The bait and switch of public-private partnerships

This being the age of public relations, the genteel term “public-private partnership” is used instead of corporate plunder. A “partnership” such deals may be, but it isn’t the public who gets the benefits.

We’ll be hearing more about so-called “public-private partnerships” in coming weeks because the new U.S. president, Donald Trump, is promoting these as the basis for a promised $1 trillion in new infrastructure investments. But the new administration has also promised cuts to public spending. How to square this circle? It’s not difficult to discern when we recall the main policy of the Trump administration is to hand out massive tax cuts to big business and the wealthy, and provide them with subsidies.

Public-private partnerships are one of the surest ways of shoveling money into the gaping maws of corporate wallets, used, with varying names, by neoliberal governments around the world, particularly in Europe and North America. The result has been disastrous — public services and infrastructure maintenance is consistently more expensive after privatization. Cuts to wages for workers who remain on the job and increased use of low-wage subcontractors are additional features of these privatizations.

Chicago at night (photo by Lol19)

Chicago at night (photo by Lol19)

The rationale for these partnerships is, similar to other neoliberal prescriptions, ideological — the private sector is supposedly always more efficient than government. A private company’s profit incentive will supposedly see to it that costs are kept under control, thereby saving money for taxpayers and transferring risk to the contractor. In the real world, however, this works much differently. A government signs a long-term contract with a private enterprise to build and/or maintain infrastructure, under which the costs are borne by the contractor but the revenue goes to the contractor as well.

The contractor, of course, expects a profit from the arrangement. The government doesn’t — and thus corporate expectation of profits requires that revenues be increased and expenses must be cut. Less services and fewer employees means more profit for the contractor, and because the contractor is a private enterprise there’s no longer public accountability.

Public-private partnerships are nothing more than a variation on straightforward schemes to sell off public assets below cost, with working people having to pay more for reduced quality of service. A survey of these partnerships across Europe and North America will demonstrate this clearly, but first a quick look at the Trump administration’s plans.

Corporate subsidies, not $1 trillion in new spending

The use of the word “plans” is rather loose here. No more than the barest outline of a plan has been articulated. The only direct mention of his intentions to jump-start investment in infrastructure is found in President Trump’s campaign web site. In full, it states the plan “Leverages public-private partnerships, and private investments through tax incentives, to spur $1 trillion in infrastructure investment over ten years. It is revenue neutral.” The administration’s official White House web site’s sole mention of infrastructure is an announcement approving the Keystone XL and Dakota Access pipelines without environmental reviews, and an intention to expedite environmental reviews for “high priority infrastructure projects.”

Wilbur Ross, an investment banker who buys companies and then takes away pensions and medical benefits so he can flip his companies for a big short-term profit, and who is President Trump’s pick for commerce secretary, along with a conservative economics professor, Peter Navarro, have recommended the Trump administration allocate $137 billion in tax credits for private investors who underwrite infrastructure projects. The two estimate that over 10 years the credits could spur $1 trillion in investment. So the new administration won’t actually spend $1 trillion to fix the country’s badly decaying infrastructure; it hopes to encourage private capital to do so through tax cuts.

The Sea-to-Sky Highway in British Columbia (photo by D. Vincent Alongi)

The Sea-to-Sky Highway in British Columbia (photo by D. Vincent Alongi)

There is a catch here — private capital is only going to invest if a steady profit can be extracted. Writing in the New Republic, David Dayen put this plainly:

“Private operators will only undertake projects if they promise a revenue stream. You may end up with another bridge in New York City or another road in Los Angeles, which can be monetized. But someplace that actually needs infrastructure investment is more dicey without user fees. So the only way to entice private-sector actors into rebuilding Flint, Michigan’s water system, for example, is to give them a cut of the profits in perpetuity. That’s what Chicago did when it sold off 36,000 parking meters to a Wall Street-led investor group. Users now pay exorbitant fees to park in Chicago, and city government is helpless to alter the rates.”

The Trump plan appears to go beyond even the ordinary terms of public-private partnerships because it would transfer money to developers with no guarantee at all that net new investments are made, according to an Economic Policy Institute analysis. The EPI report asks several questions:

“[I]t appears to be a plan to give tax credits to private financiers and developers, period. The lack of details here are daunting and incredibly important. For starters, we don’t know if the tax credit would be restricted to new investment, or if investors in already existing [public-private partnerships] are eligible for the credit. If private investors in already existing PPP arrangements are eligible, how do we ensure these tax credits actually induce net new investments rather than just transferring taxpayer largesse on operators of already-existing projects? Who decides which projects need to be built? How will the Trump administration provide needed infrastructure investments that are unlikely to be profitable for private providers (such as building lead-free water pipes in Flint, MI)? If we assume tax credits will be restricted (on paper, anyhow) to just new investment, how do we know the money is not just providing a windfall to already planned projects rather than inducing a net increase in how much infrastructure investment occurs?”

Critiques of this scheme can readily be found on the Right as well. For example, Douglas Holtz-Eakin, a former head of the Congressional Budget Office and economic adviser to John McCain’s 2008 presidential campaign, told The Associated Press, “I don’t think that is a model that is going be viewed as successful or that you can use it for all of the infrastructure needs that the U.S. has.”

Corporations plunder, people pay in Britain

Britain’s version of public-private partnerships are called “private finance initiatives.” A scheme concocted by the Conservative Party and enthusiastically adopted by the New Labour of Tony Blair and Gordon Brown, the results are disastrous. A 2015 report in The Independent reveals that the British government owes more than £222 billion to banks and businesses as a result of private finance initiatives. Jonathan Owen reports:

“The startling figure – described by experts as a ‘financial disaster’ – has been calculated as part of an Independent on Sunday analysis of Treasury data on more than 720 PFIs. The analysis has been verified by the National Audit Office. The headline debt is based on ‘unitary charges’ which start this month and will continue for 35 years. They include fees for services rendered, such as maintenance and cleaning, as well as the repayment of loans underwritten by banks and investment companies.

Responding to the findings, [British Trades Union Congress] General Secretary Frances O’Grady said: ‘Crippling PFI debts are exacerbating the funding crisis across our public services, most obviously in our National Health Service.’ ”

Under private finance initiatives, a consortium of private-sector banks and construction firms finance, own, operate and lease the formerly public property back to the U.K. taxpayer over a period of 30 to 35 years. By no means do taxpayers receive value for these deals — and the total cost will likely rise far above the initial £222 billion cost. According to The Independent:

“The system has yielded assets valued at £56.5bn. But Britain will pay more than five times that amount under the terms of the PFIs used to create them, and in some cases be left with nothing to show for it, because the PFI agreed to is effectively a leasing agreement. Some £88bn has already been spent, and even if the projected cost between now and 2049/50 does not change, the total PFI bill will be in excess of £310bn. This is more than four times the budget deficit used to justify austerity cuts to government budgets and local services.”

The private firms can even flip their contracts for a faster payday. Four companies given 25-year contracts to build and maintain schools doubled their money by selling their shares in the schemes less than five years into the deals for a composite profit of £300 million. Clearly, these contracts were given at well below reasonable cost.

City of London expanding (Photo by Will Fox)

City of London expanding (Photo by Will Fox)

One of the most prominent privatization disasters was a £30 billion deal for Metronet to upgrade and maintain London’s subway system. The company failed, leaving taxpayers with a £2 billion bill because Transport for London, the government entity responsible for overseeing the subway, guaranteed 95 percent of the debt the private companies had taken out. Then there is the example of England’s water systems, directly sold off. The largest, Thames Water, was acquired by a consortium led by the Australian bank Macquarie Group. This has been disastrous for rate payers but most profitable to the bank. An Open University study found that, in four of the five years studied, the consortium took out more money from the company than it made in post-tax profits, while fees increased and service declined.

As for the original sale itself, the water companies were sold on the cheap. Although details of the business can be discussed by “stakeholders,” the authors conclude, the privatization itself remains outside political debate, placing a “ring-fence” around the issues surrounding the privatization, such as the “politics of packaging and selling households as a captive revenue stream.” The public has no choice when the water provider is a monopoly and thus no say in rates.

Incredibly, Prime Minister Theresa May and the Tories intend to sell off more public services to Macquarie-led consortiums.

Corporations plunder, people pay across Europe

Privatization of water systems has not gone better in continental Europe. Cities in Germany and France, including Paris, have taken back their water after selling systems to corporations. The city of Paris’ contracts with Veolia Environment and Suez Environment, expired in 2010; during the preceding 25 years water prices there had doubled, after accounting for inflation, according to a paper prepared by David Hall, a University of Greenwich researcher. Despite the costs of taking back the water system, the city saved €35 million in the first year and was able to reduce water charges by eight percent. Higher prices and reduced services have been the norm for privatized systems across France, according to Professor Hall’s study.

German cities have also “re-municipalized” basic utilities. One example is the German city of Bergkamen (population about 50,000), which reversed its privatization of energy, water and other services. As a result of returning those to the public sector, the city now earns €3 million a year from the municipal companies set up to provide services, while reducing costs by as much as 30 percent.

The Grand Palais in Paris (photo by Thesupermat)

The Grand Palais in Paris (photo by Thesupermat)

Water is big business. Suez and Veolia both reported profits of more than €400 million for 2015. Not unrelated to this is the increasing prominence of bottled water. Bottled water is dominated by three of the world’s biggest companies: Coca-Cola (Dasani), PepsiCo (Aquafina) and Nestlé (Poland Springs, Deer Park, Arrowhead and others). So it’s perhaps not surprising that Nestlé Chairman Peter Brabeck-Letmathe infamously issued a video in which he declared the idea that water is a human right “extreme” and that water should instead have a “market value.”

One privatization that has not been reversed, however, is Goldman Sachs’ takeover of Denmark’s state-owned energy company Dong Energy. Despite strong popular opposition, the Danish government sold an 18 percent share in Dong Energy to Goldman Sachs in 2014 while giving the investment bank a veto over strategic decisions, essentially handing it control. The bank was also given the right to sell back its shares for a guaranteed profit. Goldman Sachs has turned a huge profit already — two years after buying its share, Dong began selling shares on the stock market, and initial trading established a value for the company twice as high as it was valued for purposes of selling the shares to Goldman. In other words, Goldman’s shares doubled in value in just two years — a $1.7 billion gain.

Danes have paid for this partial privatization in other ways as well. Taking advantage of the control granted it, Goldman demanded lower payments to Danish subcontractors and replaced some subcontractors who refused to use lower-paid workers.

Corporations plunder, people pay in Canada

Canada’s version of public-private partnerships has followed the same script. A report by the Canadian Centre for Policy Alternatives flatly declared that

“In every single project approved so far as a P3 in Ontario, the costs would have been lower through traditional procurement if they had not inflated by these calculations of the value of ‘risk.’ The calculations of risk could just as well have been pulled out of thin air — and they are not small amounts.”

Not that Ontario is alone here. Among the examples the Centre provides are a hospital, Brampton Civic, that cost the public $200 million more than if it had been publicly financed and built directly by Ontario; the Sea-to-Sky Highway in British Columbia that will cost taxpayers $220 million more than if it had been financed and operated publicly; bailouts of the companies operating the city of Ottawa’s recreational arenas; and a Université de Québec à Montréal project that doubled the cost to $400 million.

A separate study by University of Toronto researchers of 28 Ontario public-private partnerships found they cost an average of 16 percent more than conventional contracts.

Corporations plunder, people pay in the United States

In the United States, a long-time goal of the Republican Party has been to privatize the Postal Service. To facilitate this, a congressional bill signed into law in 2006 required the Postal Service to pre-fund its pension costs for the next 75 years in only 10 years. This is unheard of; certainly no private business would or could do such a thing. This preposterous requirement saddled the Postal Service with a $16 billion deficit. The goal here is to weaken the post office in order to manufacture a case that the government is incapable of running it.

The city of Chicago has found that there are many bad consequences of public-private partnerships beyond the monetary. In 2008, Chicago gave a 75-year lease on its parking meters to Morgan Stanley for $1 billion. Shortly afterward, the city’s inspector general concluded the value of the meter lease was $2 billion. Parking rates skyrocketed, and the terms of the lease protecting Morgan Stanley’s investment created new annual costs for the city, according to a Next City report.

Haze from forest fires in St. Mary Valley, Glacier National Park. Republicans are targeting national parks for sale, too. (photo by Pete Dolack)

Haze from forest fires in St. Mary Valley, Glacier National Park. Republicans are targeting national parks for sale, too. (photo by Pete Dolack)

That report noted that plans for express bus lanes, protected bike lanes and street changes to enhance pedestrian safety are complicated by the fact that each of these projects requires removing metered parking spaces. Removing meters requires the city to make penalty payments to Morgan Stanley. Even removals for street repairs requires compensation; the Next City report notes that the city lost a $61 million lawsuit filed by the investment bank because of street closures.

Nor have water systems been exempt from privatization schemes. A study by Food & Water Watch found that:

  • Investor-owned utilities typically charge 33 percent more for water and 63 percent more for sewer service than local government utilities.
  • After privatization, water rates increase at about three times the rate of inflation, with an average increase of 18 percent every other year.
  • Corporate profits, dividends and income taxes can add 20 to 30 percent to operation and maintenance costs.

Pure ideology drives these privatization schemes. The Federal Reserve poured $4.1 trillion into buying bonds, which did little more than inflate a stock-market bubble, while the investment needs to rebuild U.S. water systems, schools and dams, plus cleaning up Superfund sites and eliminating student debt, are less at a combined $3.4 trillion. What if that Federal Reserve money had gone to those instead?

“Public investment to create private profit”

Given its billionaire leadership, the Trump administration’s plans for public-private partnerships will not lead to better results, and may well be even worse. Michael Hudson recently summarized what is likely coming in this way:

“Mr. Trump wants to turn the U.S. economy into the kind of real estate development that has made him so rich in New York. It will make his fellow developers rich, and it will make the banks that finance this infrastructure rich, but the people are going to have to pay for it in a much higher cost for transportation, much higher cost for all the infrastructure that he’s proposing. So I think you could call Trump’s plan ‘public investment to create private profit.’ That’s really his plan in a summary, it looks to me.”

This makes no sense as public policy. But it is consistent with the desire of capitalists to continually extract higher profits from any and all human activity. Similar to governments handing over their sovereignty to multi-national corporations in so-called “free trade” deals that facilitate the movement of production to locales with ever lower wages and weaker laws, public-private partnerships represent a plundering of the public sector for private profit, and government surrender of public goods. All this is a reflection of the imbalance of power in capitalist countries.

This is “the market” in action — and the market is nothing more than the aggregate interests of the most powerful industrialists and financiers. It also reflects that as capitalist markets mature and capital runs out of places into which to expand, ongoing competitive pressures will drive corporate leaderships to reduce expenses (particularly wages) and move into new lines of business. Taking over what had been the public sector is one way of achieving this, especially if public goods can be bought below fair market value and guarantees of profits extracted.

The ruthless logic of capitalism is that a commodity goes to those who can pay the most, regardless of whether it is something essential to human life.

TPP is not dead: It’s now called the Trade In Services Agreement

One can hear the cry ringing through the boardrooms of capital: “Free trade is dead! Long live free trade!”

Think the ideas behind the Trans-Pacific Partnership or the so-called “free trade” regime are buried? Sadly, no. Definitely, no. Some of the countries involved in negotiating the TPP seeking to find ways to resurrect it in some new form — but that isn’t the most distressing news. What’s worse is the TPP remains alive in a new form with even worse rules. Meet the Trade In Services Agreement, even more secret than the Trans-Pacific Partnership. And more dangerous.

The Trade In Services Agreement (TISA), currently being negotiated among 50 countries, if passed would prohibit regulations on the financial industry, eliminate laws to safeguard online or digital privacy, render illegal any “buy local” rules at any level of government, effectively dismantle any public advantages to be derived from state-owned enterprises and eliminate net neutrality.

TISA negotiations began in April 2013 and have gone through 21 rounds. Silence has been the rule for these talks, and we only know what’s in it because of leaks, earlier ones published by WikiLeaks and now a new cache published January 29 by Bilaterals.org.

Earlier draft versions of TISA’s language would prohibit any restrictions on the size, expansion or entry of financial companies and a ban on new regulations, including a specific ban on any law that separates commercial and investment banking, such as the equivalent of the U.S. Glass-Steagall Act. It would also ban any restrictions on the transfer of any data collected, including across borders; place social security systems at risk of privatization or elimination; and put an end to Internet privacy and net neutrality. It hasn’t gotten any more acceptable.

Photo by Annette Dubois

Photo by Annette Dubois

TISA is the backup plan in case the TPP and the Transatlantic Trade and Investment Partnership don’t come to fruition. Perhaps fearful that the recent spotlight put on “free trade” deals might derail TISA as it derailed TPP, the governmental trade offices negotiating it have not announced the next negotiating date. The closest toward any meaningful information found was the Australian government’s bland statement that the “Parties agreed to reconvene in 2017.”

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. And while “liberalization” of professional services is being promoted, the definition of “services” is being expanded in order to stretch the category to encompass manufacturing. Deborah James of the Center for Economy and Policy Research laid out the breathtaking scope of this proposal:

“Corporations no longer consider setting up a plant and producing goods to be simply ‘manufacturing goods.’ This activity is now is broken down into research and development services, design services, legal services, real estate services, architecture services, engineering services, construction services, energy services, employment contracting services, consulting services, manufacturing services, adult education services, payroll services, maintenance services, refuse disposal services, warehousing services, data management services, telecommunications services, audiovisual services, banking services, accounting services, insurance services, transportation services, distribution services, marketing services, retail services, postal and expedited delivery services, and after-sales servicing, to name a few. Going further, a shoe or watch that measures steps or sleep could be a fitness monitoring service, not a good. A driverless car could be a transport service, not an automobile. Google and Facebook could be information services and communication services, respectively.”

Why is it you are kept in the dark?

Before we get to the details of the text itself, let’s take a quick look at how the world’s governments, on behalf of multi-national capital, are letting their citizens know what they are up to. Or, to be more accurate, what they are not telling you. Many governments have not bothered to update their official pages extolling TISA in months.

The European Union is negotiating TISA on behalf of its 28 member countries, along with, among others, the United States, Canada, Mexico, Australia, New Zealand, Japan, South Korea, Taiwan, Chile, Colombia, Peru, Norway, Switzerland, Pakistan and Turkey.

In the United States, the new Trump administration has yet to say a word about it. The Office of the U.S. Trade Representative web site’s page on TISA still says “TiSA is part of the Obama Administration’s ongoing effort to create economic opportunity for U.S. workers and businesses by expanding trade opportunities.” Uh-huh. President Donald Trump is not against “free trade” deals; he simply claims he can do it better. The Trump administration has issued blustery calls for “fair deals” and braggadocio puffing up Donald Trump’s supposed negotiating prowess. A typical White House passage reads, “To carry out his strategy, the President is appointing the toughest and smartest to his trade team, ensuring that Americans have the best negotiators possible. For too long, trade deals have been negotiated by, and for, members of the Washington establishment.”

overlap-of-trade-dealsMore typical of the TISA negotiators is the latest report from the European Commission, which summarized the latest round, held last November, this way: “Parties made good progress in working towards an agreed text and finding pathways towards solving the most controversial outstanding issues at both Chief Negotiators and Heads of Delegation levels.” The Canadian government’s last update is from last June and declares “Parties conducted a stocktaking session to assess the level of progress on all issues.”

Traveling across the Pacific brings no more useful information. Australia’s government offers this information-free update: “Parties agreed to a comprehensive stocktake of the negotiations, identifying progress made and areas which require ongoing technical work.” New Zealand’s government can’t even be bothered to provide updates, instead offering only discredited, boilerplate public-relations puffery similar to other trade offices.

The one hint that TISA negotiations are experiencing difficulty that could be found through an extensive online search is this passage in a U.S. Congressional Research Service report dated January 3, 2017: “Recognizing that outstanding issues remain and the U.S. position under a new administration is unclear, the parties canceled the planned December 2016 meeting but are meeting to determine how best to move forward in 2017.” Given that the new administration is moving as fast as possible to eliminate the tepid Dodd-Frank Act financial-industry reforms, it would seem TISA’s provisions to dismantle financial regulation globally would not be a problem at all.

But that these talks are not progressing at the present time does not mean the world can relax. It took years of cross-border organizing and popular education to stop the TPP, and this effort will have to replicated if TISA is to be halted.

The details are the devils already known

Commentary accompanying Bilaterals.org’s publication of several TISA chapters stresses that the Trans-Pacific Partnership, despite its apparent defeat, is nonetheless being used as the model for the Trade In Services Agreement. Thus we are at risk of the TPP becoming the “new norm”:

“Several proposed texts from the failed Trans-Pacific Partnership (TPP) agreement have been transferred to TiSA — including state-owned enterprises; rights to hold data offshore (including financial data); e-commerce; and prohibitions on performance requirements for foreign investors. While these texts originated with the United States, they appear to be supported by other parties to the TPP, even though those governments were reluctant to agree to them in the TPP and will no longer be bound by that agreement. That suggests the TPP may become the new norm even though it has only been ratified in two of the 12 countries, and that was done on the basis of U.S. participation that no longer applies. TPP cannot be allowed to become the new ‘default’ position for these flawed agreements.”

Some of the most extreme measures have been dropped (at least for now) and much of the text is not agreed. Nonetheless, there is nothing to cheer about, Bilaterals.org reports.

“The effectiveness of opposition to TiSA has led governments to conclude that they cannot sell some of the more extreme proposals, which have thus been dropped from previous leaked texts. But the fetters on the rights and responsibilities of governments to regulate in the interests of their citizens from what remains would still go further than any single other agreement. There are no improvements on the inadequate protections for health, environment, privacy, workers, human rights, or economic development. And there is nothing to prevent developing countries becoming even more vulnerable and dependent in an already unequal and unfair global economy.”

Hypocritically, TISA would prohibit developing countries from adopting measures that countries like the United States used to facilitate its industrial development when it was an emerging country in the 19th century. In an analysis for WikiLeaks, Sanya Reid Smith of the Third World Network, an international coalition specializing in development issues, wrote:

“[T]he proposals in this text restrict the ability of developing countries to use the development paths taken by many of the developed TISA countries. Some experts call this developed countries ‘kicking away the ladder’ after they have climbed up, to prevent developing countries from developing the same way. … In TISA, the USA is proposing restrictions on host countries being able to require senior managers be citizens of the host country. Yet when it was a capital importer, the USA had the opposite law: its 1885 contract labour law prohibited the import of foreign workers, i.e. the USA required senior managers (and all other staff) be Americans, which increased the chances of skills being passed to locals.”

Letting banks decide what’s good for you

These proposals are more extreme than language in existing bilateral trade agreements. Many of TISA’s provisions are lifted from TPP, but some go beyond the latter’s already extreme proposals For example, not even the TPP contemplated the entire elimination of regulations of any kind against the financial industry. Article 14 of TISA’s annex on financial services, which had contained the most explicit language prohibiting regulation, has been removed, but Article 9 still contains language requiring no limitations beyond those applying to domestic financial firms. In other words, a smaller country would be required to allow a giant bank from a bigger country to take over its entire banking system.

Incredibly, regulations against financial derivatives yet to be invented would be illegal. A Public Citizen analysis states:

“TISA would require governments to allow any new financial products and services — including ones not yet invented — to be sold within their territories. The TISA Annex on Financial Services clearly states that TISA governments ‘shall permit’ foreign-owned firms to introduce any new financial product or service, so long as it does not require a new law or a change to an existing law.”

As another example, the financial-services annex (in article 21) would require that any government that offers financial products through its postal service lessen the quality of its products so that those are no better than what private corporations offer. Article 1 of the financial-services annex states that “activities forming part of a statutory system of social security or public retirement plans” are specifically covered by TISA, as are “activities conducted by a central bank or monetary authority or by any other public entity in pursuit of monetary or exchange-rate policies.”

That social security or other public retirement systems are covered is cause for much alarm because they could be judged to be “illegally competing” with private financial enterprises. It is conceivable that central banks could be constrained from actions intended to shore up economies during a future financial crisis if banks decide such measures “constrain” their massive profiteering off the crisis.

The countries negotiating TISA.

The countries negotiating TISA.

Article 10 of the annex continues to explicitly ban restrictions on the transfer of information in “electronic or other form” of any “financial service supplier.” In other words, EU laws guarding privacy that stop U.S.-based Internet companies from taking data outside the EU to circumvent those privacy laws would be null and void. Laws instituting privacy protections would be verboten before they could be enacted. These rules, if enacted, could also provide a boon to companies like Uber whose modus operandi is to circumvent local laws. The Bilaterals.org analysis accompanying the leaks notes:

“The main thrust of TiSA comes through the e-commerce, telecommunications, financial services and localisation rules and countries’ commitments to allow unfettered cross-border supply of services. Together they would empower the global platforms who hold big data, like Google, without effective privacy protections, and tech companies like Uber, who have become notorious for evading national regulation, paying minimal tax and exploiting so-called self-employed workers. Given the backlash against global deals for global corporations TiSA will simply add fuel to the bonfire.”

Who interprets the rule is crucial

The language of TISA, like all “free trade” agreements, is dry and legalistic. How these rules are interpreted is what ultimately matters. TISA contains standard language requiring arbitration by judges possessing “requisite knowledge”; that language means that the usual lineup of corporate lawyers who represent corporations in these tribunals will switch hats to sit in judgment. The tribunals used to settle these “investor-state disputes” are held in secret with no accountability and no appeal.

The intention of “free trade” agreements is to elevate corporations to the level of governments. In reality, they raise corporations above the level of governments because only “investors” can sue; governments and people can’t. “Investors” can sue governments to overturn any law or regulation that they claim will hurt profits or even potential future profits. On top of this, a government ordinarily has to pay millions of dollars in costs even in the rare instances when they win one of these cases.

Each “free trade” agreement has a key provision elevating corporations above governments that codifies the “equal treatment” of business interests in accordance with international law and enables corporations to sue over any regulation or other government act that violates “investor rights,” which means any regulation or law that might prevent the corporation from extracting the maximum possible profit. Under these provisions, taxation and regulation constitute “indirect expropriation” mandating compensation — a reduction in the value of an asset is sufficient to establish expropriation rather than a physical taking of property as required under customary law. Tribunal decisions become precedents for further expansions of investor “rights” and thus constitute the “evolving standard of investor rights” required under “free trade” agreements. TISA contains the usual passages requiring “equal treatment.”

At bottom, “free trade” deals have little to do with trade and much to do with imposing corporate wish lists through undemocratic means, including the elimination of any meaningful regulations for labor, safety, health or the environment. TISA is another route to imposing more of this agenda. And the TPP itself isn’t necessarily dead — both Chile and New Zealand are holding discussions with other TPP countries to salvage some of the deal. Chile has invited TPP countries, plus China, to a March summit and the New Zealand trade minister is visiting Australia, Japan, Mexico and Singapore.

Working people around the world scored a major victory in stopping the TPP, at least in its current form. The activists who achieved this deserve much credit. But there is far more to do. Capital never rests; nor can we. Here we have class warfare in naked fashion, and there is no doubt on which side the capitalist world’s governments lie.

Economic issues are not separate from “identity” issues

Building the largest possible movement to not only tackle the immense, and intensifying, problems facing humanity and the environment but to overcome these problems is our urgent task. Given the position the Left finds itself in today, serious discussions inevitably include a variety of perspectives, and that is healthy.

But sometimes these discussions can veer too far into an “either/or” dynamic. These debates center on who should be the subject(s) of a mass movement that can begin to reverse the European and North American slide toward the right, a direction that, at least for now, appears to be sweeping across Latin America as well. In the United States, following the shock election of Donald Trump, an “either/or” debate has taken shape in the form of “identity politics” versus “class politics.” But do we really have to pick a side here?

An example of an activist arguing that there has been too much focus in the U.S. on “identity politics,” Bruce Lerro, writing for the Planning Beyond Capitalism web site, argues that both the Democratic Party and the Left ignored working class concerns, catastrophically leaving an opening for a right-wing demagogue like President-elect Trump to fill a vacuum. Critical of what he calls a capitulation to “long-standing liberal ideology [that] all ethnicities and genders will be able to compete for a piece of the capitalist pie,” Professor Lerro writes:

“Calling people into the streets on the basis of attacks on ethnic minorities or anti-Islamic remarks alone ignores the results of the election. It reveals the left’s inadequacy in having next to no influence over all the working class people who voted for Trump as well as the 47% of the people who didn’t bother to vote at all. It continues the same 45 year history of identity politics which has failed to make things better for its constituents, except for all upper middle class minorities and women in law and university professors who benefit most from identity politics and who moralistically preside over politically correct vocabulary.”

It is true that liberal ideology tends to fight for the ability of minorities and women to be able to obtain elite jobs as ends to themselves rather than orient toward a larger struggle against systemic inequality and oppression. Leaving capitalism untouched leaves behind all but a handful of people who ascend to elite jobs. Barack Obama’s eight years as U.S. president didn’t end racism, did it? Nor would have a successful Hillary Clinton campaign have brought an end to sexism. A movement serious about change fights structural discrimination; it doesn’t fight for a few individuals to have a career.

Black Lives Matter takes the streets of New York City

Black Lives Matter takes the streets of New York City

But to say this is not to deny that racism, sexism and other social ills have to be fought head-on. So even a focus on class issues does not mean ignoring these issues, Professor Lerro writes:

“In criticizing identity politics I am not proposing that race and gender issues should not be discussed or that they don’t matter. My criticism of identity politics is that it has historically excluded social class. From an anti-capitalist and socialist perspective, race and gender are most importantly discussed at the location where capitalists produce surplus labor — on the job. So where there is white privilege over wages or the quality of jobs offered, this issue should be discussed openly by workers in and out of a union setting. At the same time, when we are organizing against capitalism and developing a socialist political practice, race and gender issues as they affect socialist organizing, need to be confronted. But the further away discussions of race and gender get from social class, the workplace and efforts to organize against capitalism and for socialism, the more they becomes discussions for liberals — not socialists.”

Racism and sexism in our own movements

Racism and sexism, however, are found outside the workplace, and have not been eradicated from social struggles. Certainly there can not be any going back to the open sexism of 1960s movements. There was a prominent demonstration of that era in which no women were invited to speak, and a group of women in response confronted men organizing the event about this, insisting that their demands be included. In response, one of the men told them that there was already a women’s resolution, which was simply a general plea for peace. Demanding that issues specific to women’s oppression be included, the male activist not only refused further discussion, but actually patted Shulamith Firestone, soon to be the author of The Dialectic of Sex, on the head!

Such degrading behavior would not be tolerated in a Left movement today, but it can hardly be argued that sexism (or racism) has been overcome once and for all in Left movements, never mind in larger society. The days when a Left movement can tell a member of an oppressed group to “wait your turn, it’ll all be better after we have the revolution,” really should be behind us.

Even after a revolution, these issues have to be worked on. Women, for example, made serious advances in the 20th century’s socialist revolutions but never sufficient advances, and there was often backsliding. The Sandinistas banned the display of women’s bodies in commercial advertising after coming to power in Nicaragua, but near the end of their first 11 years in power sponsored a beauty contest, nor did they legalize abortion. No woman sat on the Sandinistas’ highest body, the nine-member National Directorate, during those 11 years despite their fighting in large numbers, and even commanding, during the hard struggle against the Somoza dictatorship. No woman ever sat on the Politburo during the Soviet Union’s 74-year history.

Working people are oppressed, but not all to the same degree

The world’s advanced capitalist countries are far from a revolution, so all the more is it necessary to seriously make structural discrimination a component part of Left struggles, without forgetting the class dimension any such struggle must contain. In a typically thoughtful article in CounterPunch, Henry Giroux, while not losing sight of class issues, and the overall repression of working people under neoliberal regimes, refused to downplay the extra repression that rains down on minority communities. He wrote:

“Large segments of the American public, especially minorities of class and color, have been written out of politics over what they view as a failed state and the inability of the basic machinery of government to serve their interests. As market mentalities and moralities tighten their grip on all aspects of society, democratic institutions and public spheres are being downsized, if not altogether disappearing.

As these institutions vanish—from public schools to health care centers– there is also a serious erosion of the discourses of community, justice, equality, public values, and the common good. With the election of Donald Trump, the savagery of neoliberalism has been intensified with the emergence at the highest levels of power of a toxic mix of anti-intellectualism, religious fundamentalism, nativism, and a renewed notion of American exceptionalism.”

Professor Giroux argues against a focus on what he calls “single-issue movements” but not in the sense of dismissing liberation movements based on specific oppressions, but rather argues for a joining together of struggles through drawing the connections among various social movements. He writes:

“Central to viable notion of ideological and structural transformation is a refusal of the mainstream politics of disconnect. In its place is a plea for broader social movements and a more comprehensive understanding of politics in order to connect the dots between, for instance, police brutality and mass incarceration, on the one hand, and the diverse crises producing massive poverty, the destruction of the welfare state, and the assaults on the environment, workers, young people and women. …

Crucial to rethinking the space and meaning of the political imaginary is the need to reach across specific identities and to move beyond around single-issue movements and their specific agendas. This is not a matter of dismissing such movements, but creating new alliances that allow them to become stronger in the fight to not only succeed in advancing their specific concerns but also enlarging the possibility of developing a radical democracy that benefits not just specific but general interests.”

Economic issues aren’t separate from other issues

All working people are exploited under capitalism. It would be the height of folly to sideline this fundamental commonality. But the levels of exploitation, and the intensity of direct oppression, varies widely and it would be folly to ignore this as well. Those subject to higher (often far higher) levels of discrimination have every right to focus on their own emancipation, and those in more privileged positions have an obligation to support those emancipations. Further, the perpetuation of class oppression central to capitalism depends on deep divisions within the working class, not only in terms of setting different groups at each other’s throats but in providing relatively better pay and conditions to some so that the more privileged set themselves apart from the less privileged, reinforcing hierarchies that maintain divisions among working peoples.

Therefore it is self-defeating to attempt to downplay racial, sexual and other divisions in an effort to “concentrate” on economic issues, as if these are somehow separate from other issues. In a very thoughtful essay dealing with the roles of non-governmental organizations (NGOs) in dampening activism and propping up the system they purport to critique, Sophia Burns goes on to argue that no fight against capitalist exploitation can succeed without women and People of Color playing central roles. If they are playing central roles, then the fight for their specific emancipations is central to the struggle.

Her discussion merits being quoted at length. Writing in The North Star, she argues:

“There’s an implicit notion that members of more privileged groups (men, whites, straights, etc) do not meaningfully stand to benefit from doing away with racism, sexism, etc. That underlies the moralistic connotations of ‘allyship’ — you support struggles in which you yourself have no personal stake, because that’s what an ethical person would do. Now, if you’re middle-class, that assumption is basically true. You aren’t part of the ruling class, but you have a degree of security, comfort, and control over your life. If you’re middle-class and white male, then pro-male or pro-white inequalities are pretty unambiguously good for you. So, the only reason you’d oppose them would have to be ethics, not self-interest.

But the working class has neither power nor security under capitalism. The fact that different parts of the working class are treated comparatively better or worse along racial, gender, etc lines does not change the fact that the whole class is exploited, oppressed, and ultimately powerless. However, white workers, male workers, and straight workers could not possibly defeat the ruling class alone. After all, it’s the middle class that is disproportionately white, male, etc — the working class has more people of color, women, and social minorities in general than other classes do. White men are only around 1/3 of the total US population, and an even smaller portion of the working class. So, because racism, sexism, etc exist within the class system and (combined together) directly oppress the large bulk of the working class, no working-class politics that rejects or ignores them has the ability to succeed. They’re components of the operation of the class system in practice, serving both to allow extra-high exploitation of female and non-white workers and to undercut the political potential of the class as a whole, which deepens all workers’ exploitation.

Racism and sexism are components of capitalism, and all ‘capitalism’ means is the exploitation by business owners of everyone else. So, when a white male worker understands capitalism as a class system that exploits the class of which he is part, it’s only through externally-imposed propaganda that he’s convinced that he has no stake in getting rid of racism and sexism. Economics is not a separate issue floating alongside others. Nothing that exists in capitalism is outside of capitalism.”

From the standpoint of the relationship to the means of production, white-collar middle class employees, as commonly defined, are of the same class as a blue-collar assembly-line laborer. Both are exploited economically in the same way, being paid a small fraction of the value of they produce. Nonetheless, it is indisputable that such middle-class workers (even if more properly understood as a strata within a working class that includes the vast majority of humanity) are privileged compared to other workers, and that their composition will be more heavily weighted toward dominant racial, ethnic or other groups in a given capitalist society, with the nastier and lower-paid jobs disproportionally held by disadvantaged groups.

Struggles against chauvinism are not an adjunct

The pervasive propaganda that denies that capitalism is exploitative or even refuses to acknowledge the different opportunities among different groups “is not a class-free worldview, but rather a worldview that’s natural for the middle class and that gets promoted because it serves the ruling class,” Ms. Burns writes. Thus, she argues, a false opposition is created between economics and other issues.

“Of course, because sexist and racist ideas receive the massive institutional sponsorship they do, working-class whites do have deep-seated racist notions and working-class men are often profoundly chauvinistic. The struggle against such beliefs and practices, even (in fact, especially) when they manifest within the working class, is not an adjunct to class struggle. It’s a central and necessary part of it. But when activist nonprofits and their supporters use an exaggerated account of working-class bigotry to dismiss working-class politics and a class struggle worldview entirely, they aren’t benevolently defending the marginalized. They are playing a useful role for the system that brings bigotry and privilege into being.

Neighborhood and workplace organizing, inside the working class and outside of the activist subculture, must include breaking down racism and sexism, within the class and everywhere else. But the self-interest of each part of a class is in the ultimate self-interest of the entire class. Even white male workers have a material stake in abolishing white and male privilege, despite the fact that it’s a long-term interest that isn’t acknowledged by mainstream ideas. Middle-class white men, of course, do not have that same stake. If a socialist movement is healthy, it’s not a middle-class affair.”

Let’s take this discussion a step further. Should we even use the term “identity politics”? Susan Cox, speaking on the Joy of Resistance: Multicultural Feminist Radio program on December 4, argued that being female is not an identity but rather is a material reality, and one of the most foundational realities that define the world’s social organization. She pointed out that women’s unpaid domestic labor props up the entire capitalist economic system. Defining feminism as a movement with a goal of global resistance wrenches it from the idea that it is an individualistic, lifestyle choice.

Further discussing this issue in an article in Feminist Current, Ms. Cox wrote:

“One would think being half of the damn population would make us more than some minor, divisive concern.

Women’s issues have been labelled “identity politics” for decades in order to belittle the feminist cause as politically unsubstantial/unimportant. In fact, the term first became prominent in American academia during its anti-Marxist ’80s in order to describe women as a fragmented group of individuals, rather than a class of persons with common class interests.”

It is reasonable to dispute the use of the term “class” in this context, but it should be indisputable that women face a particular oppression, one that although predating capitalism has long been an essential prop for maintaining capitalism. Racism is also necessary to maintain capitalism, and thus fighting it can never be an adjunct to a broad struggle for a better world.

Dismissing all those who voted for Donald Trump as bigots, “deplorables” or ignorant is not only simplistic and mistaken, it is bad practice. Some who voted for him can be described in such terms, but plenty voted for him, however mistakenly, out of a belief that he would bring back their jobs and because he represented, in their minds, “change.” Some Trump voters previously voted for Barack Obama — such folks can hardly be described as racists. Similarly, in France, many now supporting the National Front formerly supported the Socialist Party or the Communist Party. The United Kingdom Independence Party, however ridiculous we might find its name, is peeling off supporters from Labour.

Again, those trends do not mean there is no racism in such movements; that plenty of such exists is obvious. But economic insecurity is driving the rise of far right movements on more than one continent. Establishment politics has failed working people, and working people, including those without higher education, know it. They live it. At the same time, the far right movements that are gaining support among working people tap into the racism, nationalism, sexism and anti-Semitism that both exists within working classes (reflecting the whole of society) and is an inculcated weapon of division launched by elites who have every interest in our not uniting.

To “choose” between class politics and identity politics is a false choice. We are defeating ourselves if we decide to separate interrelated struggles and then debate which is the “proper” one. A multitude of tactics are just as necessary as fighting on multiple fronts, taking on the multiplicity of interconnected issues.

The crises of neoliberalism won’t be solved by more neoliberalism

We’re in a world of trouble if we are unable to conceive of alternative economic models. We need not linger on the details of rising inequality, political instability, tightening corporate control of governments, looming environmental crisis, increasingly precarious employment (if even available) and the inability to meet the basic needs of billions of people around the world to see that capitalism is failing humanity.

To put this in a nutshell, on a global basis, about 200 million people are unemployed among 2.4 billion who have no stable employment.

Neoliberalism is not a virus foisted on the world by some secret cabal; it is merely the latest phase of capitalism, one that, from the standpoint of capitalists, is the logical outgrowth of the breakdown of mid-20th century Keynesianism. We’re not going back to Keynesianism, because that was a brief period dependent on an industrial base and market expansion. A repeat of history isn’t possible because the industrial base of the advanced capitalist countries has been hollowed out, transferred to low-wage developing countries, and there is almost no place remaining into which the capitalist system can expand.

What happens to rain forests when the market is allowed to decide. (Photo of Montane Rainforest in Ecuador by Gunnar Brehm)

What happens to rain forests when the market is allowed to decide. (Photo of Montane Rainforest in Ecuador by Gunnar Brehm)

So when I saw a paper titled “Industrial policy in the 21st century: merits, demerits and how can we make it work” in the latest issue of Real-World Economic Review, I was intrigued. As its title implies, Real-World Economic Review specializes in papers by economists who think far outside the orthodox box that serves industrial and financial elites very well; the very fact that a field requires a publication with such a title speaks for itself.

The disappointing prescriptions offered in the paper, however, might at best be described as “neoliberal lite.” The author of “Industrial policy in the 21st century,” Mohammad Muaz Jalil of the NGO Swiss Foundation for Technical Cooperation, is well-intentioned, but advocates the same export-oriented policies that have led to sweatshops and dangerous working conditions across the developing world. It also implies endless growth, a dangerous illusion.

More of the same hardly seems a likely escape, and that is before we contemplate the mathematical impossibility of every country exporting its way out of economic difficulty. For every country that achieves an trade surplus, some other country has to have a trade deficit.

What works for a few doesn’t work for all

Mr. Jalil begins by noting that East Asian countries used industrial policies, including protectionist policies, to build their economies, most notably Japan, South Korea, Taiwan and Singapore. He uses the Organisation for Economic Co-operation and Development (OECD) definition of industrial policy:

“Industrial Policy is any type of intervention or government policy that attempts to improve the business environment or to alter the structure of economic activity toward sectors, technologies or tasks that are expected to offer better prospects for economic growth or societal welfare than would occur in the absence of such intervention.”

The above East Asian countries used various mixes of export-oriented growth strategies and protection for young industries. Favored corporations received export subsidies, reduced interest rates and preferential allocation of foreign exchange with the goal of these enterprises becoming competitive globally. Manufacturing in these countries started at a low level but steadily moved up the “value chain” — that is, they were able to produce increasingly sophisticated products.

Mr. Jalil does acknowledge some criticisms of this type of policy, noting the difficulty in foreseeing who or what will be the winners in the future, the much stiffer international competition of today, that international supply chains have become dominant, and that today’s severe global trade regime restricts the ability of governments to intervene. Governments today nonetheless use industrial policies, albeit within the so-called “Washington consensus” (which is really the “Washington diktat”) that imposes neoliberal policies around the world through the World Trade Organization and international lending banks controlled by the United States and to a lesser degree the European Union.

When we get to specific examples, the paper’s prescriptions rapidly break down. Mr. Jalil presents Brazil and South Africa as examples. Brazil is one of the world’s most unequal societies, and one with severe economic problems not likely to improve in the wake of the Brazilian Right’s soft coup against former President Dilma Rousseff. A weak currency, lack of growth, continuing inflation, huge piles of debt owed in dollars and euros, and local corporations saddled with debt and low credit ratings seems not a rosy picture. Poverty is widespread, and activists who challenge land owners who clear-cut rain forests are not infrequently killed.

South Africa has the most inequality of any country in the world. The African National Congress threw away its moral authority to implement its “Freedom Charter” upon taking power by negotiating away its economic control. The ANC took office handcuffed, and having tied themselves to financial markets, those markets applied further “discipline” by attacking the South African economy at the first sign of anything that displeased them.

South African workers, especially miners, are subjected to violence at the hands of the ANC government, abetted by ANC-aligned unions. More than half of South Africans live in poverty and the unemployment rate is 26.6 percent. This is an example to emulate?

Sweatshop advocates don’t have to work in them

Next up, the author promotes the Bangladesh garment industry as a success story! Well, for Wal-Mart and other global retailers who rack up enormous profits on the backs of sweatshop workers being paid starvation wages this is undoubtedly a success. But as a development strategy beneficial to working people? Let’s look at the evidence.

Bangladeshi garment workers can work 14 to 16 hours a day, some seven days a week. The minimum wage is little more than half of the minimum required to provide a family with shelter, food and education, according to the activist group War on Want. The Institute for Global Labour and Human Rights estimates that a worker in Bangladesh would have to labor 15 1/2 hours to buy a gallon of milk. In 2014, the Wal-Mart chief executive officer earned 24,500 times more than a Bangladeshi sweatshop worker. Yet despite repeated accidents resulting in mass deaths, little has changed.

The shipbuilding industry is also promoted as a route to prosperity for Bangladeshis. A key component of this industry is “ship-breaking,” whereby ships are driven onto land to be disassembled. The Institute for Global Labour and Human Rights reports that ship-breakers work 12-hour shifts, seven days a week, and are paid 30 to 45 cents an hour to perform a job “in which it is common for workers to be maimed or killed.” The ship-breakers are reported to live in crowded hovels, sleeping on concrete floors.

Ship-breaking in Chittagong, Bangladesh (photo by Naquib Hossain)

Ship-breaking in Chittagong, Bangladesh (photo by Naquib Hossain)

Nobody would choose to do such things except under the most dire deprivation. That such work is a route to sustainable development is a common trope of neoliberal apologists, but defies common sense in any humanistic context.

The author points to the increasing number of developing-country corporations among the world’s biggest, but those numbers are nonetheless still minuscule. In fact, the corporations of the Global North remain overwhelmingly dominant. A study by Sean Starrs in New Left Review found that, when the world’s industries are grouped into 25 broad categories, U.S. firms led in 18 and in 10 of those U.S. corporations hauled in at least 40 percent of the aggregate profits. Germany and Japan hold the lead in two other sectors.

In support of these prescriptions, Mr. Jalil argues that as countries move up the value chain, the next country can “take over” “entry” industries and begin its own ascent. But there is only so much productive capacity that the world can absorb — the idea that every country can become a manufacturer of the same high-end electronics equipment, for example, defies reality. It also ignores, again, that every country can’t be a net exporter. It also sidesteps the fact that China’s growth threatens to “crowd out” other competitors due to its massive size.

Minqi Li, in his book The Rise of China and the Demise of the Capitalist World Economy, argues that the huge mass of low-wage Chinese workers will drag down wage levels globally; the increase of industrialization in developing countries will lead to exhaustion of energy sources; and that ecological limits will force a halt to growth, fatal to a system dependent on growth. Professor Li argues that an upward convergence of wages around the world in present-day low-wage havens would significantly reduce capitalists’ profits.

In this scenario, capitalists would seek to cut wages in core countries to make up the difference, which in turn would trigger reductions in demand. Reduced demand would spell trouble for any export-oriented economy, especially as the ultra-low wages suppress domestic consumption.

Nor can sufficient jobs be created for the expanding population of farmers and others dispossessed from the countryside — Samir Amin calculates that even with an increase of seven percent in gross domestic product for the next 50 years, no more than a third of this population could find regular work. No such growth has ever occurred for such sustained periods.

Where is the second Earth going to come from?

Finally, all this imagined explosion of industry is predicated on endless growth. We live on a finite planet, and thus infinite growth is impossible. Consumption is already growing beyond Earth’s carrying capacity and the anthropogenic changes to the atmosphere have us dangerously close to the point of no return in terms of global warming. Humanity is currently consuming the equivalent of 1.6 Earths, and at current rates of consumption trends, that will rise to two Earths by the 2030s.

Not a substitute for Earth (Image created by NASA via Hubble Space Telescope)

Not a substitute for Earth (Image created by NASA via Hubble Space Telescope)

Ramping up ever more production, even assuming that markets could be found for it, can not be a long-term solution for poverty. Managers of corporations are answerable to private owners and shareholders, not to society, and thus do all they can to externalize environmental and other costs onto society. Alas, renewable energy is not a short cut to reversing global warming. Renewable energy is not necessarily clean nor without contributions to climate change (the production of wind turbines and electric cars lead to plenty of pollution), 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.

Finally, the belief that industrial policy can create prosperity is predicated on developing countries having the independence to implement protectionist measures. Mr. Jalil argues that the poorest countries have temporary reprieves from World Trade Organization rules until the end of this decade, but that they have room for maneuver is questionable at best. Not only WTO rules, but the bilateral and multilateral “free trade” agreements render such protections illegal. The Trans-Pacific Partnership, which includes several developing countries, would further restrict any ability to protect local industries — and the TPP is intended to be a model for other countries. (Although wounded, TPP is not dead yet because a two-year window has yet to expire.)

In a world where “free trade” agreements strongly constrict the ability of governments to enact laws and regulations, and which grant multi-national corporations the right to sue to eliminate any law they don’t like — in essence, a requirement that corporate profits trump any labor, safety, environmental or health measure — the road to becoming a net exporter will begin and end with sweatshops for most countries.

Low wages and a lack of enforceable regulations are precisely why multi-national capital is invested in developing countries like Bangladesh. The global “free trade” regime is nothing more than a mechanism for the most powerful industrialists and financiers of the Global North to accelerate a race to the bottom and increase their exploitation to the maximum humanly possible. That developing countries can win at this — or that the advanced capitalist countries will allow more competitors to arise — is fantasy. A neoliberal fantasy.

Mr. Jalil concludes with a call for private-sector funding able to “respond to diversity and dynamism inherent in markets.” Huh? Markets in the capitalist world are nothing more than the aggregate interests of the largest industrialists and financiers — allowing markets to make an ever wider range of social decisions is what has led the world to its impasse and ever harsher austerity for working people. Neoliberal capitalism may teach that people exist to serve markets, but we don’t have to accept that.

The belief that private funding — which, after all, is done to extract profit regardless of social or environmental cost — will make us live happily ever after should be left to the realm of fairy tales. As the saying goes, insanity is believing that doing the same thing over and over again will produce different results.

Building a better movement

All of us who struggle for a better world are disheartened that so many advances of the 20th century have been lost. The mounting crises of the environment, the global economy and ever more constricted political systems are unmistakably moving humanity toward a cliff. And yet social movements, for all the victories here and there, again and again fail to sustain momentum.

Why are we in this predicament? No single person or organization can fully answer such a question, of course, but we do need to seriously reconsider what has been done and how. In this spirit, Marta Harnecker’s “Ideas for the Struggle” is a document that merits wide discussion. Originally written in 2004 and updated this year, the paper consists of 12 short, closely linked sections. And although written with Latin America in mind, the ideas are borderless.

Argentines demonstrate against banks in February 2002 (photo by Usuario:Barcex)

Argentines demonstrate against banks in February 2002 (photo by Usuario:Barcex)

Taking on the idea of spontaneity head on, Ms. Harnecker, a sociologist and activist since the 1960s, opens her paper by declaring that popular uprisings are insufficient in themselves. She writes:

“The recent and not so recent popular uprisings that rocked numerous countries across the world have clearly demonstrated that the initiative of the people, in and of itself, is not enough to defeat ruling regimes. Impoverished urban and rural sectors, lacking a well-defined plan, have risen up, seized highways, towns and neighborhoods, ransacked stores and stormed parliaments, but despite being able to mobilize hundreds of thousands of people, neither their size nor their combativeness have been enough to move from mass uprisings to revolution. They have overthrown presidents, but they have not been able to conquer power and initiate a process of deep social transformations.”

The example of successful revolutions, she argues, demonstrates that a “political instrument” capable of a national struggle is essential. To be effective,

“to convert mass uprisings into revolutions, a political instrument capable of overcoming the dispersion and fragmentation of the exploited and the oppressed is required: one that can create spaces to bring together those who, in spite of their differences, have a common enemy; that is able to strengthen existing struggles and promote others by orientating their actions according to a thorough analysis of the political situation; that can act as an instrument for cohering the many expressions of resistance and struggle.”

The past doesn’t have to be the future

That “political instrument” has to be welded anew and based on current, concrete conditions; people who believe that strong organizations are something to be avoided because many parties of the past engaged in authoritarian or manipulative political practices should not be trapped in the past. She writes:

“I believe it is fundamental for us to overcome this subjective barrier and understand that when we refer to a political instrument, we are not thinking about any political instrument; we are dealing with a political instrument adjusted to the new times, an instrument that we must build together. … We are talking about understanding politics as the art of constructing a social and political force capable of changing the correlation of force in favor of the popular movement, to make possible in the future what today appears impossible. We have to think of politics as the art of constructing forces. We have to overcome the old and deeply-rooted mistake of trying to build a political force without building a social force.”

By “social force,” Ms. Harnecker refers to the multitude of grassroots organizing that takes on particular struggles, including at local levels, and whose autonomy must be respected. A larger organization working on the broader project of building a revolutionary movement can only do so by working with these multitudes of grassroots movements. There can’t be a movement toward a better society without organic movements seeking to transcend the current society. This “construction of forces,” as the author defines this process, has to be conscious work. She writes:

“[T]his construction of forces cannot occur spontaneously; only popular uprisings happen spontaneously. It requires a political instrument that is capable of consciously building the required forces. … I envisage this political instrument as an organization capable of raising a national project that can unify and act as a compass for all those sectors that oppose neoliberalism. As an organization that is orientated towards the rest of society, that respects the autonomy of the social movements instead of manipulating them. And one whose militants and leaders are true popular pedagogues, capable of stimulating the knowledge that exists within the people — derived from their cultural traditions, as well as acquired in their daily struggles for survival — through the fusion of this knowledge with the most all-encompassing knowledge that the political organization can offer.”

Balancing debate with the necessity of action

How should such an organization develop its ideas? In what some readers would likely see as more controversial, Ms. Harnecker argues for democratic centralism. Although a term that is looked on with disfavor due to how the concept was badly distorted in 20th century communist parties, she argues that only through thorough democratic discussion can activists be prepared to carry out work, but that there also has to be strategic action rather than simply debate. She argues:

“This combination of a) a democratic debate at different levels of the organization and b) a single centralized leadership based on whatever agreements are arrived at by consensus or by majority vote is called ‘democratic centralism.’ I do not see how one can conceive of successful political action if unified action is not achieved around key issues. I do not see any other alternative to democratic centralism for achieving this, if consensus cannot [be] reached.

Only a correct combination of centralism and democracy can ensure that agreements are effective, because having engaged in the discussion and the decision-making process, one feels more committed to carry out the decisions.”

That a decision must be made and actions taken based on that decision does not mean an issue is closed in this conception. The minority must be allowed to continue to argue its case because that minority might be right, and if the majority is convinced it is right it should have no fear of further debate, the author writes.

Popular Unity supporters rally in Chile in 1972 (photo via Revista Argentina Siete Días Ilustrados)

Popular Unity supporters rally in Chile in 1972 (photo via Revista Argentina Siete Días Ilustrados)

This is a crucial point. The road to one-person dictatorship began with the stifling of minority viewpoints. As the spaces for debate steadily constricted in the 1920s Soviet Union, it is impossible not to think of Leon Trotsky’s warning that the party would substitute itself for the working class, that a faction of the party would substitute itself for the party and finally a single leader would substitute itself for the faction.

We should never under-estimate the isolation that the Bolshevik Revolution faced, nor the enormous challenges of modernizing a backward country while defending itself against a hostile capitalist world. Nor ignore the huge advances made in a country that went from a 20 percent literacy rate to producing more engineers than any other country in the span of two generations. Nonetheless, the political distortions imposed by first a single-person dictatorship and then a bureaucratic monopoly of power by a single party placed fatal fetters on Soviet development.

People can only solve their problems by freely discussing them, without coercion or manipulation, and then freely acting through coordinated activity based on the results of their discussion. In turn, there must be larger organizations that connect the many particular struggles into a broad movement, one that enables activists to see the links and commonalities between these struggles and the often common enemies that they face.

Confronting capitalist hegemony

None of us possess a blueprint on how to build an effective mass movement. But one thing that ought to be clear, yet often isn’t, is that simply replicating the models of the past is a dead end. To return to Ms. Harnecker’s paper, she argues that no movement can be effective without consideration of capitalist hegemony in opinion manufacturing and the broad acceptance of capitalist rule that hegemony engenders. She writes:

“I am talking about a strategy that takes into consideration the important social, political, economic and cultural transformations that have occurred across the world in the last period. One that understands that the new forms of capitalist domination go far beyond the economic and state sphere, have infiltrated into all the interstices of society — fundamentally through the mass media which has indiscriminately invaded the homes of all social sectors, and in doing so changed the conditions of struggle. … The capitalist elites tend to achieve a significant hegemony over important popular sectors, a real cultural leadership over society; they have the capacity to ideologically subordinate the popular sectors, even those who are exploited by them. As [Noam] Chomsky says, propaganda is to bourgeois democracy what the truncheon is to the totalitarian state.”

Discussion of alternatives to capitalism must become more serious. Not only do social movements need to free themselves of forms of thinking imposed by capitalist hegemony, alternative spaces must be opened and successfully defended:

“[W]e must develop a process of popular construction opposed to capitalism in the territories and spaces won by the left, that seeks to break with the profit logic and the relations this imposes and tries to instill solidarity-based humanist logics. We must promote struggles that are not limited to simple economic demands — although these need to be included — but that advance the development of a more global, social project that encourages authentic levels of power from the grassroots.”

As I noted earlier, the author has written “Ideas for the Struggle” with the experiences of Latin America in mind, and some of the examples she provides are specific to that region. Nonetheless the ideas expressed (of which I have quoted only a very small sample) provides much material for discussion that is pertinent to any country or region. We do need to stop lamenting that we don’t know how to build an effective movement and start seriously discussing how we are going to build an effective movement.

If we don’t, barbarism will be the future. As the world’s resources are depleted, the environment is polluted beyond near-term remediation and ever more people are thrown into desperation — if we go on with capitalism, this is the path humanity will continue to walk — the industrialists and financiers who rule the world will surely have more intensive repression in store for us. If that is not the future we want, we’ll have to change it ourselves.

Cooperatives becoming bigger part of Cuba’s reforms

The continuing debates over cooperatives, including whether they represent a promising form of socialism or a reinforcement of capitalism, will likely have fresh evidence in coming years from Cuba.

The nascent cooperative movement in Cuba is genuine and growing, but many questions about its future direction are yet to be answered. That the Cuban cooperative movement is largely a top-down process, and subject to still opaque decision-making by party and government officials, adds more uncertainty. And inevitably intertwined with these debates are long-standing tensions between traditional state-owned models of property and emerging de-centralized models of cooperative property.

Perhaps the safest observation that can be made today is that nobody knows where Cuba’s experiment will lead.

Sunrise in Havana (photo by Jvlio)

Sunrise in Havana (photo by Jvlio)

The beginning stages of Cuban cooperatives were handled with considerable input. Thousands of meetings were held throughout the country in advance of the Communist Party of Cuba’s Sixth Congress, held in April 2011, to discuss the document Lineamientos de la política económica y social en Cuba (Guidelines on Economic and Social Policy in Cuba), which listed more than 300 goals intended as significant reforms to the Cuban economy. The guidelines approved at the Sixth Congress included autonomy for the state enterprises, an expansion of cooperatives, new taxing laws and changes in the system of subsidies.

Changes came swiftly. Almost 200 occupations previously limited to state enterprises were opened, and within three months of the Sixth Congress, more than 100,000 new small-business licenses were granted. The Cuban government estimated that about 489,000 people, representing nearly a tenth of the workforce, were self-employed in the first half of 2015.

The cooperative sector has not grown as fast, but by October 2013, 270 urban cooperatives had been approved. By late 2014, that number had reached nearly 500. But cooperatives are not new to Cuba — agricultural cooperatives have existed since the early years of the revolution and they produce about 80 percent of the food grown in Cuba. What is new is that cooperatives are now encouraged outside of agriculture, although they are primarily in services rather than manufacturing.

Reversal of previous openness to discussion

The Communist Party had intended to “update” the Guidelines at its Seventh Congress, held in April 2016. But no final documents have been released, nor had the documents to be discussed at the Congress been made available for discussion. This lack of transparency, said to be due to a continuing inability to complete the work, resulted in considerable public disapproval. A commentary in Green Left Weekly, contrasting this lack of transparency with the public input that helped shape the Guidelines approved by the Sixth Congress, noted the party faced a choice of either abandoning public consultation or postponing the congress.

The congress was not postponed. But the party did acknowledge the criticism directed at it. In a March 28 article (shortly before the Congress convened) in Granma, the official party newspaper, the paper wrote:

“The editorial office of this newspaper has received, by various means, expressions of concern from Party members (and non-members, as well) inquiring about the reasons for which, on this occasion, plans were not made for a popular discussion process, similar to that held five years ago regarding the proposed Economic and Social Policy Guidelines of the Party and Revolution.

The fact that such opinions and doubts were expressed is in no way reproachable, much less when they come from people who are genuinely concerned about the work of the Party and the country’s destiny.”

The Granma article argued that the discussions scheduled for the Seventh Congress would be a “continuation” of the work of the Sixth Congress, and that most of the Guidelines were still in the process of being implemented. Therefore, “what is more appropriate is finishing what has begun” rather than opening new discussions. The article argued that:

“[T]he guidelines approved by the 6th Congress serv[e] as the tactical approach to reach our aspirations, reflecting their continuity and development. These documents do not, therefore, represent anything different in terms of the road taken, but rather a higher level expression based on what has been discussed and submitted for consultation to all Party members and the people.”

Responding to criticisms of this line, President Raúl Castro later proposed that the Seventh Congress would adopt any documents “in principal” rather than definitively, promising further public consultation. The Congress did agree, but the documents still have not been released. This delay appears to be due to the drafts still being in progress; one of the documents is reported to have been drafted eight times.

Differing ideas as to direction of reforms

There is a consensus among informed observers that a primary reason for the Communist Party’s slowness in promulgating clear rules for the formation of cooperatives is that the party leadership has yet to reach a consensus itself. The Green Left Weekly commentary mentioned above suggests this division of opinion is behind the delays in producing the updated documents promised for the Seventh Congress. The author, Marce Cameron, wrote:

“The Central Committee’s glacial progress in drafting the two key documents suggests that it has tried to reconcile, behind closed doors, divergent conceptions of the new Cuban socialist model that is aspired to. They had to be reconciled if the leadership were to present a more or less coherent programmatic vision to the party as a whole—rather than strive to involve the party as a whole in developing that vision from the outset over the five years since the 6th Congress.”

In a thoughtful NACLA article, Roger Burbach, basing his analysis on the work of Camila Piñeiro Harnecker, summarized three visions of socialist economic development in Cuba. They are:

  • A statist position, largely reflecting the old guard. Advocates of this position call for more discipline and greater efficiency among state industries and enterprises, and argue that Cuba’s economic problems can be corrected through a more efficient state, not through a dismantling of the state.
  • A market socialist perspective, advanced by many economists. Advocates of a “socialist market economy” argue for privatization, even at the price of increased inequality, the exploitation of wage workers and environmental degradation, as the route to increased productivity and efficiency. These advocates assert the state can always step in to correct excesses.
  • An “autogestionario,” or self-management, stance that calls for democratic and sustainable development primarily through the promotion of cooperatives. Participation, association and solidarity should be at the heart of the new economy, advocates say. In this view, control should not come from the top down but from the bottom up, as workers engage in self-management to further their social and economic concerns.

The so far strong push for cooperatives from the party, and the assistance provided to them, is a good indication that cooperatives will be a part of Cuba’s future. To what degree remains an open question, but however that question is ultimately answered, the intention is that a significant portion of the economy will remain in state hands for the foreseeable future.

No return to capitalism

In a presentation on Cuba cooperatives at the Left Forum in New York last May, Isaac Saney noted that, despite the top-down manner of cooperative creation and the ongoing debate on whether the state should drive the development of cooperatives, popular support remains firm. He gave the example of U.S. President Barack Obama, on his trip to Cuba, saying the U.S. would buy coffee directly from Cuban coops, but the coops condemned that as intended to undermine the socialist state, which they would not go along with.

In the same Left Forum presentation, Al Campbell offered five considerations:

  • Cooperatives tend to build a sense of responsibility for the participants.
  • Coops build collective consciousness.
  • A negative is that coops can develop competition and rivalry with others; structures and practices are necessary to connect coops with the rest of society.
  • The danger of leaving economic coordination to the market; planning is an essential aspect of socialism.
  • Self-determination is a collective process; different decisions must be made by different people.

Parallel to these factors, in a part a reflection of the complex nature of the reforms, is that many cooperative enterprises did not become so on their own initiative. The Left Forum presenters, and others, have interviewed members of cooperatives who, when asked why they became a cooperative, did not know, saying they were told their state enterprise would now be a cooperative. Of 124 non-agricultural cooperatives created by mid-2013, 112 were former state enterprises, according to the Inter Press Service.

Complimentary to the creation of cooperatives, enterprises remaining in state hands are to be given more autonomy. The Inter Press Service reports:

“The authorities have defended ‘social ownership of the basic means of production’ as an essential aspect of the new economic model being built on the basis of reforms outlined by the ‘economic and social policy guidelines’ of the governing Communist Party of Cuba, considered a roadmap for ‘updating’ the socialist system promoted by President Raúl Castro.

In recent legislative debates that touched on this issue, the vice president of the Council of Ministers, Marino Murillo, said the changes underway were aimed at building ‘prosperous and sustainable socialism, in which the main protagonist is the public enterprise, strengthened with greater autonomy in its management and the distribution of its results.’ ”

Cooperatives not necessarily a path to socialism

There is some fear that cooperatives could lead Cuba back to capitalism. Although cooperatives represent a socialized form of production, and potentially can form the basis of a socialist economy based on democratic principles, coops are also completely compatible with capitalism. The formation of cooperatives in itself does not eliminate competition, not even capitalist competition. Locating the cause of greed, injustice, inequality and other social ills in the authoritarian, hierarchical structure of the capitalist enterprise is an overly simplistic analysis.

Co-op symbolAlthough that structure certainly is a factor, the cut-throat nature of unfettered, market-driven competition is central. The relentless pressure to increase profits, maximize market shares and eliminate competition — on pain of enterprise death for those who don’t do this sufficiently — makes unethical or anti-social business decisions inevitable. Putting social decisions in the hands of the capitalist “market” means putting those decisions in the hands of the biggest industrialists and financiers.

What if an economy was dominated by cooperative enterprises, but those coops competed ruthlessly with one another in unfettered market competition? Cooperative members would wind up reducing their own wages (which would be a commodity in such a scenario) and cutting whatever corners they could to survive the competition, just as capitalist enterprises do today. Smaller coops would go under or sell themselves to larger coops — an oligarchy would inevitably arise in most industries.

Working for a cooperative has its advantages, even under capitalism, but even a hugely successful cooperative such as Mondragon faces limits due to the relentless nature of capitalist competition, as the 2013 closing of its household-appliances company, Fagor Electrodomésticos, demonstrates.

An economy based on cooperatives would have to have cooperation between its cooperatives, rather than competition. Prices would have to be negotiated up and down the supply chain (with all enterprises’ financial information available to prevent unfair price-gouging) with perhaps an arbitration board to step in when parties could not agree. Community input would also be desirable, in the industries in which a given community is directly involved and for retail prices of consumer goods.

Cooperative enterprises can be responsible for investment, production and financial decisions — subject to democratic oversight — but might be required to demonstrate full compliance with a range of standards on issues such as equal opportunity, workers’ rights, health and safety, environmental protection and consumer protection. Enterprises could be required to be certified on all relevant issues before conducting business, and perhaps be re-certified at specified intervals.

And of course an economy based on cooperatives does not preclude that certain key industries remain in state hands (with democratic control). Banking, energy and basic utilities such as water come to mind as too important to allow any private control.

Old patterns of hierarchy not eliminated

The foregoing are theoretical constructs for a more developed system. In present-day Cuba, as would any society moving toward a cooperative model, there are many practical questions still to be worked out. There are also growing problems that need to be tackled. Writing in Daily Kos after a trip to Cuba, “Geminijen” observed that hierarchy seemed to stubbornly survive in some coops. She wrote:

“Although the coops are managed by the workers and the workers share the profits, many of the criteria of a coop seemed to be missing or in progress — i.e., there was usually one spokesperson who appeared to be the manager or ‘boss’ or a husband and wife heading up the business (coops are not supposed to be family businesses) and there did not always seem to be a clear path as to how the people who worked there could elect a different manager or board members (they all had elected boards) if they wanted to do so. In some cases, the members were encouraged to participate in the decision-making process, in others not so much.”

Although the writer noted that workers mostly seemed to not mind these conditions because they were making more money and had a say in pay scales, nonetheless inequality is a potential problem. In examining why “self-organized” forms of private enterprise approved by the state seemed more successful than state-run coops,

“[W]e didn’t consider that the state coops were hampered by their lack of access to raw materials necessary to create the coops. As a visiting Puerto Rican educational scholar pointed out to me, the privately organized coops have come in and taken over the failed state coops because they have the money (capital) to develop the business that the state run coops do not. When I asked self-organized coops where they got their capital, they were often evasive. My source suggested that many of these businesses were started with money from remittances from wealthy relatives in the United States. She also noted that since most of the wealthy people living in the States are white, this ability of one group of Cubans to obtain and invest capital not only was reintroducing class divisions, but increasing the divisions again between the races since most Afro Cubans did not have access to remittances.”

The Cuban government is making efforts to assist the coops created from state enterprises. Earlier this year, the government announced that restaurants and some other ex-state enterprises would be able to buy products at reduced prices from wholesale operations to be established for them, along with a tax cut, in exchange for price controls. Construction cooperatives are also hampered by inconsistent access to supplies and the sometimes poor condition of equipment inherited from state companies.

Cubans not looking north for answers

Forming a cooperative from scratch can still be difficult. There are heavy barriers, a Cuban anarchist visiting New York earlier this year reported in a presentation — approval is needed from the government, and there is no time period in which a response must be made. Political resistance remains; the presenter reported that his group was told to take down a banner saying “socialism is democracy” while participating in a parade, although they refused to do so. He is also fearful that Cuba is headed toward the model of China and Vietnam — a capitalist direction that he disapproved of.

Concomitantly, his biggest fear was of genetically modified organisms and other ills pouring into Cuba from the United States. Although there is a widespread desire among Cubans to be rid of the U.S. blockade that has done so much damage to their country, there is little desire for Cuba to revert to capitalism.

Daniel Hellinger, writing of the increased incomes but widening class divisions resulting from the reforms, reports that Cubans are firm in seeking to defend their gains. In a report written after a two-month stay in Havana, he wrote:

“They unfailingly welcome change — so long as three major accomplishments of the revolution are left untouched. No one wants a future without free, quality universal health care; free, quality education; and the peace of mind that comes with streets that are virtually free of crime or violence at any hour of the day or night. Moreover, while Cubans clearly welcome the thaw in relations, they are not looking to the U.S. to save them. Virtually everyone who talked to me seemed to agree with the government’s approach to rectifying problems; where they disagreed was over the pace of change, with most hoping to see it speed up, but more than a few anxious about their jobs, rations, pensions, etc.”

The Cuban government has consistently said it intends its reforms as a renewal of socialism, not a retreat. An objective accounting of the old Soviet model of centralized control with state ownership of all means of production has to acknowledge the disadvantages that come with it, along with the accompanying political constrictions. Change came too late, too haltingly and too much on the backs of working people in the Soviet Union, factors that can’t be ignored in assessing why the Soviet Union crumbled.

Cuba is a different country, but does face the problems of centralization. To the leadership’s credit, it is making a bonafide effort to effect necessary change, even if that change is yet to be agreed upon. It is much too early to say where Cuba’s experiment in cooperatives will lead, but the surest guarantee that it will prove to be an advance and not a retreat is the Cuban people themselves, who have stood up to unceasing U.S. attacks for more than a half-century.

Consumer detritus and the elevation of “freaks”: A reconsideration of Susan Sontag’s On Photography

I wrote this in 2005, after seeing an excellent exhibit of Diane Arbus’ photography at the Metropolitan Museum of Art. As she is in the news again with another show of her work, the themes of this article seem to me still very relevant.

To say a photograph is worth 1,000 words is to repeat the hoariest of clichés. Does that make the statement completely wrong? Consider that the most unwavering of the Bush II/Cheney administration’s censorship efforts is the suppression of photos. United Statesians are not allowed to see coffins of dead soldiers nor even injured soldiers, not the carnage wrought by their invading military in Iraq, and most certainly not the horrific destruction of Falluja. The corpses of the four mercenaries hung on the Falluja bridge were shown; it was the easiest way to raise a sufficient crescendo of indignation to create the political space needed to carry out the vengeance-inspired massacre that the pitiless logic of invasion required.

By the same logic, the Bush II/Cheney administration and the Pentagon can’t be completely upset by the Abu Ghraib torture photos. Although word of mouth goes a long way when it comes to torture, the handful of leaked photos did demonstrate to people in developing nations around the world just what they can expect should they get in the way of multinational corporations’ asset acquisition programs.

On Photography coverPunishing the enlisted personnel who carried out their orders rather effectively — and what, after all, are enlistees for from the standpoint of the corporate elite and their governmental and military hirelings? — provides a nice public relations opportunity and also underscores that the actual crime was the releasing of the photos and not the torture itself. At any rate, the U.S. corporate media quickly tired of torture and abuse photos; intra-media competition forced torture into the news temporarily, but there soon was a tacit understanding that we had seen enough of these photos.

But however ubiquitous photography is, it has its limits. Humans see what they wish to see, which Susan Sontag amply demonstrated in On Photography, although she demonstrated that principle more than she intended. Ms. Sontag’s book is a collection of six essays written for The New York Review of Books during the 1970s, as the Vietnam War was winding down. The Pentagon certainly has taken a lesson from that war, taking strong measures to censor photography and videography today. But the military, and the economic interests for which it serves, is more than capable of using photography for its own purposes. This is not new, Ms. Sontag notes:

“The photographs Mathew Brady and his colleagues took of the horrors of the battlefields did not make people any less keen to go on with the Civil War. The photographs of ill-clad, skeletal prisoners held at Andersonville inflamed Northern opinion — against the South. … Photographs cannot create a moral position, but they can reinforce one — and can help build a nascent one.”1

Ms. Sontag also noted the propaganda value that a photo can have, although a photo can be so iconographic that it transcends it political use value.

“The photograph that the Bolivian authorities transmitted to the world press in October 1967 of Che Guevara’s body, laid out in a stable on a stretcher on top of a cement trough, surrounded by a Bolivian colonel, a U.S. intelligence agent, and several journalists and soldiers, not only summed up the bitter realities of contemporary Latin American history but had some inadvertent resemblances, as John Berger has pointed out, to Mantagna’s ‘The Dead Christ’ and Rembrandt’s ‘The Anatomy Lesson of Professor Tulp.’ What is compelling about the photograph partly derives from what it shares, as a composition, with these paintings. Indeed, the very extent to which that photograph is unforgettable indicates its potential for being depoliticized, for becoming a tireless image.”2

Pastel portrait of Susan Sontag by Juan Fernando Bastos

Pastel portrait of Susan Sontag by Juan Fernando Bastos

Her argument here is that photography unnaturally beautifies what it captures, even “the small Jewish boy photographed in 1943 during a roundup in the Warsaw ghetto” with “arms raised in terror.”3 Ms. Sontag’s lament (critique would be too strong a word) is in contradiction to her themes elsewhere in the essays when focused on cultural analyses. This contradiction is most sharply in focus in her unwarranted criticisms of Diane Arbus, which frankly say much more about Ms. Sontag herself than Ms. Arbus. Ms. Sontag, with an air of disapproval, claimed that Ms. Arbus’ work

“lined up assorted monsters and borderline cases — most of them ugly; wearing grotesque or unflattering clothing; in dismal or barren surroundings. Arbus’s work does not invite viewers to identify with the pariahs and miserable-looking people she photographed. Humanity is not ‘one.’”4

A “freak” is in the mind of the viewer

To be sure, Diane Arbus’ work took a dark turn in her final works, a collection grouped as “Untitled, 1970-71” in the retrospective organized by the San Francisco Museum of Modern Art that showed at New York’s Metropolitan Museum of Art in spring 2005. But her mental health must have been a factor during this period; she committed suicide in 1971. Her skill, fully put to use prior to her final series, was to bring out the humanity in her subjects and to coax out their personality. Ms. Sontag’s repeated reproaches to Ms. Arbus for showing “victims” who are “pathetic,” “pitiable” and “repulsive,” in which “everybody looks the same,” only paint Ms. Sontag as uncomfortable with ordinary people even as her political sympathies were clearly with them. “Anybody Arbus photographed was a freak,”5 citing, as one of several examples, a boy waiting to march in a pro-war march wearing a “Bomb Hanoi” button.

But why is this earnest young man a “freak”? The picture is of a naïve, fresh-scrubbed boy, rather typical of the 1960s, and shows the young man as he is. His politics, undoubtedly the product of teaching from a conservative family, are horrible. We can recoil at the ignorance of wishing to bomb people for the crime of resisting an invasion; we can be amused at the absurdness of the sight (we can easily feel both), but this falls far short of reaching the status of “freak,” especially as plenty of United Statesians, sadly, supported the Vietnam War.

Portrait of Diane Arbus by Beppe Devalle

Portrait of Diane Arbus by Beppe Devalle

One picture in the Arbus retrospective that particularly stands out is “The 1938 Debutante of the Year at Home, Boston, 1966,” a picture of an extremely privileged woman well into the transition from middle age to seniority smoking in her bed. Every pore of this woman exudes privilege, captured in astonishing clarity by Ms. Arbus, a perhaps unequaled master of technique. This woman, like most of those whom Ms. Arbus photographed, was said to have loved the photo. Why not? It certainly captured this woman brilliantly. This woman most assuredly would not have considered herself a “freak.”

One photo that Ms. Sontag did specifically mention in her catalogue of horror is the “human pincushion” of New Jersey, a middle-aged man who, while demonstrating his specialty, nonetheless is very proud. The privileged once-debutante and the circus performer are both far removed from the life experiences of most people, but both, as are most of Ms. Arbus’ subjects, clearly are comfortable with themselves and thus in front of the camera. That they are “freaks” because they are different, or simply comfortable with their differences, is a terribly elitist attitude, and a misreading of Ms. Arbus’ work.

On the larger terrain of consumerist culture and national privilege, Ms. Sontag was on firmer ground, although her dismissal of Surrealism is jarring. She wrote:

“Surrealism is the art of generalizing the grotesque and then discovering nuances (and charms) in that. No activity is better equipped to exercise the Surrealist way of looking than photography, and eventually we look at all photographs surrealistically. People are ransacking their attics and the archives of the city and state historical societies for old photographs. … The Surrealist strategy, which promised a new and exciting vantage point for the radical criticism of modern culture, has devolved into an easy irony that democratizes all evidence, that equates its scatter of evidence with history. Surrealism can only deliver a reactionary judgment; can make out of history only an accumulation of oddities; a joke; a death trip.”6

Reactionary? Pressing ahead with this ultra-left phrasemongering, Ms. Sontag wrote:

“Surrealists, who aspire to be cultural radicals, even revolutionaries, have often been under the well-intentioned illusion that they could be, indeed should be, Marxists. But Surrealist aestheticism is too suffused with irony to be compatible with the twentieth century’s most seductive form of moralism. … Photographers, operating within the terms of the Surrealist sensibility, suggest the vanity of even trying to understand the world and instead propose that we collect it.”7

Photo of a Iraqi prisoner in Abu Ghraib

Photo of a Iraqi prisoner in Abu Ghraib

Photography as a privilege

Susan Sontag’s argument was part of her larger point that the ubiquity of photography is a function of the privilege of capitalist nations and that a culture based on consumerism necessarily produces photographic detritus as it does other consumer products. True enough. But consumer culture, none more so than the U.S. variety, is based on the reduction of freedom to the free choosing of products and the active trampling or co-optation of any artistic expression that does not extol consumerism, while Surrealism arose as artistic expressions in opposition to mechanized, mercantile society.

This line of attack is at least consistent with Ms. Sontag’s attack on Ms. Arbus, but is even more off the mark; the combination of squeamish cultural conservatism and “more revolutionary than thou” psuedo-radicalism makes for a creaky Stalinist muddle. Ms. Sontag had brilliant observations to make; it is difficult to understand these sorts of sojourns that only detract from her larger points.

Ms. Sontag began to develop her central themes in the opening pages, displaying the vast knowledge of photographic history that she was known for. Sontag posited that taking vacation photos, for many people, is a way of ameliorating feelings of guilt for not working and that travel is reduced to becoming a strategy for accumulating photographs.

“The method especially appeals to people handicapped by a ruthless work ethic — Germans, Japanese, and Americans. Using a camera appeases the anxiety which the work-driven feel about not working when they are on vacation and are supposed to be having fun.”8

Debord coverOf course, that was written before the rise of video recorders, which frequently replace the camera. This sense has only escalated with the notion that something did not happen if it wasn’t on television, and is a natural outgrowth of a hyper-consumerist society—the “society of the spectacle,” to use Guy Debord’s famous phrase. How can United Statesians be distracted, and therefore be content to buy things as a substitute for meaningful participation in their own society, unless there is a cornucopia to catch their attention. Pictures provide a part of this distraction.

Ms. Sontag took this a step further, noting that “photography is acquisition in several forms,” as a surrogate possession, a consumer’s relation to events, as an acquisition of information and furnishing knowledge independent of experience.9 But photography’s utility extends to the nation as a whole, she declared:

“A capitalist society requires a culture based on images. It needs to furnish vast amounts of entertainment in order to stimulate buying and anesthetize the injuries of class, race, and sex. And it needs to gather unlimited amounts of information, the better to exploit natural resources, increase productivity, keep order, make war, give jobs to bureaucrats. The camera’s twin capacities, to subjectify reality and to objectify it, ideally serve these needs and strengthen them.”10

Of course, the camera can point more than one way, and is a convenient tool of demonstrators and others — the police generally don’t attack when the cameras are watching. Arthur C. Clarke’s maxim that there are no evil technologies, only evil uses of technology, however much we may quibble with it, rings true in regard to the camera. If the U.S. bourgeoisie ever decide to go completely to the dark side, they will surely not want the counter-revolution to be televised. Or photographed. The ubiquity of cameras would work against them, caught in a consumerist contradiction that we, Surrealist or not, can appreciate.

1 Susan Sontag, On Photography [Picador, New York], page 17
2 ibid, pages 106-107
3 ibid, page 109
4 ibid, page 32
5 ibid, page 35
6 ibid, pages 74-75
7 ibid, pages 81-82
8 ibid, page 10
9 ibid, pages 155-156
10 ibid, page 178