That 70s Show
'The 1970s set off a kind of a vicious cycle that led to
a concentration of wealth increasingly in the hands of the financial
sector, which doesn’t benefit the economy... What’s being played out for
the last 30 years is actually a kind of a nightmare that was
anticipated by the classical economists'
It's a little hard to give a Howard Zinn Memorial Lecture at an Occupy meeting. There are mixed feelings that go along with it.
First of all, regret that Howard is not here to take part and
invigorate it in his particular way, something that would have been the
dream of his life, and secondly, excitement that the dream is actually
being fulfilled. It’s a dream for which he laid a lot of the groundwork.
It would have been the fulfilment of a dream for him to be here with
you.
The Occupy movement really is an exciting development. In fact, it's
spectacular. It's unprecedented; there's never been anything like it
that I can think of. If the bonds and associations that are being
established at these remarkable events can be sustained through a long,
hard period ahead— because victories don't come quickly— this could
turn out to be a very significant moment in American history.
The fact that the demonstrations are unprecedented is quite appropriate.
It is an unprecedented era— not just this moment— but actually since
the 1970s. The 1970s began a major turning point in American history.
For centuries, since the country began, it had been a developing society
with ups and downs. But the general progress was toward wealth and
industrialization and development— even in dark and hope— there was a
pretty constant expectation that it's going to go on like this. That was
true even in very dark times.
I'm just old enough to remember the Great Depression. After the first
few years, by the mid-1930s, although the situation was objectively much
harsher than it is today, the spirit was quite different. There was a
sense that we're going to get out of it, even among unemployed people.
It'll get better. There was a militant labour movement organizing, CIO
was organizing. It was getting to the point of sit-down strikes, which
are very frightening to the business world. You could see it in the
business press at the time. A sit-down strike was just a step before
taking over the factory and running it yourself. Also, the New Deal
legislations were beginning to come under popular pressure. There was
just a sense that somehow we're going to get out of it.
It’s quite different now. Now there’s kind of a
pervasive sense of hopeless, or, I think, despair. I think it’s quite
new in American history and it has an objective basis. In the 1930s
unemployed “working people” could anticipate realistically that the jobs
are going to come back. If you’re a worker in manufacturing today— and
the unemployment level in manufacturing today is approximately like the
Depression— if current tendencies persist, then those jobs aren’t going
to come back. The change took place in the '70s. There are a lot of
reasons for it. One of the underlying reasons, discussed mainly by
economic historian Robert Bernard, who has done a lot of work on it, is a
falling rate of profit. That, with other factors, led to major changes
in the economy— a reversal of the 700 years of progress towards
industrialization and development. We turned to a process of
deindustrialization and de-development. Of course, manufacturing
production continued, but overseas (it’s very profitable, but no good
for the workforce). Along with that came a significant shift of the
economy from productive enterprise, producing things people need, to
financial manipulation. Financialization of the economy really took off
at that time.
Before the 70s, banks were banks. They did what banks are supposed to do
in a capitalist economy: take unused funds, like, say, your bank
account, and transfer them to some potentially useful purpose, like
buying a home or sending your kid to college. There were no financial
crises. It was a period of enormous growth; the largest period of growth
in American history, or maybe in economic history. It was sustained
growth in the 50s and 60s and it was egalitarian. So the lowest
percentile did as well as the highest percentile. A lot of people moved
into reasonable lifestyles— what’s called here “middle class” (working
class is what it’s called in other countries).
It was real. The 60s accelerated it. The activism of the 60s, after a
pretty dismal decade, really civilized the country in lots of ways that
are permanent. They’re not changing. The 70s came along and suddenly
there’s sharp change to industrialization and the offshoring of
production. The shifting to financial institutions, which grew
enormously. Also in the 50s and 60s there was the development of what
became several decades later the high-tech economy. Computers, Internet,
the IT revolution was mostly developed in the 50 and the 60s, and
substantially in the state sector. It took a couple of decades before it
took off, but it was developed then.
The 1970s set off a kind of a vicious cycle that led to a concentration
of wealth increasingly in the hands of the financial sector, which
doesn’t benefit the economy. Concentration of wealth yields
concentration of political power, which, in turn, arrives to legislation
that increases and accelerates the cycle. The physical policies such as
tax changes, rules of corporate governance, deregulation were
essentially bipartisan. Alongside of this began a very sharp rise in the
costs of elections, which drives the political parties even deeper than
before into the pockets of the corporate sector.
A couple years later started a different process. The parties dissolved,
essentially. It used to be if you were a person in Congress and hoped
for a position of committee chair or a position of responsibility, you
got it mainly through seniority and service. Within a couple of years,
you started to have to put money into the party coffers in order to get
ahead. That just drove the whole system even deeper into the pockets of
the corporate sector and increasingly the financial sector--a tremendous
concentration of wealth, mainly in the literally top 1/10th of 1
percent of the population.
Meanwhile, for the general population it began an open period of pretty
much stagnation, or decline for the majority. People got by through
pretty artificial means— like borrowing, so a lot of debt. Longer
working hours for many. There was a period of stagnation and a higher
concentration of wealth. The political system began to dissolve. There’s
always been a gap between public policy and the public will, but it
just grew kind of astronomically. You can see it right now, in fact.
Take a look at what’s happening right now. The big
topic in Washington that everyone concentrates on is the deficit. For
the public, correctly, the deficit is not much of an issue. The issue is
joblessness, not a deficit. Now there’s a deficit commission but no
joblessness commission. As far as the deficit is concerned, if you want
to pay attention to it, the public has opinions. Take a look at the
polls and the public overwhelmingly supports higher taxes on the
wealthy, which have declined sharply during this stagnation period, this
period of decline. The public wants higher taxes on the wealthy and to
preserve the limited social benefits. The outcome of the deficit
commission is probably going to be the opposite. Either they’ll reach an
agreement, which will be the opposite of what the public wants, or else
it will go into kind of an automatic procedure which is going to have
those effects. Actually that’s something that’s going to happen very
quickly. The deficit commission is going to come up with its decision in
a couple of weeks. The Occupy movements could provide a mass base for
trying to avert what amounts to a dagger in the heart of the country,
and having negative effects.
Without going on with details, what’s being played out for the last 30
years is actually a kind of a nightmare that was anticipated by the
classical economists. If you take an Adam Smith, and bother to read
Wealth of Nations,
you see that he considered the possibility that the merchants and
manufacturers in England might decide to do their business abroad,
invest abroad and import from abroad. He said they would profit but
England would be harmed. He went on to say that the merchants and
manufacturers would prefer to operate in their own country, what’s
sometimes called a “home bias.” So, as if by an invisible hand, England
would be saved the ravage of what’s called “neoliberal globalization.”
That’s a pretty hard passage to miss. In his classic
Wealth of Nations,
that’s the only occurrence of the phrase “invisible hand.” Maybe
England would be saved from neoliberal globalization by an invisible
hand. The other great classical economist David Ricardo recognized the
same thing and hoped it wouldn’t happen. Kind of a sentimental hope. It
didn’t happen for a long time, but it’s happening now. Over the last 30
years that’s exactly what’s underway. For the general population— the 99
percent in the imagery of the Occupy movement—it’s really harsh and it
could get worse. This could be a period of irreversible decline. For the
1 percent, or furthermore 1/10th of 1 percent, it’s just fine. They’re
at the top, richer and more powerful than ever in controlling the
political system and disregarding the public, and if it can continue,
then sure why not? This is just what Smith and Ricardo warned about.
So pick Citigroup, for decades one of the most
corrupt of the major investment banking corporations. It was repeatedly
bailed out by the taxpayer over and over again starting in the early
Reagan years and now once again. I won’t run through all the corruption.
You probably know it, and it’s astonishing. A couple of years ago they
came out with a brochure for investors. They urged investors to put
their money in what they call the “plutonomy index.” The world is
dividing into a plutonomy, the rich and so on. That’s where the action
is. They said their plutonomy index is way outperforming the stock
market, so put your money into it. And as for the rest? We set them
adrift. We don’t really care about them and we don’t need them. They
have to be around to provide a powerful state to protect us and bail us
out when we get into trouble, but they essentially have no function.
It’s sometimes called these days the “precariat,” people who live a
precarious existence at the periphery of society. It’s not the periphery
anymore; it’s becoming a very substantial part of the society in the
United States and indeed elsewhere.
This is considered a good thing. For example, when Alan Greenspan was
still “St. Alan” hailed by the economics profession as one of the
greatest economists of all time (this is before the crash for which he
is substantially responsible for), he was testifying to Congress in the
Clinton years explaining the wonders of the great economy. He said much
of this economy was based on what he called “growing worker insecurity.”
If working people are insecure, if they’re “precariat” and living
precarious existences, then they’re not going to make demands, they
won’t make wages, they won’t get benefits and we can kick them out if we
don’t like them, and that’s good for the health of the economy. That’s
what’s called a healthy economy technically and he was highly praised
for this.
Well, now the world is indeed splitting into a plutonomy and a
precariat, again in the imagery of the Occupy movement, the 1 percent
and the 99 percent. The plutonomy is where the action is. It could
continue like this, and if it does, then this historic reversal that
began in the 1970s could become irreversible. That’s where we’re
heading. The Occupy movements are the first major popular reaction which
could avert this. It’s going to be necessary to face the fact that it’s
a long hard struggle. You don’t win victories tomorrow. You have to go
on and form structures that will be sustained through hard times and can
win major victories. There are a lot of things that can be done.
I mentioned before that in the 1930s one of the
most effective actions was a sit-down strike. The reason was very
simple: it’s just a step below a takeover of the industry. Through the
'70s, as the decline was setting in, there were some very important
events that took place. One was in the late '70s. In 1977, US Steel
decided to close one of its major facilities, Youngstown, Ohio, and
instead of just walking away, the workforce and the community decided to
get together and buy it from US Steel and hand it over to the workforce
to run and turn it into a worker-owned, worker-managed facility. They
didn’t win, but with enough popular support they could have won. It was a
partial victory because even though they lost it set off other efforts
now throughout Ohio and other places.
There’s a scattering of hundreds, maybe thousands, of not-so-small
worker owned or partially worker-owned industries which could become
worker-managed. That’s the basis for a real revolution. That’s how it
takes place. It’s happening here, too. In one of the suburbs of Boston
something similar happened. A multi-national decided to shut down a
productive, functioning and profitable manufacturing company because it
was not profitable enough for them. The workforce and union offered to
buy it and take it over and run it themselves, but the multi-national
decided to close it down instead probably for reasons of class
consciousness. I think they want things like this to happen. If there
had been enough popular support, if there had been something like this
movement that could have gotten involved, they might have succeeded.
There are other things going on like that. In fact, some of them were
major. Not long ago, Obama took over the auto industry. It’s basically
owned by the public. There were a number of things that could have been
done. One was what was done. It could be reconstituted so it could be
handed back to the ownership, or very similar ownership and continue on
its traditional path. The other possibility was they could have handed
it over to the workforce and turned it into worker-owned, worker-managed
major industrial system that’s a major part of the economy and have it
produce things that people need. And there’s a lot that we need. We all
know or should know that the US is extremely backward globally in
high-speed transportation. That’s very serious. It affects people’s
lives and it affects the economy. It’s a very serious business.
I have a personal story. I happened to be giving talks in France a
couple months ago and ended up in southern France and had to take a
train from Avignon in southern France to the airport in Paris and it
took two hours. That’s the same distance as Washington to Boston. It’s a
scandal. It could be done; we have the capacity to do it, like a
skilled workforce. It would have taken a little popular support. That
could have been a major change in the economy. Just to make it more
surreal, while this option was being avoided, the Obama administration
was sending its transportation secretary to Spain to get contracts for
developing high-speed rails for the United States. This could have been
done right in the Rust Belt, which is being closed down. There’s no
economic reason this can’t happen. These are class reasons and the lack
of political mobilization.
There are very dangerous developments in the
international arena, including two of them which are kind of a shadow
that hangs over almost everything we discuss. There are, for the first
time to human history, real threats to peace and survival of the
species. One has been hanging around since 1945 and it’s kind of a
miracle we’ve escaped it and that’s the threat of nuclear weapons.
That’s a threat that’s being escalated by the administration and its
allies. Something has to be done about that or we’re in real trouble.
The other, of course, is environmental catastrophe. Every country in the
world is taking at least halting steps toward trying to do something
about it. The US is also taking steps, namely to accelerate the threat.
The US is now the only country that’s not only not doing something
constructive…it’s not climbing on the train. It’s pulling it backwards.
Congress is right now reversing legislation instituted by the Nixon
administration. (Nixon was really the last liberal president of the
United States, and literally, this shows you what’s been going on!)
They’re dismantling the limited measures the Nixon administration took
to try to do something about what’s a growing and emerging catastrophe.
This is connected with a huge propaganda system, perfectly openly
declared by the business world, that it’s all just a liberal hoax. Why
pay attention to these scientists? We’re really regressing back to the
Medieval period. It’s not a joke. If that’s happening to the most
powerful and richest country in history then this crisis is not going to
be averted and all of this we’re talking about won’t matter in a
generation or two. All of that’s going on right now and something has to
be done about it very soon and in a dedicated and sustained way. It’s
not going to be easy to succeed. There are going to be barriers,
hardships and failures along the way. Unless the process that’s taking
place here and around the world, unless that continues to grow and kind
of becomes a major social force in the world, the chances for a decent
future are not very high.
Q&A
What about corporate personhood and getting the money out of that stream of politics?
These are very good things to do, but you can’t do any of these things
or anything else unless there’s a very large and active base. If the
Occupy movement was the leading force in the country then you could move
it forward. Most people don’t know that this is happening or they may
know about it and not know what it is. Among those who do know, the
polls show there’s a lot of support. But that assigns a task. It’s
necessary to get out into the country and get people to understand what
this is about and what they can do about and what the consequences are
of not doing anything about it.
Corporate personhood is a good point, but pay attention to what it is.
We’re supposed to worship the Constitution these days, but the 5th
Amendment of the Constitution says no person shall be deprived of rights
without due process of law. The founding fathers didn’t mean “person”
when they said “person.” For example there were a lot of creatures of
flesh and blood who were not persons. The entire indigenous population
was not considered persons. They didn’t have any rights. There was a
category of creatures called 3/5 human— they weren’t persons and didn’t
have rights. Women were not entirely persons, so they didn’t have full
rights. A lot of this was somewhat rectified over the years. During the
Civil War, the 14th amendment raised the 3/5 to full humans at least in
principle, but that was only in principle.
Now over the following years the concept of person was changed by the
courts in two ways. One way was to broaden it to include corporations,
legal fictions established by the courts and the state. These “persons”
later became the management of corporations; the management of
corporations became “persons.” Of course, that’s not what the 14th
amendment says. It’s also narrowed to undocumented workers. They had to
be excluded from the category of persons. That’s happening right now. So
legislation like this goes two ways. They defined persons to include
corporate persons, which by now have rights beyond human beings, given
by the trade agreements and others. They exclude people who flee from
Central America where the US devastated their homelands, flee from
Mexico because they can’t compete with the US’s highly subsidized
agro-business. When NAFTA was passed in 1994, the Clinton administration
understood pretty well that it was going to devastate the Mexican
economy, so they started militarizing the border. So we’re seeing the
consequences. So these people have to be excluded from the category of
persons.
So when you talk about personhood, that’s right, but there’s more than
one aspect to it. It ought to be pushed forward and it ought to be
understood, but that requires a mass base. It requires that the
population understands this and is committed to it. It’s easy to think
of a lot of things that should be done, but they all have a
prerequisite— namely a mass popular base that’s there that’s committed
to implementing them.
What about the ruling class in America? How likely is it that they’ll have an open fascist system here?
I think it’s very unlikely frankly. They don’t have the force. About a
century ago, in the freest countries in the world, Britain and the
United Sates at the time, the dominant classes came to understand that
they can’t control the population by force any longer. Too much freedom
had been won by struggles like these, and they realized it. It’s
discussed in their literature. They recognize that they’re going to have
to shift their tactics to control of attitudes and beliefs instead of
just the cudgel. It can’t do what it used to do. You have to control
attitudes and beliefs. In fact that’s when the public relations industry
began. It began in the United States and England. The free countries
where you had to control beliefs and attitudes, to induce consumerism,
to induce passivity, apathy and distraction. It’s a barrier, but it’s a
lot easier to overcome than torture and the Gestapo. I don’t think the
circumstances are any longer there to institute anything like what we
call fascism.
You mentioned earlier that sit-down protests are just a precursor to
a takeover of industry. Would you advocate a general strike as a tactic
moving forward? Would you ever if asked allow for your voice to relay
the democratically chosen will of our nation?
You don’t want leaders; you want to do it yourself. We need
representation and you should pick it yourselves. It should be
recallable representation.
The question of a general strike is like the others. You can think of it
as a possible idea at a time when the population is ready for it. We
can’t sit here and declare a general strike, obviously. There has to be
approval and a willingness to take the risks on the part of a large mass
of the population. That takes organization, education and activism.
Education doesn’t just mean telling people what to believe. It means
learning yourself. There’s a Karl Marx quote: “The task is not just to
understand the world but to change it.” There’s a variant of that which
should be kept in mind, “If you want to change the world in a certain
direction you better try to understand it first.”
Understanding it doesn’t mean listening to a talk or reading a book,
though that is helpful. It comes through learning. Learning comes from
participation. You learn from others. You learn from the people you’re
trying to organize. You have to gain the experience and understanding
which will make it possible to maybe implement ideas as a tactic.
There’s a long way to go. This doesn’t happen by the flick of a wrist.
It happens from a long, dedicated work. I think in many ways the most
exciting aspect of the Occupy movements is just the construction of
these associations and bonds that are taking place all over. Out of that
if they can be sustained can come expansion to a large part of the
population that doesn’t know what’s going on. If that can happen, then
you can raise questions about tactics like this, which could very well
at some point be appropriate.
