Today, Thursday, October 6, over 2,000 people assembled at Freedom Square and marched to the U.S. Chamber of Commerce. We brought thousands of resumes of people looking for jobs.  Many testified about their job searches. Here were my remarks: *** US Chamber Helping the “Built to Loot” companies A coalition of Wall Street companies –and the US Chamber of Commerce -are pressing for a “Tax Holiday” for companies that have parked over $1 trillion in off shore tax havens. Companies include Google, Apple, Pfizer drug, General Electric, Duke Energy. They’ve spent over $50 million and hired 62 lobbyists –mostly former Democratic Congressional staffers.  They intend to buy this tax break and hope that we will all stay asleep. Today, they introduced their bill in the Senate to “repatriate” their profits.  They want to bring this money back –and claim they will use it to create jobs. But here’s what we know: Their Pants Are On Fire.  Liar, Liar, Pants on Fire. In 2004 they convinced Congress to do the same thing.  Congress granted a $92 billion tax holiday to 800 global companies that had stashed their profits off shore. What did they do with their money?  Did they create jobs? No!  Yesterday the Institute for Policy Studies released a study: 58 companies that got 70 percent of the tax breaks in 2004 destroyed almost 600,000 jobs. They got a $64 billion in tax breaks. They say they need cash to invest in the U.S.  We found these 58 companies are sitting on $450 billion in cash.  If they want to invest now, nothing is stopping them! BE CLEAR: These companies are not job creators, they are job destroyers.  These used the money to funnel more money to their CEOs and pay out dividends and buy up smaller companies. NO TAX HOLIDAYS FOR COMPANIES THAT DESTROY JOBS. The conservative Heritage Foundation also released a study yesterday saying tax holidays won’t create jobs.  When IPS and Heritage same the same thing…hopefully Congress will Listen. Look, we’re not anti-business.  We’re not here protesting at the Chamber because we are anti-business. Some of us here are members of local chambers of commerce.  There are patriotic businesses in our communities that pay living wages, that source their products locally, that pay their federal and local taxes without whining.  These are domestic and rooted businesses that care about our communities and the environment –and understand that they are an integral part of a healthy community. The business management guru Jim Collins calls them BUILT TO LAST companies –that celebrate all their stakeholders –workers, communities and shareholders.  If we’re going to help any companies, they should be BUILD TO LAST businesses that create jobs. The companies lobbying for this Tax Holiday are BUILT TO LOOT companies. Their business model is to shift costs off their balance sheet and onto us.  They ship jobs overseas, they dodge their taxes, they pollute and get someone else to clean up their mess.  Their whole business model is TAKE THE MONEY AND RUN. Three weeks ago we did a study that showed 25 of these companies paid their CEOS more than they paid in taxes. These companies are MOOCHERS.  They use the public roads and infrastructure.  They hire employees from our local schools and universities.  When someone steals their patents, they run to US courts to defend their assets.  They want our military to defend their assets around the world.  They just don’t want to PAY.  They use accounting gymnastics to shift their profits offshore and NO TAXES in the US. Exxon Mobil, next time a pirate hijacks one of your tankers, call the Navy of Luxembourg to defend you. Pfizer Drug –next time someone steals your patent, get the Justice Department from Ireland to defend your property. Don’t call us until you PAY UP. The U.S. Chamber is a lobbyist for the BUILT TO LOOT companies.  But we have to defend ourselves against these companies.  We have to organize to stop them. If they get their tax holiday, it will only reward their bad behavior.  It will KILL JOBS at patriotic domestic companies that are forced to compete against tax dodgers on an unlevel playing field. The BUILT TO LOOT companies will keep shipping more jobs overseas.  They will keep dodging taxes. It will cost us over $80 billion –money better spent on REAL JOB CREATORS. STOP THE BUILT TO LOOT COMPANIES. NO Tax Holiday for Corporations that Destroy Jobs!
Uncle Sam Should Support Built-to–Last Companies, not Built–to-Loot Enterprises A powerful coalition of U.S.-based global companies is lobbying hard for a “tax holiday” on offshore profits. Companies like Google, Apple, Pfizer, and General Electric have parked huge amounts of profits — a stash totaling more than $1.4 trillion —in offshore tax havens. They've stowed those funds abroad primarily to avoid having to pay federal taxes on that income. But now they want to bring their treasure to the United States, albeit at a steep discount on what they owe the IRS. Instead of paying the statutory corporate income tax rate of 35 percent — or even the “effective rate,” which for most global companies, is closer to 11 percent — they're urging Congress to let them do this at a tax rate that's a whisker over 5 percent. They tell Congress they need a “tax holiday” to free up badly needed capital to invest in right here — creating jobs at a time when the U.S. economy is sputtering. They’ve formed a lobby front called the WIN America coalition to make their case, spending over $50 million and hiring over 42 lobbyists that previously worked as staffers on select Congressional tax writing committees. Most GOP members would support any tax cut, even in their sleep, so WIN America has focused its lobbying firepower on Democratic members. The coalition's corporate lobbyists argue this would be a win-win stimulus for the economy and a low-cost way to growth and jobs that both Republicans and Democrats could support. The problem with these WIN America promises is this: Their pants are on fire. Here’s how we know that: They waged the same campaign in 2004 with the same promises that they would create jobs, got their way, and created few jobs.  Worse, some companies destroyed tens of thousands of jobs. According to a new report that I co-authored, America Loses: Corporations That Tax Holidays Slash Jobs, most of the companies that claimed a tax holiday in 2004 dramatically reduced their national and global workforces. In fact, 58 of the large corporations that took the 2004 tax holidays shed almost 600,000 workers in subsequent years. This downsizing was not a result of the economic meltdown as many of these companies prospered. Today, these 58 companies maintain combined cash reserves of more than $450 billion. There’s nothing holding them back from investing in America. These 58 giant corporations accounted for nearly 70 percent of the total repatriated funds and collectively saved an estimated $64 billion from what they otherwise would have owed in taxes. The 10 biggest “layoff leaders” were Citigroup, Hewlett-Packard, Bank of America, Pfizer, Merck, Verizon, Ford, Caterpillar, Dow Chemical, and DuPont. The corporate flaks will complain that these job loss numbers are exaggerated. We believe they are low, but we won’t know for sure until companies that benefit from U.S. tax breaks and subsidies are required to report, in plain language, the number of U.S. employees they have. Congress shouldn’t be fooled again. Limited incentives should go to activities that will create jobs, not another tax holiday for off shore tax dodgers. These companies are not in the business of creating jobs. They are in the business of shifting as much wealth to their top managers and shareholders as possible. There are other businesses out there — small businesses and domestic companies rooted in local communities that should be the objects of our encouragement and support. Management guru Jim Collins (no relation) has written about the characteristics of “built to last” companies, businesses that are not “take the money and run” oriented, but are dynamic, growing, and capable of adapting to changing market environments. Built-to-last companies don’t play fast and loose with their stakeholders — namely, their employees, shareholders, the communities where they operate, and Mother Earth. Unfortunately, a segment of corporate America embraces a “built to loot” business model. They shift every possible expense off their balance sheet and squeeze their stakeholders, with the exception of top management and shareholders. They outsource and offshore jobs and engage in accounting gymnastics to game their tax bills to nothing. They mooch from the common treasury, but don’t contribute. Lawmakers should block this fiscally irresponsible and entirely undeserved tax break. Chuck Collins is a co-author of the new Institute for Policy Studies report, America Loses: Corporations that Take Tax Holidays Slash Jobs. www.ips-dc.org Originally Published at IPS’s Blob: http://www.ips-dc.org/blog/uncle_sam_should_support-built-to-last_companies
I'm really thrilled with the responses to my recent article, Is the Near-Trillion Dollar Student Loan Bubble About to Pop? A couple of people have written really nice long responses to it that add some significant value. There are a million articles that could be written about the student loan crisis, and I'm gratified to have helped move the conversation forward for other people to spin off of. I thought I'd link a few of them here for you. Kay Steiger dug in deeper to the causes for the rising tuition that's created what I and others refer to as the student loan bubble. She wrote:
Shrinking state investments in higher education. Part of this is that, public universities, which educate a large percentage of students, have seen the amount of public financing shrink. Though states were once dedicated to ensuring a free or low-cost education for its residents, that commitment has largely fallen by the wayside was state budgets tighten. The Center on Budget and Policy Priorities found that since the beginning of the recession, 43 states have cut funding assistance to public universities.
Among other reasons she highlights, one stands out:
Some schools are actually ripping people off. While the vast majority of colleges really are there with the mission of educating their students and helping them reach a better financial future, there are some schools out there that seem to actively be ripping people off. Some of these schools, according to government investigations, seemed to be calculating tuition prices to maximize the amount of federal subsidies, recruiting students by way of questionable tactics, and providing poor-quality training for jobs they purport to prepare students for. (Let me be clear on this—not all for-profit schools are setting out to rip people off. I’m talking about some of the particularly bad actors.) This gets into much of the debate over for-profit colleges, the Department of Education’s attempt to regulate them. Lately the for-profit colleges themselves have released a code of conduct to demonstrate that they can be a self-regulating body. Whether this combination of administration regulation and self-policing works remains to be seen.
Where I differ with her is over solutions. She suggests that we want to encourage students not to take student debt lightly, just as we don't want to encourage mortgage holders to walk away from their homes. The problem right now is that students are saddled with debt that they're stuck with for life. They can't walk away from the asset they purchased when its value drops like a person who bought a house can--they can't even declare bankruptcy if the current economy has led their purchase to be worth less than they thought--in this case, if they're unable to find work that allows them to pay down their debt. Mike Konczal also responded to my piece, and compared the never-ending nature of student debt to colonial indentured servitude:
How well does colonial indenture match up with student loans?  Pretty well I’d argue.  That’s the provocative thesis of this great Jeffrey Williams piece in Dissent, Student Debt and the Spirit of Indenture.  I brought this thesis up to a conservatively-minded economic historian I know and he delighted in it – as he pointed out, in colonial times people died so quickly and they could disappear easily.  As such indenture needed to function in a “total institution”-like space with coercive punishment very present to get maximum returns to creditors.  With today’s longevity, as well as our surveillance and monitoring technologies, indenture can function in the background as a cut deducted from your checking account every month for a few decades.
Steiger suggests that maybe the key to the question about student loans lies in the situation of the person I called Max Parker in the article, who told his story of having to leave school midway through and being unable to return because of the size of his debt. While I agree that Parker's case is heartbreaking, I don't think that's the most important problem. I've often quoted the wonderful BBC journalist and author Paul Mason on the "graduates with no future," the students around the world who finished school at a time of economic crisis, who did everything they were supposed to do and still have no opportunity. In the UK, where Mason is based, the current graduates don't have US-style student loans, yet they still have no future. And here, the rate of default is rising for grads--and even those who, like Colleen Williams, mentioned in my piece, manage to make their monthly payments, are stuck pumping lots of money into servicing their debt rather than into the economy, creating yet another drag on the whole. Konczal takes yet another tack in pointing out that the current system of student loans is unsustainable, looking at those who do go on to economic success (whether they are happy, fulfilled, or productive is another argument entirely, one should note) after graduation. He quotes a paper by Jesse Rothstein, Constrained After College: Student Loans and Early Career Occupational Choices, which says that "an extra $10,000 in student debt reduces the likelihood that an individual will take a job in nonprofits, government, or education by about 5 to 6 percentage points." He continues:
For our purposes, even those for whom this arrangement works find themselves pushed out of government, education or non-profit work by their debt loads.  Debt puts contraints on what people are capable of doing, and one way out of that constraint is to work in the fields that pay the most.  For those who want to see our best working in schools, government, nonprofits, taking chances starting entrepreneurial work or simply not working to replicate already existing power structures, this is a terrible arrangement.
We can see this in action as the financial sector has grown all out of proportion with the rest of the country (and broken the economy, leaving so many of these grads stranded, along the way). A recent study points out that the financial industry has "cannibalized" (no, really, that's a quote) the best and the brightest not just from business schools. No, it's taking "new master’s- and doctoral-level graduates of science, engineering, math and physics, and pays them starting wages that are five times or more what they would have earned had they remained in their own fields." (The same can be seen in the medical field, as fewer doctors are going into primary care because it pays less than specialty fields do.) Were Max Parker to graduate with his double degree in econ and physics, the likelihood that he'd end up just the kind of person being headhunted by financial firms--and feeling obligated to go there, just as he's now feeling obligated to go into the military, because of the size of his debt. In other words, Konczal notes, even when the system works, it's actually working to create more inequality by sucking up those who are considered worthy into high-paying jobs and leaving the rest with their incomes cannibalized for decades. It's creating a brain drain on just the kinds of things we want our well-educated young people doing, working for social good, innovating, going into public service--as Tarah Toney pointed out in my piece, she wanted to go into teaching after working her way through school, but there were no jobs and her debt pushed her instead to take a job at a real estate office. Konczal and Steiger both note that keeping tuition low, especially at public universities, is a necessary solution to the problem. But that would only solve the problem for some of the grads of the future. Right now, the economy desperately needs spending and, as Rep. Hansen Clarke noted (and I quoted in my piece) households are burdened with debt that in most cases they took on in good faith, and the majority of the new jobs that have been created since the beginning of the recession have been low-wage, hardly enough to keep someone going, let alone allow them to pay hundreds of dollars a month on a student loan that seems, more than ever, like a waste of money.
If you care about the future of the republic, the health of our communities, and the prospects for a transition to a new green economy –the fight over taxation and concentrated wealth is your fight. If you care about children –and the kind of society we are going to leave for the next generation – in terms of ecological health, infrastructure, functioning government –the fight to tax the wealthy and close corporate tax abuses is your fight. President Obama has put forward a revenue proposal worthy of vocal support and organizing. Progressives need to engage the media and our neighbors –and dramatize the reality that a majority of people support increasing taxes on millionaires and corporate tax dodgers. Why We Should Increase Taxes on the Wealthy There will be a vigorous debate over this proposal that will flow all the way into the 2012 election.  There are four reasons for taxing the wealthy that we should repeat in any conversation we have: 1. Taxes on the Wealthy Have Declined Steadily for Decades.  Over the last decade –and really over the last fifty years -- the portion of income paid in taxes by our wealthiest citizens has steadily declined.  In 1961, when Barack Obama was born, the effective rate paid by households with income over $1 million was 43 percent.  Today it is 23 percent.  The richer you are, as Warren Buffett has illustrated, the smaller the percentage of your income you pay. 2. The Wealthy Benefit Enormously from U.S. Society.  The U.S. wealthy have disproportionately benefited from the public investments we have all made together over the last several generations in technology, scientific research, infrastructure and the system of property rights protections, education and stable market regulations that enable wealth creation to happen.  If they have any doubts about the centrality of the U.S. system to their good fortunes, they should try somewhere else. 3. We All Have A Moral Obligation to Future Generations.  Those with significant wealth at this time have a moral obligation to pay back the society that made their wealth possible.  Progressive taxation is an “economic opportunity recycling” program, enabling present generations to ensure that future generations have the same opportunities they had.  We all have a responsibility to future generations –and the wealthy have an obligation to pay their fair share of taxes as their parents and grandparents did. 4. Progressive Taxation will Reduce Extreme Inequalities of Wealth and Power.  Over the last thirty years, we’ve seen a dramatic increase in inequalities of income, wealth and opportunity.  The wealthiest one percent of households own 35.6 percent of all private wealth, more than the bottom 95 percent of households combined.  These extreme inequalities have undermined all that we care about –our democracy, education, mobility, economic stability.  This concentrated wealth and power is threatening the fundamental tenets of our democracy –and progressive taxation is one of the few ways to reduce inequality. President Obama’s Tax Plan The President’s Tax Reform Plan has many components and covers eight pages of provisions in the summary released, “Living within Our Means and Investing in the Future.” But they fall into three areas: 1. Allowing Bush Tax Cuts Expire and Reform the Estate Tax. President Obama has renewed his campaign pledge to allow the 2001 and 2003 Bush tax cuts for the wealthy expire on households with incomes over $250,000.  Since 2001, we’ve effectively borrowed almost $1 trillion to give the highest income households in our nation these tax breaks.  Reversing them is part of how we’ll get our fiscal house in order. The President also proposes restoring the estate tax to 2009 levels when the tax applied to individuals with wealth over $3.5 million and couples with wealth over $7 million. The estate tax is our nation’s only levy on substantial inherited wealth. The combined revenue of these provisions would generate over $866 billion over 10 years, according to the Office of Budget and Management. 2. Millionaire Tax Rates and the Buffett Rule. The Obama proposal includes the “Buffett Rule” that no millionaire should pay an effective rate lower than a middle class taxpayer.  It was inspired by the billionaire investor’s disclosure of the ways our tax code gives preferential treatment to higher income taxpayers.  Buffett revealed that in 2010 that he paid an effective tax rate of 17.4 percent while many middle class and higher income taxpayers pay over 25 percent of their income. High wage earners pay at 35 percent rate while income from wealth -- capital gains and dividend tax rates -- are 15 percent.  This preference creates all kinds of distortions, including hedge fund managers who claim their income should be taxed at the lower 15 rate.  The President’s tax proposal would eliminate this so called “Carried Interest” loophole and require hedge fund managers to pay at higher rates. 3. Corporate Tax Reform.   The Obama proposal includes a number of important tax reforms, including elimination of subsidies for the oil and gas industry and reform of huge loopholes the insurance industry uses.  It closes down some of the accounting games that corporations play that contribute little to jobs or economic health. A Few Missing Pieces There are few major missing pieces in the President’s revenue plan.  There is no proposal for a financial transition tax, a modest levy on transfers of stocks, bonds and other financial instruments.  European countries have been pressing the U.S. to join a global move to institute such taxes to slow unproductive currency and financial speculation.  A penny tax on every four dollars of transactions could generate over $150 billion a year in revenue. The president’s proposal unfortunately does not fully address the huge corporate loopholes that encourage offshore tax havens and aggressive corporate tax avoidance by U.S. companies.  He should fully embrace Sen. Carl Levin and Rep. Lloyd Doggett’s “Stop Tax Haven Abuse Act,” which would raise an estimated $100 billion a year. The president’s proposal still gives preferential tax treatment to income from capital over income from work.  The tax rate gap between earned wage income and investment income is a glaring problem that creates huge abuses and distortions.  We should tax all income under the same rate structure system, whether it comes from dividends or paychecks. Organizing Time: Celebrate and Get to Work The principles and policies behind President Obama’s revenue proposals are worth lifting up and defending.  They would restore progressivity and fairness to the tax code.  They would raise $1.5 trillion over the next decade from those with the greatest capacity to pay. The push back will be enormous.  Hedge fund managers, corporate CEOs, the offshore tax dodgers  --together will spend hundreds of millions if not billions to attack these proposals.  They believe income from their investments is more virtuous that income from wages.  They believe they should get special treatment for everything they do.   They would be comfortable living in an American with great disparities of income, wealth and opportunity. They’ll accuse Obama of class warfare.  But as Warren Buffett himself observed, “There is a class war in a America, and my class is winning.”  Obama noted that his proposal is not based on class war, but math. We must talk to our friends, families and neighbors –post articles on social media and send around information. Tell people you know why the fight for fair taxes matters to everything they care about. Get the facts –and counter the mythology offensive.  Check out Citizens for Tax Justice, the Center for Budget on Policy Priorities and the Tax Policy Center. Join groups like U.S. UNCUT and The Other 98 Percent and other social networking and direct action groups that will be keeping the pressure on. If you know a wealthy person who believes their taxes should be raised, tell them to join Wealth for the Common Good and speak out for the tax fairness.  It does no good if they keep their position private.  Warren Buffett made a difference by telling his story and exposing that there is one tax system for the wealthy and one for the other 98 percent. If you are a small business owner, don’t let the right wing perpetuate the myth that tax increases on the wealthy and closing corporate tax loopholes are bad for small business and destroy jobs.  You have a unique voice in this debate.  Join Business for Shared Prosperity along with thousands of other small business people who believe that taxes are the price we pay for an unparalleled business environment and infrastructure. We should remember to celebrate.  The fact that these tax proposals are on the agenda is testament to a decade of work by organizers, netroots activists, workers, researchers, and policy advocates who have made the case for progressive taxation. It is the result of groups like Patriotic Millionaires and Wealth for the Common Good –that lift up the Warren Buffetts of the world, the thousands of other business leaders and wealthy individuals who believe they should pay more and are willing to face the cameras and say so. It is a celebration of legislative champions like Sen. Bernie Sanders, Rep. Jan Schakowsky, Rep. Barbara Lee, Sen. Carl Levin, and Rep. Lloyd Doggett who introduced and incubated many of the policies that are in the President’s proposal when they were considered “off the table.” This fall will be decisive –and the debate over taxes will go to heart of what kind of country we become.  All hands on deck! This article was initially published at www.Commondreams.org
Did the attacks of 9/11 end the movement against corporate globalization? A number of reflections written for the ten-year anniversary of the attacks have raised this question. And I think it presents some interesting challenges for those of us who think about social movements. [Cross-posted from the "Arguing the World" blog at Dissent magazine.] In an essay at Truthout journalist Dan Denvir, a friend and colleague, calls the global justice movement a "political casualty" of the War on Terror. Likewise, in the magazine's ten-year-anniversary symposium on 9/11, fellow Dissent contributor Bhaskar Sunkara notes, "The attacks on September 11 had an unforeseen consequence for the Left. The 'anti-globalization' movement abruptly entered public consciousness after the 1999 World Trade Organization (WTO) protests in Seattle and disappeared just as quickly." In their respective essays, Dan and Bhaskar consider the global justice movement as something that effectively existed for less than two years, and then had, in Dan's words, a "quick and sudden end." I think there is a kernel of truth to this idea--there is some reason to look at the period between November 1999 and September 2001 as a unique time. Yet this periodization, I would argue, also has some significant limitations. It skews how we think about the legacy and the impact of the movement--as well as its potential for revival. Let's start with how that period was indeed a special one--particularly for activists within the United States. As Bhaskar writes, "for a moment, radical politics appeared pregnant with possibility." Dan elaborates:
A rapid-fire series of mass demonstrations forced secretive financial institutions, corporations (and political parties) to make their case to the American people for the first time in a very long time, and there was a sense of incredible optimism and power. Older activists were amazed to see people back in the streets and I felt like it was an incredible time to be a young activist. We expected major social change and so did everyone else.
I think both writers are correct that anyone involved in global justice activism at the time felt that it was an exciting and exceptional moment. Importantly, it was the time in which the fickle mainstream media in the United States and Europe paid attention to the protests against corporate globalization as a new and significant force. This attention helped the different groups mobilizing for protests think of themselves as part of a single, collective effort. And it helped create the momentum needed for any mass movement to grow. After 9/11, the mainstream media sent its spotlight elsewhere, and global justice advocates would have to struggle to draw attention to their campaigns. Dan's piece is, in large part, a personal reflection about being radicalized as a student activist during this time. And his experience points to another way in which the period immediately prior to 9/11 was distinctive. Young people coming to left politics in the late 1990s and very early 2000s--particularly on campuses in the United States--were likely to be exposed to critiques of neoliberalism, to campaigns targeting multinational corporations as dominant actors on the world stage, and to challenges to the Democratic Party's acceptance of a new "free trade" orthodoxy. After 9/11, student activists were more likely to be radicalized around a different set of issues--war, torture, and the elimination of civil liberties--and were likely to direct their anger at Bush administration neoconservatives. The dominant tone changed from possibility to despair. As Dan writes:
[T]he anti-globalization was not just a movement against. It was a statement that, as the World Social Forum puts it, Another World Is Possible. The movements that followed were defensive maneuvers against a Bush administration that was truly more dangerous than anything we could have envisioned.
Bhaskar adds, "A common sentiment among those who took part in the [anti-globalization] movement is that of a historical moment cut short." In a variety of respects, the beginning of the "War on Terror" created real changes for activists, and I think that noting these is valid. Yet while there were some unique qualities of the period between N30 and 9/11, trying to contain the global justice movement entirely within this timeframe involves replicating some of the mainstream media's bad habits. Since social movements neither appear as instantaneously nor disappear as abruptly as news reports would regularly seem to suggest, it's worth taking the longer view. Those who joined in protests against corporate globalization around the turn of the millennium frequently invoked the slogan, "It didn't start in Seattle." Although the November 1999 actions against the World Trade Organization meetings in the Pacific Northwest seemed to the mainstream media to come out of nowhere, protest participants identified with a lineage of activism that had been brewing for years and that was very internationalist in nature. Antecedents included mobilizations against NAFTA and the Multilateral Agreement on Investment (MAI), the Zapatista uprising in southern Mexico, the rise in the 1990s of anti-sweatshop activism and culture jamming, and numerous protests in the global South against privatization and corporate exploitation. Bhaskar nods to this when he notes, "While the fight for Seattle's streets caught the media by surprise, it was the result of months of planning and organizing, and underpinned by broader historical shifts." Just as there are important reasons to point out that "It did not start in Seattle," I think there's value in the argument that "It did not end on 9/11." I have written before about the important impact of global justice mobilizations on the trade and development debate. Here I would just add a few notes about timeframe that run contrary to the "ended on 9/11" storyline. The World Social Forum, which is considered a key institution of the global justice movement, was only in its infancy in 2001. The first global forum, held in January of that year, drew around 12,000 people. In contrast, the first post-9/11 forum back in Porto Alegre, which took place in late January and early February of 2002, drew many times more--somewhere around 60,000 attendees. By the mid-2000s, several incarnations of the World Social Forum brought in as many as 150,000 participants. Such crowds were significantly larger than the one that amassed at the Seattle protests (estimates for which range between about 30,000 and 90,000 people). Although U.S. groups were not dominant at the social forums, they were decently represented. While focus in the United States did shift to anti-war activism during this time (and away from globalization-focused campaigns), there were efforts to link critiques of corporate power with an analysis of U.S. militarism. Highlighting the connections between movements, the call for a February 15, 2003 global day of action against war in Iraq originated at the November 2002 European Social Forum. Following 9/11, some meetings of multilateral bodies were relocated to remote or repressive locales (such as Doha) to preclude protests. Nevertheless, activist gatherings continued to form outside G8 and WTO meetings, with notable dissident contingents confronting the latter organization in Cancun in 2003 and in Hong Kong in 2005. Within the United States, significant protests gathered in Miami around negotiations for the Free Trade Area of the Americas (FTAA)--a protest in many ways comparable to the pre-9/11 protests at the IMF and World Bank on A16, although not nearly as well covered in the press. (Indicative of the ongoing radicalism at the gatherings, I had the pleasure of watching a major U.S. union leader in Miami publicly denounce the city's security deployment as a "police state"--something you don't see every day in labor circles.) The FTAA subsequently collapsed altogether, a major movement victory. Dan notes that this was "thanks in large part to Latin America's leftward swing." I agree, and I would contend that this swing was not wholly unconnected to global justice constituencies. (Furthermore, I would disagree with Bhaskar if he suggests that the example of Lula da Silva's left-leaning government in Brazil necessarily delegitimizes the arguments made by critics of corporate globalization.) Looking at a single issue central to the anti-corporate globalization movement, we can see debt relief--the demand that countries in the global South should have their international debts eliminated--follow a promising trajectory in the wake of 9/11. The debt relief movement gained momentum through July 2005, when it scored a breakthrough win with an international agreement signed at the Gleneagles, Scotland meeting of the G8. For the occasion, as many as 250,000 protesters (many times the number present in Seattle) marched in favor of eliminating unjust debts. Now, looking at this activity, one could argue that the global justice movement continued internationally after 9/11 but ceased to exist within the United States. My response there would be that we need to look more carefully at the groups that made up mass mobilizations such as N30 or A16. The global justice movement has long been described as a "movement of movements." One of the exciting aspects of the gatherings outside WTO or World Bank or FTAA meetings was the ability of a common enemy to bring together a broad range of constituencies--labor, environmentalists, indigenous rights groups, family farmers, anarchists, pro-immigrant advocates, faith-based groups. The extent to which all of these groups were united into one seamless movement was probably overhyped by hopeful activists in the post-Seattle moment, radicals who might have imagined that long-standing ideological divisions could be overcome and differences in organizational cultures bridged. On the other hand, it would be equally wrong to assume that all cooperation between the diverse constituencies ended promptly upon the launch of the "War on Terror." Labor, for one, remained far more internationalist in its stances on trade than it had been in the early 1990s and before, and its connection to immigrant rights groups were very relevant when that movement exploded into public view in 2006. Something like "slow food" was a very rare idea in 1999, but movements around food issues have only grown since then, and they continue to make fruitful links with indigenous rights activists and anti-corporate campaigners. Institutions are important. During their heyday, the global justice activists were criticized for merely hopping from summit to summit, not building local structures. In his essay, Bhaskar rightly criticizes Seattle-era excitement over ad hoc spokes-councils and movement spaces that emerged seemingly spontaneously and left "virtually no trace behind." But there's a certain "damned if you do, damned if you don't" quality to some of these arguments. During the time activists were able to capture media attention with mass summit actions, their movement was considered viable. When the summit stalking died down, it was taken as evidence of the movement's demise. Those who took on the difficult task of creating lasting activist vehicles--take, for example, anti-sweatshop organizers' development of the Worker Rights Consortium, an impressive and largely post-9/11 institution--got little credit for their efforts. The constituent groups of the global justice movement did not disappear. Nor did they lose their ability to come together as a creative, unified, and internationally minded force to challenge corporate power and oligarchic privilege. The landscape of American politics and the state of the global economy have changed plenty in the past ten years. They have changed in ways that do not always favor such unity. But the great potential, and great need for it, remain.
Over the past month, The Help, a movie adapted from a best-selling 2009 novel by Kathryn Stockett about African-American housekeepers in 1962 Jackson, Mississippi, has had a strong showing at the box office. This has created consternation among many who object to the film's politics. [Cross-posted from the "Arguing the World" blog at Dissent magazine.] Having recently seen the movie, I'm having a hard time thinking that its success is such a bad thing. Sure, The Help wasn't a masterpiece of civil rights cinema. But I would argue it had some significant redeeming qualities. And I didn't think it was nearly as bad as online discussion among progressives had led me to believe it might be. Certainly, the story has some problematic aspects. At Entertainment Weekly, novelist Martha Southgate describes as "cringeworthy" the premise of the film: "A young white woman encourages black housekeepers to tell their truth through the vehicle of a book the white woman writes." Southgate found this "both implausible and condescending to those maids." At Colorlines, Akiba Solomon wrote about why she is "Just Saying No to The Help and Its Historical Whitewash," expressing concern that, by making a well-meaning white woman the central agent for change, the movie replicates many of the bad habits of films like The Blind Side. I take their point. (The Blind Side's repellent trailers have been enough to keep me avoiding that movie for two years now.) But, in this case, I don't think the premise ends up being fatal. I agree with David Denby's assessment at the New Yorker that strong performances by Viola Davis and Octavia Spencer overcome some sketchy source material, placing the housekeepers' experiences and their decisions squarely at the center of the story's moral drama. (I get the sense that the book, which does not benefit from such performances and is written partly in dialect, has been the greater source of ire for critics of The Help.) I also think that some of the criticisms miss the point. Solomon, noting filmmaker and author Nelson George's piece in the New York Times, argues that viewers are better off watching Eyes on the Prize. Of course, she's right. But people going out for a Friday night show aren't choosing between The Help and a fourteen-hour civil rights documentary. The actual alternatives they are considering are movies like The Rise of the Planet of the Apes and Shark Night 3D. In a review at Dissent, Leonard Quart concluded of The Help: "The film eschews realism in its settings and its characters. But in a summer of the usual special effects-ridden blockbusters and forgettable romantic comedies, it's good to see a Hollywood film deal with a significant subject, however adulterated." Unlike the typical multiplex fare, The Help passes the Bechdel Test. It also contributes to a useful discussion about the ongoing exploitation of domestic workers--a workforce still predominately made up of women of color, and one that (outside of New York state, which passed a landmark Domestic Workers Bill of Rights last year) still receives scant protection under labor law. For this reason, the National Domestic Workers Alliance (NDWA) is putting a positive spin on the film. Describing The Help as a "powerful story about courageous domestic workers in the Civil Rights era," the group is using it as an opportunity to highlight their ongoing organizing. I recently spoke with NDWA Director Ai-jen Poo, who explained:
It's not every day that a major motion picture actually puts the experiences of women of color in general--and particularly of domestic workers--center stage. To me that's a huge opportunity to actually lift up the fact that there's a continuance of these stories. Not much has changed structurally for this workforce. Many of the dynamics and the vulnerabilities and the injustices that the characters deal with are still prevalent today. And there's something we can do about it.
Among other campaigns, the NDWA is currently pushing to pass a version of the Domestic Workers Bill of Rights in California. (You can learn more by watching the organization's video, "Meet Today's Help," available here.) Whether you're taken by The Help, or you're holding out for Hollywood to create better civil rights movies, domestic workers fighting for labor rights deserve your support.
As the Super Congress eyes trillions in budget cuts that will undermine the quality of life for most Americans, here's a stunning fact to contemplate: Twenty-five hugely profitable U.S. companies paid their CEOs more last year than they paid Uncle Sam in taxes. In other words, the more CEOs dodge their civic responsibilities, the more lavishly they're paid. That's the key finding of a new Institute for Policy Studies report, Massive CEO Rewards for Tax Dodging, which I co-authored. These artful dodgers include the CEOs of Verizon, Boeing, Honeywell, General Electric, International Paper, Prudential, eBay, Bank of New York Mellon, Ford, Motorola, Qwest Communications, Dow Chemical, and Stanley Black and Decker. Their average annual compensation totaled $16.7 million, well above last year's average of $10.8 million for the CEOs of S&P 500 companies. Instead of paying their fair share, these companies spend millions lobbying for additional tax breaks and loopholes. Twenty of the 25 companies spent more lobbying Congress last year than they paid the IRS in federal corporate taxes. General Electric invested $41.8 million in lobbying and got $3.3 billion in tax refunds. Boeing spent $20 million on lobbying and got a $35 billion contract from the U.S. government, while paying a paltry $13 million in U.S. taxes for a company with $4.3 billion in U.S. income last year. Eighteen of the 25 companies aggressively use off shore tax havens to shift profits around the globe to avoid U.S. taxes. These 18 companies together had 556 subsidiaries in the Cayman Islands, Singapore, Ireland, and other havens. The offshore scam works like this: companies pretend their profits are earned in low-tax or no-tax jurisdictions — and then feign losses from their U.S. operations at tax time. Whatever happened to corporate civic leadership? A previous generation of CEOs would have been ashamed to be compensated so lavishly while their companies abandoned responsibility for paying their fair share. They would have been embarrassed to go year after year contributing little or nothing to the public investments that make the United States a vibrant business environment. Here are a few examples of these champion tax-dodgers:
  • Chesapeake Energy paid its CEO Aubrey McClendon $21 million last year but paid zero federal corporate income tax in 2010. Chesapeake is fracking the tax code, drilling it for every possible subsidy it can extract — while lobbying to preserve antiquated tax breaks for oil and gas industry.
  • Online retailer eBay paid its CEO John Donahoe $21.4 million last year while collecting a federal tax refund of $131 million. eBay' 31 subsidiaries in Switzerland, Singapore, and seven other tax havens facilitate its efforts to move money around the planet as a tax-dodging strategy.
  • Insurance giant Marsh & McLennan paid its CEO Brian Duperrault $14 million yet collected a $90 million tax refund from Uncle Sam. The company has 105 subsidiaries in 20 off shore tax havens, including 25 in Bermuda  — a favorite locale for insurance companies seeking to avoid both taxes and regulation.
These super-moocher companies happily benefit from the privileges and advantages of doing business in the United States. If a competitor tries to steal their product or idea, these corporations rush to the U.S court system and law enforcement agencies for remedies and justice. The U.S. military guards their global assets. They use the fertile ground of publicly funded research and infrastructure to bolster their own profits. They create new products from a foundation of Uncle Sam's investments in medical and scientific research and government funded technologies like the Internet. Our taxpayer-funded roads, ports, and bridges bolster their business environment. Our public schools and universities educate the workers these companies rely on. In fact 16 of these 25 CEOs attended public universities. They personally were educated with help from U.S. tax dollars. These CEOs profess to love America. But when it comes time to pay the bills, they'd rather outsource that job over to you or the small business down the road. Congress should pass the Stop Tax Haven Abuse Act which would limit some of these tax shenanigans. In the face of growing fiscal austerity, these companies should contribute to the solution and pay their fair share of U.S. taxes. For more information, see the new Institute for Policy Studies report, Executive Excess 2011: The Massive CEO Rewards for Tax Dodging.
President Obama now has a clear choice on climate change. Major energy corporations are seeking to build a 1700-mile oil pipeline from Canada’s tar sands to refineries in Texas. The Keystone XL Pipeline would itself carry social and environmental costs: cutting through fragile ecosystems, creating risk of spills, and negatively affecting indigenous communities. But, most significantly, it would be a boon to efforts to exploit the tar sands. [Cross-posted from the "Arguing the World" blog at Dissent magazine.] The Canadian tar sands are a particularly dirty source of fossil fuels that could produce egregious carbon emissions. As Elizabeth Kolbert reported at the New Yorker:
[B]ecause tar-sands oil is so heavy, it has to be very heavily processed, which requires tremendous amounts of energy, usually in the form of natural gas. It’s been estimated that, on what’s known as a well-to-tank basis, tar-sands oil is responsible for eighty percent more greenhouse-gas emissions than ordinary crude.
Prominent climate scientist James Hansen has argued (in a now oft-quoted statement) that “if the tar sands are thrown into the mix, it is essentially game over” for the climate. Before the end of the year, Obama’s State Department must choose whether to approve or deny the pipeline project. To dramatize the president’s choice, environmentalists have commenced two weeks of civil disobedience. On August 20 they began daily waves of sit-ins in front of the White House. As of this writing, near the end of week one, 322 people have been arrested. Billed as the “biggest civil disobedience action in the environmental movement for many years,” the two weeks of sit-ins and arrests in summer-recessed Washington, D.C., have thus far had difficulty in creating the tension that, at times, allows acts of civil disobedience to explode into mass public spectacles. The protests have not had a single, climactic date around which many thousands might mobilize. And since the deadline by which Obama must make his call is months away, administration officials have been able to drag their feet. That said, the two weeks of action are creating many opportunities for press coverage of the issue. Protest leaders such as author Bill McKibben, who was arrested early on, have been using the ongoing actions as reason to make the rounds in the media. The protests don’t need to become front-page news in order for them to have an impact. McKibben correctly notes that the primary effect of this advocacy is to raise the stakes for Obama in terms of his support among his base in the environmental community. The fact that prominent individuals (McKibben, along with Hansen, Wendell Berry, Naomi Klein, Danny Glover, Gus Speth, Jane Hamsher, and others) have devoted their energies to highlighting this cause—and have rallied hundreds of others to make the sacrifices entailed in getting arrested while speaking out against the pipeline—has turned what might have been an easy-to-ignore bureaucratic decision into a line-in-the-sand issue for environmentalists. Obama’s credibility as a leader concerned about climate change is now publicly in question; he has the power to please corporate sponsors or environmentalists, but not both. Whether the president will make the right choice given his recent track record is, shall we say, doubtful. If he did, Andrew Leonard pointed out at Salon, Republican opponents would no doubt paint him as a job killer insensitive to high gas prices. Nevertheless, the week of protest has helped to make clear what the right choice is. The actions in Washington have given trade unionists such as Joe Uehlein the opportunity to make the case that “’jobs vs. the environment’ is a false choice.” And, in a nice media coup for the arrestees, they gave the New York Times occasion to editorialize that the administration “should acknowledge the environmental risk of the pipeline and the larger damage caused by tar sands production and block the Keystone XL.” The protests point to an increasing militancy among climate change activists that has been developing steadily in recent years. All those concerned about the planet should very much hope that the tar sands pipeline is halted before it is ever approved. But if the project does go forward, it will not be the end for those organizing civil disobedience on this issue. Should pipeline construction be approved, it is not hard to imagine arrests involving much more than symbolic acts of protest. Instead of sit-ins at the White House, we may well see bodies before bulldozers on the Western plains.
By Chuck Collins & Alison Goldberg Billionaire superinvestor Warren Buffett has done it again.  The Oracle of Omaha has made a bold and revealing statement about “taxing the wealthy.” In his  op-ed in Monday’s The New York Times, Buffett wrote, “While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks.” Buffett revealed that his own effective tax rate –the percentage of his income that he actually pays –is far below his co-workers, thanks to how investment income is taxed at lower rates.  Buffett pays an effective rate of 17.4 percent, whereas most middle and upper income individuals pay over 30 percent of their income.  He revealed one of the dirty secrets of tax policy –the privileged treatment of income from wealth over income from work and wages. We now need ten thousand more like Warren Buffett to speak up, people with incomes over $250,000 that know in their hearts that they should pay more. Of course, we need an engaged public –people in the bottom 98 percent –to mobilize and press for tax increases on the wealthy before any further budget cuts.  But enlisting the voices of wealthy people for the common good is a key part of the strategy to change the political dynamics. The good news is there are already several thousand who have stepped forward and spoken up. Several hundred business leaders and wealthy individuals have joined Patriotic Millionaires for Fiscal Strength, a joint initiative of the Agenda Project and Wealth for the Common Good. On June 7th, the tenth anniversary of the Bush Tax Cuts for the wealthy, they issued a powerful video calling on Congress to let the tax cuts expire. These folks, in the top 2 percent of income and wealth holders, eloquently make the case that they have benefited from the generations of public investments that made their wealth possible.  They celebrate the fertile soil we have created together in US society for business and wealth creation and believe they have an obligation to future generations to pay their taxes so that others have the same opportunity. Almost 500 high-income taxpayers support the Fairness in Taxation Act, that would increase top tax rates on millionaires, generating an additional $78 billion in urgently needed revenue.  This legislation would also tax both capital gains and wage income over $1 million at the same rates.  It would eliminate the “carried interest” loophole that enables billionaire hedge fund managers to have their income taxed at a low 15 percent.  This legislation would eliminate the economic distortions that come from taxing income from work at twice the rate as income from wealth and investments. There are now thousands of business leaders and wealthy investors calling on Congress to stop aggressive tax corporate dodging.  They point out that it is bad for business when companies like General Electric and Verizon pay no taxes –and force patriotic domestic companies to compete on an unlevel playing field. In early July, Senator Carl Levin reintroduced the Stop Tax Haven Abuse Act.  At a press conference Senator Levin was joined by spokespeople from Business for Shared Prosperity and the Business and Investors Against Tax Haven Abuse campaign. Rep. Lloyd Doggett introduced a version in the House. Polls show that the public supports raising taxes on millionaires and closing offshore corporate tax shelters as part of getting our fiscal house in order.  Yet the Tea Party Republicans have pledged to destroy the economy before raising taxes on their rich patrons.  The bottom 98 percent needs to get organized  --in mobilizations like the “Other 98 Percent” –to press for tax fairness. But it will enormously help the cause to have more of those who will pay these taxes step forward and speak up. In our organizing work at Wealth for the Common Good, we share Warren Buffett’s view that many of the rich “love America and appreciate the opportunity this country has given them…Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.” Polls show that wealthy people know the tax code is getting less fair and is out of balance.  But many of them –like the population as a whole -- don’t feel the intensity about tax fairness that they feel about other pressing matters such as education, children’s health, and ecological degradation. Very few people of any economic class feel passionately about tax fairness –to the point where we are politically engaged. Now is the time for all of us to understand how important this tax debate is –and that everything we care about is under attack by the current drift in politics.  We have to get real fired up about tax fairness. Revenue must be on the table as part of debt and budget debates in the coming months. Congress must let the Bush tax breaks for the wealthy expire, increase top tax rates for millionaires, and eliminate aggressive corporate tax dodging. Right now, our silence is consent to the status quo of budget cuts and unequal sacrifice. We need millions of ordinary citizens to speak up.  And to compliment this, we need tens of thousands of our nation’s business leaders and wealthy individuals to speak out. The alternative is austerity for everyone but the rich –and a growing economic apartheid in America.
If the companies that offshore their profits and design tax scams paid their fair share, we might not have a budget crisis. Like a pack of men in suits mud wrestling, Washington's budget battle would be entertaining to watch if we the people weren't about to get hurt. The zeal of Republican lawmakers and their compliant counterparts in the Democratic Party to slash spending on Medicare, Social Security, Medicaid, and the other essential programs will lower the quality of life in our communities and take a toll on public health. Off to the side of the mud pit, however, is a $1 trillion dollar idea that would support patriotic U.S. businesses, discourage job exports, and restore fairness to our tax system. It's an idea that already commands widespread public support. It deserves broad bipartisan political support too. In the last two weeks, congressional leaders, led by Democrats Carl Levin of Michigan in the Senate and Lloyd Doggett of Texas in the House, have introduced an updated version of the "Stop Tax Haven Abuse Act." Their proposal would shut down the offshore tax loopholes that encourage corporate tax dodging. Over the last year, we've learned that there are dozens of profitable and prominent U.S. companies that pay either no or very low corporate income taxes. These include Verizon, General Electric, Boeing, and Amazon. One of these companies' common gimmicks is to shift profits to subsidiaries in low-tax or no-tax countries like the Cayman Islands. They pretend corporate profits pile up "offshore," while their losses accrue in the U.S., reducing or eliminating their company's obligation to Uncle Sam. Yet these same companies use our public infrastructure, hire workers trained in our schools, and depend on the U.S. court system to protect their property. Our military defends their assets, yet they're not paying their share of the bill. In wartime, the unequal sacrifice and tax shenanigans of these companies is very unseemly. Corporate tax dodging hurts Main Street firms that are forced to compete on an unlevel playing field. "Why should we be subsidizing U.S. multinationals that use offshore tax havens to avoid paying taxes?" asked Frank Knapp, CEO of the South Carolina Small Business Chamber of Commerce at a press conference where the legislation was introduced. The Stop Tax Haven Abuse Act would end tax games that are costly, harmful to domestic U.S. businesses and workers, and blatantly unfair to those who pay our fair share of taxes. These same offshore systems facilitate criminal activity, from drug money laundering to terrorist financing networks. Smugglers, drug cartels, and even terrorist networks like al-Qaeda thrive in secret offshore jurisdictions where individuals can hide or obscure the beneficial ownership of bank accounts and corporations to avoid any reporting or government oversight. The offshore system has spawned a huge tax-dodging industry. Its teams of lawyers and accountants add nothing to the efficiency of markets or products. Instead of making a better widget, companies invest in designing a better tax scam. Reports about General Electric's storied tax dodging dramatize the ways that modern multinationals view their tax accounting departments as profit centers. The combination of federal budget concerns and a growing public awareness of corporate tax avoidance promises to focus greater attention on this proposal than past years. As leaders in Congress debate how to wring out $2 trillion to $4 trillion in deficit reductions over the next decade, this legislation should be at the top of the bipartisan list. The Stop Tax Haven Abuse Act would generate an estimated $100 billion in revenues a year. That's $1 trillion over the next decade. Lawmakers should also reject calls, currently being debated in Congress, for a tax holiday for corporate tax dodgers,. A coalition of global companies, including Google, Apple, and drug giant Pfizer, have stashed an estimated $1.2 trillion in profits offshore. They want to repatriate their profits at drastically reduced tax rates. Congress should vigorously oppose a "tax holiday" for these tax dodgers. Instead of rewarding fiscally irresponsible behavior, lawmakers should fix the root cause of the problem and outlaw tax haven abuse. Originally Published at OtherWords.