Labour MP Richard Burgon is asking people to sign a petition, which he’ll later present to parliament. And given the subject matter, there’s no reason for most people not to get involved. Because Burgon wants to properly tax the “super-rich”.
Burgon is back
The former shadow justice minister under Jeremy Corbyn is not messing about. As he tweeted:
I'll soon be presenting a new petition in Parliament for higher taxes on the super-rich
It calls for: A Wealth Tax A Windfall Tax on those that made super-profits out of the crisis A new 55% tax on income of £200,000+ per year
He’s doing it with the group Labour Assembly Against Austerity. The petition says on its website:
We call on the House of Commons to introduce higher taxes on the super-rich as a step to tackling the widespread poverty and inequality that scar our society.
This crisis has not only shone a spotlight on the huge inequalities in our society – it has deepened them.
Indeed. Because since the coronavirus (Covid-19) pandemic, the situation for millions of people in the UK has become even more desperate.
The pandemic: chaos for some, a money-spinner for others
As The Canary has documented, inequality and poverty have got worse since March last year. For example:
The number of households living in destitution more than doubled in 2020.
A parliamentary report suggested more people died of coronavirus and suffered unnecessarily during the pandemic due to historical Department for Work and Pensions (DWP) cuts.
People using foodbanks rose even more; 33% for the Trussell Trust alone.
But the story wasn’t the same for everyone. For example:
The number of UK billionaires increased by 24%. Their wealth increased by 21% – collectively to over half a trillion pounds.
House prices increased by 13.4% – the largest rise since 2004.
Average FTSE 100 CEOs had already earned the median UK wage within the first 34 hours of the working year.
The chasm between the lives of the rich and the poor was already wide. Now, the pandemic has created a gulf. So, Burgon has three ways to begin addressing this.
Starting conversations
As the petition states, he’s calling for:
A Wealth Tax that would raise tens of billions from the wealthiest in our society.
A Windfall Tax on those corporations that have made super-profits during this crisis.
A More progressive income tax system including a new 55% income tax rate on all income over £200,000 per year; a 50% income tax rate for those on over £123,000 and 45% rate for income over £80,000.
It remains to be seen how far Burgon’s plans will go in parliament. The Labour Party is unlikely to support them. The Tories certainly won’t. What Burgon is doing, however, is starting a conversation around the gaping inequality that plagues our society. And any increase in awareness and conversations around this issue can only be a good thing. So, get involved – you can sign the petition here.
When it comes to resistance to receiving the COVID vaccine, you’ve probably heard about the conspiracy theories — the wild assertions that vaccines contain microchip tracking devices, that they can alter your DNA, that they can “shed” or spread from person to person, or even the claim by some that the vaccine makes you magnetic. Much of the discourse around vaccine hesitancy is centered around these bogus conspiracy theories, and as a result, they’ve often been discussed in connection with the U.S. failure to meet the Biden administration’s goal of vaccinating 70 percent of American adults by July 4. But there’s a much less discussed factor when it comes to vaccine hesitancy — and it has nothing to do with conspiracies.
Many socioeconomic barriers and structural injustices are still impeding vaccination in a variety of communities across the country, particularly in marginalized communities.
“When we look at the barriers that could be considered structural or access barriers, the most common one that we hear from people does relate to work — and that is the concern about having to take time off of work, specifically due to side effects,” Liz Hamel, director of public opinion and survey research at the Kaiser Family Foundation, told Truthout. “We also find concerns around needing to provide documentation. So, about a third of people who haven’t been vaccinated say that they’re concerned they might have to provide a Social Security number or a government-issued I.D. in order to get the vaccine.”
Although many vaccination sites are required to request Social Security information for the purpose of charging administrative fees to insurance companies or the federal government, providing this information is not an official requirement for vaccine eligibility. However, there is still quite a bit of confusion around the ID requirement, which is exacerbated by the fact that these requirements can vary from county to county — with many requiring some form of photo ID (not necessarily government issued). So, although the Centers for Disease Control and Prevention has stated that vaccines are available to anyone — including undocumented immigrants — there needs to be more information available to these communities (and those serving them) detailing specific requirements when it comes to providing identification.
Another compounding factor in vaccine hesitancy among certain marginalized communities — particularly Black and Latinx communities — is a concern about being able to get the vaccine from a place they trust.
“There’s already a lot of fear and mistrust out there, but on top of that, you add these structural barriers and it adds another layer,” Olveen Carrasquillo, chief of general internal medicine at the University of Miami, told Truthout. “People fear that they may be arrested by immigration officers, that they’re going to be charged a lot of money, that they are going to somehow owe this debt from being vaccinated, that it’s going to somehow be charged against them if they try to apply for immigration status.”
Carrasquillo and his team have been working hard to break down many of these informational and structural barriers. They’ve found that working with local and trusted community leaders is helpful in reaching marginalized groups who have yet to be vaccinated. One of these initiatives is the Community Engaged Alliance Against COVID Disparities, which is sponsored by the National Institutes of Health. Carrasquillo is part of the Florida component of this program, which is a statewide coalition of academics and community members, which, according to Carrasquillo, is trying to increase the vaccine uptake in marginalized communities.
“One of the biggest challenges is making sure the vaccine is available when people are not working, because not all employers will provide people with paid time off to do this — they have to lose a day of work, lose a day of pay,” he said. “Strategies like offering vaccination to people who work in what we call the ‘after hours,’ either evenings and weekends, is critically important.”
The Alliance that Carrasquillo is a part of, in Florida, has been able to bring in state workers to administer vaccines in immigrant communities and communities of color during events at which speakers like him provide information to community members to assuage their fears and mistrust.
“Combining the fact that we made it very convenient right there at their workplace so they can get the vaccine and at the same time there’s somebody addressing their concerns or fears — that was a win. Those are the kind of community-based strategies that really help,” Carrasquillo said.
However, even the best vaccine access doesn’t address another concern many workers face: the prospect of missing work (and even losing a job) thanks to potential vaccine side effects. Around 24 percent of Americans don’t have access to paid sick leave, and because employers are not required by law to provide this leave, despite being in the middle of a devastating pandemic, concerns about side effects impacting work ability have become a significant factor which can help to explain why the vaccine rollout has begun to slow down. It should be noted that many people don’t experience side effects from the vaccine, and among those who do, often these side effects only last up to a day. However, for folks with little job security, even a day of missed work can be a significant concern.
As with many aspects of COVID’s impacts, from infection and death rates to the availability of testing, barriers to vaccination fall squarely along race and class lines. The same Kaiser Family Foundation poll found that information and access barriers disproportionately impact Black and Latinx adults.
“What we’re seeing is that these populations don’t have the flexibility in terms of their current employment or having child care to take care of their kids so they can get vaccinated — and so there are barriers that these populations face with their vaccine access,” Ashley Kirzinger, associate director for the public opinion and survey research team of the Kaiser Family Foundation, told Truthout. “These are not the people that are adamant that they’re not going to get vaccinated. They just need some assistance — whether it’s in terms of time off from their employer or making it part of a routine medical visit, or whatever it may be.”
States have also begun to focus on sick leave–related barriers to vaccination. For example, the state of New Jersey has proposed a bill which would provide retroactive sick leave for workers who had to miss work after taking days off because of vaccine side effects or quarantining due to COVID. The bill would require employers to cover two weeks of sick leave if an employee can’t come to work because they are quarantining, experiencing COVID symptoms, awaiting a test result, or caring for a sick family member or child.
Other states already have similar policies in place. California’s COVID-19 supplemental paid sick leave law went into effect in March and mandates that all California employers with more than 25 employees provide more paid sick leave and add more qualifying reasons for leave, such as attending an appointment to receive a COVID-19 vaccine or experiencing symptoms related to the vaccine itself. Although temporary, policies such as these are an important first step in addressing the vaccine barriers faced by many workers.
All this is not to say that there aren’t individuals out there who aren’t adamantly opposed to the vaccine regardless of any structural barriers. According to Kirzinger, these individuals comprise roughly 15 percent of those polled and tend to be largely Republican and white Evangelicals, often citing ideological or conspiratorial reasons. However, focusing our attention on the structural barriers faced by those who are open to being vaccinated could bring up the number of vaccinations in the U.S.
Further, focusing on the informational and structural barriers — particularly the concerns around sick leave from work and out-of-pocket costs — forces us to begin asking larger questions. COVID has, in so many ways, revealed the inadequacies and shortcomings of the way we organize a wide variety of institutions in the U.S., from health care to social services and much more. Vaccine access is just another issue on top of a long list of issues that have starkly exposed the structural racism and classism that permeate every aspect of our society.
“COVID is just a symptom, right? The fact that COVID disproportionately affected our communities and the fact that the COVID vaccine uptake was low in our communities — those are symptoms that were based on these underlying structural determinants of health that put us at risk,” Carrasquillo said. “Every time we have a major disaster or a major disease outbreak, it disproportionately hits the same communities. At some point, we have to ask why it is that COVID disproportionately impacts the most vulnerable.”
There are a number of ways to begin answering that question, but it’s hard to imagine an answer that doesn’t include a fundamental critique of our current economic system. The fact that health care is a for-profit industry and that paid sick leave is not guaranteed in this country are major systemic barriers to vaccine access and overall health outcomes in general. Free vaccines and policies attempting to address issues around sick leave are important, but are limited and temporary solutions. Advocates emphasize that more is needed to address the chronic, structural barriers to health in this country.
“The structural racism and the structural inequalities that result from these policies are key things,” Carrasquillo said. “These are things that doctors themselves won’t be able to address — they require more upstream interventions.”
When it comes to resistance to receiving the COVID vaccine, you’ve probably heard about the conspiracy theories — the wild assertions that vaccines contain microchip tracking devices, that they can alter your DNA, that they can “shed” or spread from person to person, or even the claim by some that the vaccine makes you magnetic. Much of the discourse around vaccine hesitancy is centered around these bogus conspiracy theories, and as a result, they’ve often been discussed in connection with the U.S. failure to meet the Biden administration’s goal of vaccinating 70 percent of American adults by July 4. But there’s a much less discussed factor when it comes to vaccine hesitancy — and it has nothing to do with conspiracies.
Many socioeconomic barriers and structural injustices are still impeding vaccination in a variety of communities across the country, particularly in marginalized communities.
“When we look at the barriers that could be considered structural or access barriers, the most common one that we hear from people does relate to work — and that is the concern about having to take time off of work, specifically due to side effects,” Liz Hamel, director of public opinion and survey research at the Kaiser Family Foundation, told Truthout. “We also find concerns around needing to provide documentation. So, about a third of people who haven’t been vaccinated say that they’re concerned they might have to provide a Social Security number or a government-issued I.D. in order to get the vaccine.”
Although many vaccination sites are required to request Social Security information for the purpose of charging administrative fees to insurance companies or the federal government, providing this information is not an official requirement for vaccine eligibility. However, there is still quite a bit of confusion around the ID requirement, which is exacerbated by the fact that these requirements can vary from county to county — with many requiring some form of photo ID (not necessarily government issued). So, although the Centers for Disease Control and Prevention has stated that vaccines are available to anyone — including undocumented immigrants — there needs to be more information available to these communities (and those serving them) detailing specific requirements when it comes to providing identification.
Another compounding factor in vaccine hesitancy among certain marginalized communities — particularly Black and Latinx communities — is a concern about being able to get the vaccine from a place they trust.
“There’s already a lot of fear and mistrust out there, but on top of that, you add these structural barriers and it adds another layer,” Olveen Carrasquillo, chief of general internal medicine at the University of Miami, told Truthout. “People fear that they may be arrested by immigration officers, that they’re going to be charged a lot of money, that they are going to somehow owe this debt from being vaccinated, that it’s going to somehow be charged against them if they try to apply for immigration status.”
Carrasquillo and his team have been working hard to break down many of these informational and structural barriers. They’ve found that working with local and trusted community leaders is helpful in reaching marginalized groups who have yet to be vaccinated. One of these initiatives is the Community Engaged Alliance Against COVID Disparities, which is sponsored by the National Institutes of Health. Carrasquillo is part of the Florida component of this program, which is a statewide coalition of academics and community members, which, according to Carrasquillo, is trying to increase the vaccine uptake in marginalized communities.
“One of the biggest challenges is making sure the vaccine is available when people are not working, because not all employers will provide people with paid time off to do this — they have to lose a day of work, lose a day of pay,” he said. “Strategies like offering vaccination to people who work in what we call the ‘after hours,’ either evenings and weekends, is critically important.”
The Alliance that Carrasquillo is a part of, in Florida, has been able to bring in state workers to administer vaccines in immigrant communities and communities of color during events at which speakers like him provide information to community members to assuage their fears and mistrust.
“Combining the fact that we made it very convenient right there at their workplace so they can get the vaccine and at the same time there’s somebody addressing their concerns or fears — that was a win. Those are the kind of community-based strategies that really help,” Carrasquillo said.
However, even the best vaccine access doesn’t address another concern many workers face: the prospect of missing work (and even losing a job) thanks to potential vaccine side effects. Around 24 percent of Americans don’t have access to paid sick leave, and because employers are not required by law to provide this leave, despite being in the middle of a devastating pandemic, concerns about side effects impacting work ability have become a significant factor which can help to explain why the vaccine rollout has begun to slow down. It should be noted that many people don’t experience side effects from the vaccine, and among those who do, often these side effects only last up to a day. However, for folks with little job security, even a day of missed work can be a significant concern.
As with many aspects of COVID’s impacts, from infection and death rates to the availability of testing, barriers to vaccination fall squarely along race and class lines. The same Kaiser Family Foundation poll found that information and access barriers disproportionately impact Black and Latinx adults.
“What we’re seeing is that these populations don’t have the flexibility in terms of their current employment or having child care to take care of their kids so they can get vaccinated — and so there are barriers that these populations face with their vaccine access,” Ashley Kirzinger, associate director for the public opinion and survey research team of the Kaiser Family Foundation, told Truthout. “These are not the people that are adamant that they’re not going to get vaccinated. They just need some assistance — whether it’s in terms of time off from their employer or making it part of a routine medical visit, or whatever it may be.”
States have also begun to focus on sick leave–related barriers to vaccination. For example, the state of New Jersey has proposed a bill which would provide retroactive sick leave for workers who had to miss work after taking days off because of vaccine side effects or quarantining due to COVID. The bill would require employers to cover two weeks of sick leave if an employee can’t come to work because they are quarantining, experiencing COVID symptoms, awaiting a test result, or caring for a sick family member or child.
Other states already have similar policies in place. California’s COVID-19 supplemental paid sick leave law went into effect in March and mandates that all California employers with more than 25 employees provide more paid sick leave and add more qualifying reasons for leave, such as attending an appointment to receive a COVID-19 vaccine or experiencing symptoms related to the vaccine itself. Although temporary, policies such as these are an important first step in addressing the vaccine barriers faced by many workers.
All this is not to say that there aren’t individuals out there who aren’t adamantly opposed to the vaccine regardless of any structural barriers. According to Kirzinger, these individuals comprise roughly 15 percent of those polled and tend to be largely Republican and white Evangelicals, often citing ideological or conspiratorial reasons. However, focusing our attention on the structural barriers faced by those who are open to being vaccinated could bring up the number of vaccinations in the U.S.
Further, focusing on the informational and structural barriers — particularly the concerns around sick leave from work and out-of-pocket costs — forces us to begin asking larger questions. COVID has, in so many ways, revealed the inadequacies and shortcomings of the way we organize a wide variety of institutions in the U.S., from health care to social services and much more. Vaccine access is just another issue on top of a long list of issues that have starkly exposed the structural racism and classism that permeate every aspect of our society.
“COVID is just a symptom, right? The fact that COVID disproportionately affected our communities and the fact that the COVID vaccine uptake was low in our communities — those are symptoms that were based on these underlying structural determinants of health that put us at risk,” Carrasquillo said. “Every time we have a major disaster or a major disease outbreak, it disproportionately hits the same communities. At some point, we have to ask why it is that COVID disproportionately impacts the most vulnerable.”
There are a number of ways to begin answering that question, but it’s hard to imagine an answer that doesn’t include a fundamental critique of our current economic system. The fact that health care is a for-profit industry and that paid sick leave is not guaranteed in this country are major systemic barriers to vaccine access and overall health outcomes in general. Free vaccines and policies attempting to address issues around sick leave are important, but are limited and temporary solutions. Advocates emphasize that more is needed to address the chronic, structural barriers to health in this country.
“The structural racism and the structural inequalities that result from these policies are key things,” Carrasquillo said. “These are things that doctors themselves won’t be able to address — they require more upstream interventions.”
High-stakes institutional investors are increasingly exposing themselves to the volatile cryptocurrency market, raising fears that the digital asset industry could wreak havoc throughout the economy — a development that would harm people who can’t afford to own any financial asset, digital or otherwise.
One in seven hedge funds now hold between 10-20 percent of their entire portfolios in cryptocurrency and one in four hedge funds are on the verge of investing in the asset class, according to a recent survey conducted by the auditing firm PricewaterhouseCoopers. The cohort demonstrates that segments of the financial industry have a large appetite for risk. The survey also shows that 21 percent of all hedge funds own some cryptocurrency, with the average invested firm having just 3 percent of its portfolio in digital assets.
The statistic on firms with up to one-fifth of their portfolios invested in cryptocurrencies was referenced during a June 30 hearing on cryptocurrency before the House Financial Services Committee. Chair Maxine Waters (D-California) cited the findings after announcing that the panel has “begun a thorough examination of this marketplace.”
Waters said she is particularly interested in “the systemic risks presented by hedge funds rushing to invest in highly volatile cryptocurrencies and cryptocurrency derivatives.” The price of Bitcoin, the most popular cryptocurrency, has fluctuated wildly in 2021, including a 48.4 percent decline during nine days in May, when the price of Bitcoin plunged from $59,519.35 to $30,681.50.
Alexis Goldstein, a Truthout contributor and an expert witness called on by Democrats to testify, said cryptocurrency markets are particularly attractive to hedge funds because rules on disclosure don’t require them to reveal what cryptocurrency they own. Popular cryptocurrency exchanges also allow customers to borrow heavily to buy digital assets.
“Hedge funds are the perfect client to use those sorts of leverage,” Goldstein remarked. Lending in cryptocurrency, which is known as decentralized finance, has increased this year alone by a factor of 25, according to one measure: The value of assets pledged as collateral in decentralized finance loans has ballooned from $2 billion to $50 billion.
If the cryptocurrency market takes another nosedive — like it did in May, shedding some $1 trillion, or 40 percent of its global market cap — investors will scramble to cover their losses on leveraged bets. This could generate a ripple effect, bringing down commercial ventures outside of the financial sector, which would harm those least likely to own any financial asset, digital or conventional. Economic downturns disproportionately harm the poor, and 45 percent of Americans own no stock, according to a Gallup poll conducted last year, while only 14 percent of Americans own cryptocurrencies.
“What happens if a huge number of hedge funds who have prime broker relationships with too-big-to-fail banks all happen to be in similar crypto positions, whether it’s long or short, and there’s massive volatility in the market? They may have to sell some of their other assets,” said Goldstein, the director of financial policy for the Open Markets Institute and a former Wall Street banker who left the industry in 2010. She told the committee that losses on cryptocurrencies could lead to “forced liquidations” of non-crypto assets (stocks and bonds of other companies in hedge funds’ portfolios).
In March, for example, the failure of a private family fund called Archegos Capital dealt a blow to banks and non-financial firms alike, sending shock waves across the economy. Archegos had bet on the stock prices of certain companies to rise, including media conglomerates ViacomCBS and Discovery, by borrowing four to five times the amount of capital that it owned. When those bets started to go sour, Archegos’ creditors — major banks such as Credit Suisse, Morgan Stanley and Goldman Sachs — sold off some $35 billion in stock, as it became clear that their client would struggle to pay them back. The banks themselves also took hits: Credit Suisse lost more than $5 billion, and Morgan Stanley and Goldman lost about $1 billion each, The stock prices of ViacomCBS and Discovery fell 35 percent as Archegos’ creditors liquidated the shares they bought on behalf of the company.
As Goldstein warned, similar fire sales could happen because of hedge funds invested in wildly fluctuating cryptocurrency, especially considering rules on disclosure and leverage. Archegos didn’t have to reveal its stake in ViacomCBS and Discovery, like investors in cryptocurrency don’t have to do, because it had purchased derivatives based on the firms’ share prices, instead of directly investing in the companies’ stock. And while Archegos leveraged up to five times its capital, some cryptocurrency exchanges, like Binance, which has processed trillions in transactions this year alone, let clients purchase digital assets with $125 in borrowed money for every $1 of the client’s own money.
Financial markets may be able to weather a few major failures in normal times, but a sudden uptick in the number of hedge fund failures and corporate bankruptcies could lead to a wider crisis of confidence, increasing the potential for more asset sales, the failure of financial markets, mass layoffs and a recession. The potential for the broader economy to suffer from financial sector wheeling and dealing in any market is particularly acute at the moment. Corporate debt reached record levels in 2020 driven by promises of pandemic bailouts of bondholders from the Federal Reserve, and it climbed to new heights this year with “higher-risk, speculative-grade bonds … now on pace to set their own record,” as the Wall Street Journal said on June 14.
Goldstein told the committee that this market structure reminded her of working the derivatives trading desk at Merrill Lynch before the 2008 financial collapse — a catastrophe caused, in part, by exponential growth in the market for derivatives like credit default swaps that were traded “over-the-counter,” or without a central exchange to monitor excessive risk. Insurance giant AIG imploded in 2008 after entering into too many credit default swap agreements, which investors purchased as insurance to protect themselves from the failure of mortgage backed-securities. The contracts bankrupted AIG after the mortgage market collapsed in a failure that led to a $182 billion government bailout for the firm.
Another expert witness called by the Democrats to testify — Sarah Hammer, managing director of the Stevens Center for Innovation in Finance at the Wharton School of Business — echoed Goldstein’s concerns. Hammer said the lack of central clearing mechanisms remind her of the market conditions that allowed AIG to accumulate so much exposure to credit default swaps. Rules requiring derivatives to go through central clearing exchanges have been strengthened by Congress and the executive branch since the crisis. Hammer also warned that the market for cryptocurrencies is larger now than the market for subprime mortgages was before the 2008 financial crisis. She called for an interagency body created after that crisis to examine the cryptocurrency situation.
“I do believe systemic risk is a key concern. I do believe that the Financial Stability Oversight Council (FSOC) is the proper authority to consider systemic risk,” she said, noting that FSOC “has a specific mandate to do so.”
“The fact is that cryptocurrency has really infiltrated many different aspects of our financial system,” Hammer added. “Regardless of what we may think the benefits and costs of that may be, that is the reality of the situation today. Not only do investors hold crypto in their individual portfolios, we see it in private funds,” like hedge funds, and “we see it in banks.”
One major concern with cryptocurrency surrounds questions about its true value, with many people believing that the current price of popular digital assets like Bitcoin is wildly inflated on the back of irrational speculation. Cryptocurrency, for example, doesn’t pay out regular dividends like stocks and bonds. Michael Burry, the hedge fund manager made famous for predicting the 2007-2008 collapse of the mortgage market (he was portrayed by actor Christian Bale in the 2015 film The Big Short) recently predicted that cryptocurrency will lead to the “mother of all crashes.”
“If you don’t know how much leverage is in crypto, you don’t know anything about crypto, no matter how much else you think you know,” Burry also said, in a series of deleted tweets.
Some, including world-renowned economist Nouriel Roubini, have questioned whether cryptocurrency has any inherent utility.
However, because cryptocurrencies are based on “blockchain” — public ledgers that keep records of transactions and asset ownership with encrypted information — they can offer users privacy protection, if nothing else. Federal Reserve Vice Chair of Supervision Randal Quarles, who said in late May that regulators were engaged in a “sprint” toward a framework for cryptocurrency regulations, said on June 28 that Bitcoin’s “attractions are its novelty and its anonymity.”
Hedge funds appear to have seized on the latter benefits, according to Goldstein, who told the committee that it’s incredibly difficult for regulators to discern who is investing in cryptocurrencies. Institutional investors aren’t required to reveal cryptocurrencies holdings in mandated quarterly disclosures because digital assets aren’t “seen as an ownership interest,” she said. In the words of the Securities and Exchange Commission, the disclosure reports “generally include equity securities that trade on an exchange,” other assets based on company equity, “shares of closed-end investment companies, and certain convertible debt securities.”
“Regulators are essentially totally in the dark about what hedge funds’ cryptocurrency positions are,” Goldstein said. “They have to rely on the financial press or try to figure out based on the transactions on the blockchain,” she added. Hammer also noted that the federal government currently lacks an official data source for cryptocurrency activity, saying that, without one, “we’re a little bit in the dark about what the proper regulatory framework should like.”
Despite the opacity and the leverage allowed by cryptocurrency exchanges, conservatives were indignant at the thought of telling the financial industry what to do.
“It really frustrates me when I hear members of this committee imply that Americans are not smart enough to know that investing in cryptocurrencies carry risk,” said Rep. William Timmons (R-South Carolina), an incredible statement that glosses over the collateral damage done by the financial sector over the past 40 years. Wall Street has caused a crisis about once per decade since the 1980s, when the Reagan administration solidified the consensus in Washington around neoliberalism and deregulation, leading to the failure of 1,043 savings and loan associations later in the decade and in the early 1990s.
A hands-off approach to the financial industry also fueled the dot-com bubble around the turn-of-the-century, and the Great Recession a few years later. The latter, a much more severe crisis, was characterized by rosy pronouncements about the benefits of financial innovation. In 2005, then-Federal Reserve Chair Alan Greenspan declared that subprime mortgages brought credit to “once more-marginal applicants” because “lenders are now able to quite efficiently judge the risk posed by individual applicants and to price that risk appropriately.”
“Especially in the past decade, technological advances have resulted in increased efficiency and scale within the financial services industry,” Greenspan said. “Innovation has brought about a multitude of new products, such as subprime loans and niche credit programs for immigrants.”
Still, the cryptocurrency industry and its allies appear to be approaching the matter of regulation with a techno-utopian view of financial innovation. During the June 30 congressional hearing, Republican witness Peter Van Valkenburgh, director of research for the D.C.-based think-tank Coin Center, said that cryptocurrency counters rising inequality because “an open blockchain network is accessible to people that banks and tech companies ignore rather than serve,” neglecting to acknowledge that it requires capital to acquire digital assets in the first place.
Research indicates that the average crypto investor has an income of $110,000, which is about three times the size of the median personal income in the United States. As Goldstein noted in her opening statement, blockchain records show cryptocurrency markets themselves reflect gaping levels of wealth inequality.
“The concentration of particular cryptocurrency assets into a small handful of addresses raise concerns about power concentrations,” Goldstein said, pointing to Dogecoin, a digital asset that started out as a joke but increased in price earlier this year by 12,000 percent before. It [dogecoin] lost about one-quarter of its value during a 24-hour period in May, during cryptocurrency sell-offs, and is now worth about 25 percent of what it was at its peak. “As of February, the top 20 largest Dogecoin addresses held half of the cryptocurrency’s entire supply,” Goldstein said.
In recent years, many centrist economists have claimed that canceling student debt is economically regressive in that it would disproportionately favor higher-income households. Yet, study after study has revealed that this is not the case. In particular, a new study by the Roosevelt Institute explains that the “regressive myth rests on a series of misleading methodological foundations,” demonstrating that, contrary to these regressive claims, student debt cancelation at each proposed level of cancelation — Biden’s $10,000 proposal, Warren and Schumer’s $50,000 proposal, or the Institute’s own proposal of $75,000 — would see those most economically marginalized benefiting the most.
The Roosevelt Institute study authors contend that previous assessments depend too heavily on annual household income, which does not fully account for a household’s overall assets. Instead, they incorporated student debt distribution data by race and household wealth, which is often ignored in studies that show cancelation to be regressive, to demonstrate that canceling student debt is fundamentally progressive while also taking into account the impact of student debt on the entire population, not just student debt borrowers. The authors note that this measure “more accurately depicts the size of the burden experienced by those in lower-income households, for whom each dollar of debt is actually a more substantial barrier to economic security, access to consumer credit, and increases in net worth.” Furthermore, the authors did not include private debt, since only federal student loans are eligible for cancelation under the present student debt cancelation proposals from Elizabeth Warren and Chuck Schumer as well as the Biden administration, while valuing student debt by its costs toward borrowers, not lenders (Bernie Sanders, on the other hand, included private debt in his proposal).
By looking at the share of wealth, not just student debt in absolute numbers, it becomes clear that borrowers in the lower percentiles are much more burdened than their counterparts in the higher percentiles. In other words, student debt makes up a larger share of their annual household incomes or share of household wealth compared to higher percentile households which makes repayment difficult and almost impossible. This is precisely why the study finds that the greatest benefits of student debt cancelation accumulate to those in the bottom 40 percentile for all racial groups. Moreover, by examining the distribution of student debt by wealth and race instead of the standard income variable, cancelation provides ample evidence that the racial wealth gap would narrow in the process. The study’s authors note that Black borrowers would, in fact, benefit significantly more from student debt cancelation than their counterpart white borrowers at every point on the income and asset distribution continuum, reflecting the fact that Black borrowers must borrow more for expenses than white students of equivalent income levels due to the racial wealth gap in family resources. For instance, Black borrowers in the poorest 10 percent of household wealth would receive around $17,000, whereas white borrowers in the same percentile would receive approximately $12,000 under the Warren-Schumer plan. Meanwhile, the wealthiest households across all race groups would benefit from debt forgiveness by an average of $562.
It is critical to emphasise the significance of this study. It is another in a long series of studies that have provided evidence that student debt cancelation is progressive from an economic standpoint. A prominent scholar on the topic, Marshall Steinbaum of the University of Utah, showed that the Warren-Schumer plan would see the lowest earners who owe more than their annual income in student debt owe just one-fifth of their annual income. According to a Brandeis University analysis, 76 percent of student loan holders would have their debt canceled with Warren’s $50,000 proposal.
We have very good reason to believe that canceling student debt provides significant economic benefits that help stimulate the economy, too. Previous research showed that canceling all student debt creates over 1 million jobs per year while increasing GDP by up to $108 billion. Over 10 years, cancelation generates between $861 billion and $1,083 billion in real GDP in 2016 dollars. Freed from the heavy burden of debt, students would utilize the extra money for day-to-day living expenses and pay off other obligations.
As student debt remains in place, it is causing significant and unequal harm to marginalized borrowers, which can only be reduced and remedied by cancelation. For instance, as shown by a recent report from the Student Borrower Protection Center, students of color disproportionately struggle to pay their student debt at a higher rate than white students — creating a vicious cycle of economic inequality along racial lines. The authors note, “America’s student debt crisis is a civil rights crisis.” Additionally, on average, Black graduates owe $7,400 more than white graduates. Thirty-two percent of Black borrowers and 15 percent of Latinx borrowers are in “default” with their payments. In New York, the six communities with the greatest levels of student loan default are largely non-white and centred in the Bronx, even though they have relatively smaller average loan balances.
Moreover, the cost of cancelation is not a straightforward concept since the total amount of student debt owed by borrowers and the costs of cancelation are not the same thing. As Sparky Abraham argues, lending money is a gamble on the future. If a substantial number of borrowers struggle to pay off their debt or die in debt, forgiving all the debt would cost less than the total amount owed, $1.7 trillion. The only way the federal government loses revenue through cancelation is when all borrowers pay back their debt.
That is the direction we are now taking, which implies that the federal government is currently collecting payments and hence, inevitably losing money on a considerably smaller percentage than commonly assumed. The standard system — get the loan, pay it back in fixed amounts over time — only works for roughly a fourth of the loans. A whopping 75 percent of student debt is carried by those who are either not paying or are paying a fixed amount based on their annual income because they can’t afford their normal payments. This suggests that cancelation would cost substantially less than the total owed by borrowers since the federal government would end up losing revenue due to accruing interest and the inability to pay the total balance by student loan borrowers.
But, of course, the economic costs of cancelation should not even be the principal deciding factor. Even if student debt forgiveness is somehow shown to be economically “regressive,” it would be irrelevant. Forgiveness is an ethical matter, regardless of “cost.” The issue at hand is the harm caused to students and its moral implications. By forcing repayment on their student debt, society is dooming its next generation to miserable and suffering lives for essentially nothing other than to increase neoliberalism’s assault on the general population, as Noam Chomsky points out. Thus, student debt — and not its forgiveness — is the truly regressive policy and an unjust imposition.
Recently leaked data revealed that Amazon CEO Jeff Bezos and several other U.S. billionaires have paid zero federal income taxes in some past years.
This has Senate Minority Leader Mitch McConnell up in arms — but not because of what the scandal reveals about our rigged tax system. Instead, McConnell wants to go after the whistleblowers who exposed the scandal.
“These people ought to, whoever did this, ought to be hunted down and thrown into jail,” McConnell said in a radio interview.
What I suspect really bothers McConnell is that this data is likely to increase the pressure on him and other lawmakers to raise taxes on the wealthy. For the first time in decades, serious proposals to do just that are actually on the table in Washington. And the timing couldn’t be better.
Poor and low-income Americans have paid the biggest price for the pandemic, while U.S. billionaires have seen their fortunes increase by more than $1 trillion. Now is the moment for America’s ultra-rich to contribute their fair share to an economic recovery that will make the nation stronger in the face of future crises.
How are billionaires getting away with paying so little to Uncle Sam now? A key reason is that our current tax system rewards wealth, not work.
The top tax rate on paycheck income is nearly double the rate at which Wall Street windfalls are taxed. But while you and I rely on our paychecks to make ends meet, the very rich make most of their money from financial investments.
In fact, America’s top 1 percent hold more than half of all U.S. wealth invested in stocks and mutual funds.
In short, their wealth makes their money for them. Yet they’re taxed at far lower rates.
President Joe Biden wants to get rid of this perverse tax preference for the wealthy. He’s proposing that we tax wealth the same as work for people who earn more than $1 million a year.
Another Biden proposal would close a loophole that allows the wealthy to escape capital gains taxes altogether on assets they pass on to their heirs. Under his plan, individuals who inherit family businesses and farms — and continue to operate them — would not be affected.
In 12 recent polls, voters, including independents, support these and other Biden tax proposals by 60 percent or more.
Some Congressional Democrats are calling on the president to go further to tax the top 1 percent. Senators Bernie Sanders and Elizabeth Warren have proposed an annual wealth tax on fortunes over $50 million, as well as levies on Wall Street speculation and excessive CEO pay.
Equitable reforms like these are critical if we want to modernize our public infrastructure and give families the economic security they need to fulfill their potential in the world’s richest country.
If we don’t unrig our tax code, billionaires will keep getting away with stiffing Uncle Sam — and sticking the rest of us with the bill.
While a majority of U.S. adults still have more positive than negative perceptions of capitalism, less than half of the country’s 18 to 34-year-olds view the profit-maximizing market system favorably, and the attractiveness of socialism continues to increase among people over 35, according to a new poll released Friday.
The online survey, conducted June 11-25 by Momentive on behalf of Axios, found that 57% of U.S. adults view capitalism in a positive light, down from 61% in January 2019, when the news outlet first polled on these questions. Then and now, 36% are critical of the exploitation of the working class and the environment by the owning class.
Perceptions of capitalism have remained consistent among adults ages 35 and older, meaning that the system’s dwindling popularity is driven by the nation’s young adults. According to the poll, 18 to 34-year-olds today are almost equally likely to hold a negative opinion of capitalism as a positive one (46% vs. 49%). Just two years ago, that margin was 38% vs. 58%.
Perhaps unsurprisingly given the severity of the climate emergency, capitalism is particularly unpopular among 18 to 24-year-olds, with negative views outweighing positive views by a margin of 54% to 42%.
Even young Republicans appear to be changing their views. Whereas 81% of Republicans and GOP-leaners between the ages of 18 and 34 perceived capitalism positively in 2019, that figure has plummeted to 66% in 2021.
Just half of younger Americans now hold a positive view of capitalism — and socialism's appeal in the U.S. continues to grow, driven by Black Americans and women, according to a new Axios/Momentive poll. https://t.co/vOQSBsCehy
Between the January 2019 poll and the latest survey, the world has been rocked by severe public health and economic crises caused by the Covid-19 pandemic. Jon Cohen, the chief research officer for Momentive, predicted that “the pandemic is sure to have lasting impact for decades to come.”
As a result of the deadly catastrophe that has unfolded over the past year and a half, Axiosargued, millions of Americans have been forced “to re-evaluate their political and economic worldview.”
The news outlet attributed shifting views to two factors. First, the coronavirus crisis exposed profound injustices in the U.S. and globally. And second, government responses to the calamity demonstrated the extent to which state intervention has the potential to mitigate or exacerbate hardship.
Although 52% of Americans still take issue with socialism, the percentage of U.S. adults with favorable views of socialism increased from 39% in 2019 to 41% in 2021. While positive perceptions of socialism dipped slightly among young adults — from 55% two years ago to 51% now — that decline was offset by an increase in the number of adults over the age of 35 who view socialism in a positive light.
Socialism is especially appealing to Black Americans (60% now vs. 53% in 2019) and women (45% now vs. 41% in 2019), two groups that would benefit disproportionately from the downward redistribution of resources and power. Less than half of women in the U.S. (48%) view capitalism in a positive light, down from 51% two years ago. It is worth noting that working-class mothers have been hit particularly hard by the ongoing economic crisis, in large part due to a lack of affordable child care.
Deciphering the meanings of “capitalism” and “socialism” can be difficult, given that both are abstractions being interpreted by Americans through the highly distorted lens of more than a century of pro-capitalist and anti-socialist propaganda.
Looking beyond those terms, the survey found that 66% of U.S. adults want the federal government to implement policies to reduce the worsening gap between rich and poor. That’s up from 62% in 2019, which is before the nation’s 660 billionaires saw their combined fortunes surge by more than $1.1 trillion amid a devastating pandemic.
Two years ago, just 40% of Republicans under 35 said the government should pursue policies that close widening gulfs in income and wealth. Today, 56% of people in that group want lawmakers to curb inequality.
“Politicians looking to attack opponents to their left can no longer use the word ‘socialist’ as an all-purpose pejorative,” notedAxios. “Increasingly, it’s worn as a badge of pride.”
Critical race theory (CRT) has been around for over 40 years. So why is there so much talk about it now?
Following the racial justice uprisings of 2020, when critical race conversations broke out across the country, racial progress seemed possible. And then came the backlash.
In a letter to U.S. Secretary of Education Miguel Cardona, attorneys general from 20 states have requested that the department’s grant funding through the American History and Civics Education programs include language that opposes what they see as the “deeply flawed and controversial teachings” of CRT in schools. At least 25 states and multiple municipalities have proposed or passed legislation banning CRT in schools.
But let’s take a step back. Is the backlash valid?
According to Char Adams, Allan Smith and Aadit Tambe, “There is scant evidence … that critical race theory is being widely taught in K-12 public schools.” Further, critical race scholars such as Gloria Ladson-Billings have suggested the recent backlash isn’t about critical race theory. According to Ladson-Billings, “I think what people are really going after at this point is the 2022 and the 2024 elections.”
Ladson-Billings’s sentiment is spot on with Charles Blow, opinion writer for The New York Times, who suggests, “Critical race theory is the political right’s new boogeyman.”
But in the context of education, this boogeyman is more of a strawman, because the very thing being called critical race theory to scare many Americans isn’t critical race theory at all.
So, what is critical race theory?
To start, critical race theory is not a theory at all, but rather a series of concepts and ideas, developed and debated for the better part of the past half century, with aspirations of explaining the enduring, shape-shifting and complex behaviors of racism in U.S. society. It both explains and demystifies the construct of race and its centrality to the unique and peculiar project of a country founded on the extravagant exploitation of other people’s lands and labor.
These theories, concepts and ideas, which first grew out of legal studies, helped scholars and other individuals seeking to understand the consequences of the U.S. origin story, as deeply rooted in race as it is, begin to pin down how racism and racial disparities are complex, changing, and often possess subtle social and institutional dynamics.
Critical race theory is not just a set of ideas, though; it is a fundamental adjustment for how we should look at the world and see the realities that a focused lens on structural inequities might present. Thus, as much as it offers ideas, critical race theory offers evidence, a lens to both see and question that world that we live in. While we make up less than 14 percent of the U.S. population, why do Black people make up close to 40 percent of the U.S. prison population and an even greater share of the U.S. jobless population? Why are Black women evicted at grossly disproportionate and alarming rates, and why do Black and Brown children make up over half of the children living in poverty?
This intense look at the evidence from a perspective that refuses to position vulnerable people as the “problem” allows for a counterstory, both of how history gets explained and about how racism gets resolved. The idea here is that one cannot solve a problem that one does not or does not want to understand.
It should be noted that many anti-CRT legislation advocates come from a pool of people who have been adamantly whitewashing history (literally). For at least a decade or so now, in some states, these “advocates” have been unwavering in their attempts to ensure that history books offer watered down accounts of colonization and slavery in the U.S. This campaign against truth was kind of a tee-up to the current anti-CRT movement.
This right-wing campaign sweeping across the country is just the latest iteration of anti-anything science or social progress that tells us to accept lies — in this case, that structural racism doesn’t exist in the U.S. The deniers of racism, much like the deniers of climate change and science itself, tell us to reject truth on the regular and vilify those who fiercely seek it to make decisions informed by it.
In my own work and in partnership with communities and schools across the country, I have seen how hungry people are for truth. And in the pursuit of truth, we have used CRT to change schools for the better.
In Community District 13 in New York City, I worked with school leaders using CRT to completely eliminate its out of school suspension gap. In Detroit, Michigan, I worked with school leaders using CRT to foster deeper community understanding and collective empathy in order to foster bold and broad conversations about improving literacy. Across the country, I’ve worked with school leaders, teachers, parents and students using CRT to help us to develop more informed educators, design more racially just systems, and address stubborn but troubling racial outcome and opportunity disparities.
At its best, CRT has provided in each of these spaces a blueprint for advancing the racial consciousness necessary for educational justice. It has provoked courageous questions that are not about nursing our cowardly comforts but finally putting an end to our immobilizing indifference.
So, what is CRT? It is the audacity to tell the truth in places built on lies. This truth will make us free, all of us, even though there are some who don’t want us all to be free, who have been and remain willing to sever a nation to ensure that some of us stay chained.
To hear the landlords tell it, the U.S.’s eviction crisis is over. A June 11 letter to President Biden, signed by 12 large real estate and landlord associations, cheerfully asserts that the economy is recovering, unemployment has fallen, rental assistance programs have worked and vaccination rates are high enough that the pandemic danger is all but passed: “As the Administration continues its support for housing, we urge you to sunset the nationwide federal moratorium on evictions on June 30th and focus on targeted housing support for those renters who continue to recover from the pandemic,” the letter says.
Nothing could be further from the truth.
Although the GDP and the stock market are both doing well, many Americans are still struggling. March 2021 saw the highest poverty rate recorded during the pandemic: 11.1 percent. Unemployment in June 2021 was more than 2 percent higher than it was in February 2020. And, with vaccine rates dropping and the Delta variant spreading fast, the COVID-19 pandemic is far from behind us.
The number of tenants at risk of eviction remains at unprecedented levels. As of May 24, 10.4 million renters — 14 percent of all tenants — were behind on their rent. Nor is the problem improving on a national level; more people failed to pay rent on time in June than in May. Over 4 million people are at immediate risk of eviction in the next two months.
“I think [people] would for the most part be evicted into homelessness,” says Rose Lenahan of the Los Angeles Tenants Union (LATU). “It’s very unclear what they would do.”
The landlords are correct about one thing: Rental assistance could theoretically go a long way toward solving the immediate crisis. And, while many state and municipal programs got off to a slow start, the U.S. has started to see uneven but significant progress in getting this money to the people desperately in need of relief.
But time is running out. While the Centers for Disease Control and Prevention (CDC) extended the moratorium to July 30, 2021, on Thursday, the agency indicated that this will be the last extension. Many state eviction programs are still scheduled to expire on the CDC’s original June 30 deadline.
“There’s a feeling of impending doom among organizers,” says Jake Marshall of the Autonomous Tenant Union (ATU), a tenant collective based in Albany Park, Chicago.
Lenahan, Marshall, and other organizers across the country are acutely aware that local protections may soon be the only thing standing between struggling tenants and eviction. With the CDC moratorium badly weakened and scheduled to sunset, responsibility falls on states and municipalities to avert a catastrophe that could irreparably damage millions of lives.
A Houseless Generation
“Losing your home in 2021 is not simply a matter of losing your belongings and community, which is traumatic enough,” says Alieza Durana of Eviction Lab, a research group affiliated with Princeton University.
Any eviction attempt on one’s record — even a failed one — makes finding housing extremely difficult. “You wind up either in lower quality housing or in some cases doubling up with a friend or a family member. Or, in the worst cases, without a home,” explains Andrew Aurand of the National Low Income Housing Coalition (NLIHC).
Long-term housing insecurity resulting from the pending eviction crisis will disproportionately impact people of color. While 9 percent of white renters are currently behind on rent payments, that number skyrockets to 22 percent for Black tenants, 19 percent for Latino tenants and 18 percent for Asian tenants. Once evictions resume in earnest, that disparity may widen even further. According to the ACLU, landlords historically file evictions against Black renters at nearly twice the rate of white renters, suggesting an increased willingness by landlords to evict tenants of color.
This racial disparity in eviction outcomes may gain a grisly new dimension due to the ongoing pandemic. Durana points out that areas most at risk for eviction also have the lowest vaccination rates — a problem especially acute in majority-Black and Latino neighborhoods. Mass evictions at this stage of the pandemic could spur yet another wave of infection that impacts the poorest and most vulnerable members of society.
The stress and privation of housing insecurity bleeds over into other areas of life. Over half of people currently behind on rent also struggle with hunger. And the constant anxiety takes a toll. “Not having stable housing, we know there are negative mental health consequences,” says Aurand. “There’s negative physical health consequences. If there are children in the family, it can disrupt their education.” This last point is especially troubling, given that 20 percent of all tenants with children are currently behind on rent.
Evictions can affect the health of children before they are even born. A Georgia study found that babies whose mothers dealt with eviction during pregnancy were at increased risk of premature birth and low birth weight, along with a possible increase in infant mortality, compared to those whose mothers endured eviction before or after pregnancy.
Durana cites the historically high eviction levels in August 2020 — after the CARES act protections expired and before the CDC moratorium went into effect — as a harbinger of things to come. With more people behind on rent and fewer state protections, rates will likely skyrocket even higher after the moratorium sunsets.
“We’re crucially forgetting how normal poverty and eviction were and are as fixtures of American life prior to the pandemic,” Durana says. “The [pre-pandemic] eviction crisis created a houseless generation, a permanent underclass of communities living paycheck to paycheck.”
COVID-19 exacerbated the U.S.’s eviction crisis but did not cause it. Although the U.S. did not compile national evictions statistics before 2021, estimates suggest that landlords evicted nearly 1 million renters every year from 2000 to 2016 (the last year for which data is available). Yet even this grim figure understates the pre-COVID problem. The estimate does not include California or New York, neither of which provide eviction data. Worse yet, Harvard sociologist Matthew Desmond estimates that for every tenant evicted by court order, two more undergo “informal evictions” where landlords pressure tenants to leave without going to court.
This eviction crisis is unsurprising given the combination of skyrocketing rent and stagnant real wages. Between 2017 and 2019, rent increased by 8.6 percent. As of 2019, half of all renters were “cost-burdened” — over 30 percent of their income went toward rent. The number of cost-burdened families skyrockets to 88 percent for tenants making under 20,000 a year.
Landlords, on the other hand, have done quite well over the years. They are, on average, four times as wealthy as the average person in the U.S. Tenants sit at the other end of the spectrum: The average U.S. tenant owns only an eighth as much wealth as the average person in the U.S. Landlords make money by charging more for rent than they pay for the property itself, and the discrepancy between rent and value increases as housing quality decreases. In other words, landlords make the most profit from their poorest tenants.
Slow Progress
The coming end of eviction moratoria is especially frustrating in light of uneven but significant progress in distributing rental assistance to the tenants who need it — efforts that need more time to be truly successful.
“Programs are starting to get the money out,” reports Andrew Aurand of the National Low Income Housing Coalition (NLIHC). “Texas is a good example, where they struggled at the beginning. But now, a few months later, I think they’ve gotten things going.”
In the early days of Texas’s infamously backlogged relief program, wait times were as high as 60 days, according to Christina Rosales of Texas Housers, a statewide nonprofit dedicated to housing justice. “People were evicted in the course of waiting for rent relief.” Since March, however, wait times have decreased steadily to a current two to three weeks. “There is an expedited process for renters who are at a very high risk for evictions,” Rosales says. “And it does make a huge difference.”
Baltimore, Maryland, is another success story. The city’s Strategic Targeted Eviction Prevention (STEP) program, which won a national award for innovation, also took a while to get off the ground. “[The program] had some snafus in the beginning,” recalled Carol Ott of Fair Housing Maryland. However, the Baltimore mayor’s office worked closely with nonprofit organizations on the ground to analyze and fix failure points within the STEP program. “I report to them where we’re getting the most complaints, the most requests for assistance,” Ott said. “And they were able to say OK, let’s start focusing on these areas.”
Outcomes in Texas and Baltimore offer hope for humane and timely responses to the current eviction crisis. “We know that programs are able to [distribute funds]. We know what makes it easier for programs to do this,” says Aurand. “And we see signs that this is starting to happen.”
Yet rent relief programs need more than the short time left before the scheduled sunset of the CDC moratorium to get help to everyone who needs it. “There are days when I feel like, great, we’re making progress,” says Bill Faith of the Coalition on Homelessness and Housing in Ohio (COHHIO). “There are thousands of people getting assistance. The money’s really starting to move…. But on a bad day, I focus on how many more people are just languishing right now.” Wait times in Ohio for rent assistance remain high — according to Faith, four to six weeks is the best-case scenario. And, without a strong moratorium in effect, that’s four to six weeks in which a landlord can evict the tenant before rent relief arrives.
State Bulwarks
Local governments are not helpless in the face of the sunsetting federal moratorium. Many states and municipalities passed laws that offer better protection than the embattled CDC moratorium, with encouraging results.
Washington, D.C. has done a poor job of distributing aid — as of May 31, the district’s Stronger Together by Assisting You (STAY) program had given out just 5 percent of its allotted assistance money. Yet the city has seen no evictions since the pandemic started due to its ironclad eviction moratorium.
“As things currently stand there shouldn’t be any evictions until the end of the year,” says Greg Afinogenov of the D.C. tenant union Stomp Out Slumlords. This moratorium means Afinogenov and other activists can spend their time advocating for improvements to the STAY program instead of engaging in on-the-ground eviction defense.
Afinogenov points to D.C.’s success as proof that moratoria work. “D.C. has not seen some kind of collapse in rent payments … for the most part, people will continue to meet their obligations even if they’re not under constant threat of eviction.”
Los Angeles tenants find themselves in a similar situation. While evictions are occurring in Los Angeles, California’s SB-91 offers far stronger protections than the federal moratorium. The provision, recently extended to September 30, will hopefully buy time for the California state legislature to finalize a bill that would provide total rent forgiveness for anyone making 80 percent of median income or less.
So far, however, California rent relief is flowing at a glacial pace. “Nobody I know has gotten money yet,” Lenahan says. “No one knows for sure that they’re going to get money.”
Harbingers of Catastrophe
In some states, where creative lawyers and overeager landlords have already eroded CDC protections almost past meaning, the eviction crisis has already arrived.
“The eviction numbers are back to where they were before the pandemic,” Faith says. Ohio lawyers have successfully challenged both the constitutionality of the moratorium itself and tenant certifications of eligibility for eviction defense. Whether numbers will increase still further after the federal moratorium sunsets remains to be seen. “It won’t get any better if the eviction moratorium expires, that’s for sure.”
Chicago finds itself in an even worse position. Illinois did not even start their assistance program until after April, and tenants still find the convoluted application process nearly impossible to navigate. Worse still, the state relief program requires landlord approval. Since landlords cannot evict if they accept funds, many simply refuse to cooperate. “I’ve been working with tenants whose landlords simply refuse to even engage in the process or to file an application for rent relief,” Marshall says.
Illinois courts recently weakened their state moratorium to allow landlords to evict tenants with pre-pandemic eviction orders. Even before this change, however, Chicago landlords contrived to carry out illegal evictions with a stunning array of tactics. Marshall has seen illegal lockouts, utility shutoffs, refusals to perform essential maintenance, harassment, and threats of legal action for unrelated issues. Chicago also permits landlords to evict for reasons not related to late rent, which include no-cause evictions as long as the landlord gives proper notice. As if this weren’t enough, landlords also have the option of suing for back rent in civil court, which turns rent debt into consumer debt that lower tenant credit scores for years. “Often what these landlords do is say, hey, we’ll drop the case if you just move out, so it effectively becomes an eviction,” Marshall says.
Chicago’s failure to prevent evictions may portend the broader dynamics of a post-moratorium U.S. “It’s not just about getting tenants’ money now,” Marshall says. “The city and state government … allowed thousands of people to fall through the cracks for months and months.” Marshall believes even a functional rent relief program would be insufficient at this point. “It’s too late to address this harm with a basic program that only lasts a few weeks. “
A Structural Problem
Activists agree: Time, information and simplicity could still go a long way toward staving off a national eviction catastrophe in the short term. Moratoria extensions allow more time for money to reach struggling tenants. Better information can help tenants and landlords alike apply for and receive aid. And simpler programs would reduce red tape and speed up the entire process.
Many activists believe that blanket rent cancellation makes far more sense than the Byzantine programs currently in place. Such policies would put the onus on property owners to recover lost rental revenue. “Property owners [could] apply to the state to have their overhead costs covered by the state,” Marshall says. “They’re the ones who have the resources. They’re the ones who have all types of associations and professional associations that can assist them.”
Yet most activists also agree that the problem goes far beyond a temporary COVID-fueled crisis. “Had we had a stronger housing safety net to begin with, we wouldn’t have as many renters in a crisis situation now,” Aurand points out. “What we need to think about in the long term is investing in affordable housing programs so that we have that safety net in place.”
Durana believes the eviction crisis represents an opportunity to fix underlying problems. “Instead of abandoning tenants, let’s build back better — provide renters a right to counsel, fully fund housing assistance and eviction diversion programs, raise the minimum wage, and construct more low-income and affordable units.”
Rosales hopes that people will go further and reexamine their assumptions about rent, landlords and housing in the wake of this crisis. “Housing should be a right,” she says. “It’s just something we need to stay safe and healthy.”
Afinogenov agrees. “Eviction is a moral evil. Rent is a moral evil. And we should aim to eliminate these things rather than to put band-aids over them.”
On Wednesday and Thursday of last week, 16 – 17 June 2021, the 50/50 by 2030 Foundation hosted its inaugural symposium, ‘Equals Now’ at the University of Canberra. In today’s post, Laura Davy (@LauraKDavy) and Briony Lipton (@briony_lipton) reflect on the key themes and highlights from this excellent 2-day conference.
Around the country women have been protesting against current power dynamics.
The 50/50 by 2030 Foundation is based out of the University of Canberra. Its Founding Director was Virginia Haussegger AM and it is now Co-Directed by Professor Kim Rubenstein and Trish Bergin.
The Foundation’s inaugural symposium, Equals Now, brought together academics, public servants, journalists, and other public commentators to discuss practical strategies for achieving women’s equal representation in leadership positions – and to discuss the challenges that need to be overcome to achieve such a goal, such as the presence of deep structural inequality, the vagaries of political will, and the insidious influence of undermining social norms and biases.
The symposium was structured around three broad themes – share the load, share the power, and share the benefits. Within these themes, the topics explored over the two days ranged from sexism, harassment and unequal pay in the workplace to the disadvantages that flow from the inequitable distribution of domestic and caregiving responsibilities to the potential of feminist critique to transform our basic public institutions such as parliament and the law.
Each panel and session of the symposium also grappled with broader, reoccurring themes of the continued prevalence of deeply sexist societal systems, striking a balance between individual and institutional responsibility, acknowledging the compromises and choices that allow us to survive and flourish within those systems, and the strong need to challenge those systems in more radical ways as part of a broader movement for change. Another key message to emerge in the proceedings was how 50/50 representation is not enough – for many presenters and attendees the ultimate goal was transforming institutions – but greater parity of representation is often the first step on the road to this broader mission. It is perhaps only through a critical mass of diversity in positions of power and influence that this deeper transformative work can be done effectively.
Some of the things about this conference that were particularly great included:
An interdisciplinary and diverse array of speakers from inside and outside of academia
A short (under 10 minute) timeframe for individual presentations, which made for a fast-paced and engaging sequence of speeches
Professional conference organisation that almost seamlessly facilitated both online and in-person modes of participation and interaction (a real feat in these pandemic times)
An effective ‘table-based discussion’ Q&A format that enabled particularly rich in person discussion and acted as a reminder of how precious impromptu face-to-face interactions are
Indefatigable MC-ing by journalist Ginger Gorman, recently appointed Editor of BroadAgenda (@BroadAgenda5050), and
A lovely reception for those lucky enough to attend in person (complete with delightful doggos) at the Residence of University of Canberra Vice-Chancellor Professor Paddy Nixon.
Kim Rubenstein, Co-Director of the 5050 Foundation, concluded the symposium with the following words – “research is essential in order to create social change” – words which are also deeply relevant to the mission of Power to Persuade. The rich engagements embodied in this symposium between researchers and practitioners are key to mobilising research insights in ways that produce real impact.
Interested readers can follow more reflections on the conference by looking up the Twitter hashtags: #EqualsNOW #sharetheload #sharethepower #sharethebenefits
This article was originally posted on the terrific Power to Persuade website. The site is a platform for discussion about social policy in Australia in a global context. Check it out!
A bipartisan group of lawmakers in Congress will release the details of their latest infrastructure proposal any day now, but their plan for paying for it remains hazy as Democrats move to bypass GOP opposition with a much more ambitious spending package.
The quest for a bipartisan infrastructure deal has exposed, more than ever, that lawmakers on the right are unwilling to raise taxes on those who benefit most from the U.S.’s lopsided economy to pay for investments in public resources, while many left-leaning lawmakers remain determined to make the rich pay their fair share without raising extra revenue off everyone else.
Between the two camps stand conservative Democrats, such as Senators Joe Manchin of West Virginia and Kyrsten Sinema of Arizona, who say Congress should reach a bipartisan compromise on infrastructure despite the GOP’s staunch opposition to taxing the wealthy, leaving negotiators with dwindling options for financing the plan. Meanwhile, Democrats are working on their own $6 trillion proposal that would allow for tax hikes on corporations and the wealthy and therefore could only pass along party lines.
Republicans have said for months that they would never support President Joe Biden’s original proposal for modest tax hikes on corporations and the wealthy that would chip away at the signature tax cuts passed by Republicans under President Trump. Biden drew his own line in the sand, refusing to renege on his campaign promise not to raise taxes on households making less than $400,000 a year.
“The logic of having the rich pay for it is both that they have been the big gainers in the economy over the last four decades and also that they just got a big tax break in 2017,” said Dean Baker, a senior economist at the Center for Economic Policy and Research, in an email. “It’s hard to argue that they would be suffering some great injustice if Biden were to reverse some or all of the 2017 tax cut for the rich.”
Biden and centrist Democrats worked to reach a deal with the GOP anyway, even as critics on the left warned them that the polling is in their favor and Republicans only wish to obstruct Biden’s agenda. Biden originally called for $2.3 trillion in infrastructure and jobs spending, along with a $1.8 trillion investment in education and support for children and families, and was willing to lower the price tag in negotiations with Republicans until those talks fell flat.
Republicans kept taxes on corporations and the rich off the bipartisan negotiating table in Congress, where a group of 21 lawmakers from both parties has floated several proposals for financing their latest offer, which outlines $579 billion in new spending on physical infrastructure such as roads, bridges, airports, water systems and public transit. This week, the White House and liberal lawmakers came out against one of those proposals for raising revenue: an increase in the federal tax on gasoline that would be paid by consumers at the pump.
Since 1993, the federal government has taxed gas at 18.4 cents a gallon. Republicans and the centrist Democrats who insist on working with them floated the idea of adjusting that tax rate to inflation. This would be an increase in “regressive” taxes — in other words, taxes on which lower-income people spend a higher percentage of their earnings than higher-income individuals. Such taxes include sales taxes on consumer goods and the fixed federal tax that is included in the price of gas. In contrast, “progressive” taxes are based on income or wealth, so people with more money pay more in taxes.
“There is no reason to fund infrastructure with a tax on the working class when we could tax the ultra-wealthy, whose businesses will benefit the most from that same bill,” Rep. Ro Khanna (D-California) said on Twitter.
In previous rounds of infrastructure talks, Republicans floated the idea of raising money with “user fees” such as tolls for roads and bridges. The cost of tolls also falls unevenly on working and lower-income people, and so there is little appetite for user fees among most Democrats in Congress.
Press Secretary Jen Psaki said on Monday that the White House is “not going to accept” a gas tax increase. Senate Budget Committee Chairman Bernie Sanders said on Sunday that he would support a bipartisan deal for fixing basic infrastructure, such as roads and bridges, but only without “regressive taxation.” Sanders and Khanna also oppose an annual user fee on electric vehicles proposed by the bipartisan group to pay for charging stations and other infrastructure necessary for electrifying transportation, a major climate goal for Democrats.
“One of the concerns that I do have about the bipartisan bill is how they are going to pay for their proposals, and they’re not clear yet,” Sanders said on “Meet the Press.” “I don’t know that they even know yet.”
Lawmakers in both parties know that increasing the gas tax as people struggle to recover economically from the COVID pandemic would be hugely unpopular with voters. The details of the latest bipartisan plan have yet to be released, but a brief fact sheet notes that the proposed gas tax is a “placeholder pending an alternative non-tax offset” from the White House, effectively kicking the question of how to pay for it back to Biden.
Sen. Ron Portman of Ohio, a Republican in the bipartisan infrastructure group, said on Sunday that the gas tax may be dropped from the final package, citing Biden’s opposition.
The bipartisan group lists several other options, including the repurposing of pandemic relief funding and unemployment benefits to pay for infrastructure, which could anger liberal Democrats who want greater social spending as the nation continues to recover.
The bipartisan group also calls for “public private partnerships” and “asset recycling,” two methods of financing infrastructure through privatization that Republicans entertained during the Trump administration before failing to produce a coherent proposal. Progressive economists and advocates say these measures, which put profit-hungry private companies in charge of public infrastructure and assets, are no replacement for robust public investments and would only burden communities struggling to recover from the pandemic.
“Communities across the country have been ripped off by public-private schemes that enrich corporations and Wall Street investors,” said Mary Grant, the director of the public water campaign at Food & Water Watch, in a statement. “The most sensible infrastructure solution is to provide robust public funding for publicly owned projects, which would discourage price-gouging by corporate interests, protect public control over these precious assets, and save everyone money.”
The success of the bipartisan deal depends largely on support from Biden, who would like a bipartisan trophy but is well aware the Democrats are preparing to use the budget reconciliation process to bypass the filibuster and pass their own priorities along party lines.
Sanders and other Democrats are reportedly preparing a roughly $6 trillion spending proposal that would update the tax code to allow for tax increases on the wealthy and corporations. That package would pay for infrastructure investments proposed by Biden but dropped during bipartisan negotiations, including investments in “human infrastructure,” such as community colleges, expanded child tax credits and paid leave for workers. The Democrats preparing the progressive proposal are also hoping to include other priorities, such as combating climate change and reforming Medicare to expand the program and lower drug prices.
Republicans would unite against such legislation, so it would require support from all 50 Senate Democrats to pass, including the centrists determined to iron out a deal with Republicans. That could ultimately result in a slimmer Democratic spending package, but progressives hope the final legislation will still greatly exceed the $579 billion bipartisan proposal.
Besides the scope and price tag, the most obvious difference between the two emerging plans is the willingness of Biden and most Democrats to raise money off those who have the most of it. Republicans see their 2017 tax cuts, which benefited the wealthy and corporations, as a crowning achievement of the Trump years. By refusing to even consider modest revisions to those cuts from the beginning, the GOP set the terms for bipartisan infrastructure talks that are finally coming to a head this week.
“As far as the economic impact, there was not a noticeable uptick in investment or the economy as a whole from the 2017 tax cut, so there is no reason to think there will be serious economic damage if it were reversed,” Baker said.
Young players excluded from matches because of their religious dress find a way to play on and encourage other hijab-wearing women into the sport
Founé Diawara was 15 years old when she was first told she could not wear her hijab in a football match.
It was an important game. She had recently got into the team of a club in Meaux, the town north-east of Paris where she grew up, and they were playing a local rival. Diawara had been wearing her hijab during training, but as she was about to walk on to the pitch, the referee said she must remove it if she wanted to play.
Founé Diawara during a training session at Montreuil football pitch in the suburbs of Paris. Les Hijabeuses (from left): Zamya, Founé Diawara and Hawa Doucouré
I’m not a woman wearing a hijab playing football, just a woman who loves football
Les Hijabeuses at a training session
Karthoum Dembélé, Hawa Doucouré and other players from Les Hijabeuses at the Women’s Urban Cup, a football tournament organised by Urban Jeunesse Academy
Les Hijabeuses at the Women’s Urban Cup
Bouchra Chaïb training at Montreuil football pitch
Les Hijabeuses during a training session at Montreuil football pitch. The group share the ground with other young people from the area
Les Hijabeuses and a community organiser for the Citizen’s Alliance, which helped set up the group
Since the start of the pandemic, Connecticut’s fourteen billionaires have seized $12.6 billion in additional wealth — while hundreds of thousands of working people across the state, especially working people of color, are suffering.
As the converging crises over the last year and a half have underscored, Connecticut has become a microcosm of the extreme racial and economic disparities in the United States. It consistently ranks as the wealthiest state here in the world’s wealthiest country. But it also ranks among the most unequal.
On a mission to end this injustice and create a more equitable state, nearly 50 labor, community, and faith organizations have formed a statewide coalition named Recovery For All. The coalition aims to unite progressive forces and reshape how Connecticut approaches the state budget: rather than perpetuate failed austerity policies that exacerbated inequalities over the last few decades, the state must actively eliminate inequalities by making dramatic investments in working-class communities and working-class communities of color in particular.
Ensuring the resources our communities need to flourish is impossible without a strong, fair, and reliable revenue stream. Recovery For All is leading a campaign for reforms that would boost revenue by taxing the wealthy and corporations, provide relief to poor and working-class residents, and fully fund vital programs and services. Similar efforts abound in states throughout the country; in nearby New York and New Jersey, allied coalitions recently won major victories.
Although Democrats maintain a state government trifecta in Connecticut, this year they have sparred with one another over progressive tax reform. Governor Ned Lamont routinely emphasizes his commitment to equity — but refuses to support tax increases on the wealthy. Challenging the governor to back up his rhetoric with action, Recovery For All has echoed an incisive catchphrase coined by State Senator Gary Winfield: “Equity Requires Revenue.” In other words, if Connecticut is serious about addressing systemic inequities, then elected officials have to repair the regressive tax structure which currently reflects and entrenches them.
Over the last six months, Recovery For All joined together with a bloc of several dozen champions inside the state legislature to make the push. At a public hearing before the Finance, Revenue, and Bonding Committee, 300 coalition members showed up to testify, sharing hours of stories illustrating why we must invest in our communities through progressive tax reform. As a result, the committee passed a package that would generate nearly $1.5 billion in new revenue by increasing taxes on the wealthy.
Outside the capitol, Recovery For All has demonstrated our key source of power: mass action in the streets. The coalition organized rallies, marches, car caravans, prayer vigils, and other mobilizations.
On May Day, for example, hundreds of people from many different organizations staged a die-in before the Governor’s Mansion to dramatize the staggering level of unmet need statewide. Coalition members worked together on actions to spotlight specific areas of investment: health care workers and community activists demanding expanded mental health services in black and brown neighborhoods; immigrant residents and labor department employees demanding expanded protections for low-wage workers; faculty, staff, and students demanding expanded public colleges and universities, etc. Our actions thus offered opportunities to forge relationships and build solidarity across organizations.
Some coalition affiliates amplified our vision of robust public investment by taking workplace action, like the members of SEIU 1199 New England. Thousands of long term care workers, mainly black and brown women, threatened to go on strike after sacrificing their lives to protect the most vulnerable patients during the pandemic while earning poverty wages. They averted the strike at the last minute after private employers and the state agreed to historic raises and benefit improvements as well as new measures to advance racial justice. This inspiring labor struggle highlighted why Connecticut must adopt a fair tax structure to end chronic underfunding of essential services such as nursing homes and group homes.
Although Governor Lamont is using the influx of federal funding as an excuse to oppose any tax reforms in this year’s legislative session, the stage is set for a continuing battle for the next two years and beyond.
State Senator John Fonfara, chairman of the Finance, Revenue, and Bonding Committee, delivered trenchant remarks from the floor on the last day of session.
“The status quo, the status quo budget, leaves us with status quo results,” he said. “Our policies are a knee on the neck of the Black community and other underserved communities of our state. We can do better. And we must do better.”
Recovery For All has successfully transformed the terms of debate over the state budget by making progressive tax reform the central question of the year. Now the coalition is primed to escalate the fight — all part of a long-term strategy to alter the balance of power in Connecticut and build a truly equitable society.
The words “I can’t breathe” were not only uttered by Eric Garner and George Floyd as they were murdered by police. They were also uttered by over 70 others who died in law enforcement custody over the past decade after saying those same three words, according to the The New York Times.
Policing in the United States is a force of racist violence that is entangled at the core of the capitalist system. As Robin D.G. Kelley pointed out on Intercepted With Jeremy Scahill, capitalism and racism are not distinct from one another: “If you think of capitalism as racial capitalism, then the outcome is you cannot eliminate capitalism, overthrow it, without the complete destruction of white supremacy, of the racial regime under which it’s built.”
Police in the United States act with impunity in targeted neighborhoods, public schools, college campuses, hospitals, and almost every other public sphere. Not only do the police view protesters, Black and Indigenous people, and undocumented immigrants as antagonists to be controlled, they are also armed with military-grade weapons. This police militarization is a process that dates at least as far back as President Lyndon Johnson when he initiated the 1965 Law Enforcement Assistance Act, which supplied local police forces with weapons used in the Vietnam War. The public is now regarded as dangerous and suspect; moreover, as the police are given more military technologies and weapons of war, a culture of punishment, resentment and racism intensifies as Black people, in particular, are viewed as a threat to law and order. Unfortunately, employing militarized responses to routine police practices has become normalized. One consequence is that the federal government has continued to arm the police through the Defense Logistics Agency’s 1033 Program, which allows the Defense Department to transfer military equipment free of charge to local enforcement agencies.
The scope of the 1033 Program is alarming given that “Since its inception, more than 11,500 domestic law enforcement agencies have taken part in the 1033 Program, receiving more than $7.4 billion in military equipment,” according to CNBC. There is also the federally run 1122 Program which allows the police to purchase military equipment at the same discounted rate as the federal government. In addition, there is the Homeland Security Grant Program, which provides funds for local police departments to buy military-grade armaments and weapons. The military-grade weapons provided through these federal programs include armored vehicles, assault rifles, flashbang grenade launchers, bomb-detonating robots, and night vision items. Arming the police with more powerful weapons reinforced a culture that taught police officers to learn, think and act as soldiers engaged in a war. Moreover, as Ryan Welch and Jack Mewhirter write in The Washington Post, the more militarized and armed the police are, the greater the increase in civilian deaths. As they point out:
Even controlling for other possible factors in police violence (such as household income, overall and black population, violent-crime levels and drug use), more-militarized law enforcement agencies were associated with more civilians killed each year by police. When a county goes from receiving no military equipment to $2,539,767 worth (the largest figure that went to one agency in our data), more than twice as many civilians are likely to die in that county the following year.
There is not a single era in United States history in which the police were not a force of violence against Black people. Policing in the South emerged from the slave patrols in the 1700 and 1800s that caught and returned runaway slaves. In the North, the first municipal police departments in the mid-1800s helped quash labor strikes and riots against the rich. Everywhere, they have suppressed marginalized populations to protect the status quo.
Police brutality cannot be separated from the lethal nature of white supremacy, and in its recent incarnations became “the war on crime.” Under President Nixon and every American president after him, the war on crime continued to expand and intensify into a war on Black communities. The call for “law and order” repeatedly served as a smokescreen for racist and militarized police practices that equated Black behavior with criminality and authorized the use of force against them.
As the reach of the culture of punishment expanded, its targets included protesters, immigrants, and those individuals and groups marginalized by class, religion, ethnicity and color as the other — an enemy. This is the organizing principle of a war mentality adopted by the police throughout the United States in which the behavior of Black people and other marginalized communities is criminalized. It comes as no surprise that as one study reports, “Police kill, on average, 2.8 men per day…. Police homicide risk is higher than suggested by official data. Black and Latino men are at higher risk for death than are White men, and these disparities vary markedly across place.”
A militarized culture breeds violence. It wastes money on the security industries and policing, and drains money from the socially necessary programs that could actually prevent violence. Violence is both shocking and part of everyday life, especially for those who are poor, Black, Indigenous, trans, disabled and/or otherwise disenfranchised. In the last few decades, Francesca Mari writes, “the US has had the highest homicide rate of any high-income country, and according to preliminary data released in March by the FBI, it rose by 25 percent in 2020, when an estimated 20,000 people were murdered — more than fifty-six a day.”
Police brutality became code for a more violent expression of racism that emerged with the rise of neoliberalism in the 1980s. This was especially obvious under the Trump administration as the racist adoption of both white supremacy and a wave of police brutality against Black people and undocumented immigrants was presented to the American public as a badge of honor and an act of civic pride.
As the power of the police expanded, along with their unions, social programs were defunded. These included job programs, food stamp programs, health centers, healthcare programs and early childhood education. In many states, more money was spent on prisons than on colleges and universities, as documented by Ruth Gilmore in her book Golden Gulag: Prisons, Surplus, Crisis, and Opposition in Globalizing California. Targeted cities inhabited mostly by poor Black and brown people were now under siege as the war on poverty morphed into the war on crime. Instead of “fighting black youth poverty,” the new crop of white supremacist politicians fought what Elizabeth Hinton called “fighting black youth crime” in her book From the War on Poverty to the War on Crime.
As Jim Crow re-emerged in more punitive forms, immigration was criminalized, the war on youth of color intensified, and the culture of punishment began to shape a range of institutions. This was particularly evident as mass incarceration became a defining organizing institution of the narrow racially inspired policies of criminalization in the U.S. and, by default, the prison its most notorious welfare agency. The U.S. has been in the midst of an imprisonment binge since the1960s. As Angela Y. Davis writes in Abolition Democracy:
But even more important, imprisonment is the punitive solution to a whole range of social problems that are not being addressed by those social institutions that might help people lead better, more satisfying lives. This is the logic of what has been called the imprisonment binge: Instead of building housing, throw the homeless in prison. Instead of developing the educational system, throw the illiterate in prison. Throw people in prison who lose jobs as the result of de-industrialization, globalization of capital, and the dismantling of the welfare state. Get rid of all of them. Remove these dispensable populations from society. According to this logic the prison becomes a way of disappearing people in the false hope of disappearing the underlying social problems they represent.
The numbers speak for themselves. Historian Khalil Gibran Muhammad makes this clear in his new preface to The Condemnation of Blackness: Race, Crime, and the Making of Modern Urban America. He writes:
By population, by per capita incarceration rates, and by expenditures, the United States exceeds all other nations in how many of its citizens, asylum seekers, and undocumented immigrants are under some form of criminal justice supervision…. The number of African American and Latinx people in American jails and prisons today exceeds the entire populations of some African, Eastern European, and Caribbean countries.
Michelle Brown has argued persuasively in her book The Culture of Punishment that the rise of police violence, especially against people of color, indicates that increases in the scale of punishment cannot be abstracted from a parallel rise in both power and apparatuses of punishment — extending from the law enforcement, military services, private security forces, immigration detention centers, to intelligence networks and surveillance apparatuses.
Moreover, the culture of punishment increasingly defines both subjects and social problems through the registers of punishment, pain and violence. How else to explain the actions of the South Carolina Gov. Henry McMaster, who in 2021 signed legislation giving people on death row the grotesque choice between a firing squad and electrocution. Frank Knaack, the executive director of South Carolina’s ACLU, stated that capital punishment and the new law “evolved from lynchings and racial terror, and it has failed to separate its modern capital punishment system from this racist history.”
Policing cannot be understood outside of the history of criminogenic culture and a racist punishing state marked by both staggering inequities in wealth, income and power, as well as a collective mindset in which those considered non-white are considered less than human, undeserving of human rights, and viewed as disposable. The journalist Robert C. Koehler rightly argues that underlying both the larger culture and the culture of policing is a deeply ingrained white supremacy marked by a system of growing inequalities in which economic rights do not match political and individual rights. Koehler writes:
it is racism that is the trigger that disproportionately escalates police encounters with people of color. However, even more sadly, it is systemic racism that normalizes it, or legitimates it, making it largely acceptable to white American eyes and consciences. For it is not only the police who have this problem, but our entire society.
As neoliberalism failed to deliver on its promises of upward social and economic mobility, it shifted attention for its broken social experiment to attacks on immigrants, Blacks, and other populations deemed unworthy, inferior and a threat to white people. In doing so, gangster capitalism has become armed, spiraling into a form of authoritarianism that has merged the savagery of market despotism with the rancid ideology of white supremacy. Cornel West is right in arguing that neoliberal capitalism with its emphasis on materialism, racism and cruelty “allows for endemic inequality and a culture of greed and consumerism that [has trampled] on the rights and dignity of poor people and minorities decade after decade.”
Sociologist Alex Vitale rightly insists that calls for change regarding policing should not be about producing “better” police through technocratic reforms such as the increased use of body cameras and bias training, but rather with a “larger structure of economic life in America.” In the age of neoliberal austerity, the defunding of the welfare state has given way to a range of social problems — extending from the criminalization of homeless people and the relentless erasure of human rights to the mass proliferation of surveillance and the placing of police in the schools — all of which have contributed to the expansion of police power as a way to control people removed from meaningful involvement in the broader global economy. Turning over every social problem for the police to fix is more than an impossible task; it is a failed, if not diversionary, political decision.
Police violence can be understood as a form of systemic terror instituted intentionally by different levels of government against populations at home in order to realize economic gains and achieve political benefits through practices that range from assassination, extortion, incarceration, violence, and intimidation or coercion of a civilian population. Some of the more notorious racist expressions of such terror include the assassination of Black Panther Party leader Fred Hampton by the Chicago Police Department on December 4, 1969; the MOVE bombing by the Philadelphia Police Department in 1985; the existence of COINTELPRO (an illegal counterintelligence program designed to harass anti-war and Black resistance fighters in the 60s and 70s); the use of extortion by the local police and courts practiced on the largely poor Black residents of Ferguson; and the more publicized killings of Ma’Khia Bryant, Breonna Taylor and George Floyd by the police — to name just a few instances of acute state violence.
The American nightmare that has descended upon the United States points to a crisis of power, agency, community, education and hope. The effects of neoliberalism’s death-dealing-machinery are everywhere, and police abuse is only one thread of this criminogenic social formation.
Rather than fade into the past or disappear beneath the propaganda techniques of right- wing disimagination machines, widespread poverty, racially segregated schools, rampant homelessness, ecological destruction, large-scale rootlessness, fearmongering, social atomization, voter suppression, and the politics of disposability are alive and well. It is now unabashedly reproduced and defended by a Republican Party that has become the overt symbol of white supremacy, economic ruthlessness and manufactured ignorance.
Widespread corruption is now matched by a climate of fear and a willingness on the part of Trump’s political allies to inflict violence on undesirable members of the public along with anyone voicing criticism or dissent. The scaffold of resistance now faces a malignant fascist politics growing across the globe. Fascist politics, especially in the United States, has been on steroids, especially true both during Trump’s reign in office and after his defeat, with the rule of the Republican Party in Congress and among a majority of state legislatures. If the systemic violence and lawlessness that denies Black communities a claim to human rights, citizenship and dignity are to be challenged, it is crucial to understand how neoliberal fascism becomes a machinery of dread, tearing the social fabric, while cancelling the future. As a regime of ideology, neoliberal fascism wages a political and pedagogical war against the conditions that make thinking, agency, the search for truth and informed judgment possible.
The heart of American violence does not reside merely in the culture and practice of policing in the U.S., or for that matter, in its prison-industrial complex. Its center of gravity is more comprehensive and is part of a broader crisis that extends from the threat of nuclear war and ecological devastation to the rise of authoritarian states and the human suffering caused by the staggering concentrations of wealth in the hands of a global financial elite. The roots of these multilayered and intersecting crises lie elsewhere in a new political and social formation that constitutes a racialized criminal economy that has embraced greed, violence, disposability, denial and racial cleansing as governing principles of the entire social order. This is the rule of neoliberal fascism on steroids. It is also an extermination machine rooted in a vapid nihilism that fuels the celebration of materialism and social atomization with a belief in unshakable loyalty, purification through violence and a cult of heroism.
It is crucial to understand how the threads of racial violence in its broader historical context, comprehensive connections and multidimensional layers shape capitalism in its totality to produce what David Theo Goldberg calls a machinery of proliferating dread. It’s no wonder that the same activists who are working to defund the police are also part of a collective movement to bring an end to neoliberal capitalism. Mariame Kaba writes:
People like me who want to abolish prisons and police, however, have a vision of a different society, built on cooperation instead of individualism, on mutual aid instead of self-preservation. What would the country look like if it had billions of extra dollars to spend on housing, food and education for all? This change in society wouldn’t happen immediately, but the protests show that many people are ready to embrace a different vision of safety and justice.
The challenge that Kaba and other abolitionists are posing does not advocate for liberal reforms. Their call is to advance a radical restructuring of society. Central to their call for social change is that such a task be understood as both political and educational. This necessitates the development of political and pedagogical struggles that take seriously the need to rethink the attack on the public imagination and attack on critical agency, identity and everyday life. Also at stake is the need to identify and reclaim those institutions, such as schools, that are necessary to produce and connect an educated public to the struggle for a substantive and radical democracy. The current crisis cannot be faced through limited calls for police reforms. It demands a more comprehensive view not only of oppression and the forces through which it is produced, legitimated and normalized, but also of political struggle itself.
Coalition of rights groups demanding Frontex be defunded claim EU policies have ‘killed over 40,555 people since 1993’
Activists, captains of rescue ships and about 40 human rights organisations across the world have launched an international campaign calling for the European border agency to be defunded and dismantled.
In an open letter sent last week to the European Commission, the Council of the EU and the European parliament, the campaign coalition highlighted the “illegal and inhumane practices” of the EU border agency, Frontex, which is accused of having promoted and enforced violent policies against migrants.
These are lives lost because of the EU’s obsession with reinforcing borders instead of protecting people
ProPublica‘s report (6/8/21) explored “how the ultrawealthy avoid taxes, exploit loopholes and escape scrutiny from federal auditors.”
A ProPublica report (6/8/21) on the leaked federal tax documents of super-wealthy individuals has bolstered the economic left’s argument that the US economy is set up in favor of the wealthiest. The report doesn’t show illegal activity; that’s what makes it so damning.
According to ProPublica, it “demolishes the cornerstone myth…that everyone pays their fair share and the richest Americans pay the most.” Examining the leaked taxes of billionaires like Jeff Bezos, Michael Bloomberg, Warren Buffett and Elon Musk, the investigation found that the
wealthiest can—perfectly legally—pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year.
The source of the leaks is anonymous, and the nonprofit outlet (6/8/21) addressed questions about the ethics of publishing such a vast trove of personal information:
We are doing so—quite selectively and carefully—because we believe it serves the public interest in fundamental ways, allowing readers to see patterns that were until now hidden.
While alumni of the Occupy Wall Street movement and the Bernie Sanders presidential campaign embrace the disclosures as proof that the system is rigged for the rich against the 99 Percent, the political and media class are fuming at ProPublica and whomever leaked the information.
Attorney General Merrick Garland (CNBC, 6/9/21) compared the ProPublica story to “what President Nixon did in the Watergate period — the creation of enemies lists and the punishment of people through reviewing their tax returns.”
Top-ranking Democrats and Republicans have said they will seek justice, not for what the leaks exposed about wealth inequality, but by catching the leaker who supplied the information. CNBC (6/9/21) reported that Attorney General Merrick Garland told members of Congress that “investigating the source of a massive leak of taxpayer information behind an article by investigative news outlet ProPublica will be one of his top priorities.” Internal Revenue Service Commissioner Charles Rettig likewise “told lawmakers that internal and external investigators are working to determine whether the data ProPublica used was illegally obtained” (Forbes, 6/8/21).
Senate Minority Leader Mitch McConnell and Republican Sens. Chuck Grassley and Mike Crapo are demanding the Justice Department and the FBI investigate the disclosure of confidential tax information of some of the country’s wealthiest taxpayers.
The GOP leaders insisted that “those responsible be prosecuted and ‘punished to the furthest extent the law permits.’”
“The real scandal,” wrote the Wall Street Journal (6/8/21), “is that someone leaked confidential IRS information about individuals to serve a political agenda.”
The Wall Street Journal editorial board (6/8/21) saw the leaks as a well-timed political hit, coming “amid the Biden administration’s effort to pass the largest tax increase as a share of the economy since 1968. Noting that the “main Democratic argument for a tax hike is that the rich should pay their ‘fair share,’” the Journal insisted, “The timing here is no coincidence, comrade.”
Edward Luce of the Financial Times (6/10/21) also smelled a rat, advancing a “reasonable suspicion” that the IRS was hacked by an “entity that does not wish US democracy well.” Whoever the leaker is, they “would know it would deepen public cynicism about America’s creed of playing fair and working hard.” Cynicism is already pretty deep when pundits think it more likely that revelations of systemic economic injustice are a foreign plot than a sincere attempt to provoke reform, or at least debate.
The attack on both the leak itself and ProPublica’s willingness to publish the information is chilling, especially when one considers the fate of leakers targeted by the United States government. Edward Snowden is still living in Russia because of his disclosure of National Security Agency surveillance to the Guardian. As Democracy Now! host Amy Goodman (6/14/21) recently said, the “US State Department [is] still pushing to extradite WikiLeaks founder Julian Assange from Britain, where he’s been locked up for over two years.” The leaker or leakers will be very lucky if they avoid a a visit from federal agents, if not much worse.
But ProPublica should welcome the attacks from the highest levels of government, and from the business press, as a backhanded compliment. The idea that the outlet compromised the privacy of individuals is farcical. These people are the literal economic, cultural and political elite, whose accumulated wealth—greater in some cases than the GDPs of most countries—gives them enormous power and influence over the lives of the rest of us.
Bloomberg is a media baron who used his wealth to buy himself not just the New York City mayoralty, but an otherwise illegal third term (FAIR.org, 10/2/08)—and spent his way into being taken seriously as a Democratic presidential contender (FAIR.org, 2/14/20). Bezos, Amazon‘s founder and the world’s richest human, bought the leading newspaper in the nation’s capital, which coincidentally has developed a habit of defending its owner against charges that he’s too wealthy (Washington Post, 6/9/20; FAIR.org, 7/25/18, 10/3/17).
The outrage by Republicans toward the leak also exposes the party’s attempt to rebrand itself as populist and anti-corporate. Senators Josh Hawley, Ted Cruz and Marco Rubio like to paint US corporate leaders as the financers of big, bad cultural liberalism (New York, 3/12/21). But the party’s rallying to the defense of the super rich shows where their sympathies really lie.
The 25 richest Americans pay little to no taxes thanks to leveraging loopholes in the tax code, according to a report from ProPublica released last week. Billionaires like Jeff Bezos, Elon Musk and Michael Bloomberg are able to pay so little because of policy decisions that result from the lobbying pressure of large corporations like the ones these billionaires run. The problems include the lack of a U.S. wealth tax and the fact that labor is taxed at a higher rate than investment. But to add insult to injury, as the ultra-wealthy take advantage of the fact that capital gains on investments are taxed at a far lower rate than incomes, they are building portfolios of investments that further increase their political power and more deeply entrench inequality.
The wealthy have many options to further increase their wealth, including investing in hedge funds — private investment funds which charge high fees but hold out the promise of returns better than the overall stock market. The 2010 Dodd-Frank Act created new rules of the road for hedge funds, including new transparency into what they own. Once a quarter, they must report certain positions on a form called the 13F. But family funds — in which only the wealth of a single family is invested — lack this same level of transparency, as they were carved out of the Dodd-Frank Act. Many of the billionaires ProPublica found are paying little to no taxes are also growing their wealth through family investment offices.
Family funds have been in the news this year following the spectacular blow up of Archegos Capital. Archegos, created in 2013 by former hedge fund manager Bill Hwang one year after he settled charges of insider trading with the U.S. Securities and Exchange Commission (SEC), made a series of increasingly risky bets that the price of about a dozen stocks would keep rising. He used money borrowed from some of the biggest banks to amplify these bets. When the bets went south and he couldn’t pay the banks what he owed, it led to an estimated $10 billion in losses across the banks, with Credit Suisse taking the biggest hit: $5.5 billion. The lack of public reporting on Archegos’s positions contributed to the fact that none of the banks knew until it was too late that they were all on the same side of the same bad trade.
Archegos wreaked havoc at the largest banks with a fund worth an estimated $20 billion. Amazon founder and Executive Chairman Jeff Bezos runs a family fund that’s even larger: Bezos Expeditions was estimated to be worth a staggering $107 billion in 2020. Bezos Expeditions is described by CrunchBase as a family investment office that manages Bezos’s venture capital investments. It was through Bezos Expeditions that Bezos purchased the Washington Post and created the private space travel firm Blue Origin. But Bezos Expeditions has a host of other investments in companies further entrenching the gig economy. Bezos Expeditions’s website discloses some of its other “select investments,” which include home sharing app Airbnb, which has been accused of skirting state hoteling laws and of displacing long-term residents; and ride-sharing app Uber, which has fought laws to classify its drivers as employees. Bezos Expeditions has also invested in Nextdoor, which in some cities has become a sort of crowd-sourced private surveillance network. As Pam Martens and Russ Martens noted for Wall Street on Parade, Bezos Expeditions has never filed a single 13F form with the SEC; this means the general public has no transparency into which stocks or options he holds. But Bezos is still able to take advantage of losses on his investments, and by disclosing those losses to the IRS, he paid no taxes in 2011, despite having a personal net worth of $18 billion.
Microsoft founder Bill Gates also has a family investment office, Cascade Investments LLC, that has allowed him to amass the largest private ownership of farmland in the U.S. Gates and Melinda French Gates together own 269,000 acres of farmland through companies that all link back to Cascade Investments. Gates may have attempted to add even more secrecy to these purchases by using a series of limited liability shell companies. An NBC News investigation found that Cascade Investments bought farmland using at least 22 limited liability shell companies across the United States. John S. Quarterman, a Georgia farmer and landowner, told NBC News that he discovered by searching property records that companies buying multiple tracts of land in Georgia were all a “shell of a shell of a shell company investing for Bill Gates.” This raises questions about concentration of power over farmland, from the same man who made his fortune through inadequate antitrust enforcement, leading to Microsoft’s concentration of power in the PC business.
Michael Bloomberg also has a family investment office called Willett Advisors. CaproAsia estimated in 2020 that Willett Advisors is worth $25 billion, which would make it the seventh largest family office in the world. Wall Street on Paradenoted that the last Form 13F the firm filed dates back to 2014, when the fund had a mere $273,000 in assets.
Elon Musk appears to have used his family investment office, Excession LLC, to buy up some $100 million in property in California around his mansion. Limited-liability companies with ties to Musk purchased six houses across two streets in the wealthy Bel-Air neighborhood of Los Angeles; at least one of those LLCs shares a P.O. Box with Excession LLC, Musk’s family office, the Wall Street Journalreported.
While reporting has given us some insights into what these family funds are doing, regulations don’t require the sorts of disclosures that hedge funds must make — allowing family offices’ investments to largely remain in the shadows, providing yet another benefit to the billionaires of the nation.
Today’s tax code incentivizes the nation’s billionaires to plow as much of their money as possible into investments in these family funds, further amplifying their wealth and giving them larger influence over the political process. With these investments, they seed companies like Uber that fight against worker’s rights, or buy up farmland, making it harder for smaller farmers to compete.
To her credit, House Financial Services Committee chairwoman Maxine Waters has proposed draft legislation requiring family funds managing more than $750 million to provide disclosures about their investments. Although broader legislation — including a wealth tax — is sorely needed to address the inequalities that family funds create, Waters’s bill is a good start. Bringing more transparency into family offices could be an important first step for Congress to tackle this sprawling problem.
Massive debt levels are a feature of contemporary capitalism that cannot be eradicated without radical change, says political scientist Éric Toussaint.
“The indebtedness of the working classes is directly connected to the widening poverty gap and increasing inequality, and to the demolition of the welfare state that most governments have been working at since the 1980s,” says Toussaint in this exclusive interview for Truthout.
Toussaint — a historian and international spokesperson for the Committee for the Abolition of Illegitimate Debt (CADTM), and author of several books on debt, development and globalization — shares his thoughts on debt, inequality and contemporary socialist movements in the conversation that follows.
C.J. Polychroniou: Over the past few decades, inequality is rising in many countries around the world, both across the Global North and the Global South, creating what UN Chief António Guterres called in his foreword to the World Social Report 2020 “a deeply unequal global landscape.” Moreover, the top 1 percent of the population are the big winners in the globalized capitalist economy of the 21st century. Is inequality an inevitable development in the face of globalization, or the outcome of politics and policies at the level of individual countries?
Éric Toussaint: Rising inequality is not inevitable. Nevertheless, it is obvious that the explosion of inequality is consubstantial with the phase that the world capitalist system entered into in the 1970s. The evolution of inequality in the capitalist system is directly related to the balance of power between the fundamental social classes, between capital and labor. When I use the term “labor,” that means urban wage-earners as well as rural workers and small-scale farming producers.
The evolution of capitalism can be divided into broad periods according to the evolution of inequality and the social balance of power. Inequality increased between the beginning of the Industrial Revolution in the first half of the 19th century and the policies implemented by the administration of Franklin D. Roosevelt in the United States in the 1930s, and then decreased up to the early 1980s. In Europe, the turn towards lower inequality lagged 10 years behind the United States. It was not until the end of World War II and the final defeat of Nazism that inequality-reducing policies were put in place, whether in Western Europe or Moscow-led Eastern Europe. In the major economies of Latin America, there was a reduction in inequality from the 1930s to the 1970s, notably during the presidencies of Lázaro Cárdenas in Mexico and Juan D. Perón in Argentina. In the period from the 1930s to the 1970s, there were massive social struggles. In many capitalist countries, capital had to make concessions to labor in order to stabilize the system. In some cases, the radical nature of social struggles led to revolutions, as in China in 1949 and Cuba in 1959.
The return to policies that strongly aggravated inequality began in the 1970s in Latin America and part of Asia. From 1973 onward, the dictatorship of Gen. Augusto Pinochet (advised by the “Chicago Boys,” the Chilean economists who had studied laissez-faire economics at the University of Chicago with Milton Friedman), the dictatorship of Ferdinand Marcos in the Philippines, and the dictatorships in Argentina and Uruguay are just a few examples of countries where neoliberal policies were first put into practice.
These neoliberal policies, which produced a sharp increase in inequality, became widespread from 1979 in Great Britain under Margaret Thatcher, from 1980 in the United States under the Reagan administration, from 1982 in Germany under the Kohl government, and in 1982-1983 in France after François Mitterrand’s turn to the right.
Inequality increased sharply with the capitalist restoration in the countries of the former Soviet bloc in Central and Eastern Europe. In China from the second half of the 1980s onward, the policies dictated by Deng Xiaoping also led to a gradual restoration of capitalism and a rise in inequality.
It is also quite clear that for the ideologues of the capitalist system and for many international organizations, a rise in inequality is a necessary condition for economic growth.
It should be noted that the World Bank does not consider a rising level of inequality as negative. Indeed, it adopts the theory developed in the 1950s by the economist Simon Kuznets, according to which a country whose economy takes off and progresses must necessarily go through a phase of increasing inequality. According to this dogma, inequality will start to fall as soon as the country has reached a higher threshold of development. It is a version of pie in the sky used by the ruling classes to placate the oppressed on whom they impose a life of suffering.
The need for rising inequalities is well rooted into World Bank philosophy. Eugene Black, World Bank president in April 1961, said: “Income inequalities are the natural result of the economic growth which is the people’s escape route from an existence of poverty.” However, empirical studies by the World Bank in the 1970s at the time when Hollis Chenery was chief economist contradict the Kuznets theory.
In Capital in the Twenty-First Century, Thomas Piketty presents a very interesting analysis of the Kuznets curve. Piketty mentions that at first, Kuznets himself doubted the real interest of the curve. That did not stop him from developing an economic theory that keeps bouncing back and, like all economists who serve orthodoxy well, receiving the Nobel Memorial Prize in Economic Sciences (1971). Since then, inequalities have reached levels never before seen in the history of humanity. This is the result of the dynamism of global capitalism and the support it receives from international institutions that are charged with “development” and governments that favor the interests of the 1 percent over those of the enormous mass of the population, as much in the developed countries as in the rest of the world.
In 2021, the World Bank reviewed the Arab Spring of 2011 by claiming, against all evidence, that the level of inequality was low in the entire Arab region, and this worried them greatly as it was symptomatic of faults in the region’s supposed economic success. As faithful followers of Kuznets’ theory, Vladimir Hlasny and Paolo Verme argue in a paper published by the World Bank that “low inequality is not an indicator of a healthy economy.”
Gilbert Achcar summarizes the position taken by Paolo Verme of the World Bank as follows: “in the view of the 2014 World Bank study, it is inequality aversion, not inequality per se, that should be deplored, since inequality must inevitably rise with development from a Kuznetsian perspective.”
Finally, the coronavirus pandemic has further increased the inequality in the distribution of income and wealth. Inequality in the face of disease and death has also increased dramatically.
Neoliberal policies have created massive debt levels for so-called emerging markets and developing countries, with debt threatening to create a global development emergency. What’s the most realistic solution to the debt crisis in developing countries?
The solution is obvious. Debt payments must be suspended without any penalty payments being paid for the delay. Beyond suspension of payment, each country must carry out debt audits with the active participation of citizens, in order to determine the illegitimate, odious, illegal and/or unsustainable parts, which must be canceled. After a crisis of the size of the present one, the slates must be wiped clean, as has happened many times before throughout human history. David Graeber reminded us of this in his important book, Debt: The First 5,000 Years.
From the point of view of the CADTM, a global network mainly active in the Global South but also in the North, the need to suspend payments and cancel debt does not only concern developing countries, whether they are emerging or not. It also concerns peripheral countries in the North like Greece and semi-colonies like Puerto Rico.
It is time to dare to speak out about canceling the abusive debts demanded of the working classes. Private banks and other private bodies have put great energy into developing policy of lending to ordinary people who turn to borrowing because their incomes are insufficient to pay for higher education or health care. In the U.S., student debt has reached over $1.7 trillion, with $165 billion worth of student loans in default, while a large part of mortgages are subjected to abusive conditions (as the subprime crisis clearly showed from 2007). The terms of certain consumer debts are also abusive, as are most debts linked to micro-credit in the South.
Indebtedness of the working classes is directly connected to the widening poverty gap and increasing inequality, and to the demolition of the welfare state that most governments have been working at since the 1980s. This is true all over the world: whether in Chile, Colombia, the Arabic-speaking region, Japan, Europe or the United States. As neoliberal policies dismantle their systems of protection, people are obliged, in turn, to incur debt as individuals to compensate for the fact that the states no longer fulfil the obligation incumbent upon them to protect, promote and enact human rights. Cinzia Arruzza, Tithi Bhattacharya and Nancy Fraser emphasized this in their book, Feminism for the 99%: A Manifesto.
What are the alternatives for a sustainable model of development?
The health crisis is far from being resolved. The capitalist system and neoliberal policies have been at the helm at all stages. At the root of this virus is the unbridled transformation of the relationship between the human species and nature. The ecological and health crises are intimately intertwined.
Governments and big capital will not be deterred from their offensive against the populations unless a vast and determined movement forces them to make concessions.
Among new attacks that must be resisted are the acceleration of automation/robotization of work; the generalization of working from home, where employees are isolated, have even less control of their time and must themselves assume many more of the costs related to their work tools than if they worked physically in their offices; a development of distance learning that deepens cultural and social inequality; the reinforcement of control over private life and over private data; the reinforcement of repression, etc.
The question of public debt remains a central element of social and political struggles. Public debt continues to explode in volume because governments are borrowing massively in order to avoid taxing the rich to pay for the measures taken to resist the COVID-19 pandemic, and it will not be long before they resume their austerity offensive. Illegitimate private debt will become an ever-greater daily burden for working people. Consequently, the struggle for the abolition of illegitimate debt must gain renewed vigor.
The struggles that [arose] on several continents during June 2020, notably massive anti-racist struggles around the Black Lives Matter movement, show that youth and the working classes do not accept the status quo. In 2021, huge popular mobilizations in Colombia and more recently in Brazil have provided new evidence of massive resistance among Latin American peoples.
We must contribute as much as possible to the rise of a new and powerful social and political movement capable of mustering the social struggles and elaborating a program that breaks away from capitalism and promotes anti-capitalist, anti-racist, ecological, feminist and socialist visions. It is fundamental to work toward a socialization of banks with expropriation of major shareholders; a moratorium of public debt repayment while an audit with citizens’ participation is carried out to repudiate its illegitimate part; the imposition of a high rate of taxation on the highest assets and incomes; the cancelation of unjust personal debts (student debt, abusive mortgage loans); the closure of stock markets, which are places of speculation; a radical reduction of working hours (without loss of pay) in order to create a large number of socially useful jobs; a radical increase in public expenditure, particularly in health care and education; the socialization of pharmaceutical companies and of the energy sector; the re-localization of as much manufacturing as possible and the development of short supply chains, as well as many other essential demands.
A few years ago, you argued that the socialist project has been betrayed and needs to be reinvented in the 21st century. What should socialism look like in today’s world, and how can it be achieved?
In the present day, the socialist project must be feminist, ecologist, anti-capitalist, anti-racist, internationalist and self-governing. In 2021, we commemorate the 150th anniversary of the Paris Commune when people set up a form of democratic self-government. It was a combination of self-organization and forms of power delegation that could be questioned at any moment, since all mandates could be revoked at the behest of the people. It has to be clearly stated that the emancipation of the oppressed will be brought about by the oppressed themselves, or will not happen at all. Socialism will only be attained if the peoples of the world consciously set themselves the goal of constructing it, and if they give themselves the means to prevent authoritarian or dictatorial degradation and the bureaucratization of the new society.
Freedom only for the supporters of the government, only for the members of one party — however numerous they may be — is no freedom at all. Freedom is always and exclusively freedom for the one who thinks differently. Not because of any fanatical concept of “justice” but because all that is instructive, wholesome and purifying in political freedom depends on this essential characteristic, and its effectiveness vanishes when “freedom” becomes a special privilege.”
Faced with the multidimensional crisis of capitalism hurtling towards the abyss due to the environmental crisis, modifying capitalism is no longer a proper option. It would merely be a lesser evil which would not bring the radical solutions that the situation requires.
This interview has been lightly edited for clarity.
If the Biden administration were serious about helping workers to build power, it would push back against the Republican governors who are ending pandemic unemployment programs early.
The Texas deputy who tased a 16-year-old asylum-seeker at a government-funded shelter was placed on administrative leave, the Bexar County Sheriff’s Office said on Wednesday.
The announcement came a day after Reveal from The Center for Investigative Reporting published bodycam footage of the incident as part of an investigation into federally sponsored shelters turning over migrant children to law enforcement.
In the footage, which Reveal obtained through a public records request, Deputy Patrick Divers can be seen arriving at the Southwest Key Casa Blanca shelter in San Antonio. Staff there had called 911 after the boy, who had fled Honduras at age 15, refused to go to class and had broken some bed frames and storage bins.
Divers didn’t request evidence of the child’s alleged wrongdoing at the time, according to the footage. The deputy didn’t attempt to have his orders translated into Spanish by the bilingual shelter staff, nor did he tell the boy that he was under arrest. He ordered the teen in English to stand up and turn around. The child showed no signs of fighting back or resisting arrest. Divers then repeatedly pulsed the weapon on the child’s torso and thighs, shocking him for 35 seconds, the footage shows.
Divers, a 27-year veteran of the department, couldn’t be reached for comment for the investigation.
The sheriff’s office has continued to deny Reveal access to a number of documents that would help the public better understand what happened. For months, Reveal has sought a copy of a use-of-force report that Divers and his partner, Harold Schneider, would have ostensibly had to file after the tasing. We have also requested the department’s use-of-force policy to understand whether the deputies’ actions were allowed. (We found that the department had already submitted an unredacted version of its use-of-force policies as part of an unrelated lawsuit and published the chapter in full online.)
What’s more, as we prepared to publish this investigation, a Sheriff’s Office sergeant requested that we destroy the video, arguing he never should have released it to the public because it involves a juvenile.
On Wednesday, officials went a step further in their attempts to keep the information from Reveal.
The Bexar County District Attorney’s Office issued a letter to Texas Attorney General Ken Paxton, seeking a ruling against releasing additional records. In its letter, the district attorney contends that “release would interfere with law enforcement and prosecution” because it would give criminals sensitive information on how law enforcement operates.
The district attorney also noted that the sheriff had requested that Reveal destroy the video footage. Reveal will not destroy the video. There is a strong public interest in its airing. The child’s grandmother told Reveal that she wants the video to be published so the public knows what can happen in shelters for migrant children in the United States.
Additionally, U.S. Rep. Joaquin Castro, a Democrat who represents San Antonio, called for a federal inquiry into what happened.
“I am urging a full investigation by the Inspector General of the U.S. Department of Health and Human Services of this incident, and also the Department’s policy with respect to the use of local police and a review of refugee shelter’s employee training and trauma-informed care practices,” he wrote in a statement.
Reveal’s investigation has found that over the last six years, shelters have discharged at least 84 migrant children, ages 11 to 17, to local law enforcement. Additional records for 19 of the children indicate many children were arrested over allegations of fighting and property damage. Only one was arrested for a felony and prosecutors didn’t pursue charges in the case.
Southwest Key’s Casa Blanca shelter is funded by the Office of Refugee Resettlement, which is part of the Department of Health and Human Services. A Southwest Key spokesperson declined to comment on Divers’s leave, saying that it is a law enforcement matter. The federal refugee agency did not respond to requests for comment about Divers’s placement on administrative leave.
The mistreatment of First Nations children in residential schools was appalling – and racial injustices persist
Last month, the Tk’emlúps te Secwépemc First Nation found the remains of 215 children who had been buried in unmarked graves at the site of a former Indian residential school in British Columbia. Residential schools, which operated in Canada from 1883 to 1996, were government-funded, church-run institutions that took Indigenous children away from their families, with the aim of “[killing] the Indian in the child”.
This was not just a metaphor. The mass grave discovered was one of many that are believed to exist at or near more than 100 residential schools all over Canada. These graves were often visible from the windows of the schools. Some children were even forced to bury their own classmates.
Cindy Blackstock, a member of the Gitxsan First Nation, is the executive director of the First Nations Child and Family Caring Society and professor at McGill University. Pamela Palmater, a member of Ugpi’ganjig (Eel River Bar First Nation), is professor and chair in indigenous governance at Ryerson University
When Bexar County Sheriff’s Deputy Patrick Divers pulled into the shelter for migrant children, a few staff members waited outside to greet him. They gave him the basics: There was a 16-year-old boy inside. He hadn’t wanted to go to class that day. He’d broken some stuff and was “super aggressive.” The boy had anger issues, Divers was told.
“Well, obviously,” he scoffed before entering the building.
As Divers was led to the boy, he didn’t ask many questions. He eventually arrived to find the child sitting in a bathroom, yelling in Spanish to the facility’s staffers.
“If they’re going to take me, let’s just fucking get it over with,” the child yelled over and over again, according to Divers’ body camera footage.
Ricardo Cisneros, the interim director of the Southwest Key Casa Blanca shelter in San Antonio, repeatedly gave the teen his word that the police wouldn’t touch him or take him anywhere. They just wanted the boy to come out. The boy sat motionless and didn’t touch anyone.
Divers didn’t request evidence of the child’s alleged wrongdoing at the time, according to the footage. He did ask staff whether they wanted to press charges. After Cisneros said yes, the deputy shared his plan with the staff members: He would wait for his partner to arrive. “As soon as they get here, we’ll take care of this,” he said.
The boy repeatedly asked what they were going to do with him.
He was a refugee, an asylum seeker in the country without his parents and in the custody of the federal Office of Refugee Resettlement. The previous year, he’d fled a gang that had beaten him and, his family says, threatened his life in Honduras. By that afternoon in May 2020, the teen had already spent nine months bouncing around five refugee agency-sponsored shelters from California to Virginia and Texas; he’d only been at this shelter for a week. Like so many other teenagers across the United States, he’d decided on this day that he didn’t want to attend class. Except he now faced a sheriff’s deputy looming over him.
After a seven-minute wait, Divers’ partner, Deputy Harold Schneider, showed up.
“Ready? I’m going to tase this kid,” Divers said in English.
The deputy had repeatedly been told that the child, who was sitting on the bathroom’s toilet seat cover, understood little English. He was surrounded by bilingual staff members who could interpret, but they stepped aside when Divers drew his weapon. He did not tell the boy that he was under arrest. He ordered the teen in English to stand up and turn around. The child stood up; he was adjusting the drawstring on his pants when Divers shot him with his Taser.
The child showed no signs of fighting back or resisting arrest. Divers then repeatedly pulsed the weapon on the child’s torso and thighs. In all, the 16-year-old experienced 35 seconds of electric current running through his body, rendering him immobile. Divers’ partner eventually cuffed the teen, who was dripping blood; it’s unclear what caused the bleeding.
After picking him up, Schneider chose a nickname for the refugee child, who’d just lost voluntary control of his muscles and who was screaming in pain and agony.
“El Stupido,” he said.
Bodycam footage obtained by @reveal captures the tasering of a migrant child at a shelter. (cw: violence) pic.twitter.com/KaUbK1fMXj
When migrant children enter the United States without their parents and end up in U.S. government custody, either after presenting themselves at a port of entry or after being picked up by the Border Patrol, they’re supposed to be taken care of by the Office of Refugee Resettlement.
Contrary to a lot of popular assumptions, the children aren’t generally detained by U.S. Immigration and Customs Enforcement. The refugee agency, ORR, is a separate agency and is subject to a court decree that’s designed to safeguard migrant children from neglect and abuse. The decree, called the Flores settlement, was crafted in response to a class-action lawsuit representing children fleeing violence in El Salvador in the 1980s who were strip searched, handcuffed and denied release to their families by the federal government. The settlement, which the Trump administration unsuccessfully tried to end, sets guidelines for how long and under what conditions the U.S. government can detain migrant children without their parents.
To care for the tens of thousands of children who pass through its custody each year, ORR finances a network of about 100 privately run shelters across the country.
An investigation by Reveal from The Center for Investigative Reporting has found that a number of the government’s shelters have been turning to police to manage the sort of behavior that could be expected of children, in particular isolated refugee children. Over the last six years, shelters have discharged at least 84 children, from ages 11 to 17, to local law enforcement, according to data Reveal obtained after suing the federal government.
Local law enforcement and courts released records for 19 of those children. An examination of more than 200 pages of records, nearly four hours of body camera footage and half a dozen 911 call recordings shows that many of the children were turned over for arrest after they allegedly fought, damaged property or had mental health challenges. Most children were processed for misdemeanors; one in Washington state was arrested for a felony, but prosecutors didn’t pursue the charge.
In April 2018, for example, police in Houston were called to a Southwest Key shelter after a 16-year-old allegedly made a suicidal threat. According to police records, officers took him into custody. The child had spent more than seven months in four different shelters. Two shelter operators, Southwest Key Programs and BCFS, account for three-fourths of all the cases in which migrant children were turned over to law enforcement, the records show. And the incidents overwhelmingly stem from two counties in Texas, Bexar and Cameron.
A number of migrant children’s shelters run by Southwest Key Programs – including Casa Padre in Brownsville, Texas, shown in 2018 – have turned to police over children’s behavior. Credit: Miguel Roberts/The Brownsville Herald via Associated Press
Over a one-month span in the summer of 2019, federal records indicate seven children, including a 12-year-old, were arrested from a single shelter in San Antonio run by BCFS, a nonprofit that received more than $186 million from federal grants for the care of migrant children last year. Reveal obtained local law enforcement records for four of the cases involving 17-year-olds; all four were charged with misdemeanor offenses for allegedly hitting staff or peers or, in one case, breaking a television and a chandelier.
In one case, no injuries were reported. Another case alleging bodily injury was later dismissed for lack of evidence. A third resulted in a misdemeanor conviction for bodily injury to another child. The child who was hurt in that case was arrested for misdemeanor assault a few days later in a separate incident and pleaded guilty to misdemeanor assault. He was sentenced to serve 28 days.
At least 10 migrant youth were charged as adults in Texas, where the criminal justice system treats 17-year-olds as adults.
In 2018, police in Brownsville, Texas, arrested several 17-year-olds held at Southwest Key shelters Casa El Presidente and Casa Padre on misdemeanor assault charges. One was convicted of pushing a worker twice on the shoulder, and a second youth was accused of punching another child who turned off the lights in a classroom, records show.
Another was accused of wrapping his arm around another teen’s neck for a few moments before walking away, a police report states. Even though the alleged victim did not have injuries to his neck, shelter workers called the police. According to the report, the assistant program director told one of the two responding officers that his supervisors advised him to call the police.
Officers booked the teen into the city jail. Court records in his case show he was charged with class A misdemeanor assault, which is punishable by up to a $4,000 fine and up to a year of imprisonment. The teen pleaded guilty and was sentenced to 120 days in county jail.
Some calls alleged more serious behaviors.
At the Selma Carson Home in Washington state, police were called after a 17-year-old was accused of grabbing another boy’s neck at night while in his bed and threatening to kill him in 2018. According to records, the child told police that he attacked his roommate for exposing his penis; police noted the victim had “a small mark” on his neck from the attack. The child was arrested on suspicion of misdemeanor assault and a felony count for making a threat, but prosecutors ultimately declined to bring charges.
But a number of current and former shelter workers and immigration advocates said staffers should be able to handle situations in which children have simple fights or break things because they don’t want to go to class. Children can be separated, for example, or a child can be transferred to a different shelter that’s more equipped to handle a child’s needs.
Claudia Valenzuela, an attorney with the nonprofit legal service provider Immigrant Legal Defense, said Southwest Key staffers did not need to call the police on the 16-year-old boy in San Antonio.
“There was no appreciation of the circumstances of this young man,” she said after Reveal showed her the video. “I’m kind of speechless at the fact that they were the ones that decided to press charges, which triggered the tasering.”
Such an arrest could make it more difficult for a child to get a visa or be released to live with a family member or friend, she said.
Reveal showed the video to U.S. Rep. Joaquin Castro, a Democrat who represents San Antonio. He called what happened horrendous.
“Here you have a young man who’s experienced incredible trauma,” Castro said. “We’ve talked a lot in this country about over-policing in different situations, and this is clearly an example of over-policing with respect to asylum-seeking youth.”
Castro told Reveal that he’ll be asking the federal refugee agency to review what occurred and evaluate Southwest Key Casa Blanca and its staffers’ training.
Neither Southwest Key nor BCFS would answer Reveal’s questions about the police calls. In a statement, Southwest Key spokesperson Kasey El-Chayeb said staff receive crisis intervention training and contact law enforcement only if their de-escalation techniques are not effective or if children present a danger to themselves or others. “We understand that we provide care to young people who have suffered various traumas while coming to this country as unaccompanied minors,” El-Chayeb said.
The refugee agency, now under the purview of President Joe Biden, would not answer questions about the police transfers, saying it doesn’t respond to “anonymous allegations.” Xavier Becerra, secretary of the Department of Health and Human Services, which oversees the refugee agency, issued an identical statement.
Reveal’s reporting is not based on anonymous allegations. The data – 266,000 records, one for every child who’s made their way through the refugee agency’s system from late 2014 to late 2020 – were obtained directly from ORR through litigation; the bodycam video was obtained under the Texas state records law directly from the Bexar County Sheriff’s Office. Even after Reveal made that clear, ORR declined to view video evidence of tasing in one of its shelters.
The boy in that video was arrested on a charge of criminal mischief. Officials in Bexar County won’t disclose whether the boy was charged with a crime and, if he was, whether he was found guilty. When Reveal requested to interview Bexar County Sheriff Javier Salazar about the incident, his spokesperson said she was unaware of the case.
“I have checked on my end to see if there was any recent incident involving our deputies using a taser on a migrant child,” Adelina Simpson wrote in an email, “and have not been able to find any information.”
When provided more detailed information about the case, including the shelter’s address and the names of the deputies who were involved, Change Management Specialist Sandra Altamirano-Pickell thanked Reveal for making the department aware of the incident and said the department would launch an internal affairs investigation.
The following day, Sgt. Abraham Abraham, an open records officer at the department, called a Reveal reporter and requested that Reveal destroy the video, saying he should not have turned it over in response to a public records request because it involves a minor. Reveal will not destroy the video. There is a strong public interest in its airing. The child’s grandmother told Reveal that she wants the video to be published so the public knows what can happen in shelters for migrant children in the United States.
When the boy was 12, he began helping his family get by, selling coconut water on the street in Honduras. Reached by phone from Honduras, his grandmother – who raised him – recalled how soon after he began working, he was hounded by a local gang to pay a tax on the little money he made. Threats against him grew more serious, and, she said, he was brutally beaten for all of his money on a few occasions.
Terrified for his life, he eventually decided to do what thousands of Central American children do each year: He made his way north. He was 15 years old.
Reveal is not naming the grandmother out of concern for her safety and is not naming the boy because he’s a juvenile.
He eventually arrived in the United States, and it’s unclear how he ended up in federal custody. Typically, migrants either present themselves as asylum seekers at a port of entry or are picked up by Border Patrol while attempting to cross without authorization. The government then began shuttling him from shelter to shelter across the country.
It first put him in a shelter in Fullerton, California. Two weeks later, it moved him to a more restrictive facility for children about an hour north of San Francisco. There, he turned 16. Then the government sent him to Virginia, to one shelter in San Antonio and then to the Southwest Key Casa Blanca shelter across town. Children are moved for a variety of reasons, without judicial oversight. Some children are moved when a shelter reaches maximum capacity; others are sent to more restrictive facilities because of how they behave or the support they are deemed to need.
Nine months, five facilities, three states and one birthday.
The government’s migrant shelter system isn’t designed for this kind of prolonged stay, depriving children of the emotional and educational support they need in the long term. Indeed, the Flores settlement calls for the government to “release a minor from its custody without unnecessary delay.” Yet as Reveal’s ongoing investigation into how detention changes migrant children found last year, nearly 1 in 10 migrant children spent more than 100 days in custody over the last six years. Nearly 1,000 spent more than a year in custody.
Persistently moving around the country, having to adjust to a new setting with new rules and new people, stressed out the boy and made him anxious, said his grandmother, who’s still in contact with the child through weekly phone calls. Before his detention, she said, he was a relatively carefree kid.
She said she noticed he was anxious when they talked by phone after he arrived at his first shelter. The anxiety, she said, grew into depression with time.
It was the tasing, however, that drastically changed her grandson, she said.
After he was tased, she said he cried a lot more on their weekly phone calls and has expressed a desire to end his life. He’s terrified of being tased again. She said he wants to seek deportation to escape the shelter but remains terrified of the death threats that motivated him to flee Honduras originally.
While she was aware that her grandson was tased, the grandmother wasn’t aware that there was video footage. She said that what happened was deeply unjust and that the people and agencies responsible for what occurred should be held accountable.
“You don’t know how much this has hurt my heart,” she said.
Records from the refugee agency reviewed by Reveal show that a day or two after his arrest in Bexar County, the 16-year-old boy was transferred for a second stint at the Shenandoah Valley Juvenile Center in Virginia.
After four months in Virginia, the child was transferred back to Texas – this time to a different shelter run by Southwest Key, Casa Montezuma in Harris County. He turned 17 years old there, his second birthday in custody. Two months later, he was sent to the Shiloh Treatment Center outside Houston, which has a history of drugging children without parental consent. He was there for a few months before being transferred to another shelter in Washington state.
Once Southwest Key’s staffers called police, they put the child’s fate in the hands of Bexar County deputies. He had been a child seeking protection from violence, someone afforded special protections under federal law. Then he became a criminal suspect turned over to law enforcement.
Even then, deputies are bound by rules about when and how they can use force against a suspect.
According to the department’s use-of-force policy, officers should use the minimum amount of force required to bring any incident under control. The handbook explains that “(g)enerally, the use of force against another is not justified in response to verbal provocation alone.” If the officer determines the need for force, the policy manual states that “an officer will use verbal persuasion first,” followed by a physical hold. Deploying a Taser would be the next step before employing deadly force.
Bexar County Sheriff’s Deputy Patrick Divers escorts a handcuffed 16-year-old boy out of a migrant children’s shelter. Credit: Bodycam footage obtained from the Bexar County Sheriff’s Office
The body camera video does not show the boy provoking the deputies verbally. It doesn’t show Deputy Patrick Divers attempting verbal persuasion. Divers was told the boy spoke Spanish, but he issued commands in English. When Divers demanded that the child stand up, the child did so, while appearing to tighten the drawstring on his pants. It’s then that Divers deploys his Taser. In two bodycam videos reviewed by Reveal, neither deputy read the child his Miranda rights following his arrest.
The video shows that after the child is handcuffed, led out of the shelter and placed in the back of the squad car, Divers returns to the shelter with Ricardo Cisneros, the shelter’s interim director, to assess the damage. Cisneros explains that the child broke two bed frames and three plastic bins, estimating a total of about $500 worth of damage. But the alleged evidence was removed because, according to Cisneros, they were “things (the teen) can use for self-harm.”
The video doesn’t show Divers observing the bed frames or plastic bins the child was accused of destroying. Divers and his partner, Schneider, couldn’t be reached for comment. At one point in the footage, Divers mentions he worked at a Texas Key facility – Southwest Key’s former name – briefly before he joined law enforcement. Personnel records indicate Divers is a 27-year veteran of the force; Schneider retired in late March after 30 years as a Bexar County deputy.
The Office of Refugee Resettlement’s policies indicate that care providers must call 911 for true emergencies, like immediate dangers that would require hospitalization, situations in which a child has run away or in the event of a child’s death. The 16-year-old who was tased last year appeared to be experiencing emotional distress, but staff members on the video don’t accuse him of threatening or striking anyone.
Congressman Joaquin Castro said the agency needs to take the care of migrant children, and the trauma they’re facing, more seriously. With Biden now in the White House, he said federal departments charged with the custody of migrants of all ages have an opportunity to alter the way asylum seekers are treated.
“If we get through these next few years of the Biden administration and nothing has structurally changed – I don’t mean, like, little things on the edges – structurally changed about how we do this, then that will have been a tragic missed opportunity,” he said.
President Joe Biden, who has promised a more humane immigration system, signs an executive order on immigration Feb. 2, 2021. Credit: Evan Vucci/Associated Press
Police arrested 31 migrant children at shelters run by BCFS, which has operated more than a dozen federally funded migrant children shelters in Texas and California, over the six-year period, records from the refugee agency show.
In a statement, a BCFS spokesperson said: “The safety and well-being of both those in our care and our employees is a top priority. BCFS Health and Human Services follows all protocols and policies as outlined by the Office of Refugee Resettlement. Law enforcement is called whenever incidents of violence occur or as deemed necessary.”
Southwest Key, the nation’s largest shelter network for migrant children, accounted for the largest number of arrests. At least 36 children in Southwest Key’s care were turned over to local law enforcement.
Southwest Key, which has run approximately 30 shelters in Texas, Arizona and California, declined to discuss the boy’s Taser incident, claiming that doing so would violate the privacy of children in its care.
“When law enforcement is present, we respect their authority and judgement on how to handle the situation and what approach officers take,” wrote spokesperson Kasey El-Chayeb. “The decision on whether to arrest an individual is a law enforcement decision.”
Cisneros, the shelter’s interim director at the time, declined to comment.
After the teen was tased and taken into custody, the footage doesn’t capture Southwest Key staffers making objections to Divers’ actions. In one conversation between deputies and Julie Tamez, who was listed in records as the child’s lead case manager at the time, Tamez explained that the child had previously been in a different facility. “Where they send all the gangs and the sicarios and stuff, like people who kill?” she said. “He was all the way up there.”
After she informs Divers that the child may bang his head against the window, Divers responds, “I ain’t worried about it.”
Tamez throws her head up, shrugs and smiles. “Apparently, when they cross countries without anybody, they feel they know all,” she told the deputies.
When reached by phone last month, Tamez stressed that she wasn’t the person who called 911 the day the child was tased. She said other shelters in the area are serviced by the San Antonio Police Department, which Tamez said has more Spanish-language speakers – and added that she would have been happy to provide language interpretation between Divers and the child. But she wasn’t given the opportunity to do so. Tamez said she was shocked by how quickly the situation escalated after Divers’ arrival to the shelter.
“I was very surprised to see that there was a Taser used,” she said.
She expressed regret for what happened and wanted the child and his family to know she was sorry for what occurred that day. Tamez said she would never call 911 for a similar situation. “I would just try to implement what we could do instead,” she said. “We would try verbal judo or timeouts.”
The child who was tased in Texas is now back in Virginia – he was sent to the Shenandoah Valley Juvenile Center for a third time in mid-May. In nearly two years, the Office of Refugee Resettlement has moved him into 10 placements across four states.
The boy could be turned over to Immigration and Customs Enforcement for adult detention when he turns 18 in September. At that time, the possibility of a special visa reserved for children abandoned by a parent will evaporate.
And the legal and social services granted to him by the federal government as a minor will also vanish, along with the traumatic pubescent years wasted in refugee agency custody.
Former Reveal reporter Patrick Michels and Reveal data reporter Melissa Lewis contributed to this story. It was edited by Andrew Donohue and Sumi Aggarwal and copy edited by Nikki Frick.
A first-of-its-kind analysis of newly disclosed Internal Revenue Service data shows that the richest 25 billionaires in the United States paid a true federal tax rate of just 3.4% between 2014 and 2018 — even as they added a staggering $401 billion to their collective wealth.
Published Tuesday by the investigative nonprofitProPublica — which obtained a sprawling cache of IRS data on thousands of the nation’s wealthiest people dating back 15 years — the analysis takes aim at “the cornerstone myth of the American tax system: that everyone pays their fair share and the richest Americans pay the most.”
“Our analysis of tax data for the 25 richest Americans quantifies just how unfair the system has become. By the end of 2018, the 25 were worth $1.1 trillion,”ProPublicanotes. “For comparison, it would take 14.3 million ordinary American wage earners put together to equal that same amount of wealth. The personal federal tax bill for the top 25 in 2018: $1.9 billion. The bill for the wage earners: $143 billion.”
“Many Americans live paycheck to paycheck, amassing little wealth and paying the federal government a percentage of their income that rises if they earn more,” the outlet adds. “In recent years, the median American household earned about $70,000 annually and paid 14% in federal taxes.”
The new analysis juxtaposes the recent wealth gains of U.S. billionaires — asestimatedbyForbes — with the information in the newly obtained IRS data to derive the “true tax rate” paid by the mega-rich.
The results show that Amazon CEO Jeff Bezos — the world’s richest man — and Berkshire Hathaway CEO Warren Buffett paid a true tax rate of 0.98% and 0.10%, respectively, between 2014 and 2018. In 2007,ProPublicanotes, Bezos paid nothing in federal taxes even as his wealth grew by $3.8 billion.
Economist Gabriel Zucman, a professor at the University of California, Berkeley,saidtheProPublicareporting is “full of incredible findings.”
“Looks like the biggest tax story of the year, if not the decade,” Zucman added.
Striking story on the tiny effective tax rates of America’s top 25 billionaires, by the fearless @propublica
Still poring over the report, full of incredible findings
ProPublicamakes clear that, far from being the beneficiaries of a sprawling, illegal tax dodging scheme, “it turns out billionaires don’t have to evade taxes exotically and illicitly — they can avoid them routinely and legally,” a point that spotlights the systemic inequities of the U.S. tax system.
As the outlet explains:
Most Americans have to work to live. When they do, they get paid — and they get taxed. The federal government considers almost every dollar workers earn to be “income,” and employers take taxes directly out of their paychecks.
The Bezoses of the world have no need to be paid a salary. Bezos’ Amazon wages have long been set at the middle-class level of around $80,000 a year.
For years, there’s been something of a competition among elite founder-CEOs to go even lower. Steve Jobs took $1 in salary when he returned to Apple in the 1990s. Facebook’s Zuckerberg, Oracle’s Larry Ellison, and Google’s Larry Page have all done the same.
Yet this is not the self-effacing gesture it appears to be: Wages are taxed at a high rate. The top 25 wealthiest Americans reported $158 million in wages in 2018, according to the IRS data. That’s a mere 1.1% of what they listed on their tax forms as their total reported income. The rest mostly came from dividends and the sale of stock, bonds, or other investments, which are taxed at lower rates than wages.
To illustrate the consequences of a system that doesn’t tax unrealized capital gains,ProPublicacites the example of Bezos’ $127 billion explosion in wealth between 2006 and 2018. The Amazon CEO “reported a total of $6.5 billion in income” during that period and paid $1.4 billion in personal federal taxes — a 1.1% true tax rate.
“America’s billionaires avail themselves of tax-avoidance strategies beyond the reach of ordinary people,”ProPublicanotes. “Their wealth derives from the skyrocketing value of their assets, like stock and property. Those gains are not defined by U.S. laws as taxable income unless and until the billionaires sell.”
This is obscene. In 2011, Jeff Bezos had $18 billion in wealth. But managed to offset all gains and paid $0 in federal taxes. And because he paid no taxes, he also claimed $4000 in tax credits for his kids: https://t.co/rgQemmntjH
Richard Tofel,ProPublica’s founding general manager and outgoing president,saidTuesday that he considers the tax analysis “the most important story we have ever published.”
“In the coming months, we plan to use this material to explore how the nation’s wealthiest people — roughly the .001% — exploit the structure of our tax code to avoid the tax burdens borne by ordinary citizens,” Tofel andProPublicaeditor-in-chief Stephen Engelbergwrotein a separate article Tuesday. “Many will ask about the ethics of publishing such private data. We are doing so — quite selectively and carefully — because we believe it serves the public interest in fundamental ways, allowing readers to see patterns that were until now hidden.”
Daniel Falcone:Could you talk about The Pandemic Pivot and how the concept, format and structure developed for the book? Also, could you share your argument and what you contend in the book?
John Feffer: The project started in the spring, as the pandemic was developing and spreading. Around May we (at the Institute for Policy Studies) realized that this was a focal point in two respects. First, governments were responding to the pandemic in a systematic fashion, which revealed some important trends that had hitherto been either obscured or not remarked upon sufficiently — both on the positive side and on the negative side. Second, progressive activists were a little slow to respond to this phenomenon both in terms of the severity of it and its implications politically and economically. But also, we failed to take advantage of some of the opportunities that presented themselves in an otherwise very terrible period.
We wanted to get the reactions of activists and scholars and journalists from around the world. So, we approached approximately 80 folks to participate in a project. We divided up the topic of the pandemic into eight topic areas, and then invited experts on those topics of economic development, war and peace, migration and refugee questions, and so on. We didn’t necessarily have an argument, per se, going into it — more of a rough hypothesis that this was an important moment globally, that populist right-wing governments were taking advantage of the COVID-19 crisis by consolidating their political power, and that the progressives should formulate some kind of response both to the pandemic itself but also to the right-wing activities around the pandemic.
We held those discussions over last summer. And then I prepared a transcript from those conversations. I checked them with all the participants to make sure that their quotes were correct and their insights were summarized correctly. And then I used that as the basis for each of the chapters of the report. It was my job to flesh out these arguments.
The argument coming out of this is that the pandemic brought into relief many of the existing inequities, whether political or social, aggravated those inequities and provided an opportunity for powerful actors of the world to increase their power. Those actors might be the leaders of countries or of institutions, like Amazon and Jeff Bezos, who were well positioned to take advantage economically of the breakdown of the global economy and the breakdown of traditional brick-and-mortar businesses in a quarantine situation.
At the same time, some transformational possibilities were also revealed. So, for instance, obviously, the climate crisis was very much in the foreground prior to the pandemic. But suddenly we had a very stark revelation of how a climate crisis can be addressed very quickly and very radically. We saw an unprecedented reduction in carbon emissions as a result of shutdowns of the economy. Animals returned to big cities and air pollution declined in cities because of the reduction in traffic.
Here’s another example: The major argument that was presented to climate activists prior to the pandemic was, “We acknowledge it’s a big problem, but where’s the money going to come from? Trillions of dollars are needed to deal with this climate crisis. Sorry, folks, but we’re already leveraged pretty heavily in many countries in the world.” And then, suddenly — surprise, during the pandemic the money is found to keep people employed, to deal with the consequences of the shutdown. We’ve been in financial crises or economic crises in the past but this was something really quite different qualitatively and quantitatively. The financial crisis in 2008- 2009 resulted ultimately in about a 0.1 percent reduction in global economic output. Last year, the global economy contracted by around 4.3 percent. That’s an extraordinary difference in scale between our current global economic crisis, which accompanied the pandemic, and the financial crisis.
So, obviously, there was a good rationale for governments to find money to deal with this unprecedented economic crisis.
The third argument is that the pandemic really revealed how interconnected these problems are and how interconnected a transformational response must be. It can’t be a return to the status quo ante, a return to “business as usual” as it existed prior to the pandemic. I think everybody has understood at an intuitive level that this was a transformational event and, therefore, required a transformational response. How transformational and in what direction that transformation goes, that’s obviously subject to discussion.
Falcone:We spoke previously, and you forecasted in a sense how “slowbalization” — the idea that globalization was slowing down — would impact and reach each social, economic and political system throughout the world. Has anything developed with a radical difference since we discussed the pandemic last year? Or even since you have come out with the book?
People are talking, obviously, about the global recovery. And many (and I would say most) industrialized countries have begun this economic recovery, complicated with certain kinds of speed bumps here and there. India was expecting to have a much faster economic rebound and then was hit by a much more severe wave of the pandemic. Taiwan thought it was completely free of infection and went slow in terms of its vaccination campaign only to be hit with its first significant wave of infections.
The situation is not so rosy for what are called emerging markets. Here we see the K-shaped recovery at a global scale. Of course, people talk about the K-shaped recovery at a national level here in the United States where you have a class of people that have done pretty well actually during the pandemic, who have saved money or who have become pandemic profiteers. And then there’s a much larger group of Americans who are seeing a major setback in terms of their economic fortunes: evicted from their properties, losing their jobs, dealing with a huge amount of debt, etcetera.
This K-shaped recovery is replicated at the global level. Some countries like China and the United States are emerging from this pandemic economically pretty strong. The EU is not doing as well but it’s not too bad off. But then, a number of countries have been driven to the brink of insolvency, including countries which hitherto had been doing reasonably well like Costa Rica, those that had not been in such great shape like Zambia, and countries somewhere in the middle like Brazil — all of them driven to the brink of insolvency because of this pandemic, because of the collapse of commodity markets and the collapse of the global system that allows countries to export and grow their economies. But also, they took on a lot of debt to deal with the pandemic and the economic crisis within their borders.
Slowbalization was a trend prior to the pandemic. It was largely a result of the declining rate of profits that were accruing to investments overseas, the vagaries of the labor market and the demands of workers overseas for higher wages in places like China. And now comes COVID-19, which starkly reveals the fragility of the labor market. Couple that with the rising costs of labor, and many global economic actors began to rethink the global supply change.
The pandemic has initiated a much longer conversation about the global economy and where it’s heading, above and beyond the day-to-day decisions made by individual corporations. There’s certainly not been any decision by any global authorities about what direction the global economy can move in at this point. But we’ll probably see two kinds of actions moving forward.
The first encourages some version of sustainability, which might include some form of greenwashing. If you look at, say, the extraction industry, which contributes quite a lot to global carbon emissions, not just in the burning of fossil fuels but the actual extraction of the resources from the ground, greening that process includes making the actual extraction process produce fewer carbon emissions. Is that good? Is that bad? If it continues to produce the same amount of fossil fuels in the end, probably not so good. But in any case, this is one type of trajectory for the global economy, an attempt to make it carbon-friendly.
The second involves the circulation of loans. With so many countries on the brink of insolvency, the International Monetary Fund (IMF), the World Bank, banks in general and creditors have to think about how to sustain the global economy. There have been some piecemeal reforms, like debt moratoria and increasing special drawing rights at the IMF. Debt forgiveness hasn’t really been on the table. But here, the trends could come together with debt-for-carbon swaps where countries reduce their carbon emissions to reduce their debt burdens.
We’ve also seen an acceleration of some trends that we saw before the pandemic hit, which are more technology-driven. The pandemic revealed the fragility of the labor force. The labor force tends to be the most expensive part of any factory process. If you get rid of those workers, you reduce costs and you protect yourself from labor shortages connected to future pandemics. So, automation is quickly going to accelerate it, and there are studies about how automation accelerates after economic crisis anyway. The International Labour Organization and World Bank produced detailed reports on how dramatic this automation might be, not just in places like the United States but also in China and Ethiopia. This is also going to raise the question of what all these redundant workers are going to do.
Another trend is reshoring, where transnational corporations make a decision that it doesn’t make sense any longer to have your manufacturing facilities so far from their consumer base. So, they’ll bring that manufacturing facility back home, closer to the consumer base. And that would accelerate the slowbalization process.
Falcone: The pandemic has created new norms. As disaster capitalism plays a role in intensifying inequality around the world, we also see new opportunities for resistance and advocacy. How has the pandemic reshaped the progressive left’s ability to harness energy and get resistance movements to focus on class disparity and class consciousness? Can recent events surrounding George Floyd and Black Lives Matter, Palestine and climate justice reduce addressing the pandemic pivot to class issues and struggles in a positive sense?
The starting point for this is really the rise of right-wing populism and the appeal of right-wing populism to what had traditionally been left-wing constituencies like the working class. We certainly saw that with Donald Trump. Obviously, there’s a race dimension here as well. It wasn’t the Black working class that Trump was appealing to, it was the white working class. But you saw this in Brazil as well. The pandemic — and this wasn’t necessarily clear from the beginning but has certainly become clear over time — removed the illusion that many of these right-wing populists fostered, that they in fact cared about these constituencies. In Brazil, President Jair Bolsonaro engaged in a perverse version of the bolsa família, the livelihood supplement for working families that former President Luiz Inacio Lula da Silva introduced, by basically throwing money at people during the pandemic in an attempt to buy people’s support. Ultimately the failure of these leaders to have an effective response to the pandemic revealed to a lot of people, including working-class constituencies, that these leaders in fact didn’t care about their lives at all.
Trump most likely wouldn’t have lost the election if not for the obvious, palpable failures of his COVID response. I think we’ll see other political casualties from the camp of right-wing populists because of their COVID responses, like Prime Minister Narendra Modi in India. So, this is an opportunity for the left to say, “Okay, you know, you have been disillusioned by the right-wing populists’ response to COVID, now let’s build an authentic left populous economic program that acknowledges what has taken place during the COVID era and build a better version.”
So, I think we can see that the left has taken advantage and will take advantage of the new kind of economic possibilities within national boundaries. Transnational is another matter; I don’t think we’ve seen an effective transnational economic program. We’ve seen transnational movements on race questions, obviously Black Lives Matter, women’s issues like the #MeToo movement, on environment questions. The pandemic either didn’t sever those connections or actually created the conditions within which those transnational movements became stronger.
Going forward, we have some ideas about what the left can do, economically speaking. Here the climate movement has offered some thinking about the economy that is largely divorced from the original Marxist or producerist roots of left economics. The climate movement is saying, “Look, a producer bias has been the problem whether it’s on the left or the right. It has produced the same overconsumption and overproduction that has led to the environmental crisis.”
But in greening the global economy, we also have to think that this is our opportunity to close the gap between rich and poor folk. This is the opportunity for the Global North to subsidize the Global South’s leapfrog over dirty technologies. In the past, the New International Economic Order offered a program for reversing the North’s colonial extraction of the South’s resources, but it never got enough traction. Now, actually, there is a self-interest among the industrialized countries to engage in this type of transformational economics because we’re all in the same climate crisis and the industrialized countries cannot shield themselves from the economic and environmental consequences of global carbon emissions elsewhere in the world.
Busra Cicek:Yeah, I was going to ask something specific regarding what you partly covered but let’s try to mention or highlight more, if we missed anything talking about it. Nationalism articulates a lot of the renewed power that states have garnered through extraordinary measures, given the pandemic. But before the pandemic, there was already a rise of far right movements co-opting state structures. And as you know, history has shown a grim result from this combination, so, what I’m asking is, what does the immediate future look like? And will authoritarian statecraft remain in place after the pandemic?
I’ve talked a little bit about how the pandemic undermined some sources of legitimation, particularly for far right populists. These populists have basically three sources of power coming from their critique of existing authority. One is their critique of neoliberal globalization, and the fact that globalization is not benefiting everybody. They have said, “Look at how corporations and international financial institutions have profited from globalization but so many people in our country have not.” The pandemic has, in some sense, only emphasized that the global economy was not benefiting everybody.
The second source of legitimate issue was a critique of the political elites that aligned themselves with that globalization project. That was also a very strong argument. After all, it wasn’t just conservative or centrist parties that supported neoliberal globalization but also some left socialist parties and former communist parties in the former Soviet bloc that adopted these policies of privatization, reduction of government services and facilitation of foreign direct investment whether they liked it or not. The global economy was structured this way, and you either “got with the program” or went down the North Korean path.
The right-wing populists said, “Let’s drive all the bums out, you know? Left, right: they all collaborated with these globalists and we, the authentic populists, never collaborated with the neoliberals.” That’s a somewhat weaker argument now because governments reversed some key elements of neoliberalism to deal with the pandemic, such as engaging in large Keynesian stimulus packages that have benefited populations.
With the third issue, immigration, the right-wing populists made the false argument that, “We have to protect the authentic communities in our country.” This took the form of white nationalism in the United States with Trump or the Alternative für Deutschland in Germany. But in India, Modi made the argument in terms of Hindu nationalism against Muslims while in Turkey, President Recep Tayyip Erdoğan made the argument against the Kurdish minority.
During the pandemic, the immigration issue was largely off the table because countries shut down their borders. Right-wing arguments about the necessity to close borders became a reality in virtually every country. This took the immigration issue largely off the political agenda in elections — for instance, in the United States in 2020 or the Netherlands in 2021. But now that countries are opening their borders again, immigration will once again be on the political agenda.
All of which is to say, we have a mixed picture coming out of the pandemic for right-wing populists. They can make a stronger argument about the global economy, but a weaker argument about the national economy and what the centrist elite has done in response to the pandemic, at least from the vantage point of neoliberalism. But the real problem will be the return of anti-immigrant rhetoric.
The loss of Trump in November is huge in terms of the United States. Will it have an impact in terms of taking the wind out of the sails of right-wing organizing more generally? That’s hard to say. For the most part, right-wing populists organize their support within their own borders. So, the loss of Trump probably has not had that much impact. But I do think that there can be a kind of “We’re in this together” spirit generated by the response to the pandemic that can substitute for the populist attack on the global order, and this kind of international solidarity, coupled with Trump’s loss, can put the far right on their back foot.
Cicek:Where were we in 2020 concerning the progressive alternatives and in which direction are we now heading in 2021 regarding “working towards the international space” and “the rejection of both the neoliberal status quo and the far-right challenge [that] will require progressive alternatives not just nationally but globally?” In other words, can we still have hope?
Hope is unevenly distributed around the world. Now we have a vaccine available, but it’s not available to everybody. It’s available in surplus here in the United States where the government is begging people to get vaccinated and states are setting up lotteries that potentially give people a million dollars to get vaccinated. Whereas in other countries, including India, which is the largest actual producer of the vaccine, they’re still getting hit hard by the virus and vaccine distribution has been weak. So, here in this country, we are very hopeful, but folks in countries [that] are still waiting on the vaccine are not as hopeful.
Moreover, the uneven distribution of vaccines only makes the K-shaped recovery worse globally. In other words, countries that can’t vaccinate their populations quickly cannot open up their economies as rapidly. It’s like the tortoise and the hare. The hare can jump out of the gate very quickly because of vaccination whereas the tortoise is going to fall progressively farther behind as a result of this. Now, of course, as in Aesop’s fable, the hare might become complacent and lose the race. So, here in the United States, we have to guard against that kind of complacency and push back against the Republican arguments that we don’t need such a big infrastructure bill or the other follow-on bills that the Democrats are preparing.
Obviously, many people were very hopeful around Biden taking office. It was so bad for four years that just to return to what it was like four years ago is cause for celebration. It’s a pretty low bar, but still, all the executive orders Biden signed in his first couple days in office, which effectively reset the United States to the last days of the Obama administration, were a sign that the U.S. is emerging from four years of irrational leadership and has returned to some measure of internationalism.
But unfortunately, we either have the same problems that existed prior to the pandemic or they’ve gotten worse coming out of the pandemic. Carbon emissions, for instance, are rebounding back to new, higher levels globally. A number of countries are now on the verge of insolvency. U.S.-China relations took a step backwards as a result of the pandemic, and they weren’t exactly in great shape at the end of the Obama administration either. But any kind of major transformational change at the international level has to include U.S.-Chinese cooperation. That doesn’t mean that the United States has to applaud what China does in Hong Kong or Xinjiang. Nor does it mean that China has to applaud what the United States is doing in the Middle East. But it does require that there is a working relationship between the two countries, especially on environmental issues.
The same could be said about U.S.-Russian relations, which is experiencing something of a step backward in the transfer of power from Trump to Biden. A third issue, which is complicating international solidarity, is the issue of hedging. The United States is an unreliable superpower. It has proven this over and over again over the years, but it’s obvious now to everybody. It’s obvious not just because of four years of Donald Trump and his unpredictability, but over the longer period in the political transitions from Clinton to Bush, from Bush to Obama, from Obama to Trump, and now from Trump to Biden. How can anybody predict where the United States is going to be four years from now? Maybe it’s a second Biden administration, maybe Trump comes back, maybe it’s neither of them but we have someone even more toxic than Trump, someone more competent like Tom Cotton.
In any case, the United States has been see-sawing back and forth in its policies domestically, but more importantly, internationally in terms of how it engages the international community. Other countries are saying, “Thank you, we’re glad you’re back, we’re happy you’re back in the Paris agreement, World Health Organization, etcetera, etcetera. But honestly, we cannot trust you and, as a result, structurally we are going to change our policies to hedge our bets.” So, the EU has concluded a new economic deal with China. It’s going to continue to explore energy cooperation with Russia. It’s going to put more money into an EU military force independent of NATO.
This is in contrast with China. Countries in Asia, Africa and Latin America may not like the strings attached to Chinese investments but they know that China’s going to be pretty consistent, even consistent in a bad way. Predictability is very important when you’re making long-range plans. But the United States is very unpredictable.
It goes beyond the U.S. government. U.S. civil society is also unpredictable. Some organizations call for greater cooperation with China around environmental issues. Others are calling for more sanctions against China because of its human rights violations, actions in the South China Sea, etcetera.
Going forward, when it comes to progressive transformation at the global level, for instance on environmental issues, the real heavy lifting will increasingly be done by other countries because the United States simply can’t be counted on given the profound political divisions in this country.
Falcone:Are there any closing thoughts about the “pivot” or do you want to say something about the book in closing that you’d hope readers take away?
One thing which has been a challenge for the left — certainly here in the United States, but one could argue globally — is that we are doom and gloom. We’re always talking about the end of the world. It’s not like we’re wrong: the planet faces some serious existential crises. Part of this doom-and-gloom critique has to do also with the fact that in the United States, the left has been shut out of government. We have some people in Congress, but for the most part the left has not been in a governing situation. So, we are not forced by circumstance to put forward a positive program. And so, we end up focusing on critique and that critique tends to be, “The world is in a lousy situation, it’s getting worse and we’ve got to do something immediately.” That might be factually accurate, but I don’t think it’s a great electoral strategy.
I don’t think people elect doom-and-gloom candidates for the most part. They elect people who promise something glorious: Obama’s “hope and change” or Trump’s MAGA.
In The Pandemic Pivot, we talk about how the pandemic has aggravated a lot of bad situations. But ultimately, it’s a hopeful platform, a platform that says there’s an opportunity for transformation and we’re seeing signs of movement in that direction here, here and here. Under the rubric of a more hopeful future, the book ultimately wants to inspire both activists and the general reader with accurate descriptions and forward-looking prescriptions.
This interview has been lightly edited for clarity and length.
In his extraordinary early 20th-century memoir, The Education of Henry Adams, Adams, the scholar, political observer and descendant of two presidents, wrote of the inherent dysfunction and dishonesty of the U.S. Congress. He wrote of a Cabinet Secretary crying out, “You can’t use tact with a Congressman! A Congressman is a hog! You must take a stick and hit him on the snout!” Of the Senate, Adams observed that “Senators passed belief. The comic side of their egotism partly disguised its extravagance, but faction had gone so far under Andrew Johnson that at times the whole Senate seemed to catch hysterics of nervous bucking without apparent reason … they were more grotesque than ridicule could make them … But their egotism and factiousness were no laughing matter. They did permanent and terrible mischief.”
Were there consistency in the GOP’s arguments, that would be one thing. But there isn’t, and there hasn’t been this past decade. Put simply, the GOP cares deeply about the debt limit when Democrats are in the White House, and cares not a whit about that limit when the commander-in-chief is a Republican.
It used to be the case that politicians of both parties tacitly agreed not to play party politics with the national debt. After all, the U.S.’s cast-iron guarantee that it won’t default on its loan obligations is what allows the country to maintain such a privileged position in global marketplaces, borrowing at far lower rates of interest than can most other countries, and allowing it to fund everything from its bloated military budget to Social Security, Medicare, Medicaid and vital infrastructure without taxing Americans at a level that would actually fully underwrite all of these programs. As soon as uncertainty is injected into that calculus, the likelihood increases that credit agencies will downgrade the country’s credit-worthiness and borrowing costs will significantly rise.
Since the Tea Party-dominated Republican Party swept to power in the House in the midterm elections of 2010, however, it’s become a central political axiom that the GOP will use the debt ceiling as a bargaining tool when dealing with Democratic presidents and their political priorities.
The GOP is now pulling the same trick against Joe Biden as its members did several times during Barack Obama’s presidency. Over a period of months in 2011, the newly minted GOP majority in the House withheld support for raising the debt ceiling, leading to a series of stop-gap spending resolutions that kept the government just about afloat, but unable to make long-term fiscal plans. They actually did shut down the government for days and weeks on end in 2013, as they tried to force negotiations over defunding the Affordable Care Act in exchange for funding government, a form of political vandalism and blackmail that would have hit the poor and the vulnerable particularly hard. And then, from 2013 through to late 2015, the GOP continued to threaten shutdowns, agreeing only to last-minute debt ceiling increases, and creating ongoing instability as they tried to leverage their power to force spending cuts.
Only in November 2015, after four years of blackmail over the debt ceiling, did Congress agree to a nearly one-and-a-half-year suspension of the ceiling, allowing for the government to be able to borrow enough money to fund its spending obligations.
True, there was a lengthy and destructive government shutdown in 2018-2019, lasting 35 days. But that was triggered not by a reluctance to raise the debt ceiling, but by the GOP and Trump being unwilling to pass and sign a government spending bill that didn’t include $5 billion for Trump’s much-touted border wall. The GOP gambled that, if threatened with a government shutdown that would put on hold the government’s ability to fund vital services like food stamps, Democrats would cave and fund the wall. When that didn’t happen, and the Democrats didn’t fold in the face of this blackmail effort, eventually Trump and the GOP blinked and reopened the government.
Fast forward to 2021, however, and the GOP — in the face of Biden proposals to increase assistance to low-income families, to establish paid family leave, to expand nutritional and early education programs, and to invest in programs to tackle climate change — has re-discovered its selective outrage at the idea of the country spending beyond its means.
Sen. Rick Scott (R-Florida) wants dollar for dollar spending cuts for any increase in the debt ceiling. Sen. Ted Cruz(R-Texas), who was silent about the dangers of increasing the debt under Trump, now worries that Biden’s plans will “bankrupt” future generations.
In the GOP mindset, busting through the debt ceiling is A-OK so long as the money flows to the wealthy through tax cuts. But it’s catastrophic and illegitimate when the money borrowed is used to better the lives of the country’s poor, to build infrastructure and to tackle climate change.
In response to these political games, last week three Democratic senators — Michael Bennet (D-Colorado), Brian Schatz (D-Hawaii) and Chris Van Hollen (D-Maryland) — introduced legislation to do away with the debt ceiling entirely. If it passes, it would do an end-run around the GOP’s ability to hold the nation’s finances hostage every time they face a set of policy priorities that they don’t like.
Of course, this reform almost certainly won’t pass the Senate. But at least it will show the stakes and highlight the hypocrisy of the Republican Party.
Bank regulators are rushing to come up with cryptocurrency rules, according to the Federal Reserve official overseeing financial regulation, but many fear the rule-making comes too late, and the unregulated bonanza may already be on the cusp of crashing and causing a broader recession that would hurt the poor most intensely.
Fed Vice Chair of Supervision Randal Quarles said on May 25 that his agency and two others — the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) — are taking the lead in what appears to be a scramble to act amid a period of instability with the potential to do serious damage to the rest of the economy. About 1 in 5 financial industry professionals believe that a cryptocurrency downturn could deliver a “salient shock to financial stability” over the next 12 to 18 months, according to a Fed survey conducted between February and April.
Though the rich might lose substantial sums in economic downturns, working-class people invariably suffer the most. The last four recessions and the ongoingCOVID-19 recession sent millions of people on the margins into poverty, with people of color hit the hardest.
“We along with the OCC and the FDIC are engaged right now in what we are calling a ‘sprint,’” Quarles said at a hearing before the Senate Banking Committee. The OCC is the primary regulator of federally chartered banks, and the FDIC is the agency that guarantees customer savings and oversees state-chartered banks. The Fed oversees bank holding companies and non-bank financial firms, and regulates the stability of the financial system as a whole.
Quarles said the three agencies have been working “over a relatively concentrated period of time, to pull together all of our work in digital assets, and to have a joint view, a joint framework for their regulation and supervision practices with regard to them.”
“It would be premature for me to tell you where that’s going to turn out,” he added, “but this is something that is a high priority not only as a matter of importance, but as a matter of chronology. And we expect to be able to give at least some results from that soon.”
The sudden “sprint” by regulators to examine cryptocurrencies might come too late, with the entire market on the brink of collapse. A sell-off earlier this month saw cryptocurrencies lose some $1 trillion in value in a week, from a peak global market cap of $2.5 trillion on May 11.
Volatility has been fueled by the structure of cryptocurrency markets. Traders can borrow 50-125 times the amount of cryptocurrency that they purchase on popular exchanges. Ownership of cryptocurrencies is highly concentrated in the hands of a relatively small number of owners, with some 42 percent of all Bitcoin owned by 2,155 unique purchasers. The value of cryptocurrencies has also fluctuated wildly in recent weeks in response to restrictions imposed by the Chinese government, and tweets from billionaire Elon Musk.
“While it’s welcome that the Fed, OCC and FDIC are going to be examining regulatory gaps when it comes to crypto, it’s crucial that they also examine any implications for systemic risk,” said Alexis Goldstein, a senior policy analyst at Americans for Financial Reform and a Truthout contributor. “With no cryptocurrency reporting requirements whatsoever for hedge fund or private equity funds, the regulators are in the dark.”
Regulatory agencies had an opportunity to act two and a half years ago, after a previous cryptocurrency crash. Since then, the global market has grown significantly, making the negative consequences of a downturn more severe. The value of the cryptocurrency market’s most recent peak, at $2.5 trillion, was three times the size of its previous peak of $815 billion in January 2018. The most recent market boom has also come at a time of great uncertainty and hardship for many throughout the world amid the COVID-19 pandemic, suggesting that the growth might be driven by irrational optimism.
By comparison, there was roughly $1.3 trillion in outstanding subprime mortgage debt in March 2007 amid the housing market meltdown that caused the Great Recession. Banks might now be engaged in safer consumer lending practices than they were during the subprime mortgage crisis, but corporations have borrowed heavily in recent years, racking up some $10.5 trillion in debt under relaxed lending standards. Fed Governor Lael Brainard warned on May 6 that inflated stock prices and “very high levels of corporate indebtedness bear watching because of the potential to amplify the effects of a re-pricing event.”
Cryptocurrencies have recovered somewhat since shedding $1 trillion in value earlier this month, but numerousanalysts have said the market resembles a bubble. This cohort of skeptics includes Vitalik Buterin, the 27-year-old who co-founded Ethereum, one of the more popular cryptocurrencies. “It could have ended already. It could end months from now,” Buterin told CNN.
Nouriel Roubini, an economist who became famous in 2008 for predicting the subprime mortgage crisis and the Great Recession, also believes that a cryptocurrency bubble is bursting. Unlike Buterin, he questions whether cryptocurrency has any use-value at all.
“A bubble occurs when the price of something is way above its fundamental value. But we can’t even determine the fundamental value of these cryptocurrencies, and yet their prices have run up dramatically,” Roubini said on May 21. “In that sense, this looks like a bubble to me.”
Despite Quarles’s promise of a “sprint,” recent remarks made by one of his colleagues failed to convey the same sense of urgency. FDIC Chair Jelena McWilliams said on May 11, at the height of the market, that her priorities in examining cryptocurrencies were to “allow entrepreneurship to flourish in the United States,” and that she would be consulting with the banking industry to see “what (if anything) the FDIC should be doing.”
McWilliams made the remarks in a speech to the Federalist Society, a highly ideological right-wing organization known for its embrace of laissez-faire dogma, and for handpicking judicial nominees for the Republican Party. The FDIC issued a request for information on digital assets the week after giving her speech.
Both McWilliams and Quarles are Republicans who were appointed to their current positions by former President Donald Trump. Quarles’s term as a top Fed official is set to expire in October. McWilliams’s FDIC Chairmanship won’t expire until 2023.
Quarles, in particular, has a reputation for having a rosy view of what will happen if banks are left to do whatever they want. In June 2006, while serving as under-secretary of the Treasury, he reacted to predictions of a housing market downturn by remarking: “I have to say that I do not think this is a likely scenario.” About two years later, the collapse of the U.S. housing market brought down the entire global financial system.
The Fed vice chair was criticized at the May 25 Senate Banking Committee hearing for more recent laxness by Democratic Sen. Elizabeth Warren of Massachusetts. Warren berated Quarles for the Fed’s decision to relax its supervision of Credit Suisse before the bank lost $4.7 billion in late March after the collapse of the family fund Archegos — a firm run by Bill Hwang, a man who had been previously banned by U.S. regulators from managing public money after pleading guilty in 2012 to insider trading and wire fraud charges.
Warren ripped Quarles and the Fed for their decision last year to absolve Credit Suisse and other foreign banks from answering to an oversight board called the Large Institution Supervision Coordinating Committee. She noted that prior to this decision, Credit Suisse had failed a Fed stress test in 2019 because its models were unrealistic. “Your term as chair is up in five months, and our financial system will be safer when you are gone,” Warren told Quarles.
Though the Credit Suisse debacle involved more conventional forms of assets, there are lessons for those concerned about digital asset markets, Goldstein told Truthout. She noted that family funds like Archegos Capital Management aren’t subject to disclosure requirements like other asset management firms.
It would be one thing if rich asset managers were only harming themselves. But by recklessly playing with huge sums of money, they risk spreading calamity throughout the economy. The Great Recession was caused by predatory lending and complex derivatives leading to systemic failure that spread misery among the working class, starting with the collapse of the investment bank Lehman Brothers in 2008. In the ensuing recession, neighborhoods with more than 40 percent of inhabitants below the poverty line increased their population by 5 million between 2010-2014. A recession could similarly spread should the market for cryptocurrency plummet even further.
“There may be multiple Archegos-sized crypto whales in the shadows,” Goldstein said. “If so, they’d all be invisible to regulators because of the total lack of reporting requirements for cryptocurrency.”
Friday 28 May is #WorldHungerDay. And while lack of access to food is a huge problem in the world’s poorest nations, it’s also a major issue in the UK.
Hunger is not just about food. Hunger and poverty are inextricably linked to a nexus of issues including: the rights of women and girls, income opportunities, health, education, social justice, the environment and climate change.
the critical importance of access to education, healthcare and technology in ending hunger.
The scale of the problem globally is staggering. The World Hunger Clock keeps a live count of people in food poverty. As of 11:30am on 28 May, over 2.4 billion people live in “moderate” or “severe” food insecurity; over 819 million of these are classed as severe, and over 161 million children have impaired growth (“stunted”) due to a lack of food:
The problem of food poverty also exists in the UK.
A very British problem
As foodbank charity the Trussell Trust tweeted:
Last year, #foodbanks in our network gave out a staggering 2.5 million emergency food parcels. This simply isn't right. On #WorldHungerDay, it's time to come together and call for change. pic.twitter.com/xIvRkhebtx
— The Trussell Trust (@TrussellTrust) May 28, 2021
During the financial year 2020/21, the Trussell Trust said it saw a 33% increase in use on the previous year. It also gave out food parcels to nearly one million children.
But the Trussell Trust seeing an explosion in demand is the tip of the iceberg. And it’s not just a coronavirus (Covid-19) pandemic problem either.
Massive food insecurity
The World Health Organisation and other groups class food insecurity as people who have “limited access to food … due to lack of money or other resources”. As the charity Church Action on Poverty wrote, food insecurity in the UK has been a huge issue for years. It noted that:
The Government’s own research conclusively shows that, even prior to the pandemic, one in twelve of all households in the UK were experiencing low or very low levels of food security.
43% of households on Universal Credit “experience low or very low food security – over five times the national average of 8% across all households”.
26% of household on the benefit “are ranked as having ‘very low’ food security – more than six times the national average of 4% for all households”.
People on other benefits “experiencing low or very low levels of food security” were as follows: Income Support (36%); Jobseekers Allowance (37%); Employment Support Allowance (31%).
“One in four households in receipt of carers allowance and more than one in five households in receipt of personal independence payments are food insecure”.
An issue of class and protected groups
The data also found that some groups experience “particularly high levels of household food insecurity”:
“31% of working age households living in social housing experience food insecurity compared to just 3% of owner occupiers”.
“29% of single parent households”.
“25% of households with one or more unemployed adults under state pension age”.
“19% of households with one or more disabled adults under state pension age”.
“19% of black households, compared to 8% for the general population”.
It is an indictment of successive Governments that benefit levels across the board have been allowed to drop to such low levels that we have reached this stage.
Millions of families face worrying whether their food will run out before they get money to buy more; can’t afford balanced meals; skip meals or are forced to eat less than they should because there isn’t enough money for food.
Whether or not the UK will be in the same or a worse position on the next #WorldHungerDay remains to be seen. But unless urgent action is taken, it is, unfortunately, unlikely to improve any time soon.