Claims that the ‘NAFTA 2’ agreement is better is a macabre joke

Democratic Party House representatives have voted by a wide margin to approve version 2 of the North American Free Trade Agreement, known as the United States-Mexico-Canada Agreement. Even Rose DeLauro of Connecticut, in the past a strong leader within Congress in the fight against so-called “free trade” agreements, is on board with this one.

Representative DeLauro and other congressional Democrats claim they forced the Trump administration to strengthen the agreement by compelling the insertion of language that allegedly creates “effective and meaningful labor standards and protect[s] worker rights”; supports environmental standards; and “protect[s] access to affordable medicine.” Can this really be true? Or have congressional Democrats reverted to normal form, rolling in the dirt at the feet of Republicans yet again?

Although Democrats and public pressure forced through some improvements, the United States-Mexico-Canada Agreement (USMCA), or NAFTA 2, isn’t substantially different and remains a document of corporate domination. It would appear that appearances, not substance, drove Democrats in the House of Representatives to approve the deal. That was signaled by House Speaker Nancy Pelosi, who said she wanted to show United Statesians that her party can get things done and is not simply opposing President Donald Trump for the sake of opposing him. That was understood to be a gesture to buttress the re-election chances of Democrats who won seats in districts previously held by Republicans.

Factory farms won’t be going away under the USMCA (photo by Mercy for Animals)

So Democrats went along to get along, much as they did in approving the massive $738 billion Pentagon budget. In other words, they once again demonstrated that cringing and cowering is their default position. One can imagine the discussion behind closed doors: Yes, that will show Donald Trump we mean business — we’ll support his most desired policy initiative.

Unfortunately, the Mexican and Canadian governments have not shown much more resistance. Mexico President Andrés Manuel López Obrador, despite being elected on a Left wave and promising significant change, has so far tended to give in to President Trump’s demands. That tendency was underscored by the almost unanimous approval given the USMCA by the Mexican Senate. Meanwhile, Canada Prime Minister Justin Trudeau has been a willing participant in bringing NAFTA 2 to fruition, even going so far as to be a voice for retaining the ability of corporations to use unaccountable tribunals to sue governments, including his own and despite Canada’s regulations being the most frequent target.

What the document says isn’t what it means

So what is really in the USMCA text? Interpretation is what really matters here, as the text, like all “free trade” agreements, is written in dry, technical language that appears to be neutral at first glance. But what the words mean in practice, and how they will be interpreted by tribunals, is not necessarily the same as what the words might appear to say.

A key portion of the document is Chapter 14, the chapter on investment. The chapter’s first page, Article 14.1, defines an “investment” with the standard broad brush — not only is any capital outlay covered but so are all forms of financial speculation, including derivatives. Intellectual property rights and intangible property are explicitly named as well. So the expectation of a profit across the spectrum of business activities is well covered here, and of course the expectation of a profit — in actual practice, the demand for the biggest possible profit regardless of cost to others — is what the owners of capital expect these agreements to help deliver. The secret tribunals used to adjudicate disputes, frequently presided over by corporate lawyers who in their day job specialize in representing the corporations who sue in the tribunals, consistently interpret the language of “free trade” agreements to mean corporations are guaranteed maximum profits above all other considerations.

So is the language of Chapter 14 substantially different? Asking that question is important because Article 14.3 states that in the event of any inconsistency between Article 14 and any any other chapter, Article 14 prevails. The one exception is financial services, covered by Chapter 17, to which we will return. Article 14.4 begins with this passage: “Each Party shall accord to investors of another Party treatment no less favorable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.”

That dry language may sound neutral, but it is the exact language that is standard in “free trade” agreements. This is the language that is invoked by multi-national corporations to demand “damages” anytime any law or regulation that upholds health, safety, worker or environmental standards prevents them from extracting the biggest possible profit. This is the language invoked in the secret tribunals that adjudicate these cases to rule in favor of corporate plunder and against regulations.

When you hear “customary international law,” be afraid

That is followed up by Article 14.6, which states “Each Party shall accord to covered investments treatment in accordance with customary international law, including fair and equitable treatment and full protection and security.” On the surface, that passage seems neutral, even innocuous. But what is “customary international law”? It is whatever the tribunals that have adjudicated disputes between multi-national corporations and governments say it is. In practice, the many outrageous decisions overturning reasonable health, safety, worker or environmental standards and making corporate profit paramount establishes precedent and thus constitutes “customary” law.

The article goes on to state: “The concepts of ‘fair and equitable treatment’ and ‘full protection and security’ do not require treatment in addition to or beyond that which is required by that standard, and do not create additional substantive rights.” Again, what sounds neutral has to been read in context. What need for “additional rights” would be needed when the profits of multi-national corporations are elevated above all other considerations?

The vote in the Canadian Parliament will likely be the last chance to stop the USMCA (photo by Saffron Blaze)

We then come to Article 14.8, which states: “No Party shall expropriate or nationalize a covered investment either directly or indirectly through measures equivalent to expropriation or nationalization (expropriation).” The word “indirectly” is crucial here. Not a reference to a nationalization, which would be a verboten act, an “indirect expropriation” can be any government act that, regardless of intention or general applicability, has the effect of preventing a multi-national corporation from extracting the biggest possible profit. An environmental regulation or a regulation imposing standards protecting human health are two examples of “indirect expropriation,” and under the rules established here would mean that the government being sued would be obligated to strike such regulations from its law and pay “compensation” to the corporation. The article explicitly states that “compensation shall be paid without delay.” (A “Party” is a government that is a signatory to the agreement.)

And what of requiring corporations to act in a socially responsible manner? Here’s Article 14.17 in full: “The Parties reaffirm the importance of each Party encouraging enterprises operating within its territory or subject to its jurisdiction to voluntarily incorporate into their internal policies those internationally recognized standards, guidelines, and principles of corporate social responsibility that have been endorsed or are supported by that Party, which may include the OECD Guidelines for Multinational Enterprises. These standards, guidelines, and principles may address areas such as labor, environment, gender equality, human rights, indigenous and aboriginal peoples’ rights, and corruption” (emphasis added).

Note the provisional language, quite unlike the many articles addressing what governments must do for multi-national corporations. In the standard language of trade agreements, rules benefiting capital and erasing the ability of governments to regulate are implemented in trade-agreement texts with words like “shall” and “must” while the few rules that purport to protect labor, health, safety and environmental standards use words like “may” and “can.” The USMCA is no different. It’s the same sleight of hand.

Regulations on banks and Internet giants? Forget about it

Chapter 17, covering financial services, contains the same standard language requiring “treatment no less favorable than that it accords to its own financial institutions … with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of financial institutions and investments.” Again, what appears to be bland language actually means something stronger: In this case, a prohibition against restrictions on predatory banks. Article 17.5 explicitly bans any limitations on the activities of financial institutions and Article 17.6 prohibits any restrictions on taking capital out of a country.

Among other rules, Article 19.11 prohibits any restrictions on “cross-border transfer of information,” which effectively means, for example, that neither Canada or Mexico can protect personal information from U.S. internet companies, a cohort not known for responsible use of personal information. Similar language can be found in Chapter 15, covering cross-border trade in services. This section appears to be modeled on the Trade In Services Agreement (TISA), a notorious “free trade” agreement negotiated in secret among 50 countries, among them all three NAFTA countries, the European Union, Australia, New Zealand and Japan, and purporting to liberalize professional services.

The cover story for why TISA is being negotiated is that it would uphold the right to hire the accountant or engineer of your choice, but in reality is intended to enable the financial industry and Internet companies to run roughshod over countries around the world. The text of TISA expanded the definition of “services” to encompass manufacturing and could potentially encompass technology companies like Google and Facebook as providers of “communications services.” The text of USMCA’s Chapter 15 may not necessarily be stretched as far it is in TISA, but a reasonable reading is that this chapter will provide another weapon that predatory banks can leverage to take over financial systems and halt attempts at bringing them under meaningful regulatory control. Citigroup, Microsoft and Google are among the many corporate entities celebrating the USMCA.

Another area of concern is Chapter 11, covering “technical barriers to trade.” This chapter adopts numerous articles from the World Trade Organization’s Agreement on Technical Barriers to Trade, and makes WTO standards obligatory. There is also a clause in Article 11.7 that requires equal participation by citizens of other countries when technical regulations or standards are developed. Might this be an invitation for executives and lobbyists for multi-national corporations to demand the ability to shape new regulations? What might be ruled an “unnecessary technical barrier to trade”? Such “barriers” are intended to be eliminated as stated in Article 11.9.

Ending secret tribunals appears to be an empty promise

In “free trade” lingo, when a corporation sues a government, the dispute is to be adjudicated in a mechanism known as an “investor-state dispute settlement.” That bland-sounding bureaucratic phrase means that a tribunal decides the issue. Under NAFTA, and many other “free trade” agreements, the tribunal is the International Centre for Settlement of Investment Disputes (ICSID), an arm of the World Bank. One of President Trump’s empty promises was to put an end to the use of these tribunals. Surprise! It’s ain’t so. OK, it’s not a surprise that he lied.

In disputes between the U.S. and Mexico, Article 14.D.3 states that disputes will be settled in the ICSID, but the two sides can agree to have it heard in another forum. Given the one-sided rulings ICSID hands down, suing corporations have little incentive to use another forum. More generally, Chapter 31 sets the rules for settling disputes. There we find Article 31.3, which states, “If a dispute regarding a matter arises under this Agreement and under another international trade agreement to which the disputing Parties are party, including the WTO Agreement, the complaining Party may select the forum in which to settle the dispute.” Can a corporation suing a government dragoon the government into the ICSID or one of the other two similarly one-sided secret tribunals? The text later in the chapter is ambiguous on that, but does not preclude use of those fora.

Finance capital will be one of the winners from the USMCA (photo by Elisa Rolle)

Later in the chapter, the text speaks of “panels” without specifying a forum and also mandates, in Article 31.8, that a “roster of up to 30 individuals who are willing to serve as panelists” be created. The panelists are to “have expertise or experience in international law, international trade, other matters covered by this Agreement, or the resolution of disputes arising under international trade agreements.” The exact same “expertise” required under NAFTA and virtually all other “free trade” agreements! In other words, corporate lawyers who specialize in representing corporations in these kinds of disputes are those who have the “expertise” and “experience” to sit in judgment. The same hat-switching will be in force.

So even if ICSID, or the other two secret tribunals, are not used and instead a new panel specific to the USMCA becomes the new forum, the same conditions and same cast of characters, using the same precedents, will be in force. There is no reason to expect any effective difference from NAFTA.

Some better language but that is not necessarily meaningful

As to what potential improvements from NAFTA exist, there are three. One is that hearings will be conducted in public (Article 14.D.8) (although there does not appear to be a requirement that a public notice be made). The second is that a side agreement in force only between Mexico and the U.S. that purports to uphold workers’ rights by prohibiting denial of free association or the right to collective bargaining to the extent that doing so impacts the other country (Annex 31-A). A panel is supposed to adjudicate this issue should it arise, and apply International Labor Organization standards. The U.S. government can sue to enforce this annex, but can anybody imagine the Trump or any other Republican administration suing to enforce the right of workers? For that matter, would a Democratic administration seek to enforce collective-bargaining standards or the right to form a union if a Mexican government, acting on behalf of its industrialists, discourages it from filing?

Democratic supporters of USCMA are taking this provision on faith, but it remains to be seen if there will be any use of this annex or if it can be meaningfully enforced even if a future administration does seek to apply it.

The third improvement is that there is language on the environment that is stronger than in past agreements. Article 24.2 declares that “The Parties recognize that a healthy environment is an integral element of sustainable development” and are encouraged to “promote high levels of environmental protection and effective enforcement of environmental laws.” There are several articles in Chapter 24 discussing various specific environmental concerns. But seemingly pro-environment language has not been absent from existing “free trade” agreements and that language has proved to be meaningless window dressing.

Further, Article 24.2 also says “The Parties further recognize that it is inappropriate to establish or use their environmental laws or other measures in a manner which would constitute a disguised restriction on trade or investment between the Parties.” Here we find a potential giant loophole. Might environmental laws be interpreted to be such a restriction? Unfortunately, there is ample precedent here. A series of rulings culminated in the World Trade Organization ruling that U.S. dolphin-safe labeling is an unfair “technical barrier to trade,” even though the U.S. had weakened its laws in response to the earlier WTO rulings.

Among rulings handed down under NAFTA — rulings that are considered precedents when similar cases are heard — Canada had to reverse its ban on a gasoline additive known as MMT, a chemical long believed to be dangerous to health, because the tribunal ruled the ban a violation of the principal of “equal treatment” even though, had a Canadian producer of MMT existed, it would have had the same standard applied. Canada was also successfully sued over its ban on the transportation of PCBs that conformed with both a Canada-United States and a multi-lateral environmental treaty. The tribunal ruled that, when formulating an environmental rule, a government “is obliged to adopt the alternative that is most consistent with open trade.”

Not only are these types of rulings precedents, but recall, as noted above, that Article 14, which elevates expectations of profits above any conflicting consideration, supersedes all other articles. And to repeat a point made earlier, WTO standards are obligatory. “Technical barriers” to trade as the WTO defines them won’t be exceptions.

A billionaires’ club masquerading as a government

So what can we really expect if the USMCA goes into effect? Given not only the history of “free trade” agreements and the mendacity of the Trump administration, probably the same as experienced under NAFTA. Consider the evidence the Trump administration has offered. Its April 2018 “National Trade Estimate Report on Foreign Trade Barriers,” a document laying out its trade goals, no less than 137 countries were cited for raising alleged “trade barriers” to be attacked, barriers that include items like laws requiring food imported to be safe.

In July 2017, the Trump administration quietly published its “Summary of Objectives for the NAFTA Renegotiation,” which features boilerplate language that in some cases appears to be lifted word for word from the Trans-Pacific Partnership. And, not least, is the Trump gang’s infrastructure plan, a macabre joke that mostly consists of massive corporate subsidies and intends the creation of “public-private partnerships,” which are scams under which services are privatized for guaranteed corporate profit while becoming more expensive and less subject to public accountability.

We’re supposed to trust this government? NAFTA has been a “lose-lose-lose” proposition for working people and farmers in Canada, Mexico and the United States. That formula won’t be changing. The Council of Canadians has issued a strong warning about what can be expected:

“Regulatory cooperation in the new NAFTA takes away our ability to set standards and regulations to protect our health, safety and well-being. … [R]egulations cannot be prescribed for ethical or social reasons. The emphasis is on the regulator to prove that a regulation is backed by science, and not on the corporation to prove that their product does no harm. … Regulators have to vigorously defend proposed regulations and are even required to suggest alternatives that don’t involve regulating. They have to provide extensive analysis, including cost-benefits to industry. The new NAFTA encourages the three countries to harmonize, or have similar regulations. This is not about raising standards, but bringing standards down to the lowest common denominator.”

The National Family Farm Coalition, representing organizations in more than 40 U.S. states, said the USMCA “offers little” for family farmers. Coalition President Jim Goodman, a retired Wisconsin dairy farmer, said:

“Climate change is not mentioned and the new treaty does nothing to curb the environmental damage that was part of the original NAFTA. [Coalition] dairy producers do not support dumping excess US milk on the Canadian or Mexican markets, as that will force family dairy farmers out of business in those countries.”

The Sierra Club, League of Conservation Voters and National Resources Defense Council also recommended against the agreement being approved:

“The deal that the Trump administration produced … would encourage further outsourcing of pollution and jobs, offer handouts to notorious corporate polluters, and prolong Trump’s polluting legacy for years. The deal not only fails to mention, acknowledge, or address the climate crisis, but would actually contribute to it.”

The Institute for Agriculture & Trade Policy similarly gave a thumbs-down to the deal:

“[The USMCA] locks in a system of agribusiness exploitation of farmers and workers in the three participating nations, while worsening the climate crisis. … Nothing in the New NAFTA addresses urgent issues plaguing our farm economy: low prices, rising debt and increased bankruptcy. … Measures in New NAFTA that open Canada’s dairy market to increased exports from the U.S. will not significantly reduce the vast oversupply of U.S. milk or raise prices paid to U.S. dairy farmers. Instead, the opening will weaken Canada’s successful supply management program, which has achieved market-based prosperity for its farmers. Added regulatory-focused sections will delay and impede the development, enactment and enforcement of protections for consumers, workers and the environment.”

Sadly, the main union federation in the U.S., the AFL-CIO, has chosen to endorse the USMCA despite its fatal flaws. The largest Canadian federation, the Canadian Labour Congress, does not seem to have taken a position, although it did issue an ambiguous statement in October 2018 saying the deal had “some points of progress.” The Congress specifically cited the eliminating of NAFTA’s notorious Chapter 11 that elevated “investor rights” above all other considerations, but that optimism proved erroneous as it is now clear that provision remains in less direct language.

The governments of Canada, Mexico and the United States have once again put a gun to their own heads. “Free trade” agreements continue to have little to do with trade and much to do with imposing a corporate dictatorship, a lesson once again being imposed.

COP25: Never have so many governments done so little for so many

It’s said that it is better to laugh than cry. But what do we do when a situation has become so beyond parody that laughter is impossible?

As Australia burns, the world is about to finish its second hottest year ever, the seas rise, polar melting is worse than previously modeled and the sixth mass extinction gains momentum, the world’s governments met in Madrid for the 25th Conference of the Parties to the United Nations Framework Convention on Climate Change, otherwise known as COP25. What did they decide after two weeks of negotiations? They issued a statement titled “Time For Action.” And here are two representative decisions concerning “action”: The conference “Notes with concern the state of the global climate system” and “Decides to hold, at its twenty-sixth (2020) and twenty-seventh (2021) sessions, round tables among Parties and non-Party stakeholders on pre-2020 implementation and ambition.”

I don’t feel like laughing.

A dire emergency threatening the long-term viability of Earth’s environment, a set of looming disasters almost certain to make refugees out of untold millions of people in the lifetimes of many people alive today, and the best the leaders of the capitalist world can do at their yearly climate summit is “note” there is a problem and that a year from now they will talk about it some more.

Casa de la Panaderia, Plaza Mayor, Madrid

The representatives of the economic system, it should be noted, that is responsible for global warming. And although all indications are that it is impossible to stop and reverse global warming as long as capitalism ravages the planet, obviously as much as can be done needs to be done today because a rational economic system is nowhere near coming into being.

We have been down this road before. A year ago, at COP24 — held in a center of coal production, Katowice, Poland — the world’s governments agreed to a rulebook with no real enforcement mechanism. The world’s governments had previously agreed to set goals for reducing their production of greenhouse gases but to do so on a voluntary basis with no enforcement mechanism, and COP24 ended with an agreement on guidelines as to how those goals will be reported that also have no enforcement mechanism. As woeful as that was, it was an improvement over COP23, when participants congratulated themselves for their willingness to talk and agreed they would talk some more. They did issue some nice press releases, though.

Having already agreed that talking is good, the world’s governments declared at COP25, which concluded December 15, that talking is indeed a good thing and that they shall do more of it.

No progress but there were more nice press releases

Press releases were happily issued at COP25, each giving off a quite surreal air of disconnect. For example, the web site for the United Nations Framework Convention on Climate Change issued a release on December 13 that declared “Global Climate Action Presents a Blueprint for a 1.5-Degree World,” which breathlessly informed us that a so-called “Climate Action Pathways” initiative would establish “transformational actions and milestones.” What of substance actually did get accomplished? Beyond issuing press releases and inviting everyone to talk next year, it would appear nothing.

Recall that the world’s governments agreed at the Paris Climate Summit in 2015 to hold the global temperature increase to 1.5 degrees Celsius above the pre-Industrial Revolution average, a change from the previous commitment of 2 degrees, although they did not make corresponding pledges to reach either goal.

Fridays For Future demonstration in Madrid near the Congress of Deputies (photo by John Englart)

The goals set for COP25 were to reach agreement on a “carbon market” scheme whereby countries could claim credits for carbon sinks such as intact forests and for renewable-energy projects that lead to reduced greenhouse-gas emissions. Poorer countries would be allowed to sell their credits to wealthy countries, which could then count those credits toward their obligations. Brazil, under its neo-fascist president Jair Bolsonaro, wanted to double-count its forests — it sought to count its forests toward its national emissions targets but also sell the credits attached to them. Other countries sought to have past credits count toward post-2020 emissions accounting, another method to evade responsibility.

The result was that no progress was made in Madrid toward the goal of formalizing the agreements from the Paris agreement, nor toward boosting those commitments as the agreement had intended. And thus no progress was made toward holding global warming to 1.5 degrees C., the agreed Paris goal. Even if all pledges made by the world’s governments were honored in full (currently a quite unlikely occurrence), global warming would reach 3 degrees.

Biggest greenhouse gas producers say no the loudest

But let us not lay all blame at the feet of Brazil, detestable as its “let the Amazon burn” president is. As a Democracy Now report succinctly put it, “Scores of civil society groups condemned governments in the European Union, Australia, Canada and the United States for a deal that requires far less action than needed to avert catastrophic climate change.”

The carbon markets, if they are set up, would be a farce designed to enable the Global North to evade responsibility. As Asad Rehman, executive director of War on Want, told Democracy Now:

“[W]hat’s happening here now is rich developed countries, not just the United States, but Australia, Canada, backed by the European Union, not only don’t want to cut their own emissions, not only don’t want to provide finance that they promised, not only don’t want to help the most impacted people, but now want a get-out-of-jail card. And this is what Article 6, the carbon markets are, because what it basically says is, ‘I won’t have to cut my emissions, but I can pay somebody else, and you cut your emissions, and I will count it as if I cut my emissions,’ as if there is a never-ending magic box of carbon pollution that we’re allowed to do. It is not possible. … 10 years ago we had an argument, in these very negotiations, about carbon markets, and developing countries and civil society absolutely rejected them. They said they do not deliver emissions reductions. They’ll lead to huge human rights violations. They allow profit for private companies and nothing to ordinary people.”

Harjeet Singh, climate change specialist at ActionAid, said in a speech at COP25 that:

[T]he constant bullying of these big countries are making this process worse than useless. Their bullying hasn’t stopped. They’re not letting us make any progress in this space. There is no substitute for action. And what rich countries are doing, they are creating an illusion of action by just talking. When we demand action, they offer reports. When we demand money, they offer workshops.”

Perhaps the worst bullying is coming from the United States, which is scheduled to leave the Paris agreement in November 2020. Despite its intention to exit, the Trump administration nevertheless actively intervened to protect polluting industries. A U.S. “loss and damage” proposal would make it more difficult for developing countries to obtain financial support for the costs they will sustain from global warming. In an interview, Singh said:

This is worst I have seen in the last 10 years of me attending negotiations. It can’t get worse than that. It’s arm-twisting and bullying at the highest level, where United States, which is not meeting its emission targets, is not giving any money to Green Climate Fund and not even letting a system to be created that can help people who face climate emergency now. I mean, look at the audacity of United States, the way they are behaving in these negotiations.”

Current pledges would leave emissions double what is necessary

The gap between the significant cuts in greenhouse-gas emissions necessary to meet the Paris goals and what has been pledged is growing wider. Climate Action Tracker calculates that the level of emissions necessary to meet the goal of capping global warming to 1.5 degrees would require that greenhouse-gas emissions be half the level of what has been pledged, assuming all pledges are met. To put concrete numbers to that statement, emissions in 2030 would need to be down to 26 gigatons (26 billion metric tons) of carbon dioxide equivalent (CO²E). The totality of Paris commitments, as of December 2019, would result in CO²E emissions of 52 to 55 gigatons.

Climate Action Tracker reports there are two countries — Morocco and The Gambia — that have made Paris commitments sufficient to meet the goal of holding global warming to 1.5 degrees. Six countries are compatible with a warming of 2 degrees. All others are insufficient, highly insufficient or critically insufficient. The last of those categories, the worst, have Paris commitments that would lead to a rise of more than 4 degrees and thus most spectacularly fail to meet global responsibilities. Those in this category are Russia, Saudi Arabia, Turkey, the United States, Ukraine and Vietnam. Several large countries, including China and Japan, are rated as highly insufficient. Among those merely insufficient are Australia, Canada, the European Union, Mexico and New Zealand.

What that means in practical terms is this, according to Climate Action Tracker:

“Under current pledges, the world will warm by 2.8°C by the end of the century, close to twice the limit they agreed in Paris. Governments are even further from the Paris temperature limit in terms of their real-world action, which would see the temperature rise by 3°C. An ‘optimistic’ take on real-world action including additional action that governments are planning still only limits warming to 2.8°C.”

The United Nations’ Emissions Gap Report 2018 said that global greenhouse-emissions set a record high in 2017 of 53.5 gigatons of CO²E. Consistent with Climate Action Tracker, the UN report said, “Global [greenhouse-gas] emissions in 2030 need to be approximately 25 percent and 55 percent lower than in 2017 to put the world on a least-cost pathway to limiting global warming to 2°C and 1.5°C respectively.” Emissions set another record in 2018 — Carbon Brief reported that 2018’s increase of 2.7 percent was the fastest increase in seven years. For 2019? Higher still, although at a reduced rate of increase despite emissions due to deforestation increasing faster than the previous five years.

Fridays For Future demonstration in Madrid (photo by John Englart)

As an additional insult, hundreds of climate activists were thrown out of COP25 at the same time that at least 42 current or former employees of the fossil fuel industry attended as part of official delegations just from Persian Gulf countries. The senior negotiator at COP25 for Saudi Arabia is a former employee for Aramco, Saudi Arabia’s giant state oil company. DeSmog further reports that a “think tank” with close ties to U.S. President Donald Trump obtained accreditation for several organizations and individuals who promote global warming denial. One of those organizations, the notorious Heartland Institute, which began life a propaganda outfit seeking to deny the dangers of smoking, hosted an alternative series of talks on what it calls the “climate delusion” with titles like “The Renewable Power Nightmare in Europe.”

I know you don’t need more facts, but here are more

It takes a special level of delusion (or amoral profit interest) to continue to deny all that is happening around us. To cite only a handful of fresh reports, here is some of the latest climate science:

• The average temperature of the Canadian Arctic increased 2.3 degrees C. from 1948 to 2016 and is projected to increase almost 8 degrees by the end of this century. One result of this is that sea ice within the Canadian Arctic Archipelago has decreased by 5 percent per decade since 1968 and that the flow of sea ice leaving the Canadian Arctic Archipelago for more southerly latitudes, where it rapidly melts, is expected to accelerate.

• The Greenland Ice Sheet is losing nearly 267 billion metric tons of ice per year and currently contributing to global average sea-level rise at a rate of about 0.7 millimeters per year.

• Thawing permafrost throughout the Arctic could be releasing an estimated 300 million to 600 million tons of net carbon per year to the atmosphere. In plain language, the Arctic may be becoming a net emitter of greenhouse gases rather than a storage.

• The Arctic as a whole is warming twice as fast as the global average, and the speed of changes there is happening faster than anticipated.

• The six warmest years on record are the most recent six years (2014 to 2019); 2019 will be the second hottest year ever despite the lack of an El Niño event, during which the hottest years ordinarily occur.

• Remarkably, 2019 has produced 142 national/territorial all-time or monthly record high temperatures, with zero all-time or monthly record lows.

It seems almost superfluous to point out some earlier studies that portend disaster, such as studies that conclude humanity may have already committed itself to a 6-meter rise in sea level; that massive coastal flooding could happen faster than currently expected; that global warming will accelerate as the oceans reach their limits of remediation; and that Earth is already crossing multiple “planetary boundaries” that will drive the planet “into a much less hospitable state.”

We’re drowning but a few people got rich

If those disastrous predictions come to pass, our descendants are not likely to declare that coping with their immense problems was a reasonable tradeoff for the one percent among their ancestors scooping up massive profits. Saving the future viability of Earth’s ecosystems for the future is an immense task, one impossible under our current global economic system.

Capitalism requires endless growth and endless growth requires more production. Capitalism’s internal logic also means that its incentives are to use more energy and inputs when more efficiency is achieved — the paradox that more energy is consumed instead of less when the cost drops. Because production is for private profit and competition is relentless, growth and cost cutting is necessary to maintain profitability — and continually increasing profitability is the actual goal. If a corporation doesn’t expand, its competitor will and put it out of business. Because of the built-in pressure to maintain profits in the face of relentless competition, corporations continually must reduce costs, employee wages not excepted. Production is moved to low-wage countries with fewer regulations, enabling not only more pollution but driving up energy and carbon-dioxide costs with the need for transportation across greater distances.

Leaving capitalism intact means allowing “markets” to make a wide array of social decisions — and markets are nothing more than the aggregate interests of the most powerful industrialists and financiers. Those markets aren’t going to provide new jobs for those currently dependent on the fossil fuel industry, so resistance from those who stand to lose work without a viable alternative are naturally going to resist change alongside oil company executives. It also means that powerful special interests can continue to dictate policies inimical to the environment solely to keep their profits rolling in. As much as we need the fastest possible transition to renewable energy sources — and we certainly do — that transition is insufficient by itself.

We in the advanced capitalist countries have yet to face the fact that we must consume less not only because natural resources are being used at rates well beyond replacement but because to meet the needed reductions in greenhouse-gas emissions requires not only renewables, not only more efficient energy usage, but that we use less energy, especially if hundreds of millions of people in the Global South are to have a chance to boost themselves out of deep poverty. A rational, democratic economic system based on meeting human need that can operate in a steady state or shrink with a falling population is necessary. An economic system geared toward nothing but massive profits for a tiny percentage of people and based on ruthless competition and exploitation, in which corporations can shift the costs of their behavior onto the public and the environment, can’t save us. The compete failure of the world’s capitalist countries to meaningfully begin to tackle global warming, despite the alarm bells nature is sounding, demonstrates this all too clearly.

So-called “green capitalism” is destined to fail. We need system change, not climate change.

The fight to overturn the latest corporate coup at Pacifica has only begun

Crisis is never far away at the Pacifica radio network, but it is now facing perhaps its worst crisis ever as a new “corporate coup” has, at least for now, shut down WBAI in New York City.

Pacifica listeners and on-air hosts have successfully fought back against prior attacks on the progressive network, most notably reversing the lockout at KPFA in Berkeley in 1999 and the “Christmas Coup” at WBAI in 2000. In those cases two decades ago, the national board of Pacifica had become self-selecting, with board members with corporate backgrounds selecting like-minded people to new board seats and trying to rewrite the bylaws to not only sell off one or more Pacifica stations but be able to personally pocket some of the proceeds. Intense organizing and a boycott of donations eventually not only reversed the coup but begat a new democratic structure of elected local station boards and a national board made up of local-station representatives supplemented by affiliate representatives. (Many stations across the United States carry Pacifica programs to supplement their local programming.)

In that case, many activists believed that starving listener-supported WBAI of funds would reverse the coup. (Full disclosure: I was personally involved in that struggle.) Indeed that proved to be the case. Yes, Pacifica listeners, and exiled staff members and producers won in court, but as that was ultimately a political struggle, it had to be won through the actions of its supporters.

(photo by The City Project)

Unfortunately, the latest coup, which began with a dramatic physical takeover of WBAI facilities on October 7, won’t be so simply solved. This is a fight that WBAI listeners and staff believe can be, and will be, won — and this fight is also a political fight. But in the Christmas Coup two decades ago, the intention was to maintain all five Pacifica stations intact for potential sale. This time, however, the coup mongers are strongly believed to want to destroy WBAI in order to sell its license.

The coup mongers, led by Interim Executive Director John Vernile (on the job for all of two months!) and National Board Secretary Bill Crosier, insist they executed their takeover in an effort to “save” WBAI, citing the New York station’s operating deficit. It is true that WBAI has struggled financially for several years, although Mr. Vernile has drastically overstated the size of the debt. But what really stands out is how the takeover was accomplished.

WBAI was in the midst of a fund drive, but the fund drive was stopped, the web site at which listeners could make donations was disabled and all local programming was taken off the air, replaced with canned programming from California with no local content. The team led by Mr. Vernile that descended on the station the morning of October 7 dismantled the equipment, rendering it impossible to broadcast; immediately fired all employees; ordered them to leave; confiscated the station bank account; took checks left in the office; put padlocks on the doors; and told the station’s landlord she should find a new tenant while cutting off rent payments. The transmitter was switched to broadcast the canned California programming and the WBAI web site, including all archives of past shows, was wiped clean and replaced with a one-page site with a propaganda message justifying the coup.

Do these sound like the acts of someone interested in the well-being of the station?

And if a financial deficit were really the problem, it would seem most counter-intuitive to do everything possible to prevent the station from raising funds and to block its bank account.

No, this was not an act of benevolence.

Scapegoating WBAI for the network’s problems

As with most things Pacifica, this is a complicated story. The entire network, not only WBAI, is struggling financially. A faction centered at Pacifica’s two California stations, KPFA in Berkeley and KPFK in Los Angeles, have long advocated the selling of WBAI’s license and to use the proceeds to benefit the remaining stations, particularly their own. Although WBAI has been commercial-free for its 60 years as a listener-supported Pacifica station, its frequency, 99.5, is in the commercial portion of the FM band, and thus worth tens of millions of dollars. This faction has made WBAI into a scapegoat for the financial difficulties of the network as a whole.

That is the context that is behind this latest coup. Of the nine National Board members supporting the coup, three are from KPFA, two from KPFK and three from the Houston station, KPFT. There are 22 members of the National Board, so nine do not constitute a majority. Moreover, 12 board members — an outright majority — oppose the WBAI takeover. Yet nearly two weeks into the coup, nothing has been reversed and the minority, for now, remains in control.

As noted above, this is complicated. An October 21 court date has been scheduled, when the contours of the legal case may begin to take shape. There have already been multiple court appearances, however, and those will be discussed below. Regardless of what happens, or doesn’t happen, on October 21, this standoff between the coup mongers and those opposed will not be resolved for some time, and resolving it will require considerable activist energy on the part of listeners, paid and unpaid staff, and other supporters.

So what is the takeover really about? Although there is a widespread belief that the real intention is to sell off the station’s license, despite the denials of the coup mongers, speculation is all that can be done for now. And perhaps there are other reasons.

“Make no mistake about it — it’s all about content — community voices,” said the lead attorney who has sued on behalf of WBAI, Arthur Schwartz, in an October 9 statement. “Nothing in the Pacific bylaws allows such a takeover by its executive director, who acted without even debate or a vote by Pacifica’s Board of Directors.”

A 40-year veteran of WBAI, Mimi Rosenberg, an activist attorney who has hosted WBAI’s outstanding labor program, Building Bridges, for decades, noted that although the takeover was sudden, the planning was not. “This has been in the works for a long time,” Ms. Rosenberg said. “The intent of the secret raid — or coup — was to wound the station irreparably by wrecking the fund drive, then drive the station to bankruptcy to sell it off so that the other stations in the network could feed off the monies from the sale of WBAI’s license.”

Ms. Rosenberg appears also to be slated by the coup mongers to be a scapegoat. She recently was handed a completely unjustified one-week suspension for allegedly putting WBAI in jeopardy. What was her “transgression”? It was uttering the words “stop Trump” in a promo for her Labor Day special broadcast. Pacifica claimed that uttering those words constituted an impermissible political endorsement that could put WBAI’s tax-exempt status at risk. So with the worst president in anyone’s memory in the White House, someone with the desire (thankfully not the competency) to become a fascist dictator, Pacifica should refrain from serious coverage? What sort of community radio station would WBAI be under such constraints?

Decisions of Pacifica headquarters worsened WBAI finances

Before we get to the legal twists and turns, it is proper to examine the financial situation that is the stated cause of the takeover. It is true that WBAI has experienced financial difficulties for several years and was expected to have a cash deficit for fiscal year 2020. By far the biggest reasons for WBAI’s financial woes are the massive back rent that was owed to the Empire State Building (where the transmitter was formerly located) and to the owners of 120 Wall Street (where its offices and studious used to be located.) That is significant because WBAI management had nothing to do with either contract — the onerous terms of those leases were negotiated and signed by the Pacifica national office around the time of the Christmas Coup.

The rent for the new locations of the transmitter and studios is considerably lower, but the heavy expenses of the previous locations weighed the station down for years and ultimately required the taking of a loan to pay off. WBAI does need to raise more money to keep itself afloat, but would be in much less jeopardy without the Pacifica-imposed expenses. The pro-coup faction on the National Board has taken no note or responsibility for those actions of its predecessors.

According to a document filed with the New York State Supreme Court Appellate Division, WBAI is projected to have a cash-flow deficit of $394,000 for fiscal year 2020. That is the largest deficit of any of the five Pacifica stations, but is not substantially larger than some others. KPFA is expected to have a cash-flow deficit of $366,000 and KPFK a deficit of $314,000. There is no movement to sell the license of either California station. (It should be noted that not all KPFA directors back the coup, and KPFA listeners staged a demonstration opposing the WBAI shutdown, an act of solidarity cheered by advocates in New York.)

“There are so many mischaracterizations and distortions, both through ignorance and of course from distain and to otherwise misrepresent the essence and structure of how the network/stations work,” Ms. Rosenberg said.

Directly addressing the allegations that WBAI’s finances are “dragging down” the network, WBAI Station Manager Berthold Reimers said:

“The Pacifica National office is largely to blame for deals they made without consulting WBAI as well as for not doing audits which prevented the station from receiving Corporation for Public Broadcasting (CPB) funding. … [The debt] was caused by a contract negotiated and signed by the Pacifica national office without consultation with WBAI. The station was put in an untenable position of having to pay $65,000 a month for the transmitter rental space. They also negotiated moving WBAI to 120 Wall Street, where the monthly payment was $45,000 per month.”

Mr. Reimers said that if the nearly $25,000 per month from the CPB that the station lost because the national office didn’t perform necessary audits in time is added to the unnecessarily high rents, WBAI lost close to $300,000 in annual revenue for many years.

Multiple court filings in first two weeks

Following the October 7 shutdown of WBAI, a group of WBAI producers and listeners asked the New York State Supreme Court (despite its name, that is the state’s trial-level court) for a temporary restraining order (TRO) to reverse the takeover pending further legal action. The next morning, a state judge granted the TRO directing the station to be returned to its pre-October 7 state and scheduled a hearing to consider if the injunction should be made permanent.

WBAI advocates argued that the takeover was illegal under Pacifica bylaws because no vote of the National Board was taken and thus there was no authority for Mr. Vernile to take such action. Mr. Vernile and the National Board faction backing him argued in an appeal to the Appellate Division that the TRO was “issued in the dead of night” and therefore invalid, and further argued that “Pacifica owns the property, offices and equipment of WBAI and thus cannot ‘seize’ it from itself.”

Brooklyn Botanic Gardens (photo by Daderot)

The Appellate Division ruled in favor of the appeal, vacating the TRO except for the termination of the 12 paid staffers. That order vacating the TRO was issued despite WBAI’s argument that the Appellate Division has no jurisdiction to overturn a TRO in the absence of a grant of appeal, which WBAI’s filing said had not been given, and that “We could not find a single decision where an appellate court assumed jurisdiction so that it could vacate a temporary restraining order.”

The coup faction on the National Board then sought to endorse the coup after the fact. A phone meeting of the National Board was convened and a vote taken on October 12. By any reasonable standard, this vote could not be considered fair. Apparently realizing they would lose the vote, five anti-coup members of the board had their phones muted so they couldn’t speak and were thus presented from voting! WBAI representatives on the board were told they had “a conflict of interest” and shouldn’t be allowed to vote. No such suspension of voting rights has ever been handed down under any circumstance. With the five board members blocked from voting, the motion to give after-the-fact blessing to the coup was nine in favor and seven against.

However, an emergency meeting was called by a majority of the National Board for the next day, October 13, and this time, 12 board members (an outright majority on a board of 22) voted to reverse the coup and instructed the corporate law firm that the coup faction had hired, Foster Garvey, to “withdraw from all litigation on behalf of Pacifica.” The board had never approved the hiring of the firm, which has filed all motions in support of the coup and the coup faction. According to the advocacy group Pacifica Radio In Exile, “All 12 board members, who represent a quorum of the nonprofit’s board of directors, formally waived notice requirements for the special [October 13] meeting and convened on a conference line that did not permit the involuntary muting of participants.” It is also notable that the 12 anti-coup members included at least one representative of each of the five Pacifica stations.

The Pacifica faction then moved the case to federal court, and asked that court to issue a TRO reversing the October 13 vote, arguing that proper notice was not given for the second vote and thus should be vacated. That request was granted, with the court also scheduling an October 21 hearing. Until then, WBAI remains under the control of the coup faction and, effectively, WBAI supporters argue, under the control of the court. So reports after the initial state-court TRO was issued that WBAI supporters had won were premature. Additionally, station equipment was dismantled on the day of the coup, so work will be necessary before WBAI can resume local broadcasting should it be allowed to do so.

The federal judge who issued the TRO in favor of the coup faction issued an order “Enjoining Petitioners [WBAI representatives and two WBAI National Board members] from disregarding or causing others to disregard the properly passed motions of the Pacifica National Board on October 12, 2019, until such time as this Court has issued a ruling determining the validity of the October 13, 2019, motions.” The judge ordered that no meetings be held that do not follow Pacific bylaws and further ordered that WBAI’s lead attorney, Mr. Schwartz, have no contact with any Pacifica employees or National Board members.

The law firm that the coup faction hired (with no authorization from the National Board) is Foster Garvey, one of the largest corporate law firms in the Pacific Northwest. One of the firm’s specialties is “labor and employment litigation,” which for a law firm of this type means that it assists corporations in screwing its employees, no matter the pretty euphemisms the firm uses in its description of its labor services. That ought to be inappropriate for what is supposed to be a progressive community-based radio network. What is inescapable is that corporate ideology is so pervasive that our own institutions are far from free of it.

Capitalism’s triumph: Labor rights violated in every country on Earth

In what country are labor rights fully respected? The sad answer is: none.

Labor rights are routinely violated around the world, and the trend is only getting worse. The International Trade Union Confederation has again issued its annual Global Rights Index and the result is no better than in past years. It’s worse. For example, the number of countries that exclude workers from the right to establish or join a union increased from 92 in 2018 to 107 in 2019. Even in Europe, the region with the (relatively) best conditions for working people, half the countries exclude at least some groups of workers from freely associating by allowing “non-standard” forms of work such as zero-hour contracts, temp work or misclassifying people working through online platforms as “self-employed.”

Corporations ever on the lookout for ways to extract more from their workforce and, with government complicity, continue to press down. The Confederation, in its report, said:

Worldwide, new technology has allowed employers to use various mechanisms to avoid paying minimum entitlements and exclude workers from labour laws. Recent technological leaps in the ways that work can be allocated and accessed has resulted in increased incidences of workers being denied rights under the guise of flexibility and as platform workers. Decent work is being affected and rights are being denied by companies avoiding rules and regulations. … More and more governments are complicit in facilitating labour exploitation or allowing the rule of law to be avoided because workers are forced to work in the informal sector of the economy.”

Rapid advances in technology, because they are controlled by corporations and repressive governments, are enabling continuing deterioration in working conditions. Not only does technology enable production to be moved to locations with ever lower wages and regulations, but it enables the weakening labor protections in new “high tech” wrapping.

In its report, the International Trade Union Confederation ranks countries from one to five, with one the least repressive and five the most. Only 12 countries — Austria, Denmark, Finland, Germany, Iceland, Ireland, Italy, the Netherlands, Norway, Slovakia, Sweden and Uruguay — are ranked as one. These are countries that are merely “sporadic” violators of rights. So there are no countries on Earth that do not violate labor rights. (There are several countries not given a rating, shown in gray in the map below.)

The International Trade Union Confederation labor rights rankings

Interestingly, the two countries most prone to wagging fingers at the rest of the world, Britain and the United States, once again fared poorly. Britain was ranked as a three, representing a country that has “regular violations of rights.” The U.S. was rated as a four, among countries determined to condone “systematic violations of rights.” There is nothing new here; the U.S. has consistently been scored as a four in these reports over the years. As recently as 2017, Britain was also ranked as a four.

In a country rated as a four, “The government and/or companies are engaged in serious efforts to crush the collective voice of workers putting fundamental rights under threat.”

So much for the so-called land of freedom.

The report’s rankings are as follows:

  • 1. Sporadic violations of rights: 12 countries as noted above (green on map above).
  • 2. Repeated violations of rights: 24 countries including France, Japan and New Zealand (yellow on map).
  • 3. Regular violations of rights: 26 countries including Australia, Canada and Spain (light orange on map).
  • 4. Systematic violations of rights: 39 countries including Argentina, Chile and Mexico (dark orange on map).
  • 5. No guarantee of rights: 34 countries including Brazil, China, Greece and India (red on map).
  • 5+ No guarantee of rights due to breakdown of the rule of law: 9 countries including Libya and Syria (dark red on map).

The Confederation, which describes itself as a coalition of “national trade union centres” encompassing 331 affiliated organizations in 163 countries and territories, determines its ratings by checking adherence to a list of 97 standards derived from International Labour Organization conventions. “The methodology is grounded in standards of fundamental rights at work, in particular the right to freedom of association, the right to collective bargaining and the right to strike,” the Confederation wrote in its report.

During the six years that the Confederation has issued its yearly reports, conditions have steadily deteriorated. Since the initial report in 2014, every region of the world has seen scores worsen. Summarizing this trend, the report says:

“In 2019, strikes have been severely restricted or banned in 123 out of 145 countries. In a significant number of these countries, industrial actions were brutally repressed by the authorities and workers exercising their right to strike often faced criminal prosecution and summary dismissals. Three regions — Africa, the Americas and [Middle East/North Africa] — all had an increase in the number of countries that violated the right to strike from last year.”

And thus it is no surprise that inequality is rising around the world, unemployment is endemic and far higher than official government statistics would have us believe and corporate tax dodging facilitated by government policies is widespread. The world’s working people continue to be on the losing side of one of the most one-sided wars in human history.

The realism and unrealism of the Green New Deals

A problem facing advocates of serious action to deter global warming is that the costs of not acting aren’t quantifiable and remain somewhat abstract. In contrast, calling for a phase-out of fossil fuels understandably leads to fears of job losses, especially since capitalism isn’t going to offer new employment for those displaced.

There will be costs with taking measures to do a portion of what needs to be done, never mind all that needs to be done. To deny this, as liberals frequently do, might backfire when it becomes apparent there won’t be a climatic free lunch. There are two counters to these future costs — first, the benefits, including new jobs, from the industries that will grow dramatically from a real effort to switch to renewable energy as part of a comprehensive tackling of global warming and, second, the massive costs that will come due from continuing business as usual. What will be the costs of a sea-level rise of, say, three meters, the disruption to agriculture and the associated mass migrations that would be triggered?

These costs would be catastrophic, totaling much more in the long run than the shorter-term costs of acting with seriousness.

Terminus of Kangerlugssuup Sermerssua glacier in west Greenland (photo by Denis Felikson, via NASA)

With this context in mind, an analysis is in order of the so-called Green New Deal, both the Green Party’s original and the Democratic Party’s later watered-down version. First, this article will highlight some of the key points in both, then look at some of the critiques (including right-wing ones, since these get the lion’s share of coverage in the corporate media) and, finally, determine what conclusions might be drawn. Inevitably, discussion of economics — and the world economic system — can’t be avoided. Can there truly be a “green capitalism” whereby the same system that has brought humanity and the environment to an existential crisis will magically provide the solution? (I suppose the way that last question is framed previews the answer.)

In other words, can reforms within current parameters prove sufficient to be able to reverse the ongoing massive dumping of greenhouse gases into the atmosphere; reduce the concentration of atmospheric carbon dioxide, methane and nitrogen oxides; and enable a conversion to sustainable agricultural and environmental practices? Or is a new way of organizing the world’s economic activity an unavoidable necessity? To begin to answer these questions, we have to define what needs to be done.

The Green Party’s Green New Deal program

Regardless of our opinions of the Green Party of the United States, the party has produced an ambitious document, one worthy of serious discussion. (Full disclosure: I was once highly active in the party but withdrew because it became too frustrating to continually fight the party majority that had a liberal orientation little different from the Democratic Party; people active in it today tell me that party has since moved in a more socialist direction.) The party’s Green New Deal sets a goal of “a new, sustainable economy that is environmentally sound, economically viable and socially responsible.”

In conjunction with the goal of sustainability is an “Economic Bill of Rights,” defined as the right to single-payer healthcare, a guaranteed job at a living wage, affordable housing and free college education. To achieve its goals, the Green New Deal calls for “a WWII-type mobilization to address the grave threat posed by climate change, transitioning our country to 100% clean energy by 2030.”

Given that humanity is inching closer to the point of no return — the atmosphere is more than halfway to the 2 degree C. global temperature rise from pre-industrial levels that is believed to be the limit before runaway change brings on catastrophic consequences and not far from the 1.5 degree mark that may be the more realistic limit — an accelerated timetable for a full shutdown of fossil-fuel consumption is unavoidably a part of any serious program to stop global warming. The U.S. Environmental Protection Agency estimates that 20 percent of greenhouse gases derive from fossil fuels used for transportation and another 28 percent comes from burning fossil fuels to produce electricity. (Apparently the Trump gang has not gotten around to censoring that report.)

“Bottle Buyology” at the Minnesota State Fair (photo by Tony Webster)

The authors of the Green New Deal certainly see massive benefits from their proposed program. For example, the party says it would “Create 20 million jobs by transitioning to 100% clean renewable energy by 2030, and investing in public transit, sustainable (regenerative) agriculture, conservation and restoration of critical infrastructure, including ecosystems.” The party would “Ensure that any worker displaced by the shift away from fossil fuels will receive full income and benefits as they transition to alternative work.” That employment initiative would be conducted in the context of “energy democracy” — there would be “public, community and worker ownership of our energy system” with access to energy treated as a human right.

All fossil fuel production, and nuclear energy, would be phased out, a carbon tax imposed (but not defined) and a “greenhouse gas tax” would be imposed on polluters to compensate society for damage already caused.

The Green Party’s Green New Deal platform asserts that implementing the program would “revive the economy” and necessitate hundreds of billions of dollars in cuts to military spending because there would be no longer a need to control foreign oil supplies and transportation. Moreover, “the Green New Deal largely pays for itself in healthcare savings from the prevention of fossil fuel-related diseases, including asthma, heart attacks, strokes and cancer.”

To help bring about these changes, the Green New Deal proposed to provide “grants and low-interest loans to grow green businesses and cooperatives, with an emphasis on small, locally based companies that keep the wealth created by local labor circulating in the community rather than being drained off to enrich absentee investors.” Current subsidies for fossil fuels would be re-directed toward research efforts to further develop wind, solar and geothermal energy and sustainable environmental and agricultural practices. Natural gas, biomass and nuclear power are ruled out as not constituting clean energy.

Surely an ambitious plan. To the question of how realistic this program is we will return later in this article.

The Democratic Party’s Green New Deal program

For a comparison, let’s now turn to the Democratic Party’s version of a Green New Deal, specifically the plan introduced into Congress by Representative Alexandria Ocasio-Cortez and Senator Ed Markey. This plan calls for “net-zero greenhouse gas emissions” and the creation of “millions of good, high-wage jobs and ensure prosperity and economic security for all people of the United States.” This proposal also seeks to “promote justice and equity … and repair historic oppression of indigenous peoples, communities of color, migrant communities, deindustrialized communities, depopulated rural communities, the poor, low-income workers, women, the elderly, the unhoused, people with disabilities, and youth.”

To achieve these goals, the Democratic Green New Deal calls for “a 10-year national mobilization” that includes investing in community-defined projects to mitigate disasters related to global warming; rebuilding infrastructure; meeting 100 percent of U.S. energy needs through “clean, renewable, and zero-emission energy sources”; removing pollution from manufacturing “as much as is technically feasible”; overhauling agricultural and transportation practices; restoring natural ecosystems to remove greenhouse gases from the atmosphere; and restoring and protecting ecosystems through “locally appropriate and science-based projects.”

Coral reefs damaged by warming seas in the Maldives (photo by Bruno de Giusti)

Rather than existing as a fully formed program with preconceived details, this Green New Deal would be “developed through transparent and inclusive consultation, collaboration, and partnership with frontline and vulnerable communities, labor unions, worker cooperatives, civil society groups, academia, and businesses.” The investment that comes out of this program would be intended to ensure “the public receives appropriate ownership stakes and returns on investment, adequate capital … technical expertise, supporting policies, and other forms of assistance to communities, organizations, Federal, State, and local government agencies, and businesses working on the Green New Deal mobilization.”

The plan calls for “guaranteeing a job with a family-sustaining wage, adequate family and medical leave, paid vacations, and retirement security to all people of the United States”; protecting the right of workers to organize; “strengthening and enforcing labor, workplace health and safety, antidiscrimination, and wage and hour standards across all employers, industries, and sectors” and “ensuring a commercial environment where every businessperson is free from unfair competition and domination by domestic or international monopolies.” The plan also advocates for “high-quality health care,” affordable housing and “healthy and affordable food.”

This plan is laid out in the form of a resolution introduced into the House of Representatives by Rep. Ocasio-Cortez and into the Senate by Sen. Markey. Considering not only the extreme hostility to such ideas in the Republican Party, which continues to control the Senate, but also the Democratic Party leadership, the prospects for congressional adoption would appear to be nil. (In dismissing the Green New Deal, House Speaker Nancy Pelosi derisively said, “The green dream, or whatever they call it, nobody knows what it is, but they’re for it, right?”) Short-term politics aside, the same question as the original Green Party Green New Deal must be asked of the Democratic Party version: How realistic is it?

Koch brothers money helps fund opposition

Before we seriously tackle the contents of these plans, let’s take a quick survey of opposition to them, which naturally is fiercest from the Right and corporate interests with something to lose.

The Institute for Energy Research, for example, slams the Democratic Party’s Green New Deal as “misguided” because the original New Deal of Franklin Delano Roosevelt was intended to address the Great Depression, whereas today “we are not currently in the midst of an economic depression.” True enough that we not currently living through another Great Depression, but the economy — for working people — is bad enough. The author of the Institute’s “Flaws With a ‘Green New Deal’ ” diatribe attempts to back up its position by saying “Even textbook Keynesians” oppose running budget deficits at the present time. Evidently, the Institute considers “textbook Keynesians” the outermost fringe of what is imaginable.

The author goes on to claim that FDR’s New Deal actually made the economy worse, despite an accompanying table showing that unemployment fell from an inherited 25 percent to 9.9 percent in 1941. It is true that the New Deal didn’t bring an end to economic depression, but it did make a big difference, and not only for the social programs that were inaugurated. It was the mobilization to fight World War II that truly ended the Depression, but that effort required massive governmental spending and intervention in the economy — in other words, going well beyond the New Deal. The problem with the New Deal was that it didn’t go far enough or spend sufficiently. So the Institute’s right-wing folderol simply doesn’t withstand the most basic scrutiny.

The Institute disingenuously calls itself “impartial and unbiased” on its About web page, but also attributes to “free markets” all manner of progress. SourceWatch reveals that the Institute is founded by the Koch brothers, has a president who was formerly an executive with Enron and is tied to the Koch brothers’ infamous American Legislative Exchange Council, an organization that literally writes extreme Right bills for state legislatures.

When you don’t have facts, make up your argument

Next up, we have similar extremist ideology masquerading as “science” from the Heritage Foundation. As with the Institute for Energy Research, this critique is aimed at the Democratic Party version. We get the flavor of the Heritage Foundation’s attack when it leads off with this statement: “[E]ach of these items is so wildly unrealistic that you have to wonder how familiar the authors are with life away from coastal urban centers.” Ah yes, only conservatives in the middle of the country can possibly possess good ideas.

Declaring that “a great deal of costly damage” would result were any of the ideas adopted, Heritage recoils in horror at the thought of more mass transit or electric motor vehicles. To buttress its ideologically driven point of view, Heritage first understates the mileage that can be driven by electric cars, then declares that an electric vehicle charging infrastructure “would necessitate having exponentially more charging stations than the current number of gas stations.”

Heritage claims that electric vehicles can only travel 90 to 125 miles, yet there are at least eight models that can travel at least 200 miles on a charge. Some of these models are very expensive and unaffordable for most people, but as technology improves, charge travel distances will lengthen and more models will become affordable. For those who do drive, how many gas stations do you pass before needing to fill the tank again? Dozens? Hundreds? Moreover, electric-vehicle recharging stations don’t need to have such a level of saturation because they are easily installed at homes and in business and apartment parking lots. Government agencies and public utilities are already executing plans and providing subsidies to encourage home and business-location chargers. So the idea that Heritage insinuates, that we’ll need a charging station on every other corner, doesn’t stand up to rational examination.

The world’s coral reefs are in danger of dying from oceanic absorption of atmospheric carbon dioxide (photo by Jim Maragos, U.S. Fish and Wildlife Service)

Heritage also shrieks that the Green New Deal calls for an end to air travel, but the plan makes no such statement. In fact, as already noted, it is mostly a set of aspirations with little in the way of concrete proposals as to how to achieve its goals.

The Heritage Foundation of course is peddling far Right ideology. No surprise there, as its founders and funders are some of the most extreme billionaires, including Joseph Coors and Richard Mellon Scaife, and notorious operatives such as Paul Weyrich. Heritage strenuously opposes action to combat global warming, little surprise when some of Heritage’s funders, including the Koch brothers, have a vested interest in promoting fossil fuels. The foundation also takes tobacco-company money while opposing any legislation aimed at that industry.

The lack of specifics in the Democratic Green New Deal hasn’t prevented Republicans from issuing preposterous numbers for the supposed cost. Another propaganda mill, this one calling itself the American Action Forum, apparently using a random-number generator, alleged that the Green New Deal would cost between $53 trillion and $91 trillion from 2020 to 2029; Republicans have taken to parroting the uppermost figure as if it was real.

As one example of this legerdemain, the Forum insists that the Green New Deal’s call for high-quality health care to be provided to all United Statesians would cost $36 trillion for the decade of the 2020s. Never mind that lack of health care has a cost — such a concept is simply ignored — and that the U.S. healthcare system is by far the world’s most expensive. (My own calculations estimate that the U.S. spends an extra $1.4 trillion per year on health care than it would if it had universal coverage similar to peer countries.) It is precisely that the privatized U.S. health care system is designed to generate corporate profits rather than health care that it so expensive.

The American Action Forum is legally able to hide the identity of its donors due to tax-law loopholes, but spends millions of dollars to elect hard-line Republicans and is led by prominent Republican politicians and operatives. The Republican politicians citing this dubious source are in effect citing themselves — their mantra is “I say it’s true, so it must be true.”

Under capitalism, we’ll get more business as usual

One is tempted to call the Right-wing attacks comic relief, but unfortunately continuing business as usual, as the above organizations would like, is anything but funny given the seriousness of the challenge. And acknowledging that seriousness compels us to return to the question of feasibility within the current economic system. The Democratic Party version of the Green New Deal is aptly named because it doesn’t go beyond the reformism of the 1930s New Deal. The reforms the Democratic document calls for certainly would be welcome as vast improvements from what we have today. Nonetheless, it is doubtful that such a program could ever come close to being enacted by Democrats — most of the Democratic leadership is opposed to it, and the record of liberals folding as soon as a Republican attacks is too consistent.

A more fundamental problem is that the backers of the Democratic Green New Deal seem to assume that a program challenging corporate interests to such a serious degree can be fully implemented in the current U.S. political and economic system, and that corporate interests will simply sit back and allow such a program not only to be signed into law but to actually be implemented. A massive social movement, bringing together the widest possible array of organizations and resolute in using a multitude of tactics inside and outside the system, could bring about the proposed program, but there is not a word of public involvement in the Democratic program. It is all to be created by congressional action.

If there was a movement so massive and powerful that it forced the implementation of a Green New Deal, shouldn’t it bring about root-and-branch change? Why have such a movement be steered into propping up the capitalist system that brings so much misery to so many people? If it did simply reform capitalism, however welcome such reforms would be, inequality, imperialism, environmental destruction and all the rest of our present-day social ills would be back with us soon enough with the massive social energy that brought the reforms now dissipated.

The biggest problem with the Democratic version is the expectation that an ambitious program significantly expanding social programs, making huge changes to the economy and bringing the fossil fuel industry to heel can be accomplished without any political or economic system change. Other than a passing mention of “the public receiv[ing] appropriate ownership stakes,” there is an implied assumption that the goals will all be accomplished under capitalism and the current system of corporate rule. Capitalism will yet save us! Sorry, no. Not going to happen. Under capitalism, all the incentives are to continue business as usual, no matter the dire future consequences of business as usual.

The capitalist system requires continual growth, which means expansion of production. Its internal logic also means that its incentives are to use more energy and inputs when more efficiency is achieved — the paradox that more energy is consumed instead of less when the cost drops. Because production is for private profit and competition is relentless, growth and cost cutting is necessary to maintain profitability — and continually increasing profitability is the actual goal. If a corporation doesn’t expand, its competitor will and put it out of business. Because of the built-in pressure to maintain profits in the face of relentless competition, corporations continually must reduce costs, employee wages not excepted. Production is moved to low-wage countries with fewer regulations, enabling not only more pollution but driving up energy and carbon-dioxide costs with the need for transportation across greater distances.

Leaving capitalism intact means allowing “markets” to make a wide array of social decisions — and markets are nothing more than the aggregate interests of the most powerful industrialists and financiers. An economy that must expand will do so. Introducing efficiencies can slow down the increase in energy consumption and resource depletion, but an ever expanding economy will ultimately use more energy, more resources. Switching to all renewable energy, although a necessity to reverse global warming, is insufficient by itself. Some forms of renewable energy are not necessarily clean nor without contributions to global warming, and the limits that living on a finite planet with finite resources presents are all the more acute in an economic system that requires endless growth.

Bioenergy requires deforestation, removing carbon sinks, which is counterproductive to the goal of reducing atmospheric greenhouse gases, and can be more polluting than fossil fuels. The turbines used to produce electricity from wind increasingly are built with the “rare earth” element neodymium, which requires a highly toxic process to produce. Increasing rare earth mining means more pollution and toxic waste. There is not a hint of any of this in the Democratic Green New Deal.

Business as usual will cost trillions of dollars

The Green Party’s Green New Deal at least acknowledges that system change is necessary to avoid catastrophic climate change. This platform also doesn’t offer ideas on how it might come to fruition, but at least there is an implicit nod to the need to transcend capitalism by calling for employment for all who are displaced by the phasing out of fossil fuels, by demanding energy production be put in public hands and by advocating for “a new, sustainable economy.” It also doesn’t shy away from the scale of what is needed, and directly connects the present energy policy with U.S. militarism.

What this program doesn’t do, however, is acknowledge the costs of a rapid transition from fossil fuels. In the mirror image of conservatives who see only costs, liberals and Greens see only benefits. Although not comparable to the cartoonishly absurd Right-wing claims of tens of trillions of dollars in costs, the idea of a cost-free transition strains credibility. The 2014 Intergovernmental Panel on Climate Change report that concludes the annual reduction in “consumption growth” on a global basis would be only 0.06 percent during the course of the 21st century has only encouraged the idea that “green capitalism” will somehow save the day. The Green version of the Green New Deal is considerably more ambitious than that of the newer Democratic version, and thus all the more out of reach within a capitalist framework.

The Green Party’s Green New Deal also rests on some not necessarily realistic assertions. The platform asserts that having no need to control oil means no more overseas military presence, but that is overly simplistic. Certainly securing oil is a driver of U.S. foreign policy, but hardly the only factor. The U.S. government seeks global dominance for its corporations, keeping the entire planet open for corporate plunder and smashing any and all attempts to escape the U.S. orbit or to challenge the domination of Global North corporations. It will take far more than reducing fossil fuel consumption to bring a halt to imperialism and the closing of 800 U.S. overseas military bases.

The platform then switches to a declaration that the savings from not having to treat diseases arising from fossil fuel use will alone pay for it. There are large savings to be had, but that this one item alone will somehow cover all the costs is unrealistic. In the long run, running an economy on the basis of human need rather than private profit and proving quality preventive health care to cut down on medical spending will be more rational and equitable then what now exists. But that such a transition will be without cost is offering platitudes that can’t be fulfilled. Better to be honest that there will be no cost-free utopia.

Again, none of this an argument against the most rapid possible transition to renewable energy nor that the massive economic changes needed shouldn’t be undertaken. Winning World War II required deficit spending well beyond anything previously seen, but what would the cost of a fascist victory been? Similarly, what would the cost of a rise of several meters in sea level, of massive disruption to weather patterns and agriculture, of hundreds of millions of forced migrations, of massive species extinctions?

Global warming already costs trillions of dollars

That the costs of business as usual can’t easily be quantified does not mean there are not attempts to do so. A 2018 paper in the peer-reviewed journal Nature Climate Change by four scientists led by climatologist Katharine Ricke of the University of California, San Diego, estimated that the social cost of carbon — the cumulative economic impact of global warming — amounts to a global total of more than $400 per ton. Based on 2017 carbon dioxide emissions, that is more than US$16 trillion!

The impact varies greatly on a country-by-country basis. Canada and Russia, as of last year, were gaining economic benefits of up to $10 per carbon dioxide ton, while India was already paying $86 per ton. (That is all the more unfair as India is estimated to be responsible for only a cumulative three percent of greenhouse-gas emissions since 1850.) This analysis is based on “a set of climate simulations, rather than a single model.” These costs are “ballpark figures” because of the uncertainty surrounding climate physics, emission trajectories and other factors, but there are additional factors, such as the impact of global warming on international trade and migration, that aren’t necessarily captured in this model.

The gross domestic product for the entire Earth was estimated at $80 trillion for 2017. Thus, if the above calculation is accurate, global warming is already costing humanity one-fifth of its productive output. And we’ve only begun to suffer the effects of the climate spiraling out of control. What will be the cost of, say, a three-meter rise in sea level? That would be more than sufficient to permanently place under water parts of many of the world’s biggest cities.

We are already paying high costs. The cost of ambient air pollution has been estimated at more than four millions deaths per year, and that might be a conservative estimate. An attempt by three economists associated with the International Monetary Fund calculated that worldwide subsidies for the fossil fuel industry is more than US$5 trillion per year when not only direct handouts and other visible monetary subsidies are accounted for, but also adding the environmental costs. Putting millions of people to work building renewable-energy infrastructure will boost the economy, as will ending the subsidies and reducing the health costs of fossil fuels. Those are real benefits. But shutting down entire industries and overhauling the world’s economic system will come at serious cost. It’s not realistic to pretend otherwise. Those of us in the advanced capitalist countries will have to consume less, including using less energy. That, too, is inescapable and both Green New Deals fail to address that.

This is a debate that shouldn’t be reduced to a sterile “revolution or reform” opposition. We need all the reform we can achieve, right now. The balance, nonetheless, is clearly on the side of advocates who push for the fastest possible transition to a new economy, one not dependent on fossil fuels. An economy based on meeting human need and in harmony with the environment, not one made for private profit and that externalizes onto society environmental and other costs. The price of business as usual will be catastrophic environmental damage. Socialism or barbarism remain humanity’s future options.

All seemed possible when the Sandinistas took power 40 years ago

This week marks the 40th anniversary of the Sandinistas taking power in Nicaragua, a milestone that merits celebration regardless of our opinions on how the Sandinista Revolution evolved. Nor should the hand of United States imperialism in distorting that revolution be ignored — the huge cost exacted by the U.S.-directed and -funded Contras totaled more than four years of Nicaragua’s gross domestic product.

Just as many of the tactics the U.S. government and those on its payroll are using in its all-out economic war against Venezuela replicate what was done to Chile during the era of Salvador Allende (including blowing up power plants to cause widespread blackouts), there are parallels with U.S. tactics against the Sandinistas. Pressuring opposition parties to boycott elections, then declaring those elections fraudulent, was a tactic used by the Reagan administration in 1984, just as the Trump administration is doing in Venezuela today following the attempts to delegitimize the Bolivarian Revolution by the Bush II/Cheney and Obama administrations.

Another parallel between the Bolivarian Revolution of the past 20 years and the Sandinista Revolution of the 1980s is the creation of a mixed economy. The intention of the Sandinistas was to build a mixed economy, one with socialist elements but that would leave much of the economy in the hands of Nicaragua’s big capitalists. The Bolivarian Revolution, although intended to progress toward a not necessarily strongly defined “socialism for the 21st century,” has struggled to advance beyond a stage of ameliorating the conditions of capitalism, although by any reasonable standard Venezuela does considerably more there than any so-called “social democratic” government has done.

The bottom line, however is this: Even when political power is taken out of the hands of a country’s capitalists, if economic power is left in those hands, that economic power will eventually enable the holders of that power (industrialists and bankers) to wrest control of the economy and ultimately force the government to bend to their will. That happened in Nicaragua — ultimately, the devastation wrought by the Contras, the financial blockade imposed by the U.S. and the contradictions arising from the Sandinistas giving ever more concessions and subsidies to Nicaragua’s capitalists resulted in the Sandinista government imposing an austerity program reminiscent of those imposed by the International Monetary Fund, excepting the dubious value of the IMF or World Bank loans.

All of that would be years in the future after the takeover. On July 17, 1979, dictator Anastasio Somoza Debayle fled the country after years of waging war on his country and muscling in on so many businesses that even some of Nicaragua’s bourgeoisie wanted him gone. Years of tireless work by Sandinista militants, often at the risk of their lives, led to that day. Two days later, on July 19, the Sandinistas marched triumphantly into Managua, the capital, having already captured control of much the country in the late stages of the insurrection.

Nonetheless, in the early years the Sandinistas made good on most of the promises they had put forth in their 1969 Historical Program. Nor should the vast array of problems left behind by the Somoza dictatorship be forgotten. The following excerpt from It’s Not Over: Learning From the Socialist Experiment discusses the new revolutionary government’s struggles with restarting a shattered economy, meeting the expectations of its millions of supporters and attempting to keep industrialists from stripping their businesses of assets while seeking to create a democracy deeper than what is possible in capitalist countries and simultaneously preparing to defend itself against the inevitable counterattack from the U.S. government.

* * * *

New government begins process of rebuilding, with strains showing early

The nature of the enormous problems the Sandinistas faced had similarities to what the young Soviet Union faced in the early 1920s. A revolution had succeeded at enormous cost, with a civil war fought savagely by the revolution’s opponents wreaking staggering economic damage; the revolution faced hostile, much stronger foreign powers; the country was dependent on agricultural exports and could adjust that dependency only with difficulty and at the risk of potentially wrenching changes internally; expanding a small industrial sector was desirable but a goal for which the fulfillment would be partly in contradiction to its agricultural base; and a population that had lived in miserable poverty expected its material needs and wants to be met faster than the country’s shattered material base was capable of doing. Somehow these problems had to be solved by men and women with energy and determination but a lack of administrative experience.

Nicaragua’s militants who had participated in the revolution and found themselves in responsible positions upon the revolution’s victory had no experience in the affairs of state, because they had been shut out of public participation, and if their attempts at organizing became known to Somoza’s authorities, the prisons and torture chambers of the National Guard awaited.

So mistakes, many of them, were made in the early days of the revolution. How could it be otherwise? It is not remarkable that the Sandinistas made mistakes; what it remarkable is their willingness to learn from them and often correct them, sometimes effecting sharp reversals of bad policies.

The early Bolshevik cadres, similarly, couldn’t help but make mistakes when they were placed in responsible positions, having also been shut out of societal participation. But that is enough comparison; it would be too easy to overgeneralize and there were more differences than commonalities between the Soviet Union of the early 1920s and Nicaragua at the end of the 1970s. And the Sandinistas certainly carried out policies drastically different than did the Bolsheviks, having the experience of many revolutions from which to learn, but also having carried out a revolution on their own terms, with a mix of ideologies and strategies rooted in their own and their country’s historical experience. They could not have led a successful revolution otherwise.

And the Sandinista National Liberation Front (FSLN) did it with much help from inside the country, and very little from outside the country.

The Soviet Union’s theorists had consistently held the position that conditions were nowhere near ripe for a revolution in Central America, and because challenging official dogma in the Soviet Union was anathema, that viewpoint could not in those years be challenged. Indeed, the Soviet Union, since Stalin’s assumption of power, had opposed revolutions everywhere. True, it did use the Red Army to impose régimes in Central Europe, but that, too, went against the spirit of Marxism that believes revolutions can only be made by a people themselves, not imposed from outside. Stalin opposed home-grown communist revolutions in China, Yugoslavia and Greece — counseling revolutionary leaders to stop and instead back their nationalist capitalists in the first two and refusing to lift a finger for the third when its revolution was drowned in blood by the United Kingdom. All of Stalin’s successors held fast to this refusal to back revolutions elsewhere; partly this was out of ideological rigidity tinged with a lack of confidence in other peoples, but perhaps more it reflected a desire to maintain peace with the capitalist West at any cost.

Tomás Borge, the only FSLN founder who lived to see the revolution, spoke frankly during an interview conducted eight years after the Sandinistas took power. “Since it was not easy to see the prospects for such a change — even revolutionary forces in the world had not grasped the imminence of victory and had adopted a rather indifferent attitude — we did not receive support during the war from any of the socialist countries, except Cuba,” Borge said, without judgment.

“The Soviet Union and others did not support us because they believed that only the Latin American Communist parties were the representatives of revolutionary changes, and it was not possible for them to think otherwise at that time. They had been through a whole series of experiences, developing ideas in distant countries that divorced them from particular realities. … I am not blaming those countries, simply pointing out an objective fact. … It cannot be said — in that idiotic language that is sometimes used — that Nicaragua’s revolution was the fruit of Moscow gold. Not even the Soviets, the Soviet revolutionaries, believed in revolutionary change in Nicaragua. So how were they going to help us!”

Official commentary in the Soviet Union’s leading theoretical journal stressed the prevailing viewpoint that armed struggle was hopeless and that Latin Americans should use peaceful tactics while participating in broad coalitions — a view echoed by the head of the El Salvador Communist Party, who went so far as to call those who advocated armed struggle “nihilists.”

The behavior of the Moscow-aligned Nicaraguan Socialist Party can best be explained in this context. The party was a participant in the Sandinista governing structure, but less than two months after the FSLN took power, it issued a formal resolution calling on the FSLN to

“be sensitive to the demands and interests of the capitalist class allies. Putting aside or neglecting those interests, in the name of excessive revolutionary radicalism, will not only lead to losing those allies but will strengthen the counter-revolution. … [T]his revolution must be conducted in such a way as to prevent the influence of tendencies seeking to skip stages or leap arbitrarily over the necessary stages and their corresponding transformations.”

Overall, a statement quite consistent with the Nicaraguan Socialists’ long-standing resistance to revolution. The party’s resolution might reasonably be read as a warning against moving too fast, but regardless of how that resolution is interpreted, it is quite far removed from a “revolutionary” mindset. Continual shrieking about Soviet bogeymen under every rock ceases being comical at some point and becomes simply morbid.

Triumphing with a large coalition

Regardless, there was no need to worry about precipitous moves. The FSLN had consistently carried out its line of encouraging mass participation, creating the largest possible coalition in the final months of the insurrection and leaving plenty of room for political participation by sectors of society ranging from Marxist parties to its Left all the way to capitalist organizations on the moderate Right. Most of the eighteen ministers in the first government lineup were capitalist figures and two of the five seats on the executive body of the provisional government, the Junta of National Reconstruction, were held by prominent capitalists.

The FSLN had adopted Augusto Sandino’s motto, “Implacable in struggle, generous in victory,” and applied that generosity even to the National Guard. Seeking to avoid a bloody revenge, Borge recalled, “When they tried to lynch the [Somozist] prisoners who were in the Red Cross building, I personally went to see the relatives of our martyrs … and convinced them not to do it by saying, ‘So why did we make this revolution, if we are going to do the same things they used to do?’ ” Borge had the moral authority to make that plea, for he suffered through two prison terms in Somoza’s prisons, undergoing torture and being held in solitary confinement, and his wife was tortured to death by the National Guard. Borge had been involved in struggles against Somoza since the late 1940s.

Borge was one of nine members of the FSLN National Directorate, which was the ultimate authority after Somoza fled. The directorate’s structure was based on unity — when the three tendencies reunited, each tendency was represented by three leaders. Daniel Ortega, of the Tercerista tendency, as the one directorate member who also sat on the five-member Junta of National Reconstruction, became the Junta’s chair.

The insurrection of Leon in 1979 (photo by Dora María Téllez)

Ortega assumed his roles because the Terceristas were the dominant faction due to their strategy proving successful and because their tactics could include the other two tendencies’ strategies, giving them a moral authority within the FSLN. Ortega had a long history of political work, joining the student protest movement as a teenager despite the disapproval of his accountant father who had once been a fighter for Augusto Sandino. Interestingly, Ortega also gave bible lessons when a student. He joined the FSLN at age eighteen in 1963, becoming a resistance fighter before spending seven years in jail, where he was tortured.

The new Sandinista government may have shown generosity in victory, but it was going to consolidate that victory. An FSLN commander, Bayardo Arce, put it this way: “This is a Sandinista State; it is a state where the majority of our people subscribe to the political philosophy of Sandisimo, that is why the Council of State has to reflect this majority.” Arce was referring to a new legislative body that would soon be formed, but, more generally, he was noting the reality of Nicaragua. The revolution had been fought under the Sandinista banner, the Sandinistas had organized the insurrection and protected people from the wrath of Somoza’s goons as best they could; there simply would not have been a revolution without them. So while Arce’s words may have been difficult to hear for some, it was a plain statement of how most Nicaraguans felt.

Formally, the five-member Junta of National Reconstruction headed the government as a collective executive, and it ruled by decree for a year until the Council of State convened. Although the FSLN National Directorate was the true center of power, setting overall policy, the Junta worked by consensus in forming policies to implement the Directorate’s broad policy decisions, and the capitalists also had opportunity to affect the carrying out of policy through their ministerial positions. The Directorate worked in a collegial fashion, creating a collective style of leadership. The Sandinistas did not wish to have a dominant personality, nor were there any candidates for such a role; only Carlos Fonseca, killed in a National Guard ambush in 1976, had any potential to do so and it is an open question as to whether he could have. Among other reasons, Fonseca advocated the Prolonged People’s War line, not that of the Terceristas.

The nationalization of Somoza’s stolen property

One of the Junta’s first acts, in Decree Number 3, was to confiscate and nationalize the property of Somoza, his family and a few very close associates. Somoza’s business empire was so extensive that the Sandinista’s new state-controlled sector represented one-quarter of the economy. Included in the nationalization were Somoza’s landholdings, which constituted 23 percent of the country’s farmland. More than 90 percent of the confiscated lands consisted of the largest plantations, those more than three and a half square kilometers (875 acres).

This decree was followed by the creation of the Nicaraguan Institute of Agricultural Reform, and, unlike other ministries, this important department was put in Sandinista hands from the start, under the direction of Jaime Wheelock, a National Directorate member and a Proletarian Tendency leader. Wheelock had originally wished to implement his tendency’s more radical agricultural program, but a more modest program was implemented under Directorate consensus. And, already, the Sandinistas were holding back landless agricultural workers from seizing more land.

The Rural Workers Association had emerged a few years earlier, organizing farm workers, particularly day laborers, and created a national organization by early 1978. The association not only organized guerrilla units and coordinated armed actions with the FSLN, but in the final months before the takeover backed spontaneous land takeovers. The land seizures assured there was sufficient food for the liberated areas; the seized lands were collectively farmed and managed, and not parceled into individual plots.

Celebrating the 10th anniversary of the Nicaraguan revolution in Managua, in 1989 (photo by tiarescott from Managua)

Other early acts of the Junta were nationalization of banks, insurance and foreign trade. Nicaragua’s banks, however, had collapsed; therefore taking them over meant taking over responsibility for the banks’ debts. As that amounted to a bailout, the capitalists were happy to go along with this decree. But this aspect of the nationalizations had its firm logic, as well — the banks had played a large role in the massive corruption under Somoza’s reign and the insurance companies were unable to cope with the country’s massive economic damage. Nicaragua’s foreign minister, Miguel D’Escoto, explained the banking and insurance takeovers in a letter to his embassies and consulates: “In this case, we were forced to act in response to economic necessity rather than ideological preference. The financial institutions were bankrupt. The nationalization of the banks was, in effect, the nationalization of their debt. In order to reopen the banks, the government has assumed an additional debt of $230 million.” That debt was on top of the $1.6 billion foreign debt that Somoza had saddled the country with, which the Junta agreed to honor.

The government takeover of foreign trade was also in effect a subsidy to capitalists, primarily agricultural exporters. The confiscation of Somoza’s properties put some of this sector under state control, but private plantation owners still commanded about three-quarters of the country’s agricultural exports, primarily cotton, coffee, beef and sugar. Maintaining agricultural exports was critical to economic recovery — they accounted for 80 percent of Nicaragua’s exports. Under the nationalization of foreign trade, the state sold imported inputs to exporters at the official exchange rate and purchased their production for export at guaranteed prices better than the exchange rates.

The state was guaranteeing the exporters a higher price, with the state absorbing the difference between the guaranteed higher price and the price set by the international market. The beneficiaries of this subsidy were overwhelmingly large plantation owners. A government pamphlet later explained that “100 percent of the private sector’s needs for working capital and investment” were now financed by the public, whereas never more than 70 percent of these needs had been subsidized under Somoza. The pamphlet continued, “Despite the fact that the private sector has made significant profits [in 1980 and 1981], the producers in this sector have not been forced to use these profits to meet their own needs for working and investment capital.”

Despite subsidies and guaranteed profits, the big capitalists continued to chafe at not being in charge politically. A class that believes it is entitled to exercise political control found it increasingly difficult to remain part of the government, and the contradictions between what the big capitalists wanted and the many policies of the Sandinistas that sought to provide better wages, benefits and working conditions, and new democratic structures, for urban and rural working people — the overwhelming majority of the population and the classes who made the revolution — slowly intensified.

Shifts in the government as the revolution advances

Those stresses caused a major shift in the cabinet. In December 1979 and February 1980, a series of resignations and reshuffles, along with shifts to the Left by other ministers, resulted in a radically different cabinet, with almost all ministries now headed by Sandinistas. Several members of the FSLN National Directorate assumed important ministerial positions. The work of the ministries were difficult at first; most of the bureaucrats who had worked in government before the takeover had fled. But the Junta asked lower- and middle-level employees to return, and about 90 percent did so. A new culture of honesty in the ranks of the ministries was created, and dedication and sacrifice were rewarded; massive corruption had been the norm under Somoza.

A new type of temporary legislature, the Council of State, convened on May 4, 1980. The council had 51 seats, each reserved for organized groups — eight political parties, three mass-participation and community organizations, seven labor organizations, seven professional guilds, five employer organizations and the armed forces. The Council originated most of the legislation and could pass or reject legislation introduced by the Junta of National Reconstruction, although the Junta could veto Council-passed legislation.

There had been hope among the employers that they would be able to control the Council of State, but when mass organizations aligned with the Sandinistas were granted seats, one of the capitalist members of the Junta, Alfonso Robelo, used that as an excuse to resign. Days earlier, the other capitalist Junta member, Violeta Barrios de Chamorro, had stepped down. Both were replaced by industrialists. The mass-participation organizations deserved representation, the Sandinistas argued, because of their massive growth during the past year. Robelo had wanted a guaranteed majority for capitalists on the Council, but walked out when a majority instead went to the organizations that had carried out the work of the revolution — the members of which had literally put their lives on the line for it and constituted a large majority of the country’s population.

The Sandinistas were also faced with the massive task of building a court system. Unlike in the ministries, it would not be possible to use the bricks of the past to rebuild; the court system had been a completely servile instrument of Somoza’s dictatorship. Plus there was the need to have trials for the thousands of imprisoned National Guardsmen. Special tribunals were created to try Somoza’s war criminals in which the defendants were afforded vastly more rights than political defendants had been under Somoza, and the trials were open to the international press, another change.

“We didn’t have anything,” said Nora Astorga, a trained lawyer who was selected to be the prosecutor at the trials of the Guardsmen. “They gave you a job and you had to do everything from finding people to do it and a house to do it in, to inventing the mechanisms. From nothing. They’d say to you, ‘You’re in charge.’ And you had to figure out how to do it.” Astorga found prosecuting Guardsmen difficult because many had wives and young children living in poverty. She had the authority to release them without trial, and did so in about one-fifth of the 6,000 cases she handled, and most of those who were convicted received sentences of five or less years. No more than fifteen percent received the maximum penalty of 30 years’ imprisonment; the Sandinistas had immediately abolished the death penalty.

Astorga said, “We had a group of compañeros who could go where the Guard member had lived to get information, to investigate why he joined the Guard, how he had behaved, what he had done. … I’m not saying we were never unjust. It’s difficult to be fair 100 percent of the time, but we made a tremendous effort.”

Citations are omitted from the above excerpt from the book It’s Not Over: Learning From the Socialist Experiment. The omitted sources cited in this excerpt are: Alan Benjamin, Nicaragua: Dynamic of an Unfinished Revolution [Walnut Publishing, 1989]; John A. Booth, The End and the Beginning: The Nicaraguan Revolution [Westview Press, 1985]; Forrest D. Colburn, Post-Revolutionary Nicaragua: State, Class, and the Dilemmas of Agrarian Policy [University of California Press, 1986]; Carmen Diana Deere and Peter Marchetti, “The Worker-Peasant Alliance in the First Year of the Nicaraguan Agrarian Reform,” Latin American Perspectives, Spring 1981; Gary Ruchwarger, “The Campesino Road to Socialism? The Sandinistas and Rural Co-operatives,” The Socialist Register, 1988; Richard Stahler-Sholk, “Stabilization, Destabilization, and the Popular Classes in Nicaragua, 1979-1988,” Latin American Research Review, Vol. XXV, No. 3 (1990); and “Nora Astorga In Her Own Words,” Envío, April 1988

Look to U.S. executive suites, not Beijing, for why production is moved

The ongoing trade war between the United States and China, and the rhetoric surrounding it coming out of the White House, has served to reinforce the idea that China is “stealing” jobs from the United States. The reality, however, is that if we are seeking the responsible party, our attention should be directed toward U.S. corporate boardrooms.

The internal logic of capitalist development is driving the manic drive to move production to the locations with the most exploitable labor, not any single company, industry or country. For a long time, that location was China, although some production, particularly in textiles, is in the process of relocating to countries with still lower wages, such as Bangladesh, Cambodia and Vietnam. (The last of those is already a long-time source of highly exploited cheap labor for Nike.) It could be said that China is opportunistic in turning itself into the world’s sweatshop. And that it constitutes a colossal market is no small factor.

Beijing (photo by Picrazy2)

Low wages and the inability of Chinese workers to legally organize are crucial factors in the movement of production to China. The minimum wage in Shanghai is 2,420 renminbi per month, which equals US$349. Per month. And Shanghai’s minimum wage is the country’s highest rate and “roughly double the minimum wage in smaller cities” across China, reports the China Labour Bulletin. That does not translate into a living wage for Chinese workers. The Bulletin states:

“National government guidelines stipulate that the minimum wage should be at least 40 percent of the local average wage. In reality, the minimum wage is usually only between 20 and 35 percent of the average wage, barely enough to cover accommodation, transport and food costs. Workers on the minimum wage, including most production line workers, unskilled labourers, shop workers etc. have to rely on overtime, bonuses and subsidies in order to make a living wage. As a consequence, if the employer cancels or reduces overtime, bonuses and other benefits, low-paid workers will often demand immediate restoration.”

Even with such meager pay and the illegality of any unions other than the Communist Party-controlled and employer-friendly All-China Federation of Trade Unions, increasing numbers of employees are classified as “independent contractors,” making them even more precarious. Enforced overtime well in excess of the legal maximum, and employers demanding “flexible” working hours, are brutal on Chinese workers stuck in assembly jobs but lift corporate executives into ecstasy.

The leading culprit is headquartered in Arkansas

The single biggest culprit in the wholesale moving of jobs to China is to be found not in Beijing, but rather in Bentonville, Arkansas. Yep, Wal-Mart, the company that pays it employees so little that they skip meals and organize food drives; receives so many government subsidies that the public pays about $1 million per store in the United States; and is estimated to avoid $1 billion per year in U.S. taxes through its use of tax loopholes.

Other major United States retailers began procuring clothing items from Asian subcontractors before Wal-Mart, but the relentless drive to pay its suppliers as little as possible forced an acceleration in the shift of production to countries with the most exploitable populations. If a manufacturer wants to continue to have contracts to supply Wal-Mart, then it has no choice but to ship its operations overseas because it has no other way to meet Wal-Mart’s demands for ever lower prices.

By 2012, 80 percent of Wal-Mart’s suppliers were located in China. And because the company is so much bigger than any other retailer, it can dictate its terms. Gary Gereffi, a professor at Duke University, said in an interview broadcast on the PBS show Frontline that “No company has had the kind of economic power that Wal-Mart does, to be able to source products from around the world. … Wal-Mart is able to transfer whole U.S. industries to overseas economies.”

Beijing Opera House (photo by Petr Kraumann)

Because of its size and its innovation in computerizing its inventory and tightly managing its suppliers, coupled with its willingness to squeeze its suppliers to the exclusion of all other factors, Wal-Mart holds life or death power over manufacturers, Professor Gereffi said:

“Wal-Mart is telling its American suppliers that they have to meet lower price standards that Wal-Mart wants to impose. The implication of that in many cases is if you’re going to be able to supply Wal-Mart at the prices Wal-Mart wants, you have to go to China or other offshore locations that would permit you to produce at lower cost. … Wal-Mart’s giving them the clear signal that you can’t be a Wal-Mart supplier if you can’t produce at substantially lower prices. … You can go to China, or, in many cases, many U.S. suppliers can’t make that move, and they just go out of business, because Wal-Mart is the dominant company for many U.S. suppliers. If they can’t go offshore, those suppliers end up going out of business.”

Wal-Mart alone cost U.S. workers more than 400,000 jobs between 2001 and 2013, according to the Economic Policy Institute. That is a sizable fraction of the 3.2 million jobs that were lost in the U.S. due to trade relations with China.

To the best of my knowledge, however, no Chinese party or government official has ever walked into the headquarters of a U.S. corporation, pointed a gun at the CEO and demanded production be moved across the Pacific Ocean. Chinese business executives sometimes demand technology be shared in exchange for access to Chinese markets (a different matter), but executives from the U.S. or elsewhere do have the option of saying “no.” Even if we were to concede that there is some coercion in regards to technology transfers, there isn’t when it comes to moving production. That is a choice, a choice routinely made in executive suites.

It’s not a deficit for Apple

Competitors that wish to stay in business can be compelled by capitalist competition to make that choice, matching the “innovation” of the company that first finds moving production a way to cut costs and thus boost profitability. This applies to all industries, and not only low-tech ones. Apple, for example, accrues massive profits by contracting out its manufacturing to subcontractors. A 2010 paper by Yuqing Xing and Neal Detert found that Chinese workers are paid so little that they accounted for only $6.50 of the $168 total manufacturing cost of an iPhone. Of course iPhones cost a lot more than $168 — an extraordinary profit is generated for Apple executives and shareholders on the backs of Chinese workers.

A 2011 study led by Kenneth L. Kraemer calculated that $334 out of each iPhone sold at $549 went to the U.S. with almost the entire remainder distributed among component suppliers. Only $10 went to China as labor costs. Thus, despite the export of iPhones contributing heavily to the official U.S. trade deficit, the study said “the primary benefits go to the U.S. economy as Apple continues to keep most of its product design, software development, product management, marketing and other high-wage functions in the U.S.”

The profits flow to Apple headquarters (photo by Joe Ravi via license CC-BY-SA 3.0)

Chinese workers today likely account for somewhat more of the manufacturing cost as wages have risen in China over the past decade, but remain minuscule compared to wages in advanced capitalist countries. And the work endured is no vacation, as John Bellamy Foster and Robert W. McChesney noted in the February 2012 edition of Monthly Review:

“The eighty hour plus work weeks, the extreme pace of production, poor food and living conditions, etc., constitute working conditions and a level of compensation that cannot keep labor alive if continued for many years—it is therefore carried out by young workers who fall back on the land where they have use rights, the most important remaining legacy of the Chinese Revolution for the majority of the population. Yet, the sharp divergences between urban and rural incomes, the inability of most families to prosper simply by working the land, and the lack of sufficient commercial employment possibilities in the countryside all contribute to the constancy of the floating population, with the continual outflow of new migrants.”

The working conditions of China are not a secret; business-press commentaries can come close to celebrating such conditions. A 2018 commentary in Investopedia, for example, goes so far as to claim that manufacturing in the U.S. is “economically unfeasible” and then says this about Chinese conditions:

“Manufacturers in the West are expected to comply with certain basic guidelines with regards to child labor, involuntary labor, health and safety norms, wage and hour laws, and protection of the environment. Chinese factories are known for not following most of these laws and guidelines, even in a permissive regulatory environment. Chinese factories employ child labor, have long shift hours and the workers are not provided with compensation insurance. Some factories even have policies where the workers are paid once a year, a strategy to keep them from quitting before the year is out. Environmental protection laws are routinely ignored, thus Chinese factories cut down on waste management costs. According to a World Bank report in 2013, sixteen of the world’s top twenty most polluted cities are in China.”

The overall U.S.-China economic picture is more balanced

The components of the iPhone are sourced from several countries and are assembled in China. Because the final product is exported from China, Apple contributes to trade deficits, as conventionally calculated. But the lion’s share of the massive profits from this global supply chain are taken by Apple, a U.S.-based corporation. The profits from the actual assembly, outsourced to Foxconn, are accrued in Taiwan, Foxconn’s home. Apple’s arrangement is far from unique; the list of U.S. companies that manufacture in China is very long. If trade balances were calculated on the basis of where the profits are retained, the U.S. deficit with China would not be nearly so imposing.

As a commentary in the Financial Times points out, U.S. corporations sell far more goods and services in China than do Chinese companies in the U.S., but those sales are not counted toward trade balances. The commentary said:

In 2015, the last year for which official US statistics were available, US multinational subsidiaries based in China made a total of $221.9bn in sales to domestic consumers. The goods and services sold were produced by an army of 1.7m people employed by US subsidiaries in the country. By contrast, China’s corporate presence in the US remains small. Official figures on Chinese companies’ US subsidiary sales to American consumers do not exist, but analysts estimate they are hardly material when compared with China’s exports to the US. Thus, the US-China ‘aggregate economic relationship’ appears a lot more balanced than the trade deficit makes it look.”

A separate report, by VoxChina (which calls itself an independent, nonpartisan platform initiated by economists), calculates that although the official U.S. trade deficit with China for 2015 was $243 billion, when foreign direct investment (FDI) and sales by both countries’ companies in the other are included, the deficit was only $30 billion, and a U.S. surplus was forecast for following years. The U.S., incidentally, remains the world’s second-biggest exporter according to the latest World Trade Organization statistics.

The Trump administration continues to make a big show of blaming China for jobs being moved across the Pacific and for trade deficits, but although China is opportunistic, those vanishing jobs (and resulting deficits) are squarely the responsibility of the corporate executives who make the decision to shut down domestic operations. This dynamic is part of the larger trend toward so-called “free trade” — as technology and faster transportation make moving production around the world more feasible, the corporations taking advantage of these trends seek to eliminate any barriers to cross-border commerce.

And as the race to the bottom continues —  as relentless competition induces a never-ending search to find locations with ever lower wages and ever lower health, safety, labor and environmental standards — what regulations remain are targets to be eliminated. Thus we have the specter of “free trade” agreements that have little to do with trade and much to do with eliminating the ability of governments to regulate. And as the whip of financial markets demand ever bigger profits at any cost, no corporation, not even Wal-Mart, can go far enough.

Despite being a leader in cutting wages, ruthless behavior toward its employees and massive profitability, when Wal-Mart bowed to public pressure in 2015 and announced it would raise its minimum pay to $9 an hour, Wall Street financiers angrily drove down the stock price by a third. Wal-Mart reported net income of $61 billion over the past five years, so it does appear the retailer will remain a going concern. Apple reported net income of $246 billion over the past five years, so outsourcing production to China seems to have worked out for it as well.

The Trump administration’s trade wars are so much huffing and puffing. Empty public rhetoric aside, Trump administration policy on trade, consistent with its all-out war on working people, is to elevate corporate power. Nationalism is a convenient cover to obscure the most extreme anti-worker U.S. administration yet seen. Class war rages on, in the usual one-sided manner.