little more than further attacks, easily deflected. (The deniers have even found a way to dismiss a new study confirming the reality of global warming that was partially funded by the Koch brothers, and led by a scientist sympathetic to the “skeptic” position.)

The effects of this emotional intensity have been on full display in the race to lead the Republican Party. Days into his presidential campaign, with his home state literally burning up with wildfires, Texas Governor Rick Perry delighted the base by declaring that climate scientists were manipulating data “so that they will have dollars rolling into their projects.” Meanwhile, the only candidate to consistently defend climate science, Jon Huntsman, was dead on arrival. And part of what has rescued Mitt Romney’s campaign has been his flight from earlier statements supporting the scientific consensus on climate change.

But the effects of the right-wing climate conspiracies reach far beyond the Republican Party. The Democrats have mostly gone mute on the subject, not wanting to alienate independents. And the media and culture industries have followed suit. Five years ago, celebrities were showing up at the Academy Awards in hybrids, Vanity Fair launched an annual green issue and, in 2007, the three major US networks ran 147 stories on climate change. No longer. In 2010 the networks ran just thirty-two climate change stories; limos are back in style at the Academy Awards; and the “annual” Vanity Fair green issue hasn’t been seen since 2008.

This uneasy silence has persisted through the end of the hottest decade in recorded history and yet another summer of freak natural disasters and record-breaking heat worldwide. Meanwhile, the fossil fuel industry is rushing to make multibillion-dollar investments in new infrastructure to extract oil, natural gas and coal from some of the dirtiest and highest-risk sources on the continent (the $7 billion Keystone XL pipeline being only the highest-profile example). In the Alberta tar sands, in the Beaufort Sea, in the gas fields of Pennsylvania and the coalfields of Wyoming and Montana, the industry is betting big that the climate movement is as good as dead.

If the carbon these projects are poised to suck out is released into the atmosphere, the chance of triggering catastrophic climate change will increase dramatically (mining the oil in the Alberta tar sands alone, says NASA’s James Hansen, would be “essentially game over” for the climate).

All of this means that the climate movement needs to have one hell of a comeback. For this to happen, the left is going to have to learn from the right. Denialists gained traction by making climate about economics: action will destroy capitalism, they have claimed, killing jobs and sending prices soaring. But at a time when a growing number of people agree with the protesters at Occupy Wall Street, many of whom argue that capitalism-as-usual is itself the cause of lost jobs and debt slavery, there is a unique opportunity to seize the economic terrain from the right. This would require making a persuasive case that the real solutions to the climate crisis are also our best hope of building a much more enlightened economic system—one that closes deep inequalities, strengthens and transforms the public sphere, generates plentiful, dignified work and radically reins in corporate power. It would also require a shift away from the notion that climate action is just one issue on a laundry list of worthy causes vying for progressive attention. Just as climate denialism has become a core identity issue on the right, utterly entwined with defending current systems of power and wealth, the scientific reality of climate change must, for progressives, occupy a central place in a coherent narrative about the perils of unrestrained greed and the need for real alternatives.

Building such a transformative movement may not be as hard as it first appears. Indeed, if you ask the Heartlanders, climate change makes some kind of left-wing revolution virtually inevitable, which is precisely why they are so determined to deny its reality. Perhaps we should listen to their theories more closely—they might just understand something the left still doesn’t get.

* * *

The deniers did not decide that climate change is a left-wing conspiracy by uncovering some covert socialist plot. They arrived at this analysis by taking a hard look at what it would take to lower global emissions as drastically and as rapidly as climate science demands. They have concluded that this can be done only by radically reordering our economic and political systems in ways antithetical to their “free market” belief system. As British blogger and Heartland regular James Delingpole has pointed out, “Modern environmentalism successfully advances many of the causes dear to the left: redistribution of wealth, higher taxes, greater government intervention, regulation.” Heartland’s Bast puts it even more bluntly: For the left, “Climate change is the perfect thing…. It’s the reason why we should do everything [the left] wanted to do anyway.”

Here’s my inconvenient truth: they aren’t wrong. Before I go any further, let me be absolutely clear: as 97 percent of the world’s climate scientists attest, the Heartlanders are completely wrong about the science. The heat-trapping gases released into the atmosphere through the burning of fossil fuels are already causing temperatures to increase. If we are not on a radically different energy path by the end of this decade, we are in for a world of pain.

But when it comes to the real-world consequences of those scientific findings, specifically the kind of deep changes required not just to our energy consumption but to the underlying logic of our economic system, the crowd gathered at the Marriott Hotel may be in considerably less denial than a lot of professional environmentalists, the ones who paint a picture of global warming Armageddon, then assure us that we can avert catastrophe by buying “green” products and creating clever markets in pollution.

The fact that the earth’s atmosphere cannot safely absorb the amount of carbon we are pumping into it is a symptom of a much larger crisis, one born of the central fiction on which our economic model is based: that nature is limitless, that we will always be able to find more of what we need, and that if something runs out it can be seamlessly replaced by another resource that we can endlessly extract. But it is not just the atmosphere that we have exploited beyond its capacity to recover—we are doing the same to the oceans, to freshwater, to topsoil and to biodiversity. The expansionist, extractive mindset, which has so long governed our relationship to nature, is what the climate crisis calls into question so fundamentally. The abundance of scientific research showing we have pushed nature beyond its limits does not just demand green products and market-based solutions; it demands a new civilizational paradigm, one grounded not in dominance over nature but in respect for natural cycles of renewal—and acutely sensitive to natural limits, including the limits of human intelligence.

So in a way, Chris Horner was right when he told his fellow Heartlanders that climate change isn’t “the issue.” In fact, it isn’t an issue at all. Climate change is a message, one that is telling us that many of our culture’s most cherished ideas are no longer viable. These are profoundly challenging revelations for all of us raised on Enlightenment ideals of progress, unaccustomed to having our ambitions confined by natural boundaries. And this is true for the statist left as well as the neoliberal right.

While Heartlanders like to invoke the specter of communism to terrify Americans about climate action (Czech President Vaclav Klaus, a Heartland conference favorite, says that attempts to prevent global warming are akin to “the ambitions of communist central planners to control the entire society”), the reality is that Soviet-era state socialism was a disaster for the climate. It devoured resources with as much enthusiasm as capitalism, and spewed waste just as recklessly: before the fall of the Berlin Wall, Czechs and Russians had even higher carbon footprints per capita than their counterparts in Britain, Canada and Australia. And while some point to the dizzying expansion of China’s renewable energy programs to argue that only centrally controlled regimes can get the green job done, China’s command-and-control economy continues to be harnessed to wage an all-out war with nature, through massively disruptive mega-dams, superhighways and extraction-based energy projects, particularly coal.

It is true that responding to the climate threat requires strong government action at all levels. But real climate solutions are ones that steer these interventions to systematically disperse and devolve power and control to the community level, whether through community-controlled renewable energy, local organic agriculture or transit systems genuinely accountable to their users.

Here is where the Heartlanders have good reason to be afraid: arriving at these new systems is going to require shredding the free-market ideology that has dominated the global economy for more than three decades. What follows is a quick-and-dirty look at what a serious climate agenda would mean in the following six arenas: public infrastructure, economic planning, corporate regulation, international trade, consumption and taxation. For hard-right ideologues like those gathered at the Heartland conference, the results are nothing short of intellectually cataclysmic.

1. Reviving and Reinventing the Public Sphere

After years of recycling, carbon offsetting and light bulb changing, it is obvious that individual action will never be an adequate response to the climate crisis. Climate change is a collective problem, and it demands collective action. One of the key areas in which this collective action must take place is big-ticket investments designed to reduce our emissions on a mass scale. That means subways, streetcars and light-rail systems that are not only everywhere but affordable to everyone; energy-efficient affordable housing along those transit lines; smart electrical grids carrying renewable energy; and a massive research effort to ensure that we are using the best methods possible.

The private sector is ill suited to providing most of these services because they require large up-front investments and, if they are to be genuinely accessible to all, some very well may not be profitable. They are, however, decidedly in the public interest, which is why they should come from the public sector.

Traditionally, battles to protect the public sphere are cast as conflicts between irresponsible leftists who want to spend without limit and practical realists who understand that we are living beyond our economic means. But the gravity of the climate crisis cries out for a radically new conception of realism, as well as a very different understanding of limits. Government budget deficits are not nearly as dangerous as the deficits we have created in vital and complex natural systems. Changing our culture to respect those limits will require all of our collective muscle—to get ourselves off fossil fuels and to shore up communal infrastructure for the coming storms.

2. Remembering How to Plan

In addition to reversing the thirty-year privatization trend, a serious response to the climate threat involves recovering an art that has been relentlessly vilified during these decades of market fundamentalism: planning. Lots and lots of planning. And not just at the national and international levels. Every community in the world needs a plan for how it is going to transition away from fossil fuels, what the Transition Town movement calls an “energy descent action plan.” In the cities and towns that have taken this responsibility seriously, the process has opened rare spaces for participatory democracy, with neighbors packing consultation meetings at city halls to share ideas about how to reorganize their communities to lower emissions and build in resilience for tough times ahead.

Climate change demands other forms of planning as well—particularly for workers whose jobs will become obsolete as we wean ourselves off fossil fuels. A few “green jobs” trainings aren’t enough. These workers need to know that real jobs will be waiting for them on the other side. That means bringing back the idea of planning our economies based on collective priorities rather than corporate profitability—giving laid-off employees of car plants and coal mines the tools and resources to create jobs, for example, with Cleveland’s worker-run green co-ops serving as a model.

Agriculture, too, will have to see a revival in planning if we are to address the triple crisis of soil erosion, extreme weather and dependence on fossil fuel inputs. Wes Jackson, the visionary founder of the Land Institute in Salina, Kansas, has been calling for “a fifty-year farm bill.” That’s the length of time he and his collaborators Wendell Berry and Fred Kirschenmann estimate it will take to conduct the research and put the infrastructure in place to replace many soil-depleting annual grain crops, grown in monocultures, with perennial crops, grown in polycultures. Since perennials don’t need to be replanted every year, their long roots do a much better job of storing scarce water, holding soil in place and sequestering carbon. Polycultures are also less vulnerable to pests and to being wiped out by extreme weather. Another bonus: this type of farming is much more labor intensive than industrial agriculture, which means that farming can once again be a substantial source of employment.

Outside the Heartland conference and like-minded gatherings, the return of planning is nothing to fear. We are not talking about a return to authoritarian socialism, after all, but a turn toward real democracy. The thirty-odd-year experiment in deregulated, Wild West economics is failing the vast majority of people around the world. These systemic failures are precisely why so many are in open revolt against their elites, demanding living wages and an end to corruption. Climate change doesn’t conflict with demands for a new kind of economy. Rather, it adds to them an existential imperative.

3. Reining in Corporations

A key piece of the planning we must undertake involves the rapid re-regulation of the corporate sector. Much can be done with incentives: subsidies for renewable energy and responsible land stewardship, for instance. But we are also going to have to get back into the habit of barring outright dangerous and destructive behavior. That means getting in the way of corporations on multiple fronts, from imposing strict caps on the amount of carbon corporations can emit, to banning new coal-fired power plants, to cracking down on industrial feedlots, to shutting down dirty-energy extraction projects like the Alberta tar sands (starting with pipelines like Keystone XL that lock in expansion plans).

Only a very small sector of the population sees any restriction on corporate or consumer choice as leading down Hayek’s road to serfdom—and, not coincidentally, it is precisely this sector of the population that is at the forefront of climate change denial.

4. Relocalizing Production

If strictly regulating corporations to respond to climate change sounds somewhat radical it’s because, since the beginning of the 1980s, it has been an article of faith that the role of government is to get out of the way of the corporate sector—and nowhere more so than in the realm of international trade. The devastating impacts of free trade on manufacturing, local business and farming are well known. But perhaps the atmosphere has taken the hardest hit of all. The cargo ships, jumbo jets and heavy trucks that haul raw resources and finished products across the globe devour fossil fuels and spew greenhouse gases. And the cheap goods being produced—made to be replaced, almost never fixed—are consuming a huge range of other nonrenewable resources while producing far more waste than can be safely absorbed.

This model is so wasteful, in fact, that it cancels out the modest gains that have been made in reducing emissions many times over. For instance, the Proceedings of the National Academy of Sciences recently published a study of the emissions from industrialized countries that signed the Kyoto Protocol. It found that while they had stabilized, that was partly because international trade had allowed these countries to move their dirty production to places like China. The researchers concluded that the rise in emissions from goods produced in developing countries but consumed in industrialized ones was six times greater than the emissions savings of industrialized countries.

In an economy organized to respect natural limits, the use of energy-intensive long-haul transport would need to be rationed—reserved for those cases where goods cannot be produced locally or where local production is more carbon-intensive. (For example, growing food in greenhouses in cold parts of the United States is often more energy-intensive than growing it in the South and shipping it by light rail.)

Climate change does not demand an end to trade. But it does demand an end to the reckless form of “free trade” that governs every bilateral trade agreement as well as the World Trade Organization. This is more good news —for unemployed workers, for farmers unable to compete with cheap imports, for communities that have seen their manufacturers move offshore and their local businesses replaced with big boxes. But the challenge this poses to the capitalist project should not be underestimated: it represents the reversal of the thirty-year trend of removing every possible limit on corporate power.

5. Ending the Cult of Shopping

The past three decades of free trade, deregulation and privatization were not only the result of greedy people wanting greater corporate profits. They were also a response to the “stagflation” of the 1970s, which created intense pressure to find new avenues for rapid economic growth. The threat was real: within our current economic model, a drop in production is by definition a crisis—a recession or, if deep enough, a depression, with all the desperation and hardship that these words imply.

This growth imperative is why conventional economists reliably approach the climate crisis by asking the question, How can we reduce emissions while maintaining robust GDP growth? The usual answer is “decoupling”—the idea that renewable energy and greater efficiencies will allow us to sever economic growth from its environmental impact. And “green growth” advocates like Thomas Friedman tell us that the process of developing new green technologies and installing green infrastructure can provide a huge economic boost, sending GDP soaring and generating the wealth needed to “make America healthier, richer, more innovative, more productive, and more secure.”

But here is where things get complicated. There is a growing body of economic research on the conflict between economic growth and sound climate policy, led by ecological economist Herman Daly at the University of Maryland, as well as Peter Victor at York University, Tim Jackson of the University of Surrey and environmental law and policy expert Gus Speth. All raise serious questions about the feasibility of industrialized countries meeting the deep emissions cuts demanded by science (at least 80 percent below 1990 levels by 2050) while continuing to grow their economies at even today’s sluggish rates. As Victor and Jackson argue, greater efficiencies simply cannot keep up with the pace of growth, in part because greater efficiency is almost always accompanied by more consumption, reducing or even canceling out the gains (often called the “Jevons Paradox”). And so long as the savings resulting from greater energy and material efficiencies are simply plowed back into further exponential expansion of the economy, reduction in total emissions will be thwarted. As Jackson argues in Prosperity Without Growth, “Those who promote decoupling as an escape route from the dilemma of growth need to take a closer look at the historical evidence—and at the basic arithmetic of growth.”

The bottom line is that an ecological crisis that has its roots in the overconsumption of natural resources must be addressed not just by improving the efficiency of our economies but by reducing the amount of material stuff we produce and consume. Yet that idea is anathema to the large corporations that dominate the global economy, which are controlled by footloose investors who demand ever greater profits year after year. We are therefore caught in the untenable bind of, as Jackson puts it, “trash the system or crash the planet.”

The way out is to embrace a managed transition to another economic paradigm, using all the tools of planning discussed above. Growth would be reserved for parts of the world still pulling themselves out of poverty. Meanwhile, in the industrialized world, those sectors that are not governed by the drive for increased yearly profit (the public sector, co-ops, local businesses, nonprofits) would expand their share of overall economic activity, as would those sectors with minimal ecological impacts (such as the caregiving professions). A great many jobs could be created this way. But the role of the corporate sector, with its structural demand for increased sales and profits, would have to contract.

So when the Heartlanders react to evidence of human-induced climate change as if capitalism itself were coming under threat, it’s not because they are paranoid. It’s because they are paying attention.

6. Taxing the Rich and Filthy

About now a sensible reader would be asking, How on earth are we going to pay for all this? The old answer would have been easy: we’ll grow our way out of it. Indeed, one of the major benefits of a growth-based economy for elites is that it allows them to constantly defer demands for social justice, claiming that if we keep growing the pie, eventually there will be enough for everyone. That was always a lie, as the current inequality crisis reveals, but in a world hitting multiple ecological limits, it is a nonstarter. So the only way to finance a meaningful response to the ecological crisis is to go where the money is.

That means taxing carbon, as well as financial speculation. It means increasing taxes on corporations and the wealthy, cutting bloated military budgets and eliminating absurd subsidies to the fossil fuel industry. And governments will have to coordinate their responses so that corporations will have nowhere to hide (this kind of robust international regulatory architecture is what Heartlanders mean when they warn that climate change will usher in a sinister “world government”).

Most of all, however, we need to go after the profits of the corporations most responsible for getting us into this mess. The top five oil companies made $900 billion in profits in the past decade; ExxonMobil alone can clear $10 billion in profits in a single quarter. For years, these companies have pledged to use their profits to invest in a shift to renewable energy (BP’s “Beyond Petroleum” rebranding being the highest-profile example). But according to a study by the Center for American Progress, just 4 percent of the big five’s $100 billion in combined 2008 profits went to “renewable and alternative energy ventures.” Instead, they continue to pour their profits into shareholder pockets, outrageous executive pay and new technologies designed to extract even dirtier and more dangerous fossil fuels. Plenty of money has also gone to paying lobbyists to beat back every piece of climate legislation that has reared its head, and to fund the denier movement gathered at the Marriott Hotel.

Just as tobacco companies have been obliged to pay the costs of helping people to quit smoking, and BP has had to pay for the cleanup in the Gulf of Mexico, it is high time for the “polluter pays” principle to be applied to climate change. Beyond higher taxes on polluters, governments will have to negotiate much higher royalty rates so that less fossil fuel extraction would raise more public revenue to pay for the shift to our postcarbon future (as well as the steep costs of climate change already upon us). Since corporations can be counted on to resist any new rules that cut into their profits, nationalization—the greatest free-market taboo of all—cannot be off the table.

When Heartlanders claim, as they so often do, that climate change is a plot to “redistribute wealth” and wage class war, these are the types of policies they most fear. They also understand that, once the reality of climate change is recognized, wealth will have to be transferred not just within wealthy countries but also from the rich countries whose emissions created the crisis to poorer ones that are on the front lines of its effects. Indeed, what makes conservatives (and plenty of liberals) so eager to bury the UN climate negotiations is that they have revived a postcolonial courage in parts of the developing world that many thought was gone for good. Armed with irrefutable scientific facts about who is responsible for global warming and who is suffering its effects first and worst, countries like Bolivia and Ecuador are attempting to shed the mantle of “debtor” thrust upon them by decades of International Monetary Fund and World Bank loans and are declaring themselves creditors—owed not just money and technology to cope with climate change but “atmospheric space” in which to develop.

* * *

So let’s summarize. Responding to climate change requires that we break every rule in the free-market playbook and that we do so with great urgency. We will need to rebuild the public sphere, reverse privatizations, relocalize large parts of economies, scale back overconsumption, bring back long-term planning, heavily regulate and tax corporations, maybe even nationalize some of them, cut military spending and recognize our debts to the global South. Of course, none of this has a hope in hell of happening unless it is accompanied by a massive, broad-based effort to radically reduce the influence that corporations have over the political process. That means, at a minimum, publicly funded elections and stripping corporations of their status as “people” under the law. In short, climate change supercharges the pre-existing case for virtually every progressive demand on the books, binding them into a coherent agenda based on a clear scientific imperative.

More than that, climate change implies the biggest political “I told you so” since Keynes predicted German backlash from the Treaty of Versailles. Marx wrote about capitalism’s “irreparable rift” with “the natural laws of life itself,” and many on the left have argued that an economic system built on unleashing the voracious appetites of capital would overwhelm the natural systems on which life depends. And of course indigenous peoples were issuing warnings about the dangers of disrespecting “Mother Earth” long before that. The fact that the airborne waste of industrial capitalism is causing the planet to warm, with potentially cataclysmic results, means that, well, the naysayers were right. And the people who said, “Hey, let’s get rid of all the rules and watch the magic happen” were disastrously, catastrophically wrong.

There is no joy in being right about something so terrifying. But for progressives, there is responsibility in it, because it means that our ideas—informed by indigenous teachings as well as by the failures of industrial state socialism—are more important than ever. It means that a green-left worldview, which rejects mere reformism and challenges the centrality of profit in our economy, offers humanity’s best hope of overcoming these overlapping crises.

But imagine, for a moment, how all of this looks to a guy like Heartland president Bast, who studied economics at the University of Chicago and described his personal calling to me as “freeing people from the tyranny of other people.” It looks like the end of the world. It’s not, of course. But it is, for all intents and purposes, the end of his world. Climate change detonates the ideological scaffolding on which contemporary conservatism rests. There is simply no way to square a belief system that vilifies collective action and venerates total market freedom with a problem that demands collective action on an unprecedented scale and a dramatic reining in of the market forces that created and are deepening the crisis.

* * *

At the Heartland conference—where everyone from the Ayn Rand Institute to the Heritage Foundation has a table hawking books and pamphlets—these anxieties are close to the surface. Bast is forthcoming about the fact that Heartland’s campaign against climate science grew out of fear about the policies that the science would require. “When we look at this issue, we say, This is a recipe for massive increase in government…. Before we take this step, let’s take another look at the science. So conservative and libertarian groups, I think, stopped and said, Let’s not simply accept this as an article of faith; let’s actually do our own research.” This is a crucial point to understand: it is not opposition to the scientific facts of climate change that drives denialists but rather opposition to the real-world implications of those facts.

What Bast is describing—albeit inadvertently—is a phenomenon receiving a great deal of attention these days from a growing subset of social scientists trying to explain the dramatic shifts in belief about climate change. Researchers with Yale’s Cultural Cognition Project have found that political/cultural worldview explains “individuals’ beliefs about global warming more powerfully than any other individual characteristic.”

Those with strong “egalitarian” and “communitarian” worldviews (marked by an inclination toward collective action and social justice, concern about inequality and suspicion of corporate power) overwhelmingly accept the scientific consensus on climate change. On the other hand, those with strong “hierarchical” and “individualistic” worldviews (marked by opposition to government assistance for the poor and minorities, strong support for industry and a belief that we all get what we deserve) overwhelmingly reject the scientific consensus.

For example, among the segment of the US population that displays the strongest “hierarchical” views, only 11 percent rate climate change as a “high risk,” compared with 69 percent of the segment displaying the strongest “egalitarian” views. Yale law professor Dan Kahan, the lead author on this study, attributes this tight correlation between “worldview” and acceptance of climate science to “cultural cognition.” This refers to the process by which all of us—regardless of political leanings—filter new information in ways designed to protect our “preferred vision of the good society.” As Kahan explained in Nature, “People find it disconcerting to believe that behaviour that they find noble is nevertheless detrimental to society, and behaviour that they find base is beneficial to it. Because accepting such a claim could drive a wedge between them and their peers, they have a strong emotional predisposition to reject it.” In other words, it is always easier to deny reality than to watch your worldview get shattered, a fact that was as true of die-hard Stalinists at the height of the purges as it is of libertarian climate deniers today.

When powerful ideologies are challenged by hard evidence from the real world, they rarely die off completely. Rather, they become cultlike and marginal. A few true believers always remain to tell one another that the problem wasn’t with the ideology; it was the weakness of leaders who did not apply the rules with sufficient rigor. We have these types on the Stalinist left, and they exist as well on the neo-Nazi right. By this point in history, free-market fundamentalists should be exiled to a similarly marginal status, left to fondle their copies of Free to Choose and Atlas Shrugged in obscurity. They are saved from this fate only because their ideas about minimal government, no matter how demonstrably at war with reality, remain so profitable to the world’s billionaires that they are kept fed and clothed in think tanks by the likes of Charles and David Koch, and ExxonMobil.

This points to the limits of theories like “cultural cognition.” The deniers are doing more than protecting their cultural worldview—they are protecting powerful interests that stand to gain from muddying the waters of the climate debate. The ties between the deniers and those interests are well known and well documented. Heartland has received more than $1 million from ExxonMobil together with foundations linked to the Koch brothers and Richard Mellon Scaife (possibly much more, but the think tank has stopped publishing its donors’ names, claiming the information was distracting from the “merits of our positions”).

And scientists who present at Heartland climate conferences are almost all so steeped in fossil fuel dollars that you can practically smell the fumes. To cite just two examples, the Cato Institute’s Patrick Michaels, who gave the conference keynote, once told CNN that 40 percent of his consulting company’s income comes from oil companies, and who knows how much of the rest comes from coal. A Greenpeace investigation into another one of the conference speakers, astrophysicist Willie Soon, found that since 2002, 100 percent of his new research grants had come from fossil fuel interests. And fossil fuel companies are not the only economic interests strongly motivated to undermine climate science. If solving this crisis requires the kinds of profound changes to the economic order that I have outlined, then every major corporation benefiting from loose regulation, free trade and low taxes has reason to fear.

With so much at stake, it should come as little surprise that climate deniers are, on the whole, those most invested in our highly unequal and dysfunctional economic status quo. One of the most interesting findings of the studies on climate perceptions is the clear connection between a refusal to accept the science of climate change and social and economic privilege. Overwhelmingly, climate deniers are not only conservative but also white and male, a group with higher than average incomes. And they are more likely than other adults to be highly confident in their views, no matter how demonstrably false. A much-discussed paper on this topic by Aaron McCright and Riley Dunlap (memorably titled “Cool Dudes”) found that confident conservative white men, as a group, were almost six times as likely to believe climate change “will never happen” than the rest of the adults surveyed. McCright and Dunlap offer a simple explanation for this discrepancy: “Conservative white males have disproportionately occupied positions of power within our economic system. Given the expansive challenge that climate change poses to the industrial capitalist economic system, it should not be surprising that conservative white males’ strong system-justifying attitudes would be triggered to deny climate change.”

But deniers’ relative economic and social privilege doesn’t just give them more to lose from a new economic order; it gives them reason to be more sanguine about the risks of climate change in the first place. This occurred to me as I listened to yet another speaker at the Heartland conference display what can only be described as an utter absence of empathy for the victims of climate change. Larry Bell, whose bio describes him as a “space architect,” drew plenty of laughs when he told the crowd that a little heat isn’t so bad: “I moved to Houston intentionally!” (Houston was, at that time, in the midst of what would turn out to be the state’s worst single-year drought on record.) Australian geologist Bob Carter offered that “the world actually does better from our human perspective in warmer times.” And Patrick Michaels said people worried about climate change should do what the French did after a devastating 2003 heat wave killed 14,000 of their people: “they discovered Walmart and air-conditioning.”

Listening to these zingers as an estimated 13 million people in the Horn of Africa face starvation on parched land was deeply unsettling. What makes this callousness possible is the firm belief that if the deniers are wrong about climate change, a few degrees of warming isn’t something wealthy people in industrialized countries have to worry about. (“When it rains, we find shelter. When it’s hot, we find shade,” Texas Congressman Joe Barton explained at an energy and environment subcommittee hearing.)

As for everyone else, well, they should stop looking for handouts and busy themselves getting unpoor. When I asked Michaels whether rich countries have a responsibility to help poor ones pay for costly adaptations to a warmer climate, he scoffed that there is no reason to give money to countries “because, for some reason, their political system is incapable of adapting.” The real solution, he claimed, was more free trade.

* * *

This is where the intersection between hard-right ideology and climate denial gets truly dangerous. It’s not simply that these “cool dudes” deny climate science because it threatens to upend their dominance-based worldview. It is that their dominance-based worldview provides them with the intellectual tools to write off huge swaths of humanity in the developing world. Recognizing the threat posed by this empathy-exterminating mindset is a matter of great urgency, because climate change will test our moral character like little before. The US Chamber of Commerce, in its bid to prevent the Environmental Protection Agency from regulating carbon emissions, argued in a petition that in the event of global warming, “populations can acclimatize to warmer climates via a range of behavioral, physiological, and technological adaptations.” These adaptations are what I worry about most.

How will we adapt to the people made homeless and jobless by increasingly intense and frequent natural disasters? How will we treat the climate refugees who arrive on our shores in leaky boats? Will we open our borders, recognizing that we created the crisis from which they are fleeing? Or will we build ever more high-tech fortresses and adopt ever more draconian antiimmigration laws? How will we deal with resource scarcity?

We know the answers already. The corporate quest for scarce resources will become more rapacious, more violent. Arable land in Africa will continue to be grabbed to provide food and fuel to wealthier nations. Drought and famine will continue to be used as a pretext to push genetically modified seeds, driving farmers further into debt. We will attempt to transcend peak oil and gas by using increasingly risky technologies to extract the last drops, turning ever larger swaths of our globe into sacrifice zones. We will fortress our borders and intervene in foreign conflicts over resources, or start those conflicts ourselves. “Free-market climate solutions,” as they are called, will be a magnet for speculation, fraud and crony capitalism, as we are already seeing with carbon trading and the use of forests as carbon offsets. And as climate change begins to affect not just the poor but the wealthy as well, we will increasingly look for techno-fixes to turn down the temperature, with massive and unknowable risks.

As the world warms, the reigning ideology that tells us it’s everyone for themselves, that victims deserve their fate, that we can master nature, will take us to a very cold place indeed. And it will only get colder, as theories of racial superiority, barely under the surface in parts of the denial movement, make a raging comeback. These theories are not optional: they are necessary to justify the hardening of hearts to the largely blameless victims of climate change in the global South, and in predominately African-American cities like New Orleans.

In The Shock Doctrine, I explore how the right has systematically used crises—real and trumped up—to push through a brutal ideological agenda designed not to solve the problems that created the crises but rather to enrich elites. As the climate crisis begins to bite, it will be no exception. This is entirely predictable. Finding new ways to privatize the commons and to profit from disaster are what our current system is built to do. The process is already well under way.

The only wild card is whether some countervailing popular movement will step up to provide a viable alternative to this grim future. That means not just an alternative set of policy proposals but an alternative worldview to rival the one at the heart of the ecological crisis—this time, embedded in interdependence rather than hyper-individualism, reciprocity rather than dominance and cooperation rather than hierarchy.

Shifting cultural values is, admittedly, a tall order. It calls for the kind of ambitious vision that movements used to fight for a century ago, before everything was broken into single “issues” to be tackled by the appropriate sector of business-minded NGOs. Climate change is, in the words of the Stern Review on the Economics of Climate Change, “the greatest example of market failure we have ever seen.” By all rights, this reality should be filling progressive sails with conviction, breathing new life and urgency into longstanding fights against everything from free trade to financial speculation to industrial agriculture to third-world debt, while elegantly weaving all these struggles into a coherent narrative about how to protect life on earth.

But that isn’t happening, at least not so far. It is a painful irony that while the Heartlanders are busily calling climate change a left-wing plot, most leftists have yet to realize that climate science has handed them the most powerful argument against capitalism since William Blake’s “dark Satanic Mills” (and, of course, those mills were the beginning of climate change). When demonstrators are cursing out the corruption of their governments and corporate elites in Athens, Madrid, Cairo, Madison and New York, climate change is often little more than a footnote, when it should be the coup de grâce.

Half of the problem is that progressives—their hands full with soaring unemployment and multiple wars—tend to assume that the big green groups have the climate issue covered. The other half is that many of those big green groups have avoided, with phobic precision, any serious debate on the blindingly obvious roots of the climate crisis: globalization, deregulation and contemporary capitalism’s quest for perpetual growth (the same forces that are responsible for the destruction of the rest of the economy). The result is that those taking on the failures of capitalism and those fighting for climate action remain two solitudes, with the small but valiant climate justice movement—drawing the connections between racism, inequality and environmental vulnerability—stringing up a few swaying bridges between them.

The right, meanwhile, has had a free hand to exploit the global economic crisis to cast climate action as a recipe for economic Armageddon, a surefire way to spike household costs and to block new, much-needed jobs drilling for oil and laying new pipelines. With virtually no loud voices offering a competing vision of how a new economic paradigm could provide a way out of both the economic and ecological crises, this fearmongering has had a ready audience.

Far from learning from past mistakes, a powerful faction in the environmental movement is pushing to go even further down the same disastrous road, arguing that the way to win on climate is to make the cause more palatable to conservative values. This can be heard from the studiously centrist Breakthrough Institute, which is calling for the movement to embrace industrial agriculture and nuclear power instead of organic farming and decentralized renewables. It can also be heard from several of the researchers studying the rise in climate denial. Some, like Yale’s Kahan, point out that while those who poll as highly “hierarchical” and “individualist” bridle at any mention of regulation, they tend to like big, centralized technologies that confirm their belief that humans can dominate nature. So, he and others argue, environmentalists should start emphasizing responses such as nuclear power and geoengineering (deliberately intervening in the climate system to counteract global warming), as well as playing up concerns about national security.

The first problem with this strategy is that it doesn’t work. For years, big green groups have framed climate action as a way to assert “energy security,” while “free-market solutions” are virtually the only ones on the table in the United States. Meanwhile, denialism has soared. The more troubling problem with this approach, however, is that rather than challenging the warped values motivating denialism, it reinforces them. Nuclear power and geoengineering are not solutions to the ecological crisis; they are a doubling down on exactly the kind of short-term hubristic thinking that got us into this mess.

It is not the job of a transformative social movement to reassure members of a panicked, megalomaniacal elite that they are still masters of the universe—nor is it necessary. According to McCright, co-author of the “Cool Dudes” study, the most extreme, intractable climate deniers (many of them conservative white men) are a small minority of the US population—roughly 10 percent. True, this demographic is massively overrepresented in positions of power. But the solution to that problem is not for the majority of people to change their ideas and values. It is to attempt to change the culture so that this small but disproportionately influential minority—and the reckless worldview it represents—wields significantly less power.

* * *

Some in the climate camp are pushing back hard against the appeasement strategy. Tim DeChristopher, serving a two-year jail sentence in Utah for disrupting a compromised auction of oil and gas leases, commented in May on the right-wing claim that climate action will upend the economy. “I believe we should embrace the charges,” he told an interviewer. “No, we are not trying to disrupt the economy, but yes, we do want to turn it upside down. We should not try and hide our vision about what we want to change—of the healthy, just world that we wish to create. We are not looking for small shifts: we want a radical overhaul of our economy and society.” He added, “I think once we start talking about it, we will find more allies than we expect.”

When DeChristopher articulated this vision for a climate movement fused with one demanding deep economic transformation, it surely sounded to most like a pipe dream. But just five months later, with Occupy Wall Street chapters seizing squares and parks in hundreds of cities, it sounds prophetic. It turns out that a great many Americans had been hungering for this kind of transformation on many fronts, from the practical to the spiritual.

Though climate change was something of an afterthought in the movement’s early texts, an ecological consciousness was woven into OWS from the start—from the sophisticated “gray water” filtration system that uses dishwater to irrigate plants at Zuccotti Park, to the scrappy community garden planted at Occupy Portland. Occupy Boston’s laptops and cellphones are powered by bicycle generators, and Occupy DC has installed solar panels. Meanwhile, the ultimate symbol of OWS—the human microphone—is nothing if not a postcarbon solution.

And new political connections are being made. The Rainforest Action Network, which has been targeting Bank of America for financing the coal industry, has made common cause with OWS activists taking aim at the bank over foreclosures. Anti-fracking activists have pointed out that the same economic model that is blasting the bedrock of the earth to keep the gas flowing is blasting the social bedrock to keep the profits flowing. And then there is the historic movement against the Keystone XL pipeline, which this fall has decisively yanked the climate movement out of the lobbyists’ offices and into the streets (and jail cells). Anti-Keystone campaigners have noted that anyone concerned about the corporate takeover of democracy need look no further than the corrupt process that led the State Department to conclude that a pipeline carrying dirty tar sands oil across some of the most sensitive land in the country would have “limited adverse environmental impacts.” As 350.org’s Phil Aroneanu put it, “If Wall Street is occupying President Obama’s State Department and the halls of Congress, it’s time for the people to occupy Wall Street.”

But these connections go beyond a shared critique of corporate power. As Occupiers ask themselves what kind of economy should be built to displace the one crashing all around us, many are finding inspiration in the network of green economic alternatives that has taken root over the past decade—in community-controlled renewable energy projects, in community-supported agriculture and farmers’ markets, in economic localization initiatives that have brought main streets back to life, and in the co-op sector. Already a group at OWS is cooking up plans to launch the movement’s first green workers’ co-op (a printing press); local food activists have made the call to “Occupy the Food System!”; and November 20 is “Occupy Rooftops”—a coordinated effort to use crowd-sourcing to buy solar panels for community buildings.

Not only do these economic models create jobs and revive communities while reducing emissions; they do so in a way that systematically disperses power—the antithesis of an economy by and for the 1 percent. Omar Freilla, one of the founders of Green Worker Cooperatives in the South Bronx, told me that the experience in direct democracy that thousands are having in plazas and parks has been, for many, “like flexing a muscle you didn’t know you had.” And, he says, now they want more democracy—not just at a meeting but also in their community planning and in their workplaces.

In other words, culture is rapidly shifting. And this is what truly sets the OWS moment apart. The Occupiers—holding signs that said Greed Is Gross and I Care About You—decided early on not to confine their protests to narrow policy demands. Instead, they took aim at the underlying values of rampant greed and individualism that created the economic crisis, while embodying—in highly visible ways—radically different ways to treat one another and relate to the natural world.

This deliberate attempt to shift cultural values is not a distraction from the “real” struggles. In the rocky future we have already made inevitable, an unshakable belief in the equal rights of all people, and a capacity for deep compassion, will be the only things standing between humanity and barbarism. Climate change, by putting us on a firm deadline, can serve as the catalyst for precisely this profound social and ecological transformation.

Culture, after all, is fluid. It can change. It happens all the time. The delegates at the Heartland conference know this, which is why they are so determined to suppress the mountain of evidence proving that their worldview is a threat to life on earth. The task for the rest of us is to believe, based on that same evidence, that a very different worldview can be our salvation.
Source URL:

http://www.thenation.com/article/164497/capitalism-vs-climate

Movement Here and Around the World Must Grow

By Noam Chomsky
SolidarityEconomy.net via AlterNet.org

Nov 1, 2011 - It's a little hard to give a Howard Zinn Memorial Lecture at an Occupy meeting. There are mixed feelings that go along with it. First of all, regret that Howard is not here to take part and invigorate it in his particular way, something that would have been the dream of his life, and secondly, excitement that the dream is actually being fulfilled. It’s a dream for which he laid a lot of the groundwork. It would have been the fulfillment of a dream for him to be here with you.

The Occupy movement really is an exciting development. In fact, it's spectacular. It's unprecedented; there's never been anything like it that I can think of. If the bonds and associations that are being established at these remarkable events can be sustained through a long, hard period ahead -- because victories don't come quickly-- this could turn out to be a very significant moment in American history.

The fact that the demonstrations are unprecedented is quite appropriate. It is an unprecedented era -- not just this moment -- but actually since the 1970s. The 1970s began a major turning point in American history. For centuries, since the country began, it had been a developing society with ups and downs. But the general progress was toward wealth and industrialization and development -- even in dark and hope -- there was a pretty constant expectation that it's going to go on like this. That was true even in very dark times.

I'm just old enough to remember the Great Depression. After the first few years, by the mid-1930s, although the situation was objectively much harsher than it is today, the spirit was quite different. There was a sense that we're going to get out of it, even among unemployed people. It'll get better. There was a militant labor movement organizing, CIO was organizing. It was getting to the point of sit-down strikes, which are very frightening to the business world. You could see it in the business press at the time. A sit-down strike was just a step before taking over the factory and running it yourself. Also, the New Deal legislations were beginning to come under popular pressure. There was just a sense that somehow we're going to get out of it.

It’s quite different now. Now there’s kind of a pervasive sense of hopeless, or, I think, despair. I think it’s quite new in American history and it has an objective basis. In the 1930s unemployed “working people” could anticipate realistically that the jobs are going to come back. If you’re a worker in manufacturing today -- and the unemployment level in manufacturing today is approximately like the Depression -- if current tendencies persist, then those jobs aren’t going to come back. The change took place in the '70s. There are a lot of reasons for it. One of the underlying reasons, discussed mainly by economic historian Robert Bernard, who has done a lot of work on it, is a falling rate of profit. That, with other factors, led to major changes in the economy -- a reversal of the 700 years of progress towards industrialization and development. We turned to a process of deindustrialization and de-development. Of course, manufacturing production continued, but overseas (it’s very profitable, but no good for the workforce). Along with that came a significant shift of the economy from productive enterprise, producing things people need, to financial manipulation. Financialization of the economy really took off at that time.

Before the '70s, banks were banks. They did what banks are supposed to do in a capitalist economy: take unused funds, like, say, your bank account, and transfer them to some potentially useful purpose, like buying a home or sending your kid to college. There were no financial crises. It was a period of enormous growth; the largest period of growth in American history, or maybe in economic history. It was sustained growth in the '50s and '60s and it was egalitarian. So the lowest percentile did as well as the highest percentile. A lot of people moved into reasonable lifestyles -- what’s called here “middle class” (working class is what it’s called in other countries).

It was real. The '60s accelerated it. The activism of the '60s, after a pretty dismal decade, really civilized the country in lots of ways that are permanent. They’re not changing. The '70s came along and suddenly there’s sharp change to industrialization and the offshoring of production. The shifting to financial institutions, which grew enormously. Also in the '50s and '60s there was the development of what became several decades later the high-tech economy. Computers, Internet, the IT revolution was mostly developed in the '50 and the '60s, and substantially in the state sector. It took a couple of decades before it took off, but it was developed then.

The 1970s set off a kind of a vicious cycle that led to a concentration of wealth increasingly in the hands of the financial sector, which doesn’t benefit the economy. Concentration of wealth yields concentration of political power, which, in turn, arrives to legislation that increases and accelerates the cycle. The physical policies such as tax changes, rules of corporate governance, deregulation were essentially bipartisan. Alongside of this began a very sharp rise in the costs of elections, which drives the political parties even deeper than before into the pockets of the corporate sector.

A couple years later started a different process. The parties dissolved, essentially. It used to be if you were a person in Congress and hoped for a position of committee chair or a position of responsibility, you got it mainly through seniority and service. Within a couple of years, you started to have to put money into the party coffers in order to get ahead. That just drove the whole system even deeper into the pockets of the corporate sector and increasingly the financial sector--a tremendous concentration of wealth, mainly in the literally top 1/10th of 1 percent of the population.

Meanwhile, for the general population it began an open period of pretty much stagnation, or decline for the majority. People got by through pretty artificial means -- like borrowing, so a lot of debt. Longer working hours for many. There was a period of stagnation and a higher concentration of wealth. The political system began to dissolve. There’s always been a gap between public policy and the public will, but it just grew kind of astronomically. You can see it right now, in fact.

Take a look at what’s happening right now. The big topic in Washington that everyone concentrates on is the deficit. For the public, correctly, the deficit is not much of an issue. The issue is joblessness, not a deficit. Now there’s a deficit commission but no joblessness commission. As far as the deficit is concerned, if you want to pay attention to it, the public has opinions. Take a look at the polls and the public overwhelmingly supports higher taxes on the wealthy, which have declined sharply during this stagnation period, this period of decline. The public wants higher taxes on the wealthy and to preserve the limited social benefits. The outcome of the deficit commission is probably going to be the opposite. Either they’ll reach an agreement, which will be the opposite of what the public wants, or else it will go into kind of an automatic procedure which is going to have those effects. Actually that’s something that’s going to happen very quickly. The deficit commission is going to come up with its decision in a couple of weeks. The Occupy movements could provide a mass base for trying to avert what amounts to a dagger in the heart of the country, and having negative effects.

Without going on with details, what’s being played out for the last 30 years is actually a kind of a nightmare that was anticipated by the classical economists. If you take an Adam Smith, and bother to read Wealth of Nations, you see that he considered the possibility that the merchants and manufacturers in England might decide to do their business abroad, invest abroad and import from abroad. He said they would profit but England would be harmed. He went on to say that the merchants and manufacturers would prefer to operate in their own country, what’s sometimes called a “home bias.” So, as if by an invisible hand, England would be saved the ravage of what’s called “neoliberal globalization.”

That’s a pretty hard passage to miss. In his classic Wealth of Nations, that’s the only occurrence of the phrase “invisible hand.” Maybe England would be saved from neoliberal globalization by an invisible hand. The other great classical economist David Ricardo recognized the same thing and hoped it wouldn’t happen. Kind of a sentimental hope. It didn’t happen for a long time, but it’s happening now. Over the last 30 years that’s exactly what’s underway. For the general population -- the 99 percent in the imagery of the Occupy movement --it’s really harsh and it could get worse. This could be a period of irreversible decline. For the 1 percent, or furthermore 1/10th of 1 percent, it’s just fine. They’re at the top, richer and more powerful than ever in controlling the political system and disregarding the public, and if it can continue, then sure why not? This is just what Smith and Ricardo warned about.

So pick Citigroup, for decades one of the most corrupt of the major investment banking corporations. It was repeatedly bailed out by the taxpayer over and over again starting in the early Reagan years and now once again. I won’t run through all the corruption. You probably know it, and it’s astonishing. A couple of years ago they came out with a brochure for investors. They urged investors to put their money in what they call the “plutonomy index.” The world is dividing into a plutonomy, the rich and so on. That’s where the action is. They said their plutonomy index is way outperforming the stock market, so put your money into it. And as for the rest? We set them adrift. We don’t really care about them and we don’t need them. They have to be around to provide a powerful state to protect us and bail us out when we get into trouble, but they essentially have no function. It’s sometimes called these days the “precariat,” people who live a precarious existence at the periphery of society. It’s not the periphery anymore; it’s becoming a very substantial part of the society in the United States and indeed elsewhere.

This is considered a good thing. For example, when Alan Greenspan was still “St. Alan,” hailed by the economics profession as one of the greatest economists of all time (this is before the crash for which he is substantially responsible for), he was testifying to Congress in the Clinton years explaining the wonders of the great economy. He said much of this economy was based on what he called “growing worker insecurity.” If working people are insecure, if they’re “precariat” and living precarious existences, then they’re not going to make demands, they won’t make wages, they won’t get benefits and we can kick them out if we don’t like them, and that’s good for the health of the economy. That’s what’s called a healthy economy technically and he was highly praised for this.

Well, now the world is indeed splitting into a plutonomy and a precariat, again in the imagery of the Occupy movement, the 1 percent and the 99 percent. The plutonomy is where the action is. It could continue like this, and if it does, then this historic reversal that began in the 1970s could become irreversible. That’s where we’re heading. The Occupy movements are the first major popular reaction which could avert this. It’s going to be necessary to face the fact that it’s a long hard struggle. You don’t win victories tomorrow. You have to go on and form structures that will be sustained through hard times and can win major victories. There are a lot of things that can be done.

I mentioned before that in the 1930s one of the most effective actions was a sit-down strike. The reason was very simple: it’s just a step below a takeover of the industry. Through the '70s, as the decline was setting in, there were some very important events that took place. One was in the late '70s. In 1977, US Steel decided to close one of its major facilities, Youngstown, Ohio, and instead of just walking away, the workforce and the community decided to get together and buy it from US Steel and hand it over to the workforce to run and turn it into a worker-owned, worker-managed facility. They didn’t win, but with enough popular support they could have won. It was a partial victory because even though they lost it set off other efforts now throughout Ohio and other places.

There’s a scattering of hundreds, maybe thousands, of not-so-small worker owned or partially worker-owned industries which could become worker-managed. That’s the basis for a real revolution. That’s how it takes place. It’s happening here, too. In one of the suburbs of Boston something similar happened. A multi-national decided to shut down a productive, functioning and profitable manufacturing company because it was not profitable enough for them. The workforce and union offered to buy it and take it over and run it themselves, but the multi-national decided to close it down instead probably for reasons of class consciousness. I think they want things like this to happen. If there had been enough popular support, if there had been something like this movement that could have gotten involved, they might have succeeded.

There are other things going on like that. In fact, some of them were major. Not long ago, Obama took over the auto industry. It’s basically owned by the public. There were a number of things that could have been done. One was what was done. It could be reconstituted so it could be handed back to the ownership, or very similar ownership and continue on its traditional path. The other possibility was they could have handed it over to the workforce and turned it into worker-owned, worker-managed major industrial system that’s a major part of the economy and have it produce things that people need. And there’s a lot that we need. We all know or should know that the US is extremely backward globally in high-speed transportation. That’s very serious. It affects people’s lives and it affects the economy. It’s a very serious business.

I have a personal story. I happened to be giving talks in France a couple months ago and ended up in southern France and had to take a train from Avignon in southern France to the airport in Paris and it took two hours. That’s the same distance as Washington to Boston. It’s a scandal. It could be done; we have the capacity to do it, like a skilled workforce. It would have taken a little popular support. That could have been a major change in the economy. Just to make it more surreal, while this option was being avoided, the Obama administration was sending its transportation secretary to Spain to get contracts for developing high-speed rails for the United States. This could have been done right in the Rust Belt, which is being closed down. There’s no economic reason this can’t happen. These are class reasons and the lack of political mobilization.

There are very dangerous developments in the international arena, including two of them which are kind of a shadow that hangs over almost everything we discuss. There are, for the first time to human history, real threats to peace and survival of the species. One has been hanging around since 1945 and it’s kind of a miracle we’ve escaped it and that’s the threat of nuclear weapons. That’s a threat that’s being escalated by the administration and its allies. Something has to be done about that or we’re in real trouble. The other, of course, is environmental catastrophe. Every country in the world is taking at least halting steps toward trying to do something about it. The US is also taking steps, namely to accelerate the threat. The US is now the only country that’s not only not doing something constructive…it’s not climbing on the train. It’s pulling it backwards.

Congress is right now reversing legislation instituted by the Nixon administration. (Nixon was really the last liberal president of the United States, and literally, this shows you what’s been going on!) They’re dismantling the limited measures the Nixon administration took to try to do something about what’s a growing and emerging catastrophe. This is connected with a huge propaganda system, perfectly openly declared by the business world, that it’s all just a liberal hoax. Why pay attention to these scientists? We’re really regressing back to the Medieval period. It’s not a joke. If that’s happening to the most powerful and richest country in history then this crisis is not going to be averted and all of this we’re talking about won’t matter in a generation or two. All of that’s going on right now and something has to be done about it very soon and in a dedicated and sustained way. It’s not going to be easy to succeed. There are going to be barriers, hardships and failures along the way. Unless the process that’s taking place here and around the world, unless that continues to grow and kind of becomes a major social force in the world, the chances for a decent future are not very high.

Q&A

Q: What about corporate personhood and getting the money out of that stream of politics?

A: These are very good things to do, but you can’t do any of these things or anything else unless there’s a very large and active base. If the Occupy movement was the leading force in the country then you could move it forward. Most people don’t know that this is happening or they may know about it and not know what it is. Among those who do know, the polls show there’s a lot of support. But that assigns a task. It’s necessary to get out into the country and get people to understand what this is about and what they can do about and what the consequences are of not doing anything about it.

Corporate personhood is a good point, but pay attention to what it is. We’re supposed to worship the Constitution these days, but the 5th Amendment of the Constitution says no person shall be deprived of rights without due process of law. The founding fathers didn’t mean “person” when they said “person.” For example there were a lot of creatures of flesh and blood who were not persons. The entire indigenous population was not considered persons. They didn’t have any rights. There was a category of creatures called 3/5 human -- they weren’t persons and didn’t have rights. Women were not entirely persons, so they didn’t have full rights. A lot of this was somewhat rectified over the years. During the Civil War, the 14th amendment raised the 3/5 to full humans at least in principle, but that was only in principle.

Now over the following years the concept of person was changed by the courts in two ways. One way was to broaden it to include corporations, legal fictions established by the courts and the state. These “persons” later became the management of corporations; the management of corporations became “persons.” Of course, that’s not what the 14th amendment says. It’s also narrowed to undocumented workers. They had to be excluded from the category of persons. That’s happening right now. So legislation like this goes two ways. They defined persons to include corporate persons, which by now have rights beyond human beings, given by the trade agreements and others. They exclude people who flee from Central America where the US devastated their homelands, flee from Mexico because they can’t compete with the US’s highly subsidized agro-business. When NAFTA was passed in 1994, the Clinton administration understood pretty well that it was going to devastate the Mexican economy, so they started militarizing the border. So we’re seeing the consequences. So these people have to be excluded from the category of persons.

So when you talk about personhood, that’s right, but there’s more than one aspect to it. It ought to be pushed forward and it ought to be understood, but that requires a mass base. It requires that the population understands this and is committed to it. It’s easy to think of a lot of things that should be done, but they all have a prerequisite – namely a mass popular base that’s there that’s committed to implementing them.

Q: What about the ruling class in America? How likely is it that they’ll have an open fascist system here?

A: I think it’s very unlikely frankly. They don’t have the force. About a century ago, in the freest countries in the world, Britain and the United Sates at the time, the dominant classes came to understand that they can’t control the population by force any longer. Too much freedom had been won by struggles like these, and they realized it. It’s discussed in their literature. They recognize that they’re going to have to shift their tactics to control of attitudes and beliefs instead of just the cudgel. It can’t do what it used to do. You have to control attitudes and beliefs. In fact that’s when the public relations industry began. It began in the United States and England. The free countries where you had to control beliefs and attitudes, to induce consumerism, to induce passivity, apathy and distraction. It’s a barrier, but it’s a lot easier to overcome than torture and the Gestapo. I don’t think the circumstances are any longer there to institute anything like what we call fascism.

Q: You mentioned earlier that sit-down protests are just a precursor to a takeover of industry. Would you advocate a general strike as a tactic moving forward? Would you ever if asked allow for your voice to relay the democratically chosen will of our nation?

A: You don’t want leaders; you want to do it yourself. We need representation and you should pick it yourselves. It should be recallable representation.

The question of a general strike is like the others. You can think of it as a possible idea at a time when the population is ready for it. We can’t sit here and declare a general strike, obviously. There has to be approval and a willingness to take the risks on the part of a large mass of the population. That takes organization, education and activism. Education doesn’t just mean telling people what to believe. It means learning yourself. There’s a Karl Marx quote: “The task is not just to understand the world but to change it.” There’s a variant of that which should be kept in mind, “If you want to change the world in a certain direction you better try to understand it first.”

Understanding it doesn’t mean listening to a talk or reading a book, though that is helpful. It comes through learning. Learning comes from participation. You learn from others. You learn from the people you’re trying to organize. You have to gain the experience and understanding which will make it possible to maybe implement ideas as a tactic. There’s a long way to go. This doesn’t happen by the flick of a wrist. It happens from a long, dedicated work. I think in many ways the most exciting aspect of the Occupy movements is just the construction of these associations and bonds that are taking place all over. Out of that if they can be sustained can come expansion to a large part of the population that doesn’t know what’s going on. If that can happen, then you can raise questions about tactics like this, which could very well at some point be appropriate.

*This transcript has been edited slightly for clarity. To read the full address, click here.

© 2011 Independent Media Institute. All rights reserved. View this story online at: http://www.alternet.org/story/152933/ [w1]

Together Let Us Build Working

Class Power in our Communities:

The 2011 Launch of the

SACP Red October Campaign

We are in that time of the year when the SACP launches its popular Red October Campaign. Our Red October Campaign is inspired and seeks to take forward the spirit and the victories of the Great October Socialist Revolution of 1917 in Russia - ushering in the first workers' government in the 20th century.

The Red October campaign has been an important platform in building and strengthening the SACP over the last 11 years. Through our Red October Campaign we have built an SACP that is closer to the workers and the poor of our country. Through this campaign we say to the workers and the poor of our country, take up struggles to change your lives for the better and be the masters of your own destinies. It is only the workers and the poor themselves, in struggle and in solidarity with all other progressive forces that will consolidate and deepen our national democratic revolution, and advance the struggle for socialism in our country.

Through these campaigns we have also exposed the failures of the capitalist system to address the needs of the overwhelming majority of our people, and particularly also the failures of the neo-liberal macro-economic policies pursued since 1996. Our Red October Campaign has also been an important organising tool to recruit more and more members to the SACP. The Red October Campaign has also been an important platform for the ideological development of SACP members, and generally to conscientise and mobilise the workers and the poor to be the makers of their own history.

Since its launch twelve years ago, the Red October Campaign has been an important campaigning platform led by the SACP, and has notched some important victories, including:

a. the roll out of banking services to the poor via Umzansi account

b. the transformation of the financial sector as a whole

c. The passage of the Co-operatives and Co-operative Banks legislation

d. the introduction of the National Credit Act to protect consumers against reckless lending

e. the convening of the Land Summit in 2005, direct as a result of the 2004 Red October Campaign - a summit that resolved that the ‘willing seller, willing buyer' model of land reform must be changed as it is an obstacle to access to land by our people

f. raised the plight of our public transport system and the fact that it needed much improvement and attention in 2006, including the convening of the national transport indaba

g. the introduction of the National Health Insurance (NHI) in which our campaigning in 2007 and 2009 on health matters contributed significantly towards this advance

h. Our campaign against corruption through our Red October Campaign of 2009, and the increase focus by government on these matters including the call for the reform of the government tender system by also making it more transparent

The major lessons from our Red October Campaign include the fact that we must not just satisfy ourselves by becoming professional critics, permanent protestors and lamentors in the face of the many challenges facing our country. But that is essential for the working class to take the lead on concretely what is to be done, through concrete actions and campaigns!

Since 1994, and especially since Polokwane, our country has made some important advances. Today we have an industrial policy, a framework for a new growth path, a proposed NHI, amongst others, and our task should be on how we build on these, to continue to provide leadership in order to change the lives of millions of our people.

Through our Red October Campaign we have deepened our work with the progressive trade union movement, formed important alliances with community organisations, youth and women's groups, faith groups and many progressive NGOs and research initiatives to advance the struggle of ordinary workers and the poor.

The 2011 Red October Campaign is a very special one as it is launched during our 90th anniversary year. It is therefore a Red October also to celebrate the heroic role played by our Party in the national liberation strugggle, and the role we continue to play in the reconstruction and development of our country. It is a celebration done in the best way we do as communists, to continue being in the trenches with the workers and poor of our country.

In 2011 the SACP calls upon all our people to join us in campaigning on the following on the following issues:

1. People's education for people's power - Education with an emphasis on making our schools functional, and also the wider challenges of skills and training, with a particular focus on the girl child and the youth.

2. Building a solidarity economy - Through this to, amongst others, building and strengthenings a people's cooperative banks movement as part of taking forward our campaign to make banks and other financial institutions to serve our people

3. Building local people`s committees for comprehensive rural development - With a particular emphasis on building a women`s rural movement for land, food and infrastructure for rural development

4. Intensifying the struggle against corruption - Through all these struggles we must these to intensify the struggle against corruption and tenderpreneurs

The 2011 Red October Campaign, seeks to build on the many advances we have made in the past, taking these to higher We must use our voting district (VD) based branches to convene community red forums in all our localities around our key areas of focus, engage communities, as well as intensify our work with and inside the trade union movement.

5. People's education for people's power

Education and skills are the most important tools to empower the workers, the poor, our youth and women, our communities, and to lay a basis for a better life for all in our country. Let us mobilise our youth to take up all the opportunities for schooling and skills development. Let us say to them it is cool to be educated, as part of defeating all the attempts to mislead young people to think that their salvation is in tenders, and often ill-gotten monies as a short cut to riches. Education can never be taken away from anybody, unlike a tender that can be given or taken away the next day.

To this end the SACP is calling upon all our structures, including the alliance structures and communities to embark on the following:

Identifying and fixing dysfunctional schools - The Department of Basic Education has provided us with a list of all poorly performing or dysfunctional schools throughout the country. Let us go out and engage school governing bodies, parents, communities, learners and government departments to identify and mobilise for our schools to work. Let us make sure that there is teaching and learning taking place in all our schools, that teachers and learners are on time, teaching and learning. Let us expose all those teacher, principals and government officials who are not doing their work, and let us ensure that there are no shebeens next to our schools. Let us engage SADTU and other teacher organisations to make sure our schools work!

The SACP also says let us not only focus on secondary schools, but let us also make sure that our primary schools are functional, as foundation learning is very important for the rest of our education system.

Let us convene community forums to discuss, and decide on appropriate actions where we live, to make our schools work. Most of the dysfunctional schools are those attendend by the children of especially the black working class and the poor.

Let us form co-operatives and other community initiatives to ensure that it is these co-operatives that are used by government for the school feeding scheme. The school nutrition scheme is now reaching more that 8 million learners, and let us take this away from individual businesses and give them to co-operatives as part of genuine empowerment of ordinary people.

Why package everything into a tender? Why should the local state and local popular capacities not be harnessed jointly so that government and communities work together to build their own housing, their own schools, maintain their own roads and infrastructure?

It is time that the SACP tackles the many challenges facing the girl-child, for the naming and shaming of teachers who sexually abuse girl-pupils, and to conscientise our communities about the need to fight teenage pregnancy and youth suicide. To this end we must support the YCL call to end the publication of matric results in newspapers, so that we reduce the many stresses already placed on our young people at such a vulnerable age.

Infrastructure, books and stationery - Let us mobilise our communities to ensure that monies allocated to building schools and do away with mud schools. The SACP calls for the building of schools infrastructure, maintenance and repairs be part of the expanded or community public works programmes, and take them out of tenders to individuals. Let us also train our communities and use FET colleges to fix and repair school furniture, as part of creating job opportunities for ordinary people. Let us mobilise to ensure that required resources (books, stationery and teachers) are supplied timeously.

Community skills development and strengthening FET colleges - Let us get closer to making sure that our FET colleges are functional and for accessing government resources for community skills development initiatives. Let us make sure that poor youth in particular take up learning opportunities in FET colleges, now that poor student are no longer required to pay fees in these colleges.

Fighting corruption in all of our education system - It is important that our communities stand up to expose and fight all forms of corruption in our education system. Let us defeat the sometimes unholy alliance between some school or college managers, governing bodies and government officials to squander monies meant for education. Let us campaign to end all forms of corruption in the schooling and education systems

2. Building a solidarity economy

A national summit of the financial sector - This pillar of our campaign must be linked to laying the foundations for the revitalisation of our financial sector campaign. The SACP is calling upon the convening of the second national financial sector summit, incuding both the private and public financial sector to assess progress made since the signing of the financial sector charter in 2003. We want to know if banks are investing in low-cost houses; why the exorbitant charges they are still charging?; are they investing in a manner that is creating jobs through investment ninto infrastructure?

Building a co-operative banks movement - Much as private banks must still be pressurised to lend money to the workers and the poor for developmental activities, away from funding narrow BEE, this will not be enough to build the necessary finances to support co-operatives, the informal sector and SMEs. Therefore in the wake of the Co-operative Banks Act, let us engage our burial societies, stokvels and the trade union movement on creating a viable co-operative banks movement, as entities that will support development initiatives in our communities. These must just not be on the periphery but we must work towards mainstreaming them as an important component of a new growth path. This initiaitve is very crucial in building an alternative solidarity economy that is not based on capitalist greed and selfishness.

Our people's monies in burial societies and stokvels can support a lot of secondary initiatives that are owned and controlled by members of these societies themselves (eg micro banking services, coffin making, etc). Let us convene red forums to engage all our people's initiatives in burial societies, stokvels, and co-operatives for these resources to be pulled together in a manner that supports people's own development initiatives.

It is estimated that more than 60,000 people belong to 121 co-op banking institutions (Savings and Credit Co-ops (SACCO), Financial Services Co-ops (FSC); co-op banks.), with total assets of more than R100-million, employing around 100 people to run and manage these co-ops. Notwithstanding the above, the sector faces challenges ranging from inability to grow in membership, assets and services, lack of skills and effective leadership and governance.

3. Building rural motive forces for Land Reform, Food Production and rural development

The struggle for liberation will be incomplete and suffer major setbacks if there is no deliberate programme to restore back to the formerly oppressed people land taken from under colonialism and apartheid. Government alone, without a mobilised people, will not be able to achieve our land and rural development goals. Despite some progress made on this front, land in our country is still in the hands of a minority.

Rural development is more than just land and agriculture, important as these are, but is about rural infrastructure including access roads, the building of bridges, rural education infrastructure, rural clinics and police stations, and many other facilities that are readily available in many urban areas. Let us campaign for infrastructure as the foundation for sustainable rural economic development

In tackling these the SACP, acting together with the people in rural areas will embark in the following activities:

Conclusion of land restitution claims - Let us engage government and our communities for speedy settlement of all land restitution claims. Let us also ensure that all re-claimed land is used productively through support from government and through the mobilisation of financial and other resources in the hands of the communities. Let our co-operative banks support viable, productive agricultural activities in reclaimed land. Let reclaimed land be used for food production and food security.

The SACP calls for the intensification of the struggle against instances of corruption in the land restitution process. Land meant for the people must not be sold back to former owners because our people do not have the means to use it productively. Land meant for the people must be used by the people themselves and not be shared amongst tenderpreneurs or people in leadership or government positions!

Building People's Committees for rural development - Let the SACP convene people's red forums in all of our rural areas in order to form people's committees for rural development. Where various types of committees already exist to fight for access to land and agricultural activities or rural development, let us strengthen them in order to build motive forces for rural development. Let us pay particular attention to the organisation of women in the rural areas, as they are the ones who stand to benefit most

Transform the white agricultural countryside, with and for workers and poor - Working with FAWU and other progressive trade unions in the ‘white' countryside, let us intensify organisation of farm workers and for farm dwellers to have access to decent accommodation, pension funds, trade union rights, and intensify the struggle against evictions, and for access to education to all children of farm-workers and farm-dwellers.

Let us not allow white agricultural bosses to divide and exploit workers by seeking to replace South African workers with foreign, and vulnerable workers. Let us not fight amongst ourselves as workers, irrespective of our country of national origin, but must unite to defeat the white bosses' divide and rule tactics! We must accelerate the campaign for access to decent accommodation and pension funds for farmworkers, and fight against farm evictions.

Let us expose the racist agenda of organisations like the DA and Afri-forum, who never once raise the issue of abuse and the super-exploitation of black farmworkers, but instead oppose all actions of government to try and change our country for the better!

Let us fight to access to farms to organise farm-workers and address the conditions of farm-dwellers, and for farms to be declared workplaces and public residential areas, so that they are accessible. Let us remove the prison-type walls in farms that are seeking to make workers and their communities some kind of ‘prison labour'.

(The Evictions Toll Free Number: 0800 007095

Defend the moral and revolutionary integrity of our movement

In order to achieve many of these objectives outlined in our Red October Campaign it is important that we also intensify the struggle to defend all our organisations in the Alliance and the broader progressive movements from the corrupting influence of money and wealth. This requires amongst other that we intensify the struggle in the following areas:

Exposing, naming and shaming those peddling dirty money - Our movement is faced with a serious threat of attempts to buy our cadres with money, to influence decisions in our organisations through money, and to seek to sell our organisation to highest imperialist bidder through dirty money. Let us name and shame those who are trying to buy us. This is money meant to influence you, but once you accept such money, you will never, ever be part of those dishing out money, but will only use that power to steal our organisations, and to steal our government! Let us name and shame money peddlers, tenderpreneurs and those seeking to steal our organisations for their own personal interests of greed!

‘De-tenderise' the state as much as possible - Worse still, our state is being daily ‘tenderised' - bureaucrats in the state (some of them highly qualified professionals) don't actually DO anything, don't build anything - instead they spend their time writing up tenders and adjudicating on applications. Increasingly the state relates to its popular base by way of these tenders. Instead of uniting popular forces behind a common struggle for transformation, the state divides communities into competing factions all vying for a tender.

This is a source of a great deal of corruption in the state, but also of factionalism within our own organizations which get used as stepping stones to influence the allocation of tenders.

Let us also fight against the latest phenomenon of ‘professional tenderpreneurs', who do nothing but use their political influence to influence tender awards and get cuts from those corrupt proceeds. Let us not allow the relationship between government and political leadership, on the one hand, and our communities, on the other, to be mediated by the tender!

The SACP calls upon all our alliance to cement its unity by focusing on the key challenges facing our country (poverty, unemployment, disease), and UNITE against corruption and tenderpreneurs!

Expose the corrupting influence and failure of the capitalist system - The whole world is in a crisis today, retrenching millions of especially young workers, because of the greed and selfishness of the capitalist system. Let the workers and the poor of our country unite behind ‘Socialism is the Future, Build it Now' to roll back the capitalist system and its corrupting influence.

Let all communists go out in their numbers to mobilise our communities behind our Red October Campaign! We call upon all our communities, the workers and the poor to join us in this 2011 Red October Campaign!

Issued by the SACP, October 2 2011

Women-led Socio-Solidarity Economy

Yoko Kitazawa at ASEF II Tokyo November 2009

By Yoko Kitazawa

Asian Alliance for Solidarity Economy

The Burst of the Economic Bubble Since the bursting in 1991 of the bubble economy, which was a product of real estate and stock price inflation, Japan has experienced what is known as the “two lost decades,” with zero or minus growth and price deflation.

Consumers have stopped buying commodities except food and daily necessities with minimum amounts. Luxury department stores have few customers except just before the summer and winter holidays when people exchange gifts. Thus most of them have gone to either just bankrupt or merger with each other. In addition, small-scale shops have closed and nearly all the shopping districts have become shuttered streets with nobody wandering in the towns.

Small and medium-sized manufacturing factories, which were once a source of Japan’s economic vitality and technological innovation, have gone bankrupt. They acted as subsidiaries for the big corporations, and were forced to close when the big corporations scaled down their production

Non-existent Social Security As a result, the unemployment rate rose sharply, from 2% before 1985 to 4.9% in 2010. It is particularly serious that the youth are unable to find regular jobs for decades after graduating from school. They are called the lost-generation, and many call themselves freeters (“free part-timers”) as they look for miscellaneous part-time jobs. They numbered 1,870,000 in 2006, with an average annual income of Y1 million (about $10,000.00).

Starting from the end of World War II, the Japanese economy grew rapidly until the signing of the Plaza Accord by the G5 finance Ministers in New York in 1985. At that time, Japan was forced to accept an appreciation of the yen to deal with its huge trade surplus with the US and the EU.

During the period of post-war economic growth, Japan enjoyed full employment under the seniority wage system. Therefore, the Employment Insurance Agency, to whom both workers and employers paid monthly employment insurance fee, was unnecessary to spend. The Agency accumulated a huge surplus, which it spent building luxury resort hotels. When the bubble burst, the asset value of those hotels plummeted.

Today, there are no longer ample funds to cover the massive unemployment. Unemployed workers are paid 40-80% of their previous salaries for just six months. If they are unable to find new jobs, they have no choice but to become homeless or to die. It is very difficult and complicated to receive social welfare under the Livelihood Protection Law.

The same Agency is also in charge of the pension system. It is a universal system in Japan, with every person being obligated to contribute to the Agency until the age of 60. However, the Agency has been irresponsible in the management of its fund, which is based on the monthly payments by both workers and employers. In 2004, it was revealed that pension records for around 50 million people had been lost. Eventually, the Social Insurance Agency was dissolved.

The Koizumi neoliberal policy When the Koizumi cabinet was formed under the Liberal Democratic Party (LDP) in April 2001, Prime Minister Junichiro Koizumi launched a full-fledged neoliberal program, two decades after those in the US and UK. His mantra of neoliberalism was “self-responsibility” and “everything is determined by the market”. This means that all social security should be borne by individuals. His favoured method was deregulation, in particular of the labour market, and the privatization of public services in particular in the area of social security.

During his term (2001-2006), for example, the landscape of the labour market was totally changed. Non-regular employees increased from 5,000,000 in 1980 to 16,770,000 in 2008, to make up 33.9% of the overall labour force. Looking from a gender perspective, women non-regular workers amounted to 53.6% of all women workers in 2009, up from 37.9% in 1990, while men non-regular workers amounted to 17.7% in 2009, up from 8.7% in 1990.

The reason that the ratio of women non-regular workers is so high is the peculiar practice of Japan’s labour market. Women begin to work as cheap labour, and then stop working upon marriage to raise children at home. When their children reach a certain age, they begin working again as non-regular worker (usually part-timers). This working pattern of women workers is known as the M-shaped pattern.

The gap between rich and poor became increasingly visible, with no social security provided by the government to the poor, and with everybody becoming fearful of dismissal.

Regime change Eventually, the Japanese people became fearful of their lives and angry with the successive LDP governments. The social security system began to collapse, and their bank savings yield no interest.

In reaction, they voted for the Democratic Party, throwing the LDP out of power for the first time in a half century. First, they were fed up with the widespread corruption among LDP politicians and their anti-poor policies. Secondly, the DP promised pro-poor and human-faced politics.

Although the new government under Yukio Hatoyama came into being in September 2009, revelations of corruption involving the DP leadership have emerged one after other. Even worse, the new government found itself unable to implement the policies of pro-poor and human capitalism that it had promised during the election campaign, because of the lack of money in the government treasury. For 2010, the government’s tax revenues amounted to less than a half of the expenditures. Deficits have been covered through the issue of Japanese government bonds (JGB). The ratio of debt to GDP reached 197.2%, the highest figure among the developed countries, and the debt service ratio of JGB amounted to 21.7% of the 2010 budget. This is a much larger figure than the 11.2% the government spends on education.

People understand that even following the regime change, pro-poor and human-faced policies cannot be obtained from the government.

Yoko Kitazawa (center) at ASEF 1. Manila. October 2007 Solidarity-based economic activities Neoliberalism is the most extreme form of capitalism. Big corporations and financial institutions seek to maximize their profits. Meanwhile, the solidarity economy is just the opposite. Its economic activities are based on solidarity between people. The solidarity economy takes into account environmental protection and human rights, as well as unpaid work by women.

In Japan, we can find the solidarity economy in the practices of the daily lives of people and communities. We find it in the area of cooperatives, mutualities, and NPOs.

(a) Agricultural cooperatives Beginning with cooperatives, there are two major types, made up by farmers and by consumers.

First, the farmer’s cooperatives, organized under the Central Union of Agricultural Cooperatives (Nokyo) have a membership of 4 million farming households plus 2.5 million non-farmers in 2008. Nokyo is organized at the national level with 733 branches, and it is shaped like a big multinational corporation. Nokyo manages a diversified business, providing agricultural machines, seeds, and fertilizers on credit, collecting produce from farmers and selling it in the markets. Nokyo also has financial and insurance schemes.

However, the individual members of Nokyo are just customers and its decision-making power is in the hands of top management. Nokyo claims to be a cooperative, but it is definitely not part of the solidarity economy.

Case study: women farming entrepreneurs Some women Nokyo members, amid the decline of agriculture as well as the deepening economic recession, began to set up joint workspaces to process agricultural products. They earn additional income through this work. They are known as women farmer entrepreneurs and there are 9,444 such groups all over rural Japan. Each workspace is normally small, with capital of 3 million yen ($30,000.00) and an average of 30-50 women working in each unit. They borrow the capital and operating funds from the financial department of Nokyo.

Although these workspaces are very small in scale compared to the national Nokyo organization, their members work collectively and the profits are shared evenly among the participants. The Ministry of Agriculture has encouraged the entrepreneurs to merge into larger scale — \10 million ($100 million) — units in the name of efficiency and competitiveness. However, this would lead to a loss of the solidarity economy aspect. Consequently, women farmers oppose this policy.

(b) Consumer’s cooperatives Secondly, consumer’s cooperatives (co-ops) in Japan are very large, with a long history dating back to the 1930s. There are 1,097 large and small co-ops, and together they form the Japan Consumer’s Cooperatives Union (Nisseikyo). It has a total membership of 60 million, the majority being women. It has capital of \1 trillion ($10 billion) and total annual sales amount to \3 trillion ($30 billion).

This large scale outreach of co-ops in Japan leads to a number of problems. They are organized into 51 prefecture-level units, and run 2,668 shops around the country. Therefore, co-op members are basically the same as customers of commercial supermarkets. Co-op shops even sell imported vegetables and processed foods simply because they are cheaper than locally produced ones. As with Nokyo, individual members of co-ops have no voice in the leadership. In all aspects, it would be inappropriate to call it part of the solidarity economy.

Case study: the Seikatsu Club Consumers’ Co-operative Union Among cooperatives, there are some exceptions that could be said to belong to the solidarity economy. One such group is the Seikatsu Club Consumers’ Co-operative Union, which won the Right Livelihood Award in 1989. Although it only forms a small group within Nisseikyo, it has 310,000 members in 29 cooperatives spread over 19 prefectures.

In Kanagawa Prefecture, where I live, we have Kanagawa Seikatsu Club Consumer’s Cooperative. It has 68,424 members. It is composed of various units, including small groups with 10-20 members (han) and depots, which have 1,000- 2,000 members. They argue that the depot is not a commercial shop but a space for storing items. They call commodities consumption items rather than merchandise.

The depot is run by a workers’ collective. Those who manage the depot originally and collectively invested into renting the space and purchasing consumer’s goods. The members of the workers’ collective are equal in decision-making and decide how to work collectively.

Kanagawa Seikatsu Club makes a yearly contract in advance with producers such as farmers who practice organic farming, GMO-free food processing factories, and organizations carrying out fair trade of goods from the developing countries. The members of Seikatsu Club regularly have exchanges with producers. For instance, they help farmers to weed their fields.

Although Kanagawa Seikatsu Club has a fairly long history, going back to 1971, and it is still a consumer’s cooperative, it presents a model for the solidarity economy. In particular, since the 1980s the number of workers’ collectives has grown to 187 units including depots, with a total of 5,296 members. The workers’ collectives have been organized into federations in nine prefectures. Their memberships are increasing rapidly.

(c) Mutual aid cooperatives There are number of mutual aid cooperatives established at the local government, trade union, and workplace levels. These mutual aid cooperatives collect funds from their members and provide loans to them when needed.

These cooperatives are very large in scale, and are similar to Nokyo and Nisseikyo. For instance, the mutual aid cooperatives in trade unions are organized into a national federation (ZENROUKYO) and there are 46,340 participating units. In 2009 alone, they provided 35 million loans, amounting to \669 trillion ($6.7 trillion).

Although they use the term “mutual aid,” they do not form part of the solidarity economy. In this sense they are no different from commercial banks.

Case study: the Women and Citizens Community Bank

As indicated by its name, this organization is run by women and provides loans exclusively to women’s non-profit economic activities. It was established in 1998 in Yokohama, Kanagawa prefecture with capital of \120 million ($1.2 million), and in 2009, it provided 110 loans with a total of \400 million ($4 million) to non-profit enterprises.

When the economic bubble burst in 1999, the Bank of Japan lowered the interest rate to nearly zero. This posed a dilemma for people who were fearful of losing their jobs, and particularly for aged people who were uncertain about the future of the public pension system. They wanted to save money, but had no other way than to put their money in banks with zero interest rate. Today, the total volume of savings in banks and insurance companies amounts to \736 trillion ($7.3 trillion).

This situation has provided a good chance for citizen’s banks which invest in non-profit activities. However, there is no legal status for the newly emerging citizen’s banks. They have no choice but to operate under the law set up for moneylenders, because previous governments never encouraged citizen initiatives to develop non-profit banks. Since the regime change, we can expect some improvement on his issue.

d) Non-profit organizations (NPOs) In 1998, at the initiative of women legislators belonging to the Democratic Socialist Party, the NPO Promotion Law was enacted by the National Diet. Prior to it, all citizen’s organizations were regarded as non-legal entities, neither controlled nor protected by law. Under the newly stipulated law, NPOs have to register with the national or local authorities and obtain the status of legal person.

In fact, the new law did not offer any public support to NPOs, but it encouraged citizens to work as volunteers for the benefit of the vulnerable people such as the aged, the handicapped, infants, and immigrant workers.

During the time since the passage of the law, the number of registered NPOs has risen to 41,154 all over Japan. Most are run by workers’ collectives.

Case study: the Human Support Network in Atsugi City Atsugi City is situated in Kanagawa Prefecture. It has a population of 230,000, most belonging to the middle class. In 1989, a group of approximately 20 women in the city decided to establish a daycare center for the aged with funds donated by the members themselves and people around the neighbourhood. It was a typical NPO, created 10 years before the NPO Promotion Law was enacted.

Those women, who were mostly housewives, were initially members of the Seikatsu Club Consumer’s Cooperative in Atsugi city, and they later formed the Atsugi branch of the Kanagawa Network Movement.

The Kanagawa Network Movement was founded in 1989 as a political wing of the Seikatsu Club Cooperative in Kanagawa. Its strategy is to make a claim as a “local party,” and it participates exclusively in local elections. It has 30 members of local assemblies in Kanagawa prefecture.

The daycare center for the aged, named the Asahi Welfare Center, proved very successful. Then same women’s group has set up 22 NPOs in the last 20 years. They operate homes for the aged, childcare facilities, in particular for handicapped children, kitchens providing meals to aged people who live alone, second-hand shops, pharmacies selling traditional Chinese medicines, schools to teach Japanese language to migrant workers, and a rehabilitation center for people injured in traffic accidents. The Atsugi Human Support Network is an alliance of 22 NPOs managed by workers’ collectives.

CONCLUSION NPOs are the most promising part of the solidarity economy. However, they should not be large-scale, but should retain a human scale. The solidarity economy is only possible if there is trust among the people who participate in it.

What is needed for the solidarity economy in Japan now is to form loose networks, like the Atsugi Human Support Network, at the regional, national and global levels and to engage in political action to fight against neoliberalism.

Is it possible to simply destroy the globalized market economy and replace it with a solidarity economy? The answer is no.

For instance, big corporations cannot be entirely replaced by cooperatives: Big financial institutions cannot be replaced by citizen’s banks. All foreign trade cannot be replaced by fair trade.

Instead, we must place restrictions on the excessive, rampant, highly speculative and unaccountable activities of big corporations and financial institutions and the market economy’s search for maximum profits. We must rein in the excessive exploitation of workers, unlimited destruction of the environment, and economic and political domination by big corporations, as well as the concentration of power, decisions, options and functions by small elites.

This control will only be possible if we can promote the solidarity economy at the local, regional and global levels.

UE and Taunton, Mass. Set Own Course

in Fight Against Job Outsourcing

By Roger Bybee
SolidarityEconomy.net via ZNet

Dec. 14, 2010 - The American economy increasingly functions like a high-tech machine that efficiently plunders money from the vast majority of citizens and shoots a jetstream of the cash upward into the bank accounts of the richest 1%. At the same instant, it sends family-supporting jobs zooming off to Mexico, China, India and other low-wage sites.

The Republican landslide, enabled by a weak job-creation strategy coming from the White House, might lead you to think that a majority buys into the notion of letting the economic machine run on, continuing to chew up lives and communities.

However, a growing number of restless and desperate Americans in places like Taunton, Mass., a factory town of 50,000 hard-hit by unemployment, are showing that they understand how disastrously the machine works for them.

They increasingly realize that they must fight to save every endangered job and do battle to preserve decent pay, benefits and union representation.

They also understand that the Great Recession will continue--despite record profits and bonuses for the few at the apex of the economic pyramid—until ordinary Americans have jobs and wages to buy American-made products and get the economy providing prosperity for all.

PROPAGANDA ASSAULT

The experience of watching America becoming economically polarized between the super-rich and vast majority fueled overwhelming sentiment against extending tax cuts to the richest 2%.

But predictably, citizens' responses to pollsters turned around to 68% support once Americans were subjected to weeks of an incessant bi-partisan bombardment from party elites and media pundits telling them that only the uninformed would be foolish enough to oppose the Obama-Republican deal.

The results of this propaganda onslaught left President Obama and other members of the Democratic elite busy congratulating themselves on their clever bargaining and slick salesmanship. However, the facts remain that the deal will do next to nothing on job creation while ballooning the deficit and playing into the hands of Social Security privatizers. 

Obama and the Republicans are also pressing ahead with with a new free trade deal with South Korea despite a projected job loss of 200,000, Obama's consistent campaign pledges and 53% of Americans believing that free trade deals have hurt the U.S, up from 32% in 1999.

CRUCIAL EXAMPLE: PEOPLE CAN FIGHT BACK

But regardless of the cynical deals and manipulation of public opinion being directed by the White House, workers in places like Taunton, Mass. are continuing their struggles at the grass-roots level against the destruction of America's productive base and its dwindling supply of good jobs.

In Taunton, members of United Electrical, Radio and Machine Workers Local 204 have been taking on Esterline Technologies, a Bellevue, Washington aerospace firm, which plans to move about 100 jobs to a non-union plant in California and an even lower-wage plant in Tijuana, Mexico. The Taunton plant, which makes silicone gaskets for aircraft, has been consistently profitable and productive, yet Esterline is in a rush to sell off the plant's equipment and get production rolling in the other facilities.

Esterline had originally promised the workers that it would give them the right of first refusal on the plant's equipment, as the UE sought to pursue either running the operation on their own or as a subsidiary of another firm. But Esterline reneged when the union demanded that the company adhere to the UE-Esterline contract and Massachusetts law on closing the plant.

So despite $119.8 million profits last year, Esterline announced that it needed to sell off the machinery to cover the cost of severance payments. It quickly announced plans for a Dec. 12 auction to dispose of the equipment.

But Local 204 responded on two fronts. First, the UE took action to halt the auction. It persuaded elected officials like US Rep. Barney Frank, state legislators and the City Council to request that Esterline delay the auction until at least Feb. 15.

The union also alerted unionists throughout New England about Esterline's plans to destroy the workers' dreams of saving their jobs and to head for the repressive low-wage paradise of Mexico as rapidly as possible. Facing both the pressure from the elected officials and the prospect of a large rally of militant unionists furious about more jobs going off to Mexico, the company announced a delay in the auction until Jan. 19.

MOVING AHEAD ON EMINENT DOMAIN

Second, the city of Taunton is moving ahead—with unanimous support from the City Council and mayor—to pursue the use of "eminent domain" to seize the machinery of Esterline Technologies' local plant if necessary. The city will also need the support of the Democratically-controlled Maassachusetts Legislautre, which reconvenes in January.

"Eminent domain" is a doctrine under which private property may be taken, with compensation, by governmental units for a compelling public purpose. While often used by huge corporations to raze neighborhoods for new factories that could be located elsewhere, this time the UE and the Taunton City Council are preparing to use eminent domain against Esterline.

In the scope of things, the fight in Taunton is one small battle at a time when at least 15 million are unemployed. But the fierce determination of the UE Local 204 members represents a total rejection of all the messages from corporate, political and media elites that working people must simply "get used to it" when CEOs decide to send their jobs off to Mexico or China in search of even greater profits.

NO RECESSION AT THE TOP

For those running America's economic machine, things could not be rosier. Corporate profits in the third quarter set an all-time record. CEO pay at the 100 largest corporations is 1,723 times as much as their average workers make. The richest 1% possess more wealth than the bottom 90% of Americans.

Wall Street, dominated by a small circle of insiders who set the rules will be once again be handing out record bonuses for 2010:

    According to an October estimate, Wall Street firms are set to pay out $144 billion in bonuses this year, which would break a record for the second year in a row.

But regardless of the Republican landslide Nov. 2 that provides no real mandate, there are powerful signs that the basic unfairness of the economic system is widely recognized by the majority of the American people.

"Worries about side effects of trade and outsourcing seem one of the few issues on which Americans of different classes, occupations and political persuasions agree," the Wall Street Journal reported.

That's why the example of a small union local and a small factory town taking on a giant corporation sending jobs to Mexico is so crucial. The public mood is impatient and volatile, and an example like Taunton could eventually provide the spark for a much broader battle.

UE Local 204 and Taunton are showing that it is possible to ignore those who tell them hope is futile and globalization's carnage is inevitable—and take effective action.

Earlier reports on the UE campaign in Taunton:

    * UE Fights Defense Firm's Plan to Scrap Machines and Mass. Workers (9/10/2010)
    * Memo to Labor Movement: Follow UE's Lead and Fight Corporate Outsourcing (9/28/2010)
    * Masters of Eminent Domain? Union, Struggling Mass. Town Take on Aerospace Giant (11/19/2010)
    * UE Determined to Clip Wings of Aerospace Giant, Save Jobs in Mass. (11/30/2010)

Factory Auction to Save Jobs

By Jane Slaughter
solidarityeconomy.net

via Labor Notes

Nov. 29, 2010 - In a move to save factory jobs that evokes shades of the ’30s, the United Electrical Workers [1] are asking supporters to block a December 14 auction of presses and equipment from a plant south of Boston. The UE is calling for mass picketing and blockading of entrances to the 80-year-old plant if necessary.

Esterline Technologies Corp. of Bellevue, Washington, has refused to hold off on selling the equipment till another buyer can be found. The union’s request to buy the closed plant, which would create an employee-owned factory, has been ignored.

“They told us a year ago they did not want the presses or equipment,” said UE Local 204 President Scott Marques. “But they would rather junk them than sell them to us.”

The plant makes crucial door-seals and silicone gaskets for aircraft. Esterline is consolidating operations in Southern California and in Mexico.

Eminent Domain

Actually, the UE is trying two drastic tactics to keep the plant open: it’s also enlisted the Taunton, Massachusetts, city council, which has said it would use eminent domain [2] to take over the assets, and then sell them to a new owner. Keeping the machinery together—rather than sold off piece by piece or for scrap—is crucial to that plan.

Marques says that in addition to help from fellow union members and groups like Massachusetts Jobs with Justice [3], the union is trying to enlist the plant’s neighbors and nearby business owners. “They’re losing out, too,” Marques said, noting that generations have been supported by the plant.

The plant’s workers are known for their longevity, through multiple owners. Marques said 25 to 30 of the 85 union members have worked there at least 30 years, and two retired with 51 years’ seniority.

Doreen Arguin says she’s not ready to retire at the age of 60 years, 41½ of them in the factory. Now a van driver, she says it takes skill to create seals from silicone, fabric, and rubber—take a look at your window the next time you’re on a plane, and be grateful for union labor.

“I’m a worker, I like to work,” Arguin said. “I can’t fathom not going there every day. I’ve never been married, but I feel as if I just got divorced, and not a divorce that I wanted.”

Peter Knowlton, the UE’s regional president, says Esterline could realize only a pittance by selling the machines, maybe $100,000 to $250,000. An auction typically brings little more than the cost of scrap. “It’s collectively they have value,” he said, “when you put a workforce in front of them.”

But potential investors need to be sure there will be something there to buy. “No one wants to give you an answer if they don’t know if there’ll be presses or equipment in the building,” Marques said.

Knowlton believes Esterline might defy the city’s use of eminent domain, and hold the auction on December 14 anyway. Thus the need for as many supporters as possible to get in the way of that plan. The UE is no stranger to militant actions in December: in 2008 its local at Republic Windows and Doors [4] in Chicago occupied a factory for six days to demand legally required severance payments.
Bad Actors

Esterline and its local subsidiary Haskon, Inc. have set the standard for bad actors in a plant closing. Executives were shocked to learn that Massachusetts law requires a company to keep paying its regular share of workers’ health insurance for three months after a closing. It took the intervention of the state’s congressional delegation and attorney general to convince them to pay up.

Then the company reneged on severance pay. Its proposal “gets worse every time we meet,” Marques said. “Now they’re putting our severance on the basis of what they can get at auction of the machines.”

The Taunton mayor and city council are asking Esterline to postpone the auction till February 15. The union, potential investors, and interested management employees also need time to raise funds and write a business plan. The union has hired the longtime former president of Haskon as a consultant, and a feasibility study by the ICA Group, experts in employee-owned cooperatives, concluded that a new company could succeed in the aircraft sealant market.

Arguin, the local’s secretary-treasurer, explained that a small business would be eligible for certain government contracts through a program for “historically underutilized business zones.” Federal agencies are required to give a certain percentage of their contracts to such businesses.

The UE is asking for emails, faxes, and calls to Esterline requesting a delay of the auction till February 15. Contact Esterline Corp., 500 108th Ave. NE, Suite 1500, Bellevue, WA 98004, 425-453-9400, fax: 425-453-2916, info@esterline.com [5].

See the Keep Haskon Jobs In Taunton! Facebook page [6] for updated information, including on the December 14 auction protest. If your local plans to send a delegation, let the UE know at 774-264-0110 or uenortheast@gmail.com [7].

“We’re going to keep fighting, we’re not going to let it go,” Marques said. “We think we should be treated fair.”

Worker-Run Factories in Argentina Continue to Thrive,

Boosting the Economy and Influencing Workers in Other Countries

By Marcela Valente

SolidarityEconomy.net

viaIPS News, Nov. 12, 2010

After the late 2001 financial and political meltdown in Argentina, thousands of companies were abandoned by their owners in a sea of debt. But some of them were taken over and reopened by their employees. Today, as the economy continues to grow, these worker-run factories are still going strong.

There are now 205 "recovered" companies, with a total of 9,362 workers -- up from 161 companies with 6,900 workers in 2004, according to a study published in October.

"How has a phenomenon that emerged as a kind of life raft after the 2001 economic collapse grown rather than faded away during a period of economic boom?" asks the lead author of the study, Andrés Ruggeri.

"The workers learned that running a company by themselves is a viable alternative, to keep a company operating," he tells IPS. "That was unthinkable before."

The study, "Las Empresas Recuperadas en la Argentina. 2010" ("Recovered Companies in Argentina 2010"), was carried out by a large team of student volunteers with the Open Faculty Programme at the University of Buenos Aires.

The aim was to provide data to help design policies to strengthen and improve the self-management of companies, says the study, which is based on an in-depth survey of the companies. Although there are some earlier precedents in Argentine history of bankrupt businesses that were reopened by their workers, they were isolated cases.

But as a result of the severe 2002-2003 economic crisis, worker-run companies began to mushroom in a broad range of areas, including the food industry, steel, textile, footwear and plastic factories, meat-packing plants, ceramic, glass and rubber manufacturers, graphic design companies, transport firms, restaurants, health businesses and even a five-star hotel.

The companies were reclaimed by their workers after the owners disappeared overnight, leaving behind jobless employees, piles of debt, factories stripped of everything not bolted down -- and, often, charges of tax evasion or fraud.

Many of the companies are producing and even exporting again after they were taken over by the workers, who were owed months and sometimes years of back wages.

Most of the workers formed cooperatives, and decisions are reached in assemblies, while they receive advice and support from other worker-owned companies and from government institutions as well.

A similar phenomenon has occurred in other countries of Latin America. According to the Open Faculty Programme report, there are 69 "recovered" companies in Brazil, around 30 in Uruguay, 20 in Paraguay and a growing number in Venezuela. Cases are also starting to be seen in Spain, says Ruggeri.

Many believed that as the economy boomed -- it grew an average of 8.5 percent a year from 2003 to 2008 -- the companies had gradually shrunk in number, and only a few survived as testimony to an era, the study says. But "nothing could be further from the truth," Ruggeri says.

Even during times of economic growth, numerous companies fall into bankruptcy, sometimes as part of a strategy aimed at enabling the owner to start over again elsewhere. But the employees are left high and dry, and many of them are no longer young enough to be reabsorbed by the labour market, he points out.

"Recovered companies are a labour, economic and social reality that has taken root; they are here to stay and they will continue growing," the study says. Although they face their own difficulties, they have enormous potential, it adds.

One illustrative case not related to the 2002-2003 crisis is that of Global, a firm that produced latex products -- mainly balloons -- that declared bankruptcy in 2004.

One Monday morning the workers showed up and found the sign "closed until further notice." Neighbours told them that trucks had been hauling things away over the weekend -- the owners had taken all the machinery.

The company's dozens of employees were left without a job. But they managed to overcome many difficulties and reopen the business, and by 2005, Global had been transformed into "La Nueva Esperanza" (The New Hope), a cooperative with 32 members.

One of them is Domingo Palomeque, who has worked for 26 of his 50 years of life in the balloon factory on the outskirts of the Argentine capital. But now he does so as an equal partner in the cooperative.

"First we set up the cooperative, and then we recovered the machines they had stolen," Palomeque explains to IPS.

In the survey by the team of university researchers, the problem mentioned most frequently by the companies is the lack of financing to purchase raw materials and machinery or to hire specialised workers. They also cited problems making headway in the market.

La Nueva Esperanza is no exception. "Credit," Palomeque says without hesitation when asked what the company needs most. "We have to buy automated machines, not to replace people but to be more competitive."

The cooperative's products compete at a disadvantage in the local market today with cheap imports from Malaysia or Singapore. "Our products used to be cheaper, but that's not true any more," he says.

Despite the difficulties, they have managed to continue selling on the domestic market, and they even export their products. According to the report, 15 percent of the recovered firms export part of their output, and another 60 percent have the potential to do so.

The La Nueva Esperanza cooperative found its own way around certain hurdles. "It's something we invented ourselves -- we sell to Brazil, Paraguay, Chile and Uruguay, but we don't export the products ourselves: our customers register at an address in Argentine provinces bordering their countries," Palomeque explains.

He says there is no turning back. On the contrary, he has ambitions for the cooperative. "Our goal is to get new machines, hire new workers, and continue growing."

Recovered companies vary in size. Seventy-five percent employ less than 50 workers, only a few have more than 100 employees, and just 2.3 percent have more than 200 workers.

The study calls for coherent public policies to support the firms. "The state should take a more active role, but it acts in an erratic manner because it has an erroneous conception that this is a transitory phenomenon," Ruggeri says.

"It should strengthen these businesses because they are productive units that are growing sources of genuine jobs, which are neither precarious nor informal," he adds. "These are workers who have got back on their feet on their own."

In the last few years, the government has taken some steps that have given the businesses a boost. Through the Labour Ministry, it distributed more than one million dollars in subsidies. But it was a one-off arrangement. Without steady access to financing, the recovered companies "are condemned to teeter on the threshold of survival," the report concludes.

Marcela Valente has been an IPS correspondent in Argentina since 1990, specializing in social and gender issues. She is a History teacher and alternates her correspondent work with teaching journalism at various schools and workshops.
© 2010 IPS News All rights reserved.
View this story online at: http://www.alternet.org/story/148808/

How the Common Good

Is Transforming Our World

By Douglas LaBier

Huffington Post

In my previous post I wrote about a rising social psychosis that's visible in three areas of our society. It's likely to prevail for some time, but I think it's like a wave that's crested and will crash to the shore. The reason is that the social psychosis is a backlash against a steadily growing consciousness and behavior that refocuses personal lives and public policies towards promoting the common good.

By the "common good" I'm referring to a broad evolution beyond values and actions that serve narrow self-interest, and towards those guided by inclusiveness -- supporting well-being, economic success, security, human rights and stewardship of resources for the benefit of all, rather than just for some.

It's like a stealth operation, because it hasn't become highly visible yet. But polls, surveys and research data reveal several strands of change that are coalescing in this overall direction. I describe each of them below. They may appear to be unrelated, but I think they're driven by an underlying perspective that we're all like organs of the same body, and the body doesn't thrive if any of the organs is neglected or diseased.

It's an awareness of interconnection of all lives on this planet, and a pull towards acting upon that reality in a range of ways. They include rethinking personal relationships, the responsibility of business to society, and the role of government in an interdependent world.

A 21st-Century Mindset

The rise of the common good reflects a sense of global citizenship and an obligation to be a good ancestor to future generations who inhabit this planet. In fact, it embodies behavior and policies that fit the needs for effective functioning -- both personal and political -- in our post-9/11, post-economic meltdown world.

That is, in previous posts I've argued that this new era of unpredictable change in a non-equilibrium world requires new criteria for psychological health and resiliency, beyond just effective stress management and coping. Others have emphasized the new mindset that's needed for effective business and leadership strategies in this interconnected era.

For example, Matt Bai has described in the New York Times that "[n]ow we live in an integrated world where American jobs rely on the economic policies of governments in Asia or Latin America, while our security is subject to the whims of a cleric living in a cave," and, "[w]ith global interdependence comes a certain lack of control, a vulnerability to disparate influence."

Similarly, CUNY professor and blogger Jeff Jarvis refers to a "great restructuring of the economy and society, starting with a fundamental change in our relationships -- how we are linked and intertwined and how we act."

And Umair Haque writes in his Harvard Business School blog about the new principles of a new economy "built around stewardship, trusteeship, guardianship, leadership, partnership," adding that "[a]s interaction explodes, the costs of evil are starting to outweigh the benefits." In effect, transparency will become the antidote to evil.

Let's look at some of the seemingly disparate themes of the massive shift underway that has spawned the current social psychosis.

The New Norm of Racial-Ethnic Diversity

As you read these words, the country is becoming more diverse. Some demographers believe that 2010 could be the first year that most children born in the country will be non-white. Already, five states have a majority non-white population. New York Times columnist Charles Blow captured a slice of this at the time of the passage of health care legislation, writing that "[a] woman [Nancy Pelosi] pushed the health care bill through the House. The bill's most visible and vocal proponents included a gay man [Barney Frank] and a Jew [Anthony Weiner]. And the black man in the White House signed the bill into law. It's enough to make a good old boy go crazy."

Nearly 20 percent of counties in the U.S. have, or are close to, a nonwhite majority. This shift is steadily changing the social landscape. The trend is towards movement in the direction of tolerance, acceptance and valuing -- rather than fearing or hating -- the increasingly diverse composition of American society. And that includes the rising numbers of those with multi-racial/ethnic backgrounds. Moreover, research finds that the latter group tends to be open-minded and more oriented to inclusiveness and openness.

Volunteer Service

Data show that the number of volunteers is steadily growing among all age groups. During 2009, about 64 million Americans did volunteer work (defined as unpaid volunteer activities through an organization.) That's nearly 27 percent of the populations and reflects a steady year-by-year increase, according to a Bureau of Labor Statistics report. And a rapid rise of volunteerism has occurred in the last decade among men and women in their 30s and 40s. Today, people describe volunteerism as part of their sense of responsibility to help others in need, not something for padding their resume.

Donations of Organs by Living Donors to Strangers

That number is steadily rising. For example, kidney donations from living donors have outnumbered those from deceased donors since 2003. Some states, such as Wisconsin, offer tax deductions for expenses related to living organ donations.

Hands-On Philanthropy

This trend is towards wanting contributions to have visible, direct impact upon people's lives. More are turning away from writing checks to well-heeled organizations like universities or cultural centers. This trend is visible among venture capitalists who bring a high-impact perspective to venture philanthropy as well as among average citizens, who increasingly contribute to international organizations that help people become more self-sufficient in daily life -- for example, through micro finance (providing small loans to individuals starting businesses in impoverished countries), or purchasing a goat for a family that relies on small farming for their livelihood, or paying the salary of a schoolteacher in an impoverished part of the world.

Responsibility for a Healthy Planet

Despite the continued denial of the reality of climate change and the human contributions to it by the GOP, a denial unmatched among major political parties around the globe, pressure continues to build, both politically and on a grassroots level, for actions that reverse or halt climate change and promote sustainable living. Among the latter are groups like 350.org, the Alliance for Climate Protection and community alliances of citizens, businesses and government such as Bethesda Green, in Bethesda, Md. This trend is underscored by the steadily rising financial contributions to environmental organizations.

Support For Human Rights

Data show a steady increase of both financial contributions to and membership in such organizations as Human Rights Watch, Save the Children, Amnesty International, Mercy Corps International and others. Even in the absence of effective action, consciousness continues to build around the perspective that violations of rights to safety, dignity and personal freedom for another -- anywhere in the world -- affect oneself, as well. In addition, the view of security and human rights is expanding to include not only freedom from violence and terrorism, but also the rights to health care, support of older citizens, rights to adequate housing, food, fair wages and other conditions. A recent U.N. report examines these issues with respect to responsibilities and actions of member nations.

Personal Success

I've written previously that men and women increasingly want a "4.0 career": one that provides more than personal recognition, power and financial reward. They want meaningful work, opportunities for continued learning and growth, a positive management culture and a team-oriented, ethical environment. They want to have impact on something larger than just their own personal success. These themes are especially pronounced among younger workers.

The Social Impact of Business

Business leaders have already bought into the need for sustainability, and many are contributing to the rise of a new business model, one that addresses social problems and serves the common good as well as achieving financial success. The "green business" movement reflects this shift, along with the concept of the "triple bottom line." Related trends include sustainable investing, social entrepreneurialism, corporate social responsibility, building a psychologically healthy management culture, and transparency via open access to information and corporate disclosure policies.

Acceptance of Gay Relationships and Gay Marriage

Acceptance of gay relationships has steadily increased, while opposition to gay marriage has steadily decreased, when tracked over the last several years, according to data from the Pew Research Center. Between one-quarter and one-third of gay and lesbian couples are raising children, a steadily rising number. And the most current surveys indicate that about half of all Americans support gay marriage.

Families And Relationships Are Transforming

A majority of Americans now say their definition of family includes same-sex couples with children, as well as married gay and lesbian couples. Regarding intimate relationships, surveys by the Gallup organization and other groups find that the quality of the relationship is more important to people today than simple allegiance to the institution of marriage. Census statistics and other data confirm this, showing, for example, a steady decline in the marriage rate over the last several decades, while cohabitation has steadily risen in each of those same decades. About half of all households today are headed by people who are single. And unmarried couples are as likely as married couples to be raising children: it's currently approaching 50 percent.

Some surveys report that at least 30 percent of those polled admit to having had an affair. Whether that's accurate or not, the upshot is that affairs are no longer viewed as immoral in today's culture. Moreover, attitudes towards prostitution are also shifting towards greater acceptance and focus on the rights of sex workers.

So, these are just some of the pervasive shifts underway. My read is that they link around an underlying theme that our culture is evolving in both consciousness and action, and that evolution will grow and strengthen over time. That's why the current social psychosis will fade. That's not only hopeful but important: The rise of the common good is both a necessary path for survival and security on an interdependent planet and the path towards personal psychological health, success and well being in this new world era.

Douglas LaBier, Ph.D., a business psychologist and psychotherapist, is Director of the Center for Progressive Development, in Washington, D.C. You may contact him at dlabier@CenterProgressive.org.

Excess wind power finds home on Maine islands

Thermal storage heaters also offset

the area's high cost of petroleum

By Tux Turkeltturkel@mainetoday.com
Staff Writer, Porland Press Mail

Via SolidarityEconomy.net

The futuristic idea of heating buildings and powering cars with electricity from wind farms off the Maine coast is being tested on a small scale, on two islands that are home to a community-run wind project and some of the highest energy bills in the state.

More Power than needed, working on noise problem

Organizers of the Fox Islands Wind Project say the three turbines that began turning last fall on Vinalhaven generated more power this winter than residents needed, putting the community on a path toward stable energy costs. But attempts to lower noise levels that are disturbing some people who live near the towers have yet to make a difference, according to Cheryl Lindgren, one of the residents.

“They say it’s going to take time, and that may be,” she said. “We’re always hopeful.”

Remedies are still being studied, according to Bill Alcorn, who serves on the Fox Islands Wind board. Turbine speed has been turned down a bit at night to comply with state noise standards. Sound insulation may be upgraded around the turbines, and a sound engineer is analyzing data collected by neighbors, although some abutters have declined to return the logs, he said.

The board remains committed to trying to reduce the impact to neighbors, Alcorn said. But overall, he added, the turbines are performing as designed.

“They’re a major step in helping this island survive,” he said.

During the next year or so, up to 50 homes and businesses on Vinalhaven and North Haven will install electric thermal storage heaters. These units, which can absorb a day's worth of heat in dense, ceramic bricks, will be charged with electricity from the Fox Islands Wind Project.

The charging will take place when the project's three turbines are generating more power than the islands need, which is common in winter. Rather than sell electricity to the mainland grid at low prices, the energy will be used on the islands to offset the high cost of oil and kerosene heat. In addition, some of the excess power could be soaked up by batteries in electric vehicles.

Organizers say the experiment is the first of its kind in the United States. In theory, it's exactly what state officials hope Maine can do in the next decade by developing floating, offshore wind farms and tidal energy sites.

Theory is becoming reality this spring in Penobscot Bay. The first five units were hooked up in March on Vinalhaven; another is set to go in on North Haven. Residents say the heaters seem to be working well. next winter, they'll know more about the "smart grid" technology that makes the power shunting possible, and the impact on their energy bills.

"Vinalhaven is a grid we can study," said Adam Lachman, a local businessman spearheading the project for the Island Energy Task Force. "We can understand how it works."

Using wind power to reduce Maine's dependence on petroleum reflects the vision of the Baldacci administration and a task force that studied ocean energy. But it's premature to say what Vinalhaven's experience will mean in a larger sense.

A plan that would have raised electric rates to encourage ocean energy development by switching Mainers from oil heat to efficient electric heating systems was defeated last month in the Legislature. Moreover, industrial-scale wind power faces opposition for reasons including noise, a factor that remains an issue for at least some neighbors on Vinalhaven.

But supporters say wind energy can become a hedge for Maine against sky-high oil and gasoline prices in the future. On Vinalhaven and North Haven, that future is now. Electric rates are roughly twice what they are on the mainland, and heating oil is well over $3 a gallon.

"The overwhelming concern on the islands," Lachman said, "is how much it costs to heat homes and businesses."

In the initial phase, the task force is testing storage heaters donated by North Dakota-based Steffes Corp., which are distributed by Thermal Energy Storage of Maine. These units are common in Europe and Canada, and are becoming more available in other states. They use lower-priced electricity produced when demand is low, typically at night.

On Vinalhaven, the recently installed wind turbines produce excess power more than half the time they're turning during the winter. The island utility sells this electricity to the mainland grid via an underwater cable, but the price is low compared with the cost of space heat.

On the mainland, a meter keeps track of when power is flowing off the island and a signal is sent to each heater telling it whether to charge or not. The meter also could tell the heaters to charge using electricity from the mainland grid, if the price is low enough. For this experiment, the power for the storage heaters will never cost more than 9 cents a kilowatt hour, which was the equivalent price for heating oil in March.

Storage heat participants paid less than that last month. The math worked out to an oil equivalent of $2.20 a gallon, at a time when oil was selling for roughly $3.20 on the island.

"So they're saving $1 a gallon on their heating source," Lachman said.

This seemed like a good deal for Shelly Andrews.

Andrews wanted to start heating her greenhouse in early spring, to grow flowers for her landscaping business. But the greenhouse has a kerosene heater, and the cost was too high.

"Now I can start sooner," she said last week.

The storage heater is hooked to a computer modem in her home. Andrews' husband, Tom, a plumbing and heating contractor, said the unit appears too small to warm the entire greenhouse but it should cut the use of kerosene, which has been costing more than $3.50 a gallon.

"That's what we're trying to determine, whether it's cheaper than K-1," he said.

The heater is getting good reviews at The ARC, Vinalhaven's community center and Internet cafe. The unit there is warming 980 square feet of public space and reducing the need for an aging oil boiler.

The heat produced by the unit is very comfortable, according to Tristan Jackson, the center's executive director. He wonders, though, how many more turbines the islands would need, or how much power islanders would have to buy from the grid, to greatly expand the concept.

"The question is, how far can it scale up?" he said.

In the bigger picture, scale will depend on how far Maine gets toward its goal of developing thousands of megawatts of wind capacity off the coast. any measure, said Sam Zaitlin, president of Thermal Energy Storage, excess capacity will exist at certain periods. Storage heat and the coming of electric vehicles are two ways to integrate renewable energy into the grid.

"When you get a sudden surge of wind," he said, "rather than curtail generation, or ship it elsewhere, you can shunt it to heating or transportation."

Using the energy locally to replace oil could have a side benefit, according to Beth Nagusky, a state environmental manager and co-chairwoman of the ocean energy task force.

"People may be more accepting of seeing, and perhaps hearing, wind turbines if they know they are replacing their oil furnace," she said.

If the initial phase of the island experiment is a success, organizers plan to expand it to more households and create a more sophisticated control system.

Lachman and his colleagues have partnered with the Rockland-based Island Institute to help with project management and fundraising. A start-up company from Rhode Island, VCharge, is providing the energy management software to control the heaters. VCharge is working on a larger thermal storage program with Steffes Corp. in Concord, Mass., which has a municipal electric company.

Looking ahead, Lachman hopes the islands can partner with one of the car makers poised to release a plug-in vehicle this year. Another option is the fleet of electric recreation vehicles on the market, one of which is already on Vinalhaven, he said.

"This will allow us to study how we can use renewable power in the state," Lachman said, "rather than thinking about how we can transport it out of state."

Staff Writer Tux Turkel can be contacted at 791-6462 or:

tturkel@pressherald.com

Find this article at:
http://www.pressherald.com/news/excess-wind-power-finds-home-on-maine-islands_2010-04-04.html