Commentary: On Solidarity with AAPI Communities

| Wenda Tai |

I’ve spent the last 3 days reaching out to my AAPI friends and family, responding to other non-AAPI friends, doom-scrolling through the news coverage and experiencing a traumatic cycle of emotions – sadness, grief, anger, anxiety and more ANGER.

There were some rays of hope and comfort from AAPI representatives and groups speaking up and educating the public about a history of violence and exclusion deliberately buried and distorted. What has been most upsetting for me is the deafening silence from friends and colleagues and many people in the progressive movement. Some have expressed solidarity, issuing statements and committing to
actions. We need more. Now is the time for a true united front against white supremacy and misogyny, against colonization and divide-and-conquer manipulations by the state. We need respected civil rights groups to speak up, not just the AAJC and the ADL. [Note: since this was written, many groups have put out clear and powerful solidarity messages: Poor People’s Campaign, M4BL, Racial Equity Anchor Collaborative, and the NAACP, among others.]

I heartily support Marion’s suggestions. And I applaud the observations about the racist undertone in Biden’s foreign policy toward China.

For me, the Atlanta murders hit very close to home. Not sure many of you know that I spent my teen years in Atlanta as a new immigrant. My memories of high school bullying, micro-aggressions, invisibility, and invalidation just came flooding back. Yet I am encouraged that this is now out in the open and people (Asians and non-Asians
alike) are confronting this. No more hiding because we’re forced to feel white- adjacent and presumed to have the same level of white privilege (“model minority” myth). No more hiding because we feel we don’t “count” as POC. No more hiding because we still have to deal with inter- and intra-Asian colorism and racism within each of the Asian American communities.
 
“Let’s take this opportunity to build solidarity across communities of color and ensure that AAPI voices are listened to. That we count, and are COUNTED, literally! How many official reports and research papers actually disaggregate AAPI data and statistics to get to the underlying issues and needs, instead of getting lumped together and ignored/dismissed?”

This is what I told my former boss, the director of the largest LGBTQ and HIV/AIDS advocacy organization in the Pacific Northwest yesterday and helped him edit a statement. Next, I’m going to work with the largest Community Land Trust in this area to do the same in my capacity as a board member. I hope all of us in the family do the same with the platforms we have and the organizations we work with.
 
Thank you to those who are already on it. Thank you for the thoughtful support and resource sharing. Some of us are starting to keep a tally of who’s done what – not in a negative way – as a document of AAPI movement building to take charge of our lives and futures, avenge the suffering of our ancestors and earn the respect of
future generations, to paraphrase the preamble to the M4BL Reparations Now Toolkit.

One step in many towards healing and restorative justice.

Commentary: On the Narratives Around the Atlanta Massacre

| Marion Yuen |

It hurts. We are all grieving.

The most important protection is solidarity by comrades, those who say they are our friends and colleagues.

The most important help at this time is for as many people on as many platforms as possible to insist that the message of the police and the murderer not be normalized.  

We need as many public messages of solidarity as possible and sincere acknowledgment of our talents, contributions & needs as real human individuals and as particular communities.

If there is anything we learned from the Greensboro Massacre, the first 1-2 weeks are critical. In 1979, once the “shootout-by-2 sides” message became established as the “normal” media theme and umbrella, we were forced to fight out of it, often defensively.

I’ve been calling on political allies, elected officials and those who want our votes-talents-help-contribution. This is the time to speak out and BE in solidarity.

Comrades, every bit helps.

As I write this message, the Brooklyn Borough President (who is running for Mayor) just announced a solidarity and support rally on Sunday. 

Our people have been busy organizing.

Commentary: On the Atlanta Massacre

| Sally Alvarez |

I want to acknowledge and mourn the horrific violence that happened in Atlanta on Wednesday. Now is also the time to check in with our AAPI family members and let them know we are listening for them. We hear and see you.

The more we learn about this attack, the clearer it becomes that it was an attack cooked in a horrific stew of racism, misogyny and toxic, deranged, religious fundamentalism driven even further aboveground by the racist rhetoric coming out around the pandemic. It reveals a lot about our culture and politics that Americans would rather not face, and it’s only the latest attack in a long and ugly history.

One of the most compelling and transformative elements of our CWP history was its broad reach across racial and national divisions. Many of us have had deep and meaningful relationship with so many people across those divisions that we never would have had without our common journey. This is an example of targeted violence that reverberates with the hatred and racism that also fueled November 3rd.

We must also seek our other ways we can contribute to a response or offer comfort to those in our family who are feeling this the most painfully and deeply.

Below is a powerful video by John Kim at the Advancement Project. I encourage you to view and circulate the clip as we build solidarity with AAPI communities and allies against white supremacy.

Commentary: The Unionizing Workers Who Became Amazon’s Biggest Threat

Commentary on the new Vice article, The Unionizing Workers Who Became Amazon’s Biggest Threat.

“It wasn’t lost on workers that Amazon wanted to spend hours filling workers’ ears with anti-union rhetoric, but resisted calls to give workers more time to eat lunch, socialize, and use the bathroom.”

Since the beginning of our transformation to a post-industrial society, and especially throughout the pandemic, we have seen a new wave of consolidation of capital. Nothing exemplifies this quite like Amazon, the digital retail behemoth that has propelled founder Jeff Bezos to become the world’s richest man.

But despite promises of innovation, career advancement, community investment, and starting wages of $15/hr, Amazon workers are reporting that Amazon workplaces are increasingly looking like the shop floors of the early Industrial Revolution. They recount how workers are surveilled constantly and hounded to keep up productivity at all costs, leading many employees to forgo bathroom breaks and sleep in their cars in the parking lots of Amazon’s “fulfillment centers.”

Amid these conditions, Vice has published a new article highlighting how workers are finally beginning to push back. Amazon workers in Bessemer, Alabama are mounting a major unionization effort with the RWDSU that would mark the first American union of Amazon employees — 5,800 of them.

The article is an important look at a union drive that is increasingly seen as a national referendum on unions, with major national figures and even President Biden voicing support for the vote. The Amazon drive could also be an important bellwether for the American labor movement as a whole, as it represents the changing face of the American working class (which is increasingly occupied in the service sector rather than the traditional union strongholds of manufacturing). Downwardly mobile millennials and former union manufacturing workers in their 40s, 50s, and 60s are the driving force behind the unionization effort for a workforce that is 85% Black. This intergenerational and interracial solidarity could be the key to their success.

It’s also notable where this effort is taking place. Bessemer has a poverty rate of nearly 25%, but stands out compared to the rest of the South as having a relatively high unionization rate of 8%. As union manufacturing jobs have left American shores, those former union workers are turning to Amazon, bringing with them their direct understanding of the power of organized labor. And historically, Bessemer has been a hotbed of labor organizing going back to the efforts of the Communist Party in the 1930s.

Nevertheless, there are major challenges. Amazon has colluded with the local government to decrease the length of red lights to limit the amount of time organizers can speak with employees on their way to work, and employees report being forced to sit in meetings full of anti-union propaganda. Vice reports that the 18-24 year-old cohort has been especially skeptical of the unionization effort, both because the decades-long assault on organized labor has left many young workers with little understanding of the importance of having a union and also because Amazon has all but threatened to slash pay or even shut down the facility if the union drive is successful. Effectively, they have become so accustomed to low expectations that even the promise of a better workplace seems fanciful.

Whatever the results, this unionization drive represents a major strategic effort for the American labor movement, and deserves close attention.

Read more via Vice: The Unionizing Workers Who Became Amazon’s Biggest Threat

The Left Should Be Talking About GameStop

| Harrison Neuhaus |

If you’ve been paying attention to the stock market over the past two months, it would be hard to avoid the incredible saga of video game retailer GameStop, which in early February became a flashpoint for a “very-online” revolt against hedge funds.

Doug Henwood summarizes the situation well, but the gist of the story goes like this: GameStop, a brick-and-mortar video game retailer, was being heavily shorted by a number of hedge funds due to the overall decline in brick-and-mortar retail even before the pandemic (as well as the gaming economy moving more and more online). GameStop got some good news with a few new investments and signals that it was beginning to move to e-commerce, which led to mild skepticism about the short positions. What really matters here is that a number of users on the reddit forum “Wall Street Bets” got wind of the short positions, realized that the shorts were oversold (113% of the company’s outstanding shares were being shorted), and started to take advantage of the situation by effectively pumping the stock. Overnight, GameStop stock skyrocketed as small individual investors motivated by the reddit board (and goaded on by each other) poured their money into the stock — not only driving up GameStop stock price by orders of magnitude, but also decimating the hedge fund short-sellers in the process. 

Almost immediately, Wall Street cried foul with sudden (and extremely out of character) demands for regulation. And their calls were heeded — a number of trading platforms like Robinhood halted all purchases of GameStop stock for days, only allowing holders to cash out. This, of course, only strengthened the resolve of the reddit investors, who have been firmly committed to holding the stock at any cost. Now the saga has evolved from a classic short squeeze by a new type of trader, to what a lot of the GameStop investors perceive as an existential fight to destabilize the system and screw over hedge funds using their own methods — even if they lose their entire investment doing it.

At this point, GameStop stock is a classic bubble ready to burst at any moment, held back only by the sheer will of reddit traders to hold their stocks and drive institutional short-sellers deeper into crisis. We already saw this when GameStop’s stock price fell by 40% on February 2nd. And while it rose back up to $348.50 per share earlier today (a sudden 40% increase), it fell back under $200 per share within 25 minutes, in an incredible rollercoaster of volatility. What makes this bubble unique, though, is the deliberate effort to create these conditions (led by small independent traders) simply to wreak chaos. It’s a microcosm of class war on the terrain of capital, and while GameStop itself is insignificant, the whole spectacle points to the deeper realities of our political economy — and a rising desire to burn it down. 

It would be a mistake to read this story as the righteous revolt of the working class against the capitalist class — many of the influential reddit users driving this short squeeze are clearly insiders that have access to Bloomberg Terminals and thousands (sometimes tens of thousands) of dollars to spare to play on the stock market. And while many working people have gotten in on the action (and even shared stories of how cashing out enabled them to pay off their medical debt, buy a home, or take the pressure off providing for their families), this is not a mass working class movement. At the same time, the short squeezers are clearly motivated in some way by a deep anti-corporate sentiment, delight in using Wall Street’s own tools against them, and for many of them even small gains (compared to Wall Street norms, anyway) have been life-changing.   

But beyond all the spectacle and the trickle of positive stories, the real importance of this whole saga is what it demonstrates about our economic system. The GameStop bubble is a) clarifying the irrelevance of the stock market to the real economy and real people’s lives, and b) exposing the real way that Wall Street is a rigged game for the ruling class, which will immediately turn on its hegemonic principles as soon as money starts flowing in the “wrong” direction. It’s vital that the Left tap into both of these phenomena and channel them into efforts that can actuallychallenge corporate hegemony. 

The first point does not come as a surprise — Americans have long understood that what is good for the stock market does not always translate into the mainstream (especially during the pandemic, when capitalist fortunes have skyrocketed amid misery and death for most working people). But what makes the GameStop situation unique is that it exposes the process by which the stock market works, and how absolutely crazy it is. The concept of short-selling alone is nearly incomprehensible to many. Value here is not created by actually producing anything, but by pure speculation and conscious manipulation of markets. It’s obvious to most consumers that a niche brick-and-mortar retailer like GameStop cannot actually be worth more than Delta Air Lines or Kellogg’s — and yet for all intents and purposes, the stock market has no choice but to treat it as such. The fraud and speculation is palpable, and yet the rules of the system make it so. 

This is, of course, no surprise to socialists. You couldn’t ask for a better demonstration of Marx’s concept of fictitious capital — that is, “money that is thrown into circulation as capital without any material basis in commodities or productive activity” as David Harvey puts it. This form of capital has no substantive relation to material production, resources, or assets — it’s wealth that exists only on paper, that is based on abstract claims to future wealth, but for all intents and purposes is treated as real and current. What GameStop demonstrates to the general public is that these forms of value (stocks) are disconnected from real production, and are mainly driven by speculation (rather than productive investment) that does not feed back into the real economy. 

Is it any wonder, then, why the GameStop story gained such traction and why participants are styling themselves as anti-corporate crusaders? More and more, it would seem that Americans are realizing that working class people, on the one hand, must participate in the real economy and are subject to the discipline of the market, while the owning class, on the other hand, largely deals in a fictitious economy that can be easily manipulated and gamed precisely because it does not correspond to the real economy. And in the Post Industrial Society that we’ve built since the stagflation crisis of the 1970s, this divide is only growing as profit rates fall and workers are squeezed harder, while finance giants increasingly hold the power to shape global markets. It’s as though the financial economy — where most of our collective economic gains are flowing — exists above and independent of the real economy, inaccessible to the average worker because it does not have a physical site of production and is not materially beholden to labor. “All that is solid melts into air,” indeed.

But while many of the reddit short squeezers have embraced a nihilistic drive to “just burn it all down,” it’s important for the Left to highlight the opportunities here. We must go beyond the simple anti-corporate sentiment and demonstrate that this reality is not simply a “corporate” problem, but a systemic problem of capitalism. And if we accept that so much of our economy is based on fictitious capital, created at the stroke of a pen (or keyboard) and existing independently of real assets and production, we can also ask what we could do if we were able to use that to actually benefit working people instead of the owning class. This is the key insight of Modern Monetary Theory (MMT), after all — in a world where the economy largely exists on balance sheets rather than bank deposits, the government could simply create more money for new programs and national projects whose benefits would flow to the public; if markets can be manipulated, we could instead manipulate them better ends; and in such a world, what possible justification could there ever be for austerity? We can’t content ourselves with mocking the absurdity of the status quo; we have to use this moment of clarification to posit new ways of organizing our economy that resonate with people’s needs. 

Just as significant as the absurdity of the market itself is the way that Wall Street has responded to it. Even on top of exposing (once again) the utter shadiness of our financial economy, the GameStop saga is also reigniting the class war in increasingly transparent ways. The short squeeze is, of course, nothing new to hedge funds — they pioneered the tactic in the 1980s and have used it ruthlessly, to great effect. What’s different now is that, for once, someone else is doing the squeezing and some of them are getting the raw end of it. This has them up in arms. They whined — without any self-awareness — about how reddit users are “manipulating the market” and were quickly able to shut down Robinhood. These swift, unprecedented steps to “correct” the market in these last few weeks over this trivial squeeze have been a slap in the face to anyone with a memory of the 2008 financial collapse. It’s been a “mask off” moment that clearly demonstrates the fundamental class antagonism between the interests of Wall Street and the interests of ordinary people. They all but admit that the game is rigged, and that therefore it must be unfair (or even illegal!) for them to lose. What the Left needs in this moment is to take this understanding further to help people recognize how these class interests are always taking action like this — they just hide it behind the scenes a little bit better. The analysis, of course, can’t end there and must ultimately point to mass movements against the capitalist mode of production as a whole, but the GameStop saga can be an important point of reference for the threat we all pose to the ruling class when we organize. 

Ultimately, the GameStop saga has not amounted to much and is likely to end up as a historical footnote, if that. It’s a bubble that is already bursting, and ordinary people will be left holding the bag. And Wall Street ultimately won’t feel the hit, outside of a few hedge funds — most of GameStop stock is owned by institutional giants like BlackRock, so the majority of the gains from this bubble are going to stay within the hands of the wealthy, anyway. But what we can take advantage of is what the situation reveals about our political economy, and connect that to the real squeeze that working people are facing every day in neoliberal America. And if we do this well, perhaps we can also begin to imagine new ways of seizing finance power for the collective good. 

Commentary: A Job Guarantee Can Challenge Growth and Fight Climate Change

| Steve Clark |

Coming out of this economic recession, we’re hearing a lot of talk about restarting “growth.” But strategically, it’s crucial to stop promoting growth as a thing in itself. We need to employ everyone, but not in the same way that has brought us to the brink of climate change disaster. We need to refocus production and investment in sustainable enterprise, but what about all the working people who need jobs in the meantime? For instance, fracking is way down now; do we want its revival? What is a former fracking worker to do while jobs in the new economy still don’t exist? As this piece in Foreign Policy points out, a Job Guarantee (JG) would immediately solve this problem… as any worker without a job would be entitled to one funded by the government (at $15/hr with benefits) until the private sector is able and willing to hire her. Instead of climate-destroying jobs in the old economy, a JG can provide useful, caring jobs and stability to families and the economy while we make the structural changes necessary to create a sustainable economy for everyone.

Read more: Foreign Policy – “Stimulus Is an Environmental Disaster Waiting to Happen”

NGO-Led Investment is Key to Community Development in US

| Matt Perrenod |

One encouraging aspect of the new Biden Administration’s response to the combined COVID/economic crisis is its unapologetic willingness to spend public funds, in sharp contrast to the Obama Administration’s response to the 2008 bank crash. There seems to be a solid understanding that any future initiatives depend upon a strong recovery over the next 12 months and that, in turn, depends on a sharp reversal of Trump Administration policies of bailing out corporations while leaving everyone else to fend for themselves.

Even if Biden is successful in pushing his immediate $1.9 trillion plan through Congress — and in getting a large infrastructure/stimulus package through later this year — there is an enormous challenge in actually delivering aid where, and to whom, it’s most badly needed.  We saw this last summer with the rollout of the Payroll Protection Program (PPP), which achieved some of its goals of sustaining small business payrolls, but performed very poorly in terms of reaching community-based enterprises, especially BIPOC (Black, Indigenous and People of Color)-owned and operated businesses.

This speaks to how major financial investment channels are currently structured: well-designed to deliver capital to large corporations with substantial infrastructure to deal with complex capital structures; less adept, but somewhat adequate at reaching many white-owned businesses with established banking relationships; and utterly abysmal at reaching Black, Hispanic, and immigrant-led operations that, in the case of PPP, were often at a loss in negotiating large bank bureaucracies.

In response to public outcry, Congress and the Small Business Administration (SBA) made a minor course correction, setting aside a portion of remaining PPP funds for Community Development Finance Institutions (CDFIs) with strong community relationships.  Tellingly, these funds were almost immediately pushed out the door where needed, as CDFIs did the painstaking work of helping borrowers understand the use of the funds and how to successfully apply. CDFIs were able to quickly double, triple, and quadruple their previous levels of SBA-backed lending.

For decades, CDFIs and other mission-based lenders have been minor players in the U.S. financial system, dwarfed in size and importance by both regulated depositories and the broader network of profit-driven financial institutions, including the largely un-regulated “shadow banking” sector. Now, however, they offer an opportunity to build robust channels for federally-driven investment in hard-hit communities nationwide.

What is a CDFI?

The term Community Development Financial Institution refers specifically to a certification by the CDFI Fund, a bureau of the U.S. Treasury and, more generally, to a class of mission-oriented lending and investment organizations. Under CDFI Fund guidelines, a CDFI may be either a non-profit or for-profit corporation, but must:

• Have a primary mission of promoting community development

• Provide both financial and educational services 

• Serve to one or more defined target markets

• Maintain accountability to the defined target market

• Be a legal, non-governmental entity (with the exception of Tribal governmental entities)

For purposes of this discussion, however, I will refer to CDFIs in their more generic sense as mission investors and will focus on nonprofits (thus the reference to NGOs in the title).

There is about a 50-year history of CDFI activity in the U.S., originating in the community development movement that emerged from the civil rights and anti-war activities of the 50s, 60s and 70s.  Today, there are hundreds of such organizations, some active nationally, but most regional or local in scope. They are generally much smaller than banks. A few of the larger CDFIs have assets in excess of $500 million, but most are under $50M. By comparison, the largest U.S. banks have assets in excess of $500 billion. (Note: both banks and CDFIs engage in off-balance sheet activity that magnifies their impact.)

Most CDFIs invest primarily through loan instruments, though a few also provide equity or equity-like capital. In general, CDFIs tend to engage in smaller transactions, and have a higher risk tolerance than banks. Affordable housing, charter schools and small business lending are the largest categories of CDFI investment.  Nonprofit CDFIs raise equity through retained earnings, fundraising and from a set of grant programs operated by the federal CDFI Fund. They raise debt primarily by borrowing from banks, but the CDFI Bond Guarantee Program extends a federal guarantee to a limited amount of debt raised (more on this below). In general, the primary limitation to CDFI growth is not demand for their product; rather it is the difficulty of raising equity, since most CDFIs are held to a minimum 20% net worth requirement (equity/liabilities).

Current Status of the CDFI Sector

Starting from essentially zero in 1980 CDFIs have grown substantially in number, size and impact since then. Highly innovative, they have pioneered investment practices which have meaningfully resolved the inherent conflict in their double-bottom lines: their own private financial prosperity (and from that, growth) and a public social mission of supporting community development and collective prosperity.

Despite growth, however, CDFI capacity remains far too small, by perhaps two orders of magnitude, to have systemic impact on a national, much less global, scale. Their activities during the Great Recession bear this out. CDFIs, rather than retreating from community investment as the major banks did, expanded their activities from 2008 to 2011, including new efforts designed specifically to address the nature of the crisis. Several CDFIs, for example, began buying defaulted mortgage loans and instituted principal reductions (not just payment restructuring) that allowed homeowners to avoid foreclosure as their home values had fallen precipitously. This was in sharp contrast to the activities of the for-profit market, which competed to buy up defaulted loans for the purpose of foreclosing and claiming the underlying real estate at a bargain cost, and then turning those homes into rentals (and not the affordable kind). While nonprofit CDFIs were able to help tens of thousands avoid foreclosure, private equity ended up as landlords of millions of single-family structures previously owner-occupied.

More generally, mission-driven CDFIs have been able to build great models of community investment, backed by sophisticated investment management operations, but as a whole have done little to change the overall landscape of American communities in terms of meeting the needs of the large portion of the market that is not well served by traditional profit-driven finance. 

Not that CDFIs aren’t well-positioned for growth. Most are managerially quite strong, with staffs that rival much larger firms in terms of skill, experience and capacity. They have relationships among low- and moderate-income people, including communities of color, that go well beyond anything found in the profit-driven investment sector. They have struggled with, and resolved, many of the practical difficulties of reaching investees, whether individuals or businesses, who may lack personal wealth and financial literacy. Given access to larger pools of capital, they can grow exponentially.

Where Now?

The main limiting factor to CDFI growth is the amount of equity they possess. CDFIs are extremely good, as a class, at leveraging their own net worth, and have themselves excellent borrowing relationships.  Successful borrowing, however, requires a solid equity base. Because of their (typically) nonprofit structure, however, CDFIs cannot raise equity by issuing ownership shares; nonprofits by definition are not privately owned. CDFIs have increased their net worth through engaging in profitable activities that generate retained earnings (less than if they were profit-maximizing) and from fundraising grants, mainly from the federal government.

Through grant-making programs administered by the CDFI Fund, the federal government has done a good job of making very small CDFIs less small. Many of the larger CDFIs have gotten where they are by consistently adding a few million in equity annually from federal programs established for that purpose. As they have grown, however, these limited grants are less effective at driving growth — $5 million in new equity can be transformational for an organization with only $5 million to start, but the incremental impact is considerably less when it’s grown to $100 million in net worth.

One of the most important things the federal government can do to support healthy communities would be to substantially increase its CDFI investment through the CDFI Fund. There is little, other than political will, that stands in the way of taking $1 billion of annual grant-making to $10 billion or even $100 billion, over a handful of years.  But the feds can do even more than that.

For several years, beginning in the second Obama term, Treasury has operated a program called the CDFI Bond Guarantee Program.  CDFIs are able to borrow, in $100 million chunks, with a full federal guarantee of the debt. This means that the CDFI’s cost of funds drops to the federal funds rate, allowing it to make community investments far below bank rates. Even more importantly, this activity can happen almost entirely off-balance-sheet, allowing CDFIs to leverage far more investment activity off a given equity base. This would allow CDFIs to grow not just 10X, but 100X over a small number of years. That’s not happening now, because the program remains small, at $500M to $1B annually. The federal government has the capacity to issue trillions in new debt instruments, however, and so it is again a question of political will.

A reasonable person might ask whether the federal government couldn’t just issue that debt for its own programs of direct investment – why act through another party?

The answer is that the federal government, even in the best of times, is not particularly good at retail investment. It is not customer-oriented, and really can’t be, given that all authority flows from the top down, from the authorizing and funding legislative branch through an administrative structure that is necessarily focused on approval from Congress, itself answering to voters and campaign contributors divorced from the consuming public. A voter may also be a consumer, but they think and act quite differently in those separate roles. Public sector agencies are necessarily rule-driven and bureaucratic, the opposite of the entrepreneurial innovation needed when old means have atrophied, and new investment channels have to be built anew or drastically widened.

CDFIs, however, have distinguished themselves in their outward customer focus. They have learned to reach out in their communities, to identify needs, and devise solutions to meet those needs. Working against the headwinds of a profit-maximizing capitalist system, they have nevertheless succeeded in delivering capital to millions unable to access it through any other channel. They are ideal vehicles for pursuing public goals through investment in private individuals and businesses.

Conclusion

Popular movements are forcing Congressional Democrats to consider real community investment, after years of much lip service, but precious little action. The challenges of scaling up in this area should not be underestimated. We have seen repeatedly that, even when the federal government generates the will, the paucity of existing investment channels hampers that investment, leading to a dragged-out, inefficient process lacking in urgency and ripe for criticism.

Fortunately, we have a class of NGOs already active in this space that are prepared to grow into a larger role in directing capital toward human needs at the community level. CDFIs have been doing this work at a small scale for decades, establishing community roots, and innovating new approaches geared toward today’s society and economy. Their dual character as private entrepreneurial innovators with a public mission makes them ideal targets to channel a renewal of public investment in our communities.

Matt Perrenod is a consultant to nonprofit community development and finance organizations working throughout the United States.

Is the U.S. Now in the Weimar Era?

| Dennis Torigoe |

Walden Bello and I go way back as grad students at Princeton’s sociology department and activists on campus and in the years since. In his recent interview after the events of January 6th, Walden, a famed activist, author and public intellectual from the Philippines, asserted that the United States “has entered the Weimar Era.” In Germany after the First World War, a section of the German capitalist class and its politicians backed right wing mobs to take to the streets in violent demonstrations. Since the Right could not take power through elections, they worked to delegitimize the democratic process and the government. This, Bello contends, paved the way for fascism to replace the representative government ending up with Hitler as Chancellor of the Reich.

As the US is one of the oldest, and certainly the biggest, continuous democracies (in some form) in existence, the sounding of its death knell is a bit premature despite the severity of the crisis. There are a number of reasons for this. These reasons are not to assert that the challenges and crises that democratic governments face from the extreme right in the US are not serious. I agree with Walden’s characterization of neoliberal policies leading to deindustrialization, and therefore feelings of loss and anger among some workers and small business people, who have been manipulated by Trump and other right-wingers. Political violence from the white supremacist right is a historic current in this country and a rising threat. We must counter it by gaining and strengthening cultural hegemony with such values as equality, inclusiveness and thoroughgoing democracy through organizing people and politically isolating the extreme right.  When they do resort to violence, we must make sure that they are dealt with aggressively legally, politically, by law enforcement and, if necessary, through armed self-defense.  

However, due to their actions against the government on January 6th, the extreme right is now in the crosshairs of the US Government and a large majority of the American people. The events of January 6th has not increased their strength, but has isolated them from the vast majority of the American people who believe in democratic government.

The Curious Case of the Missing Movement

One of Walden’s omissions in this interview is curious. Did he forget about the millions of demonstrators in every major city, localities and small towns across the country after George Floyd’s murder? Did he forget about Black Lives Matter? For some reason, he forgot about the people’s fight against police and racist violence occurring for months during the last year. He also dismisses the hard-won electoral victories through the relentless organizing efforts of hundreds of thousands in places like Georgia and Arizona, and indeed across the country. Here is the problem with this. According to this line of thought if we fight for more democracy, organize harder and succeed, then the Right gets more violent in the streets, the political situation gets chaotic and the military or a tyrant takes over. Thus, his view is that of self-defeat.   

That is the problem with his historical analogies, one that compares the United States as the world’s superpower to Third World countries like Chile in the 70’s and the Philippines under Marcos and to Weimar Germany. The United States today is starkly different from any of those examples that Walden Bello uses. For one thing, each of those examples were times of fatally deep economic crises, with runaway inflation in Chile and in the economic collapse of the Weimar Republic. There was relatively sudden, widespread and brutal  impoverishment if not outright starvation because of the economic catastrophes  they faced.    

As their economies were weak, their currencies were devalued to almost worthless pieces of paper and issuing more meant even more inflation and economic ruin.

In contrast, the United States controls the world’s recognized reserve currency, which gives it vast economic power. The US Government issues virtually as many dollars as it wants, knowing it will be accepted as the currency of world trade and commerce. Printing money in this way not only sustains its own economy, US capitalists have also used this tactic to manipulate other currencies and suppress other economies. That can be shown by the  Asian currency crises in the 90s and the trade and economic sanctions on Cuba and Venezuela, which are not allowed to conduct trade through the clearing system based on the US dollar.  

On top of that our economy is very unlikely to experience the kind of economic collapse that breeds fascism. The 2 trillion dollar rescue plan put out by Biden, impossible in Chile or a Weimar Republic, will not result in hyperinflation, but in real benefit to the welfare of the country’s citizens. The Federal Reserve Bank can and does further prop up the economy by lowering interest rates and directly buying US government, and mortgage-backed bonds through its quantitative easing program. The government can also forgive college loans, lower taxes, and a host of other steps to buoy the economy. This is not the economy of 70s Chile, the Philippines under Marcos and not even close to what Weimar Germany was.   

The same facts that Walden Bello uses to promote his view of deepening chaos and military rule in fact shows that the tide is running high against the right wing extremists. The breach of the Capitol was a sign of desperation, not a sign of strength. Their President had been thrown out after one term (the last time that happened was in 1992) and the left had dominated the streets for months, the Democrats had won both houses of Congress and the left is resurging.  

Is Military Intervention Likely?

Bello argues that chaos brought on by right wing street violence will trigger a military takeover. In fact, that is the least likely scenario given the circumstances the country is in now. For one thing, we must not forget or belittle the power of the constitutional and normative tradition of the US military’s position being under civilian control.  The Joint Chiefs of Staff are, in the military chain of command, directly below the Secretary of Defense and this Secretary under the President.  In the 233-year history since the ratification of the Constitution, this has never been breached, though it has been challenged twice — once by General McClellan against Lincoln during the Civil War and by Douglas MacArthur against Truman during the Korean War.  Both Generals were fired summarily.  

More recently, in light of Trump’s misuse of Federal power, numerous former Defense Secretaries and retired Generals and Admirals have stated their positions clearly: the active military shall not be used in internal politics and that the military should be staunch in its position that, as stated in the in Uniform Code of Military Justice, no illegal order order should be obeyed. The testament of these military leaders has put both institutional as well as political weight behind the military’s non-intervention in civilian political affairs.  

Another telling incident on military non-intervention in political affairs  was the apology of the sitting Chair of the Joint Chiefs for marching with Trump to his Bible-holding photo op after the site was cleared of Black Lives Matter protestors with federal officers. As reported in the Guardian:

Milley and defense secretary Mark Esper were widely criticized for participating in the photo-op, with many former defense officials saying the two were helping Trump’s efforts to politicize the military.

“As senior leaders, everything you do will be closely watched, and I am not immune,” Milley said.

“As many of you saw the result of the photograph of me at Lafayette Square last week, that sparked a national debate about the role of the military in civil society. I should not have been there,” Milley continued.

“My presence in that moment and in that environment created a perception of the military involved in domestic politics. As a commissioned uniformed officer, it was a mistake that I have learned from, and I sincerely hope we all can learn from it.”

These are not the words of a military ready to pounce on civilian leadership of the country if chaos in the streets erupts. 

Walden Bello has dedicated his life to effectively fight for the people of the Philippines and the world. His contributions are historic and will be remembered for generations to come. Though I believe he does not correctly view the United States at this historic juncture, I look forward to his continued contributions to the people’s movement for justice and democracy in the future.