Thursday, June 25, 2015

Against Reformism in Greece

Trotskyists are uncompromising. The class line cannot be crossed. Accordingly they oppose popular fronts like Syriza, which consist of unprincipled alliances with bourgeois parties. That Syriza's coalition partner is a small, center-right outfit called ANEL simply demonstrates the perfidy.

Nevermind that the Left wing of Syriza is a sundry mob of Maoists, pseudo-Trotskyists, anarchists, etc. Nevermind that Alexis Tsipras has resolutely refused to compromise with the Troika on core issues. True Trotskyism, as expressed by Socialist Action, regards the whole movement as nothing but a bourgeois front, just waiting to sell out the working class as soon as politically expedient.

The global organization of Trotskyists is something called the Fourth International. The Greek section of the Fourth International is a grouplet that not even I had previously heard of: OKDE-Spartacos. If bombastic proclamations are a mark of revolutionary fervor, then these folks take the cake. Their statement is reprinted in Socialist Action. (The translation isn't very good.)

Of course no proclamation is complete without a list of demands at the end. These range from the stupid to the ridiculous. I've copied them below, along with my comments.

  • No new austerity measures, no new agreement, no negotiations
Why should there be no negotiation? What can one possibly lose by talking? Even Trotsky negotiated at Brest-Litovsk. Otherwise, this sounds also like Syriza's strategy. If Syriza is going to sell out the working class, then they've only got a few days left to do it.
  • Reduction of working hours, along with raises in wages and pensions
Greeks already don't work very hard--that surely is part of the problem. And where is the money for the wage & pension increase going to come from? Our Trotskyist friends don't say.
  • Stop paying off the debt and fully cancel it
Greece has long since stopped paying off its debt, and nobody is suggesting that they start now. The only issue is how the debt going to be refinanced so that the country doesn't default. Greek bailouts consist of money lent by European banks, which is then paid back to European banks to avoid the appearance of default. There is no advantage to anybody in letting Greece default--certainly not to the Greeks. By advocating default, OKDE shows why they are such a small, irrelevant organization.

Far from asking Greece to repay its debts, the Troika is merely insisting that it break even, i.e., run a primary surplus. That's a reasonable request, but the country can't do that with stifling regulations, a retirement age at 50 or 55, and a completely bloated public sector. (Some argue that Greece also needs to cut defense spending.) These misnamed "austerity" measures will bolster the Greek economy and enrich Greek consumers.

  • Expropriation of banks and big enterprises, with no compensation for capitalists, and operation under workers control
Greek banks are broke and continue to exist only by the generosity of the ECB. Expropriating them will yield no assets--only debts. And of course the ECB won't continue to put in money. Regarding "big enterprises", it's not clear that Greece actually has many of those, and decapitating a company hardly improves its chances of success. See, e.g., Zimbabwe.
  • Self-management of closing factories and enterprises
Good luck with that. I don't care who manages it, but without access to either capital or markets no business can flourish.
  • Disengagement from the euro and the EU, for an anticapitalist internationalist perspective For the self-organization, the government and the power of the working people
So 70% of Greeks want to stay in the Euro no matter what. That's because their standard of living depends on it. If Greece is forced out of the Euro instant poverty will follow. I've always said that Trotskyists are pro-poverty, but rarely is it so dramatically illustrated.

Frankly, this is just pathetic. There is such a thing as intelligent Trotskyism--I've remarked on it many times on the blog. But that Socialist Action reprints the foolish ramblings of silly people is beneath their dignity.

Further Reading:

Friday, June 19, 2015

The Minimum Wage

Recent articles in the Trotskyist press and elsewhere have covered the Fight for $15, a serious effort to raise the minimum wage. Let's review.

An early report appeared in Socialist Viewpoint, in April 2013. That article covered the demonstration by fast food workers in Chicago demanding a near doubling in the minimum wage to $15/hour. The march set the tone for the fight as it spread nationwide. While the marchers included some fast food employees, the organizers and majority of attendees appeared to be members of already existing unions, notably the SEIU.

At the time I didn't think anything would come of it--the very idea of doubling the minimum wage seems outlandish. But I confess it's gotten more traction than I expected. Since then, Seattle, San Francisco, and most recently Los Angeles have agreed to raise wages to $15/hour. Chicago will raise its to $13, and other cities are making lesser pledges.

In addition, Walmart, McDonalds, and Target have all agreed to give their employees a raise, albeit not to $15. So something is going on. The Militant reported on this last March, which elicited my comments here. What gives?

The Militant revisits the issue again with a recent report by Alyson Kennedy and Dan Fein, two reporters for whom I have considerable respect. Entitled McDonald's Workers' Fight 'Getting Stronger', it's an account of the demonstrations in front of the company's headquarters in Oakbrook, IL.
“I make around 30 meals per hour and earn $7.25 per hour. I can’t even afford to buy one of the meals I make,” Amy Petite, 21, who works at Wendy’s in Knoxville, Tennessee, told the Militant. 
Demonstrators said that as the movement grows, gains are being made. “We won better hours and five days a week where I work,” said Connie Bennett, a Chicago McDonald’s worker. “Before we were getting three or four days a week.”
Socialist Action highlights the campaign of Kshama Sawant, the socialist Seattle City Councilwoman now running for re-election.
Since her election in 2013, Sawant fulfilled her campaign promise to make Seattle the first major city to pass a $15 an hour minimum wage. And she has taken on a number of other issues that are important to working people. In the city with the fastest rising rents in the country, she has championed the fight for rent control, a Tenant’s Bill of Rights, and the demand that the city build thousands of quality apartments to be rented at below-market rates.
The most substantive article comes from Socialist Viewpoint's contributer, Arun Gupta. He reveals Fight for $15 as astroturf, staged by the SEIU.
For example, one fast-food protest in 2013 was run like a military campaign. The staffing plan included the local organizing leadership, four different media workers, half-a-dozen “diffusers” to soothe any trouble, a photographer, videographer, police liaison, chant leader and energizer, a supply team, drivers, onsite legal, a criminal lawyer on standby, breakfast and lunch coordinators, and people designated to hand out signs, flags, t-shirts, and water. A spreadsheet mapped out protests by the minute, noting times and location for loading vans, picking up workers, talking points for press conferences, skits, prayers, dancing in the streets, and “walk backs” of workers the next day to minimize retaliation. Insiders say to maximize turnout, Fight for 15 will sometimes rent hotel rooms for workers the night before a protest, rent vans to drive them to the start point, and provide meals.
 Mr. Gupta, while a staunch supporter of the effort, is skeptical about its chances of success.
A fundamental goal of labor organizing is to take labor out of competition with itself. But that is nearly impossible when low-skilled, low-wage workers have few rights and number in the tens-of-millions. Fight for 15’s approach is unorthodox, but it is constrained by organized labor’s history. Class-struggle unionism has been abandoned by labor leaders who act as junior partners to corporations, like SEIU and Kaiser Permanente, the UAW and auto companies, the machinists union and Boeing, and the building trades and real-estate developers. Many union leaders are also in the pocket of the Democratic Party despite it being in the pocket of Wall Street.
As said, I share Mr. Gupta's skepticism, and that begs the question. Why has Fight for $15 been as successful as it has? I count several reasons.

1)  I am willing to give the SEIU some credit. Their well-organized public relations campaign has surely had some effect, albeit mostly as public relations. The victories in city councils are probably due mostly to this effort.

2)  $15 per hour has passed in cities that have lots of billionaires, and even more millionaires. These are places where the added costs can be passed on to consumers. That won't work in less fortunate towns, such as Fayetteville, NC or Kokomo, IN. So far from starting a trend, the SEIU has just picked the low-hanging fruit.

3) McDonald's and Walmart are both reevaluating their business models. They need a different kind of workforce to make that happen. So I think the pay raises they offer probably won't go to their current employees, but rather to future employees who will have different skills. The lowest-skilled, least educated people will be laid off.

4) McDonald's is shrinking--this year they are closing more stores than they are opening. Further, all the stores in San Francisco will be closing. While high real estate prices are probably the culprit, the fact is that $15/hour will have no effect on McDonald's there.

My socialist friends all make one important mistake. They implicitly assume that raising wages to $15/hour will have no effect anywhere else in the economy. Only the Wall Street Banksters will suffer negative consequences--their endless stash of cash will be slightly diminished because of higher salaries.

But of course that's not true. Mr. Gupta at least points out that profits are shrinking at McDonald's. There is no stash of cash, and the Banksters will not be the ones who pay the bill. So who's the patsy? There are only two choices: customers or other employees.

Except in billionaire cities, customers simply won't pay up. They don't have the money, and/or they have too many other choices.

That leaves the employees. For everybody that gets a pay raise, somebody else is going to be either unemployed or paid less. That's obviously what is happening at McDonald's and Walmart--both companies are looking to trim their workforces. They can afford to give the remaining people raises.

So I'll stick to my original prediction: The Fight for $15 will fail. It is impossible to nearly double the pay of low wage workers in a low-inflation world where everybody else's salaries are flat. It won't happen.

Further Reading:

Wednesday, June 10, 2015

Louis Proyect's Pro-Poverty Alliance

Louis Proyect kindly posted video from the recent Left Forum meeting in New York. It's a nice summary of the travails of the modern Left.

As a leader of the North Star movement, he provides an introduction to its history and goals. "What we need," he maintains, "is a broad Left Party where people can work together based on a common program" that doesn't require close ideological agreement. Mr. Proyect goes back to Peter Camejo, Lenin, and even the Communist Manifesto for guidance. The latter sounds veritably reformist, calling for a "heavy, progressive, graduated income tax, equal liability of all to work, establishment of industrial armies, especially for agriculture."

Mr. Proyect claims that Lenin's conception of a Leninist Party was much closer to what North Star aspires to than something like the Socialist Workers Party. Socialist movements can't simply imitate ancient Russian history and expect success. Instead they must draw heavily from the heritage of their own time and country. Socialists need to stop waving hammers & sickles around, and end democratic centralism in it's current form.

Channeling Peter Camejo, Mr. Proyect cites as positive examples the Farabundo Marti National Liberation Movement (FNLM) in El Salvador, and the Sandinista National Liberation Front in Nicaragua. Marti and Sandinista were local heroes, not Russian ideologues. Likewise, North Star named itself after the (very obscure) newspaper published from 1847 to 1851 by (nearly as obscure) Frederick Douglass. Current role models include Greece's Syriza, and Spain's Podemos.

And here's the problem. Does Mr. Proyect really think that either the FNLM or the Sandinistas made their countries any richer? Both movements plunged their countries into decades-long civil wars that killed thousands of people. Yes, one can lay significant blame on the Contras and the Salvadoran army, and even the USA, but it takes two to tango. Both nations were left substantially poorer at the end of the Leftists' reign than they were at the beginning. Which is why the Left is no longer in power in either country.

If that's success, then I'd like to know what failure looks like.

Likewise Syriza, which by becoming the government has inherited a poisoned chalice. It can either succumb to the demands of the Troika, or it can take Greece out of the Euro. Contrary to the popular media, the Troika's demands are not unreasonable and will lead to long-term economic growth in Greece. But Syriza's constituency (government employees) will be hurt. Leaving the Euro, on the other hand, will drive the entire population into instant poverty. Please, Mr. Proyect--tell us how this is a positive outcome for the Left.

Two other speakers are worth noting. Kshama Sawant, the global proletariat's representative on the Seattle City Council, was asked to speak on the fly, without prepared remarks, and the result is slightly incoherent. She doesn't like corporations. She's very proud that her campaign received no corporate money from Starbucks. Count me happy--when I buy coffee I really don't want my purchase subsidizing socialist radicals.

But she really hates Starbucks. She didn't explain why, but I'll suppose it's because they pay low wages. In most of the country it's probably around $9/hour, albeit with some benefits. In Seattle they now pay $15 per hour. To Ms. Sawant (a talented software engineer) this sounds like chump change--the baristas are getting exploited.

So here is my question for Ms. Sawant: What salary would Starbucks have to pay before she'd like Starbucks? Obviously $15/hour is not enough.

Here are my reasons for liking Starbucks:

  • I like their coffee. It's better than 90% of the Ma & Pa places. Starbucks is good for consumers.
  • They employ 180,000 people, all of whom get a salary, some benefits and a possible career track.
  • They have greatly expanded the coffee market in the US, to the benefit of farmers in places like Nicaragua.
Ms. Sawant, judging from her language, thinks the world would be a better place if Starbucks went out of business. Needless to say, I don't think the 180,000 people who work there are going to sign on to that crusade.

The best talk was given by the 2014 Green Party candidate for Lieutenant Governor of New York, Brian Jones. He's a card carrying communist--a member of the International Socialist Organization. He's also a member of the teacher's union, NYSUT, an organization dedicated to ripping off the taxpayers in support of their members. Taxpayers like those who work at Starbucks, who pay New York's record high property taxes and sales taxes.

Mr. Jones channels Syriza, and as such epitomizes Mr. Proyect's project. Mr. Jones believes that government employees--and only government employees--are people of good will who have the public's interest at heart. Thus he sees no conflict between higher salaries for teachers and better outcomes for students, despite the fact that there's no empirical correlation.

We need government employees. We need cops, and prison guards, and road maintenance crews, and soldiers. These people are an expense necessary to correct for the failings of human nature.

But government workers don't make us richer--they simply preserve civilization. Wealth comes from people who produce things that consumers want to buy. Starbucks employees make me richer because I enjoy drinking their coffee. On the other hand, I hope I will never require the services of a prison guard. The goal of society is certainly to pay civil servants appropriately--even generously. But frankly, we need as few of them as possible.

Mr. Jones and Syriza have it backwards. Greece has hired way more people than it needs--the Troika wants a lot of them privatized (or fired). New York schools are famous for their rubber rooms--places where useless teachers can hang out because the union won't let us get rid of them. College professors (like me) use the taxpayer's dime to write books that literally nobody is going to read.

So there it is. Mr. Proyect is pro-poverty: he has supported hugely destructive civil wars; he thinks Starbucks employees should all be fired because it's an evil company; he believes that more teachers and more cops and more prison guards will make us richer.

Mr. Proyect is wrong on all counts.

Further Reading:

Wednesday, June 3, 2015

Capitalism Just Won't Sit Still

The lead article in Socialist Viewpoint, by Joe Allen, is entitled The Power of Logistics Workers (reprinted from Jacobin). It's a marvelous article--well written, nicely researched, and well worth the read. It has inspired me to purchase the book by Nelson Lichtenstein on The Retail Revolution--with any luck I'll review it here soon.

Mr. Allen's thesis is that logistics, embodied by companies like FedEx and UPS, represents a choke point in the US economy, and therefore an opportunity for working class activism. Logistics workers today have a power that was once held by auto and steel workers. Of course he has a point, and it's odd in this context that he doesn't mention the recent port disruptions on the West Coast. There a few hundred workers put the screws on the entire global economy.

Still, as Mr. Allen admits, organizing FedEx is not going to be easy. A large percentage of the employees are part-time and the turnover rate is very high. At UPS the problem is slightly different--while the full-time employees are all Teamsters, the 1997 strike against the company ended in a draw. Since then not much has happened. Also, the large number of casual, seasonal workers are non-union.

Mr. Allen takes an expansive view of logistics:
Sociologists Edna Bonacich and Khaleelah Hardie argue that logistics has two interrelated meanings. The first is the “nuts-and-bolts distribution function” that we generally associate with the word. But the other refers to “the management of the supply chain, including the relations between retailers, their producers/suppliers, and their carrier/transportation providers.”
While it used to be that manufacturers determined what got sold and when, now it is the retailer who makes those decisions. Mr. Allen accurately credits Walmart with this revolution
Wal-Mart, from its world headquarters in Bentonville, Arkansas, “cut out a raft of salesmen, jobbers, and other supply chain middlemen, squeezed the manufacturers by shifting every imaginable cost, risk, and penalty onto their books [and has] taught the entire retail world,” according to historian Nelson Lichtenstein, “how the bar code and data warehouse could finally put real money on the bottom line.”
Mr. Allen should go on to say that ultimately it is consumers who benefited--they got better products delivered in a timely fashion at cheaper prices. Always Low Prices, as the saying goes.

That, however, is not the major flaw with Mr. Allen's thesis. A hint to the real issue is found in this excerpt.
The production of capital goods (machines and tools for manufacturing) and consumer goods (for personal consumption) has been and will be central to the capitalist system. Every generation or so, however, capital reorganizes its methods of production and circulation (what bourgeois economists call distribution) and in the process remakes the composition of the industrial working class. 
These changes can be painful and disorienting, and it can take a significant amount of time for socialists and other working-class activists to reorient themselves. This remaking includes modernization of production techniques (the means of production), the organization of production and labor management, the methods of transporting goods to the market, and how goods are actually sold to the consumer.
Two glaring problems stand out. First, that events are cyclic--every generation or so. Capitalists do this out of boredom, we suppose, or perhaps because Mars is in Sagittarius. Mr. Allen forgets that capitalists don't like these painful and disorienting changes any more than workers do--just ask Eddie Lampert, owner of the now combined Sears and K-Mart chains. Bourgeois economists call it creative destruction.

The second problem is the belief that the disorienting changes are behind us for this generation. Mr. Allen just assumes that the logistics revolution of the 1990s and the aughts is over, and now we workers have time to readjust, unionize FedEx, and fight for our fair slice of the pie.

How quaint. And how wrong. For the logistics revolution that Mr. Allen describes--goods manufactured in China shipped just-in-time to your local Walmart store--is as passe as last year's Christmas tree.

Has he not heard that manufacturing is booming in these United States? Textiles, in particular, are coming back. Instead of being assembled by low wage workers in China or Bangladesh, instead they're sewn together by robots in North Carolina. Why? Not just because it's cheaper, though that, too. The cost of shipping the product halfway round the world is saved.

Rather, clothes can be made just-in-time and to order. I don't mean orders from Walmart--I mean the order from Kathy in Pocatello. You know--the lady with the big butt and the tiny feet. The old logistics revolution (i.e., from a decade ago) cut out a raft of salesmen, jobbers, and other supply chain middlemen. But now the retailer is getting squeezed out--products move one at a time from the manufacturer direct to the consumer.

So much for that big, FedEx operation in Memphis, moving mass-market merchandise from one continent to the other. No, not anymore. Today it's the small, contract manufacturer in Boise shipping products all the way to Pocatello. Kathy will get her new, custom-designed, perfectly-tailored dress by tomorrow morning.

Mr. Allen informs us that UPS has 395,000 employees. FedEx employs about 300,000. Does he believe that either of these companies will hire as many people ten years from now? While logistics will still be important, it will look very different than it does today. It won't be organized around a central location in Memphis, relatively easy to unionize.

So Mr. Allen and his doughty band of union organizers better get hopping. They've got at most a decade to organize that Memphis facility before it goes extinct. Because creative destruction isn't a generational thing. Indeed, you ain't seen nothing yet. Our economy and our world is changing faster than Mr. Allen can keep up.

Further Reading: