All that is solid…

As sometime fans of Slavoj Zizek it was with real disappointment that we read his latest contribution to the London Review of Books, ‘Revolt of the Salaried Bourgeoisie.’ At his best, Zizek is a piercing and hilarious critic of contemporary ideology. This time, however, he seems to have been taken in. The piece contains more than one howler, a number of which were dissected over at Lenin’s Tomb. Zizek’s main point seems to be that current economic problems are not susceptible to orthodox Marxist analysis because the economy no longer functions by extracting ‘surplus-value’ from wage-laborers, but via the “privatisation of the general intellect.” This privatisation is represented by figures like Bill Gates, whose intellectual property rights give him “rent(s) appropriate through the privatisation of knowledge.” (Tell that to the Chinese workers at Foxconn…)

Zizek’s main piece of evidence in favor his his “post-industrial” analysis of this ‘information economy’ is that “any attempt now to link the rise and fall in the price of oil to the rise or fall in production costs or the price of exploited labour would be meaningless: production costs are negligible as a proportion of the price we pay for oil, a price which is really the rent the resource’s owners can command thanks to its limited supply.” But this is a silly argument. For one, it is Marxist economics 101 that value and price diverge. Moreover, all Zizek is really talking about is monopoly rents, which just about any economic theory can grasp, and which disproves none. Finally, any anti-sweatshop campaign can tell us that labor costs “are  negligible as a proportion of” the final price of, say, a $30 Nike cap. There is little monopoly rent there.

More problematic, Zizek’s further point is that we can understand recent protests as the political activity of the “salaried bourgeoisie,” a strata of professionals and managers, whose salaries are paid by the rent-receiver, but who now feel the austerity squeeze. These are not a ‘revolutionary subject’ because they are indifferent to the plight of the real 99%, the globally jobless, the post-proletarians, who don’t even have the right to work.

In his rush to join the time-servers and declare a new era of informational capitalism, based on information and creativity on the one hand, and mass joblessness on the other, Zizek has missed the chance to make a potentially valid point in a more serious way. It is certainly true that the Occupy/Indignado phenomenon has a touch of the petty bourgeois element to it. In fact, as others like Jodi Dean have argued quite powerfully, this class element seems to be inscribed into the politics of Occupy itself: “The refusal to be represented by demands is actually the refusal or inability to make an honest assessment of the social composition of the movement so as to develop a politics in which different forces and perspectives do not simply neutralize each other.” This political analysis is available to us without having to trot out trite nostrums about the new economy.

Moreover, if there really is something new under the sun in the realm of surplus extraction, it probably has more to do with the development of debt and finance over the past thirty or forty years, not the (fake) disappearance of industrial production. The piles of debt under which so many workers sit represent yet another claim on their labor time. It is not just lower wages, but that a substantial amount of what they get paid is not theirs to control. They are paid less than what they produce, and then a further chunk of their means of subsistence is siphoned off. To be sure, debt burdens are a long-standing feature of the capitalist economy, and one should not overstate the novelty of the situation. Capitalism is an extremely dynamic economic system, and it is easy to get caught up in the dynamism and believe that everything has changed. But if we are looking for the distinctive features of surplus extraction in the present, it won’t be found in the heady, but superficial, claims that we have entered an informational age in which surplus is extracted through ‘rents.’ More promising is the attempt to grasp the role of debt and finance, not as replacing, but overlapping with the regular old wage-contract.

The Occupy Effect

In an earlier post, we commented on the difficulty movements such as Occupy Wall Street or Indignados were having in influencing the course of electoral politics. In Spain, in spite of all the protests in Madrid and other parts of the country, elections late last year saw the return of the Right to power after a campaign where its leader, Mariano Rajoy, pointedly avoided setting out anything like a detailed economic plan. In Italy and Greece, protests coincided with the replacement of elected governments by technocratic administrations rather than with any lurch to the left or any real change in austerity-based politics.

This may now be changing. Recent campaign speeches suggest that these popular mobilisations have begun to shift the terrain of representative politics. In France last weekend the Socialist Party candidate, François Hollande, in a keynote speech, made a point of targeting the world of finance. Two moments of his speech took on a confessional, intimate tone. I shall let you into a secret of mine, he said, clearly trying to differentiate himself from the current incumbent of the Elysée palace: “it is people that interest me, not money”. And a little later, with the same confessional tone: “let me share with you who my real enemy is… It is an enemy without a face or a name; it governs without being elected… It is the world of finance”. Hollande’s proposed policies to disable this “enemy” were in line with what has been suggested elsewhere: to isolate the speculative activities of banks from their commercial lending; to introduce a comprehensive financial transaction tax, not just a tax on the trading of stocks; to set up a public ratings agency at the European level and to renegotiate the EU fiscal pact so as to make explicit its growth model. Hollande called this a pact for responsibility, governance and growth.

In Obama’s 2012 State of the Union address, given yesterday to Congress, the same themes were apparent. Invoking much of the Occupy rhetoric about the 99% versus 1%, Obama argued for a fairer, less unequal US society. He endorsed the Warren Buffet idea of raising taxes on the most wealthy and dismissed any claims that he was engaging in class warfare, calling these policies common sensical rather than partisan (see here for the Guardian’s write-up). The Republican primaries have similarly been taken up with the same themes. One of the problems faced by Mitt Romney is that he not an industrial magnate or oil man but gained his wealth through finance, making him the target of people’s anger at Wall Street and at bankers. The battle with Gingrich has been focused on tax with Romney forced to disclose his tax returns. Romney’s fight-back after his defeat in the South Carolina primary has been to highlight, under the banner ‘Newt Gingrich cashed in’, the payments received by Gingrich from the mortgage brokerage company, Freddie Mac.

If recent political mobilisations have indeed given this current economic crisis its political narrative, it is worth asking what this narrative is. So far, it is mainly an ethical critique of contemporary capitalism. Critics of finance take issue with the unscrupulous actions of bankers and hedge fund managers, their conspicuous wealth, the brazenness of new inequalities. In its place, Obama, Hollande and others call for a return to more traditional values where money matters less than people and the common good. There are obvious limits to such a critique. A defining feature of capitalism is its systemic nature: it is based upon a set of social relations that are more than merely the accumulation of individual intentions. Without uncovering the specific set of social relations that are the basis of today’s financialized capitalism, invocations towards a better, fairer society will only breed disappointment as changes fail to appear.

Expropriating the expropriated (1983-2009), or, Why It’s the Top 20 not Top 1% That Matter

Recently, the Economic Policy Institute published “11 Telling Charts from 2011,” including the following one showing the share that different segments of the US Population took of the wealth gain from 1983-2009.

When we first looked at this chart, we started reading from the left and adding the numbers but did a double take by the time we added the Top 1%, Next 4%, Next 5%, and Next 10% – or the top 20%. Add their shares together and you get 101.7%. At first that just didn’t seem right, since our assumption was that when you add up all the shares one would get 100%. Naively, we had assumed that, while radically unequal, the gain in wealth for all quintiles would positive. A piece of folk philosophy in the United States is that the rich can gain huge gobs of money and power, so long as the poorest can also have some piece; and that those who rise do so on their own merits, but not by making the worst off even worse off. That, as it turns out, is also a premise of the most influential theory of justice in contemporary political philosophy, which states that the only permissible inequalities are those that make the worst off better off than they otherwise would be under pure equality.

The past twenty-five years have followed a different path from mainstream, common sense theories of justice. The worst have been made worse off. Meanwhile, the massive gains of the top 20% were only as large as they were because wealth was redistributed from the poor to the rich (with very moderate gains for the top 20-40%). The expropriated were expropriated some more.

These figures are even more important than the income inequality statistics with which everyone is now familiar, because those income statistics alone give the impression that, at the very least, nobody is being made worse off. In addition, wealth is a much better indicator of social and economic power than income, as it shapes individual bargaining power, determines who controls investment, and establishes the distinction between those who are economically secure enough not to have to work, and those who aren’t. Looking at the graph again, a key political point emerges, which we have made before: the problem is not with the 1% alone. The expropriators area larger class than that. After all, the next 4% took just as large a share of the total wealth increase, and overall, the top 20% are doing quite well. To reuse a chart we have used before, the top 20% control 85% of the total wealth in the United States, and if residential wealth were removed (at least, value of primary homes), that would undoubtedly rise much higher.

So the current political obsession with the 1% introduces a very problematic distortion into the actual dynamics of class, and the real distribution of wealth and power, in the current political economy. We are the 99% has a wonderful, quasi-universalist ring, but actually real distinctions under the rug, and implicitly dodges hard conversations about the real class composition of the United States. A real critique would have to reach beyond mere populism.

Interview with Wolfgang Streeck

Continuing our series of interviews, today we publish an interview with Wolfgang Streeck. A guest contributor to The Current Moment, Professor Streeck is Director of the Max Planck Institue for the Study of Societies (MPIfG), based in Cologne, Germany. The author of many books and articles on comparative political economy, he recently published ‘The Crises of Democratic Capitalism‘ in the New Left Review.

 

What are the stories right now that you think people either aren’t paying enough attention to, or about which we have the wrong view?

Generally the historical and political-economic continuities between the global inflation crisis of the 1970s, the widespread public debt crisis of the 1980s, the internationally agreed consolidation and financial deregulation policies of the 1990s, and the worldwide private debt crisis of the 2000s, with its commutation into another public debt crisis.

Turning to the Eurozone debt problem, a dominant view is that Greeks and Italians are corrupt, inefficient and lazy, and that is why they find themselves in this mess. What is your view of what is going on?

The Mediterranean version of the debt problem reflects a specific relationship between modern states and societies on the periphery of Europe that have become stuck, partly or wholly, in pre-modern social structures and lifeways. In Italy and Spain in particular, this relationship is furthermore complicated by deep divisions between advanced regions such as Lombardy and Catalonia, and backward regions like the Mezzogiorno and the Spanish South. In quasi-feudal areas, or in an entire country such as Greece, huge concentrations of old wealth coexist with widespread rural poverty and stagnation. Vacationers from the North romanticize this as an easy-going way of life and tend to be envious about it. They also notice that there is corruption, and clearly a lot more than, say, in Sweden or Finland. What they don’t see is that there is also a lot of oppression by local elites with more or less close connections to the legal and illegal markets offered by modern capitalism, not to mention the political parties of the modern state. To be able to catch up with capitalist modernity, these societies would in the past have needed social revolutions to expropriate the old money and clear the way for the new money of middle-class industrial entrepreneurs. But this happened in Italy only in parts of the country, and in the post-fascist democracies of Portugal, Spain and Greece in the 1970s a revolutionary response to backwardness was prevented not least by the containment policies of Northern Europe and the United States. One of the tools of that policy was admission of Greece, Portugal and Spain, first into the European Union, and then into Monetary Union.

The standard recipe for the recovery from the Eurozone crisis is austerity and structural reforms in the peripheries, plus some recapitalization of banks. Do you think this is the right way to go?

I really don’t know what the solution is. Perhaps austerity is politically sustainable for the two decades that are claimed to be required for fiscal “consolidation” in debtor countries, perhaps not. In any case it will have to be accompanied by some form of, very likely hidden, transfer payments from the North, which also may or may not be politically sustainable, in this case with Northern electorates. “Structural reforms”, in the language of ruling economists, are not much more than union-breaking and the creation of tax-free economic development zones. But nobody tells us what the sectors are where growth is to take place, in countries squeezed between high-technology competition like Germany and low-wage competition like Thailand. Structural development policies that go beyond supply-siderism are not only expensive but are likely not to work when imposed from above or from the outside on a traditional social structure; see Southern Italy where fifty years of Cassa di Mezzogiorno were by and large an unqualified disaster. There is no reason to believe that Brussels or Berlin will in a decade be more successful in Greece than Rome was in Sicily for half a century.

What do you think would address the trade and debt imbalances between Northern and Southern Europe? Do you think it can be done within the European monetary union or does it require a fundamental change or dismantling of that union?

The problem is: there will be no such dismantling. The middle classes in the Mediterranean consider EMU as the lesser evil compared to a return to national currencies, because their savings are denominated in Euros and full membership in the European Union harbors vague promises of individual mobility and collective support, however meager. In the North, the common currency ensures export industries against competitive devaluation and guarantees a favorable external exchange rate. This is why German industry, including industrial trade unions, are strongly in favor of “European solidarity,” meaning that Mediterranean countries must by all means be prevented from getting out of the monetary trap in which they have moved themselves when joining the common currency. Some sort of competitiveness tax to be paid out of public budgets or in the form of some sort of “Eurobonds” is accepted as the price for unlimited access to Southern markets, especially if it is paid by taxpayers at large and not by industry itself. Here I see an unholy alliance between Southern middle classes and state elites on the one hand, and Northern export industries on the other. It will, however, be an unhappy alliance as Southern countries will inevitably be disappointed by the benefits they will receive from the North, while Northern electorates will resent such benefits regardless how small they may be, at a time when they themselves have to accept spending cuts of all sorts. Like in Italy, the South will hate the North and vice versa. Northern clichés of lazy Southerners will be complemented by Southern clichés of Northern, in particular German, imperialism. Europe will grow together at the price of rising nationalist resentment.

The hegemony of the demand for austerity is striking. It is offered as the solution to the Eurozone crisis, as well as to the American situation – the US Congress even created a supercommittee to find savings. It seems odd to have such agreement around austerity in the midst of a potential double dip recession. Why is there such agreement on this point and what do you think of the demand for austerity?

There seems to be no way to close the gap between public expenditures and public revenue by higher taxes, in no country. This being so, what remains to reassure creditors are spending cuts. Financial liberalization has made it easy for owners of significant wealth to move abroad; right now the London real estate market, in places like Chelsea, Kensington, Hampstead and Belgravia, is booming from rich Greek families putting their money in new homes. Tax increases are resented even by the middle classes who would more than the rich benefit from a functioning welfare state; one reason seems to be that for a long time higher public revenues will have to pay for goods already consumed. Those who would have to pay increased taxes because they cannot move their money or themselves out of their country may even prefer continuing public deficits to fiscal consolidation as long as austerity is firmly institutionalized and creditors can as a result be sure to get their money back. This is because, rather than having their savings confiscated, they could keep them and lend them to the state, drawing interest on them and eventually passing them on to their children. As I said, this presupposes a “credible commitment” of public policy to giving priority to servicing the public debt over keeping the political promises inherent in social citizenship. In practice this means a suspension of democracy to the extent that it is linked to social citizenship.

How optimistic/pessimistic are you about the ability of national democratic procedures to provide solutions to the current economic crises in Europe and in the US? What do you think of the recent proliferation of technocratic governments in Greece and Italy? Does the current crisis expose some basic tensions between capitalism and democracy? If so, how exactly?

I have written about these tensions, caused by ultimately incompatible demands for “market justice” and “social justice” having to be balanced against each other. Democracy is more than democratic procedures; it also expresses itself through social movements and general strikes. Even so, in present circumstances it lacks power and the capacity for collective action on the relevant battlefield, which has become the international monetary system. Today, states and their governments are facing two sovereigns at the same time: their peoples, organized nationally, and “the markets,” organized on a global scale. The latter clearly prevail over the former: see the replacement “from above” of the elected political leaders of Greece and Italy by representatives of the “economic reason” vested in the international money industry, shifting the political economy from social to market justice as the latter is deprived of its democratic empowerment.

What has perhaps not been said clearly enough is how the postwar settlement between the two kinds of justice came to be revised after the end of the “Golden Age.” When postwar growth ended in the late 1960s, the functional needs of capital accumulation began gradually to push aside the social needs whose institutionalized recognition had been the condition for workers being prepared to live with capitalism. More and more “capital controls,” in a broad sense, were removed while one promise after the other that had been made to buy labor in after 1945 was withdrawn. Such promises included a steady increase in living standards, progressive de-commodification of labor through an expanding welfare state, politically guaranteed full employment, “industrial democracy,” an encompassing regime of collective bargaining and trade union rights, a broad public sector providing citizens with social services as well as with stable employment, equal access to education and social advancement, a moderate and certainly not growing level of social and economic inequality, and the like. All of these disappeared or were “reformed,” often beyond recognition. The almost four decades since the end of postwar prosperity were a long series of defeats for labor, and of successful attempts on the part of capital gradually to re-establish its hegemony, with market justice pushing social justice to the sidelines of the political economy. It was not the logic of democratic claim-making or social citizenship or even democratic political opportunism that undercut the postwar social compact, but the historical reassertion of the logic of capital accumulation that had for a limited period been contained and overruled by democratic politics – just as the fiscal crisis of today was not caused by ordinary people demanding more than they were entitled to, but by the winners of the market first refusing to pay for their social license to enrich themselves, and later blackmailing governments to save them from the fallout of their own recklessness.

Right now it is democracy itself that is about to be rescinded – at the national level, which is where it came to be located under democratic capitalism, without replacement at the supranational level, where it should today move but nobody knows how. Increasingly democracy is turning into an empty shell, a formal ritual, not just in the United States but also in Europe. In the camp of the Indignados at the Puerta del Sol in July 2011, I saw a hand-painted sign saying: Como se puede hablar de democracia si no se puede cambiar el sistema económico en las urnas? (How can one speak of democracy if one cannot change the economic system at the ballot box?)

What are your views of the nascent protests (Occupy Wall Street, Indignados) developing in response to the introduction of austerity packages in Europe and the US? Are these movements a continuation of or a break with the anti-globalization movements of the past? Are they likely to fundamentally change public perceptions and government policy or will they have only a small lasting impact?

I know too little about such movements. I am looking for signs of an impending cultural break with possessive individualism, competitive greed, hedonistic consumerism. This is a tall order indeed, but I feel nothing less would do. Beyond “protest” or calls for “reform,” what would be interesting to see are actual changes in people’s ways of life, some kind of separatism and recapturing of local autonomy, with people cutting themselves loose from the capitalist mainstream and becoming less dependent on it, materially and mentally: a way of life where time matters more than money, ideal goods more than material ones, and social bonds more than individual property. That may not be available without a measure of neo-romanticism or even insurrectionism. What one might hope for is a sort of cultural change that, unlike 1968 and its aftermath, would not lend itself to being transformed into a “new spirit of capitalism,” as described by Chiapello and Boltanski. At the intellectual level, I find the growing literature on low-growth, no-growth and de-growth capitalism (or perhaps post-capitalism?) intriguing and I wish one could find good reasons for believing that working for this politically would not necessarily be futile.

What, finally, do you think the appropriate political response is to both these crises and their aftermath?

What is “appropriate,” and in what sense? What I see coming in Europe seems far from “appropriate” to me but it will probably come anyway. Clearly, the United States and the UK will continue to depend economically on an overblown international financial system that happens to reside mainly on their territories, and that they regulate in their national interest rather than the interest of all. The question is: is there anything on the horizon that could break the trend of the past three decades toward an ever more unstable, unpredictable, uncontrollable – in other words, ever more capitalist – global capitalism, with an ever more unequal distribution in the historically rich countries of wealth and risks and opportunities and life chances? I see nothing.

Thoughts on the EU’s fiscal union

The main topic of Eurozone discussions this week, amongst finance ministers, heads of states, and journalists, will be the Franco-German proposal for a “fiscal union”. The details of exactly what is being proposed remain vague. Later today, Sarkozy and Merkel are expected to outline some of what they mean. But for the full plan, we will have to wait for the final announcement at the European summit in Brussels at the end of this week, assuming this proposal wins the support of other EU members.

Already, the debate about this fiscal union has begun. For Sarkozy’s critics in France, from the Socialist Party through to the right-wing National Front, the President has sold French sovereignty (very cheaply) in his attempt at saving the Euro. For many others, the proposed fiscal union is little more than a German Europe.

There is no doubt that Germany is pushing through its own preferred solution to the crisis. France may manage to win concessions on both the role of the European Central Bank and on who has the final say regarding the imposition of sanctions on profligate states (the European Commission? the European Court of Justice? the European Council?) but it has certainly conceded to the German demand that national budget lines are policed as closely as possible.

But does this represent the imposition of German sovereignty over the rest of the Eurozone? The reality, as we have argued before, is more complex. That some states have had their interests better represented via the EU than others goes without saying. In a region where power is unevenly distributed, any consensus has tended to represent a compromise between the more powerful members. Others have been bought-out via side deals designed to ensure their acquiescence to the bigger picture. But to reduce everything to power politics is lose the distinctiveness of what we are seeing today in Europe. The question is not whether or not we are seeing the emergence of German Europe. It is rather: why is a German-dominated Europe taking the form of this kind of fiscal union?

The first point to note is that whilst the new fiscal union may be German in content, it is hardly German in form. Instead, it is premised upon the unerring power of rules overseen by unelected bodies. The idea here is that rules are not merely a tool used in order to reach a particular destination; rules have become an end in themselves. The idea of the fiscal union is that what matters is the ability to constrain – via punitive sanctions if necessary – the spending power of national governments. Attention is focused on how to organize these constraints, not on what they will achieve. The result is actually based on very shaky assumptions, namely that via tighter fiscal policy and some key reforms (e.g. the raising of the retirement age) Europe can return to growth (see here for a critique). Few are convinced by this argument but they agree with the focus on rules.

This fetishizing of rules has driven the sentiment of the markets as much as that of European policymakers: Italy and Greece have been seen in a more positive light ever since their political leaders were swapped for technocratic managers. These managers are seen as more reliable enforcers of common rules, in comparison with their mercurial predecessors. Far from representing a break with the past, this tendency to fetishize rules is a hallmark of European integration. Actual expressions of raw political power reappear at the EU level as neutral rules overseen by technocrats. We have seen this in many other areas and today it has reached fiscal policy.

This faith in rules reflects something broader, what we might call the ideology of technocracy. It is nothing new to say that particular social and political interests present themselves to us not as they are but as carriers of something universal. That is, after all, the very definition of ideology: the particular represented to us as the universal. What is distinctive is that today’s universal is the universe of neutral and non-partisan rules. In Europe today, this ideology is unchallenged because its main opponent – the nation as a particular interest – is so attenuated. The Occupy movement itself has consolidated this trend, seeking to please everyone with its “we are the 99%” slogan. A more divisive and particularlistic politics is needed in order to challenge this ideology of rules.

Interview with Kees Van Der Pijl

As part of our investigation into contemporary political economy, The Current Moment will be publishing interviews with different individuals on the subject of today’s economic and financial crisis. Based on the same set of questions, these interviews are aimed at opening up a debate about the causes and consequences of the current crisis and at advancing our understanding of political economy.

Today’s interview is with Kees Van Der Pijl, professor of international relations at the University of Sussex, UK. One of the leading Marxist scholars of international relations and international political economy, Professor Van Der Pijl has published widely. His books include a three volume project on modes of foreign relations (vol. 1 and vol. 2), Global Rivalries: From the Cold War to Iraq (2006) and The Making of an Atlantic Ruling Class (1984). He has also published widely in the New Left Review and other journals and magazines.

What are the stories right now that you think people either aren’t paying enough attention to, or about which we have the wrong view?

Generally speaking I have become more and more concerned with the War on Terror as a route to constraining civil liberties and freeing the forces of authoritarianism in the West. In combination with a stubborn adherence to neoliberal responses to the crisis, the by now almost routine resort to war as a means of regime change, the steady build-up by the West of military assets against Russia and China, and Israel’s preparation for war with Iran (in which NATO is complicit in many ways, for instance by allowing Israeli air force jets to practice on Sardinia for such an attack), this raises the frightening prospect of a larger conflict which in turn will further reduce the space for dissent.

Turning to the Eurozone debt problem, a dominant view is that Greeks and Italians are corrupt, inefficient and lazy, and that is why they find themselves in this mess. What is your view of what is going on?

Tax evasion and the size of a black economy are real problems. But if compared to what it costs in campaign contributions to be elected to the presidency of the US, or the non-payment of taxes by big corporations in the US and the larger EU economies (just think of how the hedge fund LCTM, based in the Cayman Island, was bailed out in 1998 by the Fed with public money, or what German banks were able to avoid paying by a simple change in capital gains tax so that they could divest themselves of their stakes in other corporations), what happens in southern Europe is small fry.

What is at stake everywhere is that bank capital is able to avoid the negative consequences of low interest rates by raising the call for debt reduction, which means debt rescheduling and mark-ups in bond rates for the most affected countries. All of which works to keep the banks in a position where they can dictate to governments which economic policy to follow.

Deeper down of course is the issue that ‘growth’, that is, capital accumulation, is stalling because society is reaching the limits (which are ‘culturally’ specific in each country) of what it can absorb in goods and services, what it can perform work-wise, and the like.

The standard recipe for the recovery from the Eurozone crisis is austerity and structural reforms in the peripheries, plus some recapitalization of banks. Do you think this is the right way to go?

This is a recipe for disaster and will aggravate what I said above. Shrinking the economy will make any debt relatively larger and the ability to service it more difficult.

What do you think would address the trade and debt imbalances between Northern and Southern Europe? Do you think it can be done within the European monetary union or does it require a fundamental change or dismantling of that union?

EMU was set up prematurely to allow the strongest capitals to expand from a larger economic zone without having unnecessary transaction costs. More importantly, it served to generalize their desire to have a strong currency to diversify internationally through direct foreign investment. For German capital in particular this solution does not harm its remaining export prospects because the sectors in which production remains in Germany are not price-sensitive. A power plant or a giant turbine for hydroelectric dam is not bought at competitive prices, even a Mercedes or BMW is not subject to the same price pressures as an Alfa Romeo or a Renault.

Hence EMU was bound to reinforce the strongest German capitals, Dutch, some French, at the expense of the peripheral economies which no longer can adjust lower productivity and greater exposure to competitive pressures by devaluation. Liberal capitalism always produces inequalities; uneven development is at the heart of it.

Within a capitalist economy, Eurobonds would have a stabilizing effect. However, that is precisely where the financial fraction of US capital and politicians associated with it (Volcker, Summers, Geithner…) don’t want the Euro: it would create a real alternative to US Treasury bonds which are currently the mainstay of the global credit economy and keep the US afloat. The current Eurozone troubles work in various ways to keep the Euro embattled and prevent the Eurobond solution. Inequality is translated by the Murdoch and Springer media and the like into chauvinist sentiment (‘Greeks are lazy’, the ‘PIGS’ etc.), with the result that German or Dutch ‘public opinion’ resists shouldering a heavier interest rate burden on public debt which Eurobonds would entail. The way Strauss-Kahn, a philanderer but also an advocate of building a more complete financial infrastructure around the Euro, was removed, or the ‘mistake’ of downgrading France’s credit-rating, is a reminder of the conspiratorial dimension that is inevitably involved in keeping the Euro off-balance. Of course, the process is systemic but it evolves through concrete actions.

The hegemony of the demand for austerity is striking. It is offered as the solution to the Eurozone crisis, as well as to the American situation – the US Congress even created a supercommittee to find savings. It seems odd to have such agreement around austerity in the midst of a potential double dip recession. Why is there such agreement on this point and what do you think of the demand for austerity?

This is about the continued hegemony of neoclassical economics, the failure of Keynesians to adjust to a globalised economy and the even more disturbing failure of Marxist-inspired or Institutionalist political economists to challenge neoclassical principles, in the way of the 1970s capital debate and so on. Only this can explain why completely corrupt mainstream economics (just look at the part on the economists’ role in the film ‘Inside Job’) can remain as the dominant intellectual force. Mario Monti is called ‘a respected economist’ and nobody asks in what sort of economics did he gain his credentials.

In the US, an influential view is to argue for continued expansionary monetary policy but with contractionary fiscal policy. That seems to be the recipe of the moment, with the Fed even contemplating another round of quantitative easing. What do you think of this approach to inadequate demand and balance sheet problems?

Dollar inflation by printing more money keeps the mass consumption economy going although it is losing steam as accumulation stalls. And as long as China, Japan, Kuwait and the like continue to buy up US Treasuries, the value of the dollar is hardly affected either. As purchases of precious metals by China and other countries outside the Atlantic heartland increase, we may be in for a surprise at some point in terms of global monetary relations. However, how the holders of US Treasuries would square a loss of value of their 2 or 3 trillion worth of holdings, with a new role for e.g. the Yuan backed by gold or silver, I cannot predict.

Debt, especially mortgages and student loans, have become a major issue over the past few years. What, if anything, should be done about this? How should we understand the growing debt of American households in the past decades?

In the English-speaking West, the debt problem is much more acute because the lowering of wages was accompanied by a credit-card culture that kept consumption going in spite of it. Also their mortgage debt is higher than elsewhere and the attempts by banks to move into new zones to create mortgage markets are more recent or even just beginning. Only some sort of socialization of debt, separating economically and ecologically justifiable repayments (that is, to institutions useful in these respects) from speculative titles, can be a way out here. The continued payment of interest to big players who are not, say, pension funds or otherwise institutions of public interest, should be suspended.

One thing that seems to tie the American and European situation together is the considerable growth of financial activity. Is there anything to the view that the last decades can be understood as a period of “financialization”? If so, what might it mean to say the economy has become “financialized”?

This has been explained by noting on the one hand the accumulation crisis which diverts investment funds to speculative circulation, quasi-liquidity, all to make commercial profit by raiding and asset-stripping. On the other hand, financialization serves as a socialization of risk, hence ‘hedge’ funds etc. of course also operating for profit but simultaneously performing a role that we later may come to see as a route to some sort of socialization of the economy as a whole.

Related to that question, what accounts for the “bubbliness” of the US and European economies and especially the scale of these bubbles? We have seen a number of different bubbles and credit crises – housing bubbles in the US, UK, Ireland, and Spain; sovereign debt events in Greece, Portugal, and Italy, perhaps even France. While there was the dot.com bubble in the late 90s, and the East Asian financial crisis in the same decade, those don’t seem to have had the magnitude and systemic character as the latest period. What is, or isn’t, different about what we’re experiencing now?

What we’re experiencing now is that speculation, hedging etc. is coming home from having raided various peripheral locations. It is now the turn of the ‘central’ bubble which contains all others. This raises profound questions about the role of the shadow economy and how it is related to shadow politics.

How optimistic/pessimistic are you about the ability of national democratic procedures to provide solutions to the current economic crises in Europe and in the US? What do you think of the recent proliferation of technocratic governments in Greece and Italy? Does the current crisis expose some basic tensions between capitalism and democracy? If so, how exactly?

I am not optimistic about the ability of the established parliamentary governing classes to come up with any solution of their own because they are morally corrupt and hostage to a defunct understanding of the economy and society. The governments imposed on Greece and Italy are instances of ‘soft regime change’ by the EU and the IMF and will fail as their elected predecessors have.

What are your views of the nascent protests (Occupy Wall Street, Indignados) developing in response to the introduction of austerity packages in Europe and the US? Are these movements a continuation of or a break with the anti-globalization movements of the past? Are they likely to fundamentally change public perceptions and government policy or will they have only a small lasting impact?

The Occupy movements are the most important event in thirty years and are having an impact already on mainstream political discourse. They go beyond anti-globalization because they demand from governments (irrespective of their stripe) to restore a basic decency to social life and to disempower global finance. This conforms, unintentionally of course, to Marx’s insight in Capital Volume III that a transition to what he called the ‘Associated Mode of Production’ would come about through precisely such a movement demanding from governments that they rein in financial flows destabilizing economies, after which an economy based on cooperation of polytechnic workers would replace the capitalist one based on direction by owners. Today we would add the ecological dimension, the most urgent issue of our epoch.

What, finally, do you think the appropriate political response is to both these crises and their aftermath?

Some form of ecological socialism, within the specific context of each particular national or regional culture and attuned to the expectations of its citizens. In such a society, education should be at the heart of social reproduction and guide people to living culturally rich lives that are less dependant on continually buying new consumer goods.

Corporations Revisited

The issue of demands continues to surface (and die) at the Occupations, with a recent casualty being a ‘jobs for all’ platform proposed at Occupy Wall Street. Media coverage has obsessed about the lack of demands, yet it has missed the fact that a number of General Assemblies have approved one: end corporate personhood. As far as we can gather, this is the one point on which the OWS and the Occupy Boston groups have agreed on, and at our various discussions at Occupy Boston in particular, it is the one demand we find nearly everyone there actively supporting. Although we addressed the corporate personhood issue before, it is worth revisiting given its emergence as something of a consensus position.

At a tactical level calling for an end to corporate personhood, especially while rejecting most other demands, is just politically tone deaf. For one, why would a movement claiming to represent the interests of 99% begin with such a technical and dislocated demand? It is hardly high on the list of the many groups and persons who are suffering from the current economic order and who might very well tacitly support the Occupations. While Occupy enjoys a fair, though unmeasurable, amount of tacit popular support, at some point it will have to convert at least some of that support into active support. To do that, it will have to show political insight into the needs and desires of those potential supporters – workers, debt-burdened consumers, immigrants. Corporate personhood is hardly high on their list, and it is certainly not the main obstacle to meeting their demands.

Moreover, the demand to end corporate personhood is a tactical mistake because it is so middling and indeterminate. It seeks to tear down some aspect of the present, but does not even hint at the ultimate structure of ownership, scale of production, and justice of distribution that a more desirable economic order would have. Ending corporate personhood is neither a broad and radical desire, like a demand to create jobs for all or demand to nationalize banks and socialize investment, nor is it a concrete demand, like a millionaire’s tax and suspension of foreclosures. In other words, it does not seem to offer either a utopian vision nor any immediate improvement in the majority’s economic situation. The demand speaks to a kind of poverty of imagination and, at a more mundane level, betrays an odd unwillingness to think about the immediate concerns of the 99%.

Of course, we know why the idea of ‘corporate personhood’ has seized the Occupiers’ imagination. In the Citizens United case, the Supreme Court used the idea of corporate personhood to defend the free speech rights of corporations and to undermine federal limits on campaign contributions and political ads by corporations and unions. Further, Citizens United was decided against the background of Kelo v. City of New London. That case expanded the legitimate use of eminent domain to allow the state to force property owners to sell their land to the government for the purposes of having that land resold to private development corporations (rather than be put to use by the state itself). If the corruption of democracy is generally associated with corporations and concentrated wealth, these cases have made corporate personhood the special object of contempt.

Citizens and Kelo were both bad cases, but they were not bad cases because of the very idea of corporate personhood. They were bad cases because they constructed the legal personality of corporations in bad, undemocratic ways. There is nothing inherent in the very idea of a corporate person that leads to undemocratic outcomes. As we pointed out in our previous post on corporations, a corporation is a collective economic entity with certain powers, rights, and liabilities. These features of its legal ‘personality’ are artifacts of law. The undesirable legal changes to corporate governance – by judges and legislators – are a sign that democracy was already corrupted well before the expansion of certain corporate powers. Under conditions of real democracy, we might construct this legal personality in ways that were more suited to serving the public interest.

In fact, there are elements of corporate personality that still bear the traces of democratic control. In many civil cases, corporations are subject to ‘strict liability.’ That means they are economically liable for the harm some decision they make causes, even if they did not intend harm others and could not have known of the consequence. This is not the kind of liability to which an individual person can normally be held. (An individual generally is liable only if some kind of intent – even if only at the minimal level of negligence – is present.) Part of the reason for this difference in liability is to acknowledge the greater social power that corporations have, and to impose a discipline on them given the risks they take. Knowing they face strict liability, and the prospect of massive damages from hostile juries, forces a degree of self-supervision of corporate activities. Civil lawsuits might not be the best way to deal with the unequal social power of corporations. But the point is that the lower standards of intent that corporations face is a feature of how lawmakers have constructed their legal personhood. That corporations have legal personality is what makes that personality subject to democratic control.

The protests and representative politics: like ships in the night?

The Current Moment watched this weekend as a desultory Occupation/We are the 99% demonstration marched past on Amsterdam’s Rokin avenue. The numbers were small, the slogans diffuse and the chanting sporadic. The poignant quality of the march was summed up when one protester, alone as everyone around her walked on quietly, tried to get a chant going. “We are the 99%, we are the 99%…”. But no one joined her.

Such first impressions notwithstanding, the protests have attracted attention around the world. They made the cover of The Economist, no mean feat. But a curious feature of the protests is that as the media interest in them booms, their electoral fortunes dwindle. Will these protests eventually reshape the world of representative politics or will they crystallize as a form of anti-politics, eschewing elections and party platforms?

The results at present are mixed. Take Germany, for instance. One important recent development was the adoption by Die Linke of a party program (for a draft of this program in English, see here). A feature of this new Left party in Germany (set up in 2007) was its absence of any clear program, preferring instead a set of “orientations”. Its party congress this month was held in the German town of Erfurt – famous as the town that gave its name to the Social Democratic party program of 1891, a key document of the Marxist Second International. The message of Die Linke to its critics was that it was no longer an eclectic mixture of Leftists but a coherent answer to the questions being raised by demonstrators across Europe. As Die Linke firmed up its party program, its electoral fortunes have waned. Only a few weeks prior to adopting its program, the party lost heavily in local elections in Berlin. After a decade of sharing power with the Social Democrat Party (SPD) in the capital, Die Linke lost almost two thirds of its support.

We see similar trends in Spain and in France. The Spanish Indignados have led the street protest movement, pioneering the public square occupations and inspiring the more recent Wall Street occupation movement. And yet, as the Spanish protestors have grown in number, electoral politics in Spain have moved in the opposite direction. With the parliament dissolved on the 26^th September and elections set for the 20^th November, polls put the right-wing People’s Party far ahead of the incumbent Socialist Party of José Luis Rodríguez Zapatero. In early October, the PP’s leader, Mariano Rajoy, was polling at 15% ahead of Zapatero.

In France, the elections for candidate of the Socialist Party in next year’s presidential election were marked by the success of the most determinedly left-wing candidate, Arnaud Montebourg. Having popularized ideas such as “de-globalization” (= protection) and openly arguing for far greater regulation of the financial sector, Montebourg won 17.19% in the first round of votes, far ahead of the 2008 Socialist candidate, Ségolène Royale (who got only 6.95%). With such a score, Montebourg was able to decisively influence the second round results by supporting François Hollande on the basis of his willingness to control the banks (see here for Montebourg’s reasons for supporting Hollande). Looking at the second round results, however, the dynamics were different. Martine Aubry attacked Hollande for being “weak” (la gauche molle) and put herself forward as a more robust and radical alternative. Her attempt at courting the left of the party failed and a more centrist, more moderate Hollande won. Radicalism in the street protests has not yet, in France, found its way through to the Socialist Party leadership.

The ongoing protests are influencing the terms of political debate in Europe. The freedom government leaders have to manoeuvre at the European level is shrinking, especially in Germany as the Bundesdag exerts control over Chancellor Merkel’s negotiation strategies. But whether the protests will engage directly with representative politics is less clear. Much of the protest movement is organized around a critique of the political class. Until it sheds its rhetoric of anti-politics and tries to win support by proposing its own alternatives, the protests will struggle to transform their rhetoric of “we are the 99%” into the reality of a political movement able to mobilize majorities and transform society.

 

Thoughts on Corporations

Ever high minded, The New Republic has seen reason to explain to us why the Occupy movement is hysterical  and dangerous. Worse yet, trotting out an Cold War trope, TNR thinks the General Assembly political form “has an air of group-think about it that is, or should be, troubling to liberals.” Group-think so very unlike, of course, corporate boardrooms, trading floors, and, dare we say it, editorial boards. (We struggle to remember the last war TNR failed, so predictably, to support.) Luckily, we have that venerable mouthpiece of radical criticism, Business Insider, to remind us of some of the reasons why one might be on the street these days. Its summary of the economic situation is excellent, and very helpfully arranged with illuminating graphics.

For our part, we think the Occupy movement, like most protest movements, is mixed, and still in formation. Having spent the weekend at Occupy Boston, and yesterday facilitating an open air class at the camp, perhaps the most noticeable and exciting feature of the movement is the desire and willingness to think everything anew. The freeing of the imagination may, in fact, be the first and most significant effect of these protests. And just about everybody there seems to be open to debating all kinds of new ideas.

Of course, the imagination can go anywhere, and the Occupy movement will have to make some choices down the road. To the end of trying to think through the different possibilities, we discussed alternative ways of thinking about debt and corporations at the class yesterday. Below are some of our initial thoughts on corporations. The basic message we were trying to work through was ‘democratize, don’t destroy.’

Our economy is based on artifacts. Property, contract, money, corporations, these are all economic domains based on law and convention. Markets themselves are not natural, they are products of law. There is no such thing as ‘the market,’ with necessary and natural features. There are markets. The ‘fictitious’ character of our economy sometimes becomes the object of attack, especially when some of these fictions seem out of control and not work to our benefit. Anyone who has been to an Occupy event will have met Ron Paulites, who not only want to end the Fed, but also return to the gold standard. The return to the gold standard is offered with the, in our mind misguided, comfort of appearing to return to something concrete – gold. Abolish the fiction, so we can get back to the real thing. (A return to the gold standard would contract the money supply so severely that it would make the credit crunch of 2008 look like a hiccup.)

But it’s not just the Paulites who want to abolish the economic fictions that seem out of control. One also sees a lot of signs against corporations. ‘Corporations are not persons,’ is a familiar one. In so far as these signs are protestations against the Citizens United ruling, which used the fact that corporations are ‘legal persons’ to argue that they have free speech rights, we agree with these signs. But these signs often express a kind of parallel antagonism to the Paulite rejection of fiat money – abolish the fiction, return us to the real thing. Real persons, actual gold.

That is, in its roughest outlines, the ‘destroy’ side, or at least ‘refuse’. But the problem is that in large, global economy, based on the division of labor, there is no way out of such abstract or seemingly ‘fictitious’ relationships. And in fact, there are some very good things about them, on the basis of which one could start thinking about alternatives. In the case of corporations, we can think of at least three aspects of its legal or ‘fictitious’ personality that are a good thing. For one, abstracting for the moment from the specific rules of ownership and control, a corporation is a large amount of cooperative workers who work towards a common end. It is a collective economic agent. As such, it can take advantage of economies of scale, and these economies are potentially enormous (think of electricity, or steel, or even health insurance. Those actuarial risks are much more reliably calculated over a massive population than a small one.) There is no reason, in principle, why these economies of scale cannot benefit everyone. One can imagine large scale production dramatically reducing the amount of hours any given person must spend doing necessary work. That’s not our society – in which one in six have too little or no work, while many of the rest have to work too long. But it could be our society – and an important feature of that society would be using the productivity of large scale enterprises to meet human needs with minimal effort.

Second, a corporation is a separation of ownership and control. The ‘mom and pop store’ – the real fictions of the American economy, since 80% of US workers are employed in businesses of 500 or more (more than any other industrial economy) – is one where ownership and control lie in the same persons. But a corporation works by this separation owners and controllers, shareholders and managers, which is part of the reason why this construction ‘legal person’ is required. Over the past thirty years the ‘shareholder revolution’ has meant that this separation of ownership and control has worked largely against public interests. Previously passive shareholders have demanded higher profits, bigger dividends, which required transforming managers into creators of (short-term) shareholder value rather than managers of a long-term enterprise with various interests (worker, public, etc…) at stake. There is not much to defend in the old, pre-1980s managerial capitalism, but what the new relationship has meant is distributing more value to shareholders by squeezing workers. Slackwire recently graphed dividends against corporate profits, and produced a great graph of the shareholder revolution, showing the rapid rise in dividends plus net share repurchases (read the whole post, it’s excellent):

These dividend payouts, and shareholders cashing in, came from reorienting activities to the short-term share values, and by keeping wages low – hardly an arrangement that has served the public interest. (Especially since households compensated for stagnating wages by borrowing, and we know how that has gone.) But there is nothing necessary about this particular relationship between owners and controlers.

In fact, the separation of ownership and control at least used to be considered, by the Left, as one of the good things about corporations. It suggested that, against reigning ideology, the rentiers (shareholders) didn’t do much, since it was managers that ran day-to-day operations. Why, then, not euthanize the shareholders, have workers hire managers, and democratize the firm? And more broadly, the point is that the relevant stakeholders in a corporation – whose very existence is recognized, in American law, as necessary only to serve a public interest – are not just shareholders but also its workers, and the general public. As an artifact of law, the structure of ownership and control could be changed so that the idea – creating this collective agents for the public good – could better fit reality. (The best summary we’ve read on these questions is still the ‘Governance’ chapter of Doug Henwood’s Wall Street, available for free download.) Again, this democratization of the corporation hinges on seeing its artificiality or ‘fictitiousness’ as a good thing – as a feature of it being a creature of law, which we can change and control.

Finally, our one other thought is that corporations are said to take risks, and to engage in risky behavior that endanger the wider community. And part of the reason why it does that is because of its fictitious personality, the fact that its managers and shareholders only bear limited risks, that corporations can ignore all kinds of negative externalities, and this leads to bad outcomes. This may be true, but it is not an inherent feature of collective economic agents. It’s a matter of how we have constructed laws and incentives, such that we often socialize the risks but privatize the benefits of corporate activity. But there is nothing in itself wrong with giving certain collective agents the power, within appropriate constraints, to take risks. Taking risks, making a bet on the future, is a necessary feature of large scale economic activity and progress. It would be nearly impossible for an economy to do things like develop new planes, which take decades to develop, test, and manufacture, or new energy technologies, if it did not allow groups to take a bet on the future, to take risks with some portion of our economic surplus. How we arrange which risks are taken, and who bears the relevant risks, as well as who benefits from the distributions is again a matter of law. But it is not the risk-taking itself that is the bad thing about corporations.

These are not final positions, but initial thoughts, produced in response to the emerging economic thinking of the new Occupy movements, and with the hope that the initial, quite justifiable, feeling of rejection of fictions might be transformed into a more positive and constructive attitude, that finds a vision of the future in the seedbed of the present. The other alternatives we have heard discussed, especially ones that try to eliminate all of our seemingly fictitious or unreal economic practices, seem to us to be more of a rejection of the division of labor and large scale production itself. It’s hard to find a positive vision in that.

What Are They Occupied With?

Many now ask what are the ‘Occupiers’ occupied with? Though heartened by their growth, we are concerned both with the form and the content of their demands. Today, we will discuss only the content of these demands, and hope to follow up with a discussion of form.

Since it began, Occupy Wall Street has spread to a number of other cities, and has shed light on the activities of other, similar groups, already in existence. We had the opportunity to visit Occupy Wall Street last Friday, participating in the march from Zucotti Park to Police Plaza, and we have followed closely the debates over what the new ‘Occupy’ movement means. Some of the contours of the debate are familiar. Critics ridicule their street theater and ignorance. Sympathizers worry about the lack of clear demands. Supporters argue that the process-orientation is the demand, it even ‘prefigures’ the new utopian society within the constraints of the old; or more moderately, they argue it is a necessary tactic to attract a broad base of support. (For the most recent demands at OWS, see this General Assembly declaration). We are somewhere between sympathizers and supporters, but have the following concerns about the ‘movement’ as it currently exists.

Content problems

The lion’s share of the debate has revolved around the lack of demands and the absence of clear organization. The claim to represent 99% yet unwillingness to erect any formal structure of representation has been a visible worry. Yet our concerns begin with the content of the claim to represent 99%. In a recent post, Doug Henwood quite reasonably pointed to the charm of the claim to 99% – it is universal. For the Left, this is indeed an advance over the highly fragmented, minority-based politics of the last decades. (Though we note the ‘class, race, gender, etc…’ language seeping back into the general demands.) The attempt to articulate the shared interests of a (vast) majority is a more promising direction to go than the more fragile alliance of numerous minorities. Back in the 1990s, the political philosopher Iris Marion Young pointed out that if you add up all the ‘minorities’ victim to some kind of oppression you end up with a vast majority, so why call them minorities? And as we ourselves have argued, roughly 80% have a shared interest in changing the structure of investment in the US economy. (Henwood also believes that 80% is a better marker of class politics.)

So what is the problem? Well, 99% is most decidedly not 80%. In fact, the critique of the 99%, especially when the 1% is exclusively held to be rich bankers and their lackeys at the Fed, has much more in common with American populism than it does with progressive class struggle. The critique of sinister, East Coast interests, the demand for fairer monetary policy, the assault on the ‘big corporations’ in defense of the little guy is just as much, if not more, petty bourgeois as it is working class. The demand for a ‘People’s Monetary System’; the desire to break up big corporations; the defense of local banks against the massive Eastern money interests are all the bread and butter of classic, nineteenth century American populism. The latter, as we know, was just as effective at absorbing and redirecting America’s agricultural and industrial workers as it was at channeling their needs and efforts.

While some populism at the moment is certainly better than nothing, it is too crude a way of addressing the underlying inequalities of economic power and the sources of economic stagnation. For one, it implicitly hives off the financial class from the rest of the economy, rather than connects the growth of finance to problems with advanced industrial economies since the 1970s. As we have attempted to argue, ‘financialization’ is about more than the emergence of the super-rich and the rise of hedge-funds. Moreover, there are more sources of economic unfreedom than simply indebtedness and a massive banking industry – the strikes of the 1970s were directed against employers, after all, and the recent strikes by Verizon workers remind us of that. Finally, a critique focused on the top 1% of the wealthy, and on the overweening power of corporations, at best leaves ambiguous what kinds of social power would be acceptable in a reformed economy. Here, some of the petty bourgeois anxiety of the protests is especially problematic. A modern economy, even run ‘socialistically,’ would of necessity be composed of extremely large agglomerations of machinery and labor, even if these did not take the form of ‘capital’ and ‘corporation.’ It would also include immense global trade networks, which cannot be modeled on anything like a spontaneous barter system.

All of this might seem exceedingly harsh or over-interpreted. Where, one might ask, can one actually find these ideas at the OWS or any of the other movements itself? No single set of ideas can be pinned on them, and that is there virtue. Be that as it may, it is more of a non-response. There is no consensus, but there are clear tendencies, some stronger than others. The 99% claim has emerged as the most powerful tendency, and as far as we can tell, it has the basic content described above. Our arguments are not offered as a reason to reject the movement but in the spirit of reflection and internal criticism. We do not think the current efforts are useless, ridiculous, or pointless. But we do think that, as they develop, some serious disagreements and points of direction will have to be settled. On that front, we hope 99% become 80.