Lessons From Hard Times Past
by: Jeremy Brecher, Tim Costello and Brendan Smith,
t r u t h o u t : 22 July 2009
We're all struggling with how to think - and what to do - in the face of
the "great recession." An initial progressive response was to advocate
better regulation; then Keynesian economic stimulus; now nationalization;
perhaps in the future some kind of socialism.
One theme that has reverberated through periods of "hard times" in the
past is the idea of "production for use." It has appeared in the form of
public works job creation; worker-run enterprises; self-help mutual aid; and
efforts to push the envelope on property rights that prevent people from
using the resources that are available to meet their needs. Today production
for use may find new applications - including working to save the planet
from climate destruction.
What are recessions, depressions and economic "hard times"?
According to conventional economics, markets guide companies and
investors to bring together labor and means of production to produce the
goods and services that people need. Notwithstanding numerous "market
failures," something like that happens in capitalist economies during normal
times.
But in times of economic crisis, recession and depression, it doesn't
work like that. Instead, people lose their livelihoods, homes and health
care and slash their budgets for food and other necessities - even while
workers who want to work are unemployed and underemployed and offices,
factories and construction sites lie idle. As a result, people often begin
thinking and doing things that they didn't think and do before.
Since 1900, the US experienced depressions and recessions in 1903, 1907,
1911, 1914, 1921, the whole decade of the 1930s, 1949, 1954, 1957, 1961,
1970, 1982, 1990, and 2002.
We don't know how severe the current "great recession" will be. One
thing we know from hard times past, however, is that they are almost always
declared over when they have barely begun. Prosperity is always just around
the corner. True to form, as early as April, headlines like "Top U.S.
officials offered reassurances that the worst of the economic downturn is
likely over," began appearing in media outlets around the country. Maybe so.
But what should we do if it is not?
Production for Use
A reverberating theme that emerges in hard times is the idea of
"production for use," rather than production only if production is
profitable in the market. This requires actions - whether by government or
by ordinary community members - that attempt to meet needs directly, rather
than through the failing process of production for the market.
Remarkably, President Obama laid out this precise this idea - rarely
heard in public discourse in The United States since the 1930's - in
advocating his economic stimulus legislation.
His plan, he said, recognizes both the paradox and the promise of this
moment - the fact that there are millions of Americans trying to find work,
even as, all around the country, there is so much work to be done. That's
why we'll invest in priorities like energy and education; health care and a
new infrastructure that are necessary to keep us strong and competitive in
the 21st century.
Such an approach has a long history.
In every major U.S. recession since 1808, unemployed people and allies
have organized to demanded job creation through public works at local, state
national and even international levels. (Franklin Folsom offers a history of
these efforts in his book, "Impatient Armies of the Poor.") And in an
earlier post we described how the international labor movement proposed
international public works as a way to overcome the mass unemployment of the
Great Depression - and to combat the fascist movements it was engendering.
This expressed an intuitive - and at times explicit - sense that if there
are things that need to be done and people who need work, why shouldn't
those people be put to work doing what needs to be done?
New Deal public works programs like the Works Progress Administration
(WPA) employed millions and substantially reduced unemployment until
Roosevelt cut them back in the face of conservative hostility. The WPA was
notable for its emphasis on putting people to work doing things that utilize
their existing skills.
In 1973, in the midst of a deep recession, the Carter administration
created the Comprehensive Employment and Training Act - CETA. It provided
the unemployed, the poor and high school students full-time jobs for one to
two years in public agencies or private not-for-profit organizations. CETA
provided 750,000 jobs at its peak in 1978. It, too, became a bete noire for
those who saw it as government interference with the private labor market.
But the idea has come back with the Obama stimulus plan.
Worker-Run Enterprises
Another feature that often emerges is the combination of production for
use with some kind of cooperative self-management. For example, in 1934 the
Ohio State Relief Commission used relief funds to support a dozen factories
in which unemployed men and women made clothing, furniture and stoves for
the unemployed. The Ohio Plan became a model for programs in several other
states and was incorporated in the Federal relief agencies. It became the
basis for Upton Sinclair's sensational "end poverty in California " (EPIC )
campaign for governor - and the bete noire of those who feared the U.S. was
on the road to red revolution.
The massive deindustrialization of the 1980's led to the emergence of
efforts throughout the "rust belt" to save and create jobs through worker
and community ownership. For example, the Ecumenical Coalition to Save the
Mahoning Valley conducted a three-year campaign, ultimately defeated, to
preserve Youngstown's steel plants through labor and community ownership.
Another such effort, the Naugatuck Valley Project in western Connecticut,
helped workers buy and for seven years run a threatened brass mill dubbed
Seymour Specialty Wire: An Employee-Owned Company and create an
community-worker-owned home health care cooperative.
These groups developed a strategy based on networks designed to give
early warning of threatened plant closings, coordinated efforts to save
threatened plants, employee buyouts, new cooperative enterprises, and other
locally-initiated economic development. Fifteen of these organizations came
together in 1988 to form the Federation for Industrial Retention and
Renewal.
Self-Help Mutual Aid
In the early years of the Great Depression of the 1930's, the unemployed
in many cities tried to create a counter-economy. A Seattle Unemployed
Citizens' League, for example, established 22 locals throughout the city,
each with its own commissary at which donated food and firewood were
exchanged for the services of barbers, seamstresses, carpenters and doctors.
By the end of 1932 there were 330 such self-help mutual aid
organizations in 37 states, with membership over 300,000. (For an account of
this movement see Strike! by Jeremy Brecher who is one of the authors of
this post.)
Unfortunately, commissaries needed food and carpenters required wood:
when the materials that could be begged, borrowed or stolen petered out, so
did self-help mutual aid.
Much more sophisticated versions of such mutual aid self-help are being
developed today. Much of it is occurring through bartering web sites -
Craiglist.org reports that traffic is up 100 percent in a year on its
bartering boards. About a dozen communities have now established local
currencies. The BerkShares currency in western Massachusetts can be used in
370 local businesses. These alternative systems of exchange all help bring
resources together to do something useful that isn't happening in the
mainstream economy.
Transgressing Property Rights
When things get desperate, people often find they have to ignore
established property relations.
In the early 1930's, unemployed organizations used direct action to halt
evictions. Journalist Charles Walker described how a local branch of the
Unemployed Council in Chicago responded when it received word that a
neighbor was to be evicted.
The sheriff arrives and in the face of protest does his work. The
MacNamaras' bed, bureau stove, and children are transported to the street.
Then the Council acts. With great gusto the bed, bureau, stove and children
are put back in the house. Then the neighbors proceed to the local relief
bureau, where a Council spokesman displays the children, presents the facts,
and demands that the Relief Commission pay the rent or find another flat for
the MacNamaras.... If the Commission is adamant, he leaves and reappears at
general headquarters with a hundred Council members instead of fifty.
Usually the Commission digs up the $6 a month rent or the landlord throws up
his hands, and Mrs. MacNamara's children have a roof over their heads.
Such direct action halted many evictions and forced the authorities in
Chicago and other cities to halt them entirely.
During the 1980's, the Association of Community Organizations for Reform
Now - ACORN) developed a movement in which squatters occupied and set out to
renovate thousands of abandoned city-owned buildings in New York,
Philadelphia, Detroit and other cities.
In 2009, Acorn has started a new campaign called Home Defenders to use
civil disobedience to support families who refuse orders to vacate their
homes. According to The New York Times, in cities like Orlando, Boston,
Houston, Baltimore, Oakland and Tucson,
Acorn organizers have been creating networks to alert a homeowner's
neighbors when an eviction has been scheduled or deputies are on the way.
Some volunteers will summon friends and relatives to converge at the home,
while others will be in charge of notifying news media. Organizers are also
recruiting lawyers willing to defend for no fee those who are arrested.
On March 12, as real estate investors waited to bid foreclosed
properties at the Alameda County Courthouse, dozens of "home defenders"
carried signs saying Stop Evictions Now! and Save Our Home. Among them were
Fernanda Cardenas and her husband Armando Ramos, whose home in East Oakland
was up for auction. In the face of the protest, the auction of their home
was temporarily postponed.
In addition, in a growing number of cities across the country, activists
are moving homeless families into empty foreclosed homes.
Perhaps the most dramatic example of action pushing the limits of
property relations was the wave of "sitdown strikes" - factory occupations -
of 1936-37. The sitdown had developed as a vehicle to exert rank-and-file
labor power in the rubber plants in Akron. But when, in the midst of a union
organizing campaign, General Motors started removing production equipment
from its plants in Flint, auto workers began a massive occupation. They
organized an orderly daily life, guarded the plant, and even spread the
occupation to adjoining plants. Tens of thousands of workers mobilized
outside to protect the plants from attack. After more than a month, GM
agreed to recognize the union. Seeing what the sitdown could accomplish,
400,000 workers occupied their workplaces during 1937.
During the recession of 1974, workers seized the Rheingold breweries in
New York City when management decided to close them down. The occupation led
to political intervention which successfully kept the company, a local icon,
in business.
At the end of 2008, 240 workers at the Republic Window and Door factory
in Chicago were told they would lose their jobs in three days, without the
advance notice legally required by the WARN act, and not even get the money
they were owed. After intense discussions with their union, the United
Electrical Workers (UE), they decided that at the end of their final work
day they would not leave the plant. Their sitdown received instant media
coverage and huge public support. The governor of Illinois came to the plant
to show support. Even President-Elect Obama weighed in:
"When it comes to the situation here in Chicago with the workers who are
asking for their benefits and payments they have earned, I think they are
absolutely right ... what's happening to them is reflective of what's
happening across this economy," Obama said.
By the sixth day of the occupation, the company and its chief creditor,
the Bank of America (which had just received a major federal subsidy),
agreed to a $1.75 million settlement that provided workers pay owned under
the WARN Act and the union contract. The plant has been purchased by the
California-based Serious Materials, which has promised the union it will
call back workers over the next few months.
Very often such actions challenge existing property rights - but often
rights that have some degree of ambiguity. In the early days of the sitdown
strikes, it wasn't clear that the occupations were illegal since the
companies were in violation of the newly passed Wagner Act. The same was
true of the recent Republic Window and Door occupation in Chicago, where the
employer was in violation of the WARN act. Due to the securitization and
tranching of so much of capital over recent years, there is reason to think
the entire American property system is somewhat up for grabs. So there
should be a lot of opportunity to utilize such ambiguities, most obviously
in housing, but also in the rest of the economy as well.
Today's "Great Recession"
Each period of hard times is unique, both in the character of the
economic downturn and in the changing character of national and global
society. Today's "great recession" is differentiated from previous downturns
by globalization and the massive financialization of the U.S.
Deindustrialization has transformed the majority of the American workforce
from blue-collar to white-collar. Outsourcing has divided that workforce
into "core" employees with job security and benefits and a "ring" of
contingent workers with neither.
Unions have shrunk and the social safety net has been dismantled - less
than half of those without work and who are actively seeking a new job were
receiving unemployment compensation in early 2009. Meanwhile, new means of
communication - think smart phones and web 2 - are making new ways of
organizing possible. And behind it all, the crisis of human-induced climate
change threatens to disrupt all social life and cause economic dislocation
greater than the Great Depression and World War I and II combined.
The fundamental problem underlying today's "great recession," however,
is the same as in past periods of hard times - Obama's paradox that "there
are millions of Americans trying to find work, even as, all around the
country, there is so much work to be done."
The pursuit of profit through the market does not lead to production of
what people need. The solution can be summed up in the phrase "production
for use."
The range of unmet needs - nationally and globally - is enormous. All -
education, health care, food security, infrastructure, childcare - can be
spheres for putting people to work doing the work we need to have done.
These all represent what economists call "market failures." And
according to the British government's Stern report, the greatest market
failure of all history is the destruction of the planet by greenhouse gases.
While current "cap and trade" programs attempt to create a market solution
to this problem by creating a market to buy and sell pollution permits, we
cannot wait for the market to fix the market.
Instead, we need to create a rapidly growing "green" sector in which
production is for use - specifically, for climate protection - not just for
profit. We must reconstruct society on a low carbon basis regardless of
whether or not it is profitable to do so.
It is often pointed out that it took mobilization for World War II to
end the Depression. Today we need, in William James' magnificent phrase, a
"moral equivalent to war."
We don't expect an army to make a profit. It has other responsibilities
and other means of support. During World War II, for example, public policy
mandated the production that was necessary: tanks and airplanes. At the same
time, public policy forbade much production that was unnecessary; as a
popular song about wartime mobilization put it, "put those plans for
pleasure cars away." Today's equivalent would be mandated reductions every
year in carbon-emitting production and consumption, combined with employment
of all available people and resources for green transformation.
Obama's stimulus package actually provides a first step in the right
direction:
To finally spark the creation of a clean energy economy, we will double
the production of alternative energy in the next three years. We will
modernize more than 75% of federal buildings and improve the energy
efficiency of two million American homes, saving consumers and taxpayers
billions on our energy bills. In the process, we will put Americans to work
in new jobs that pay well and can't be outsourced - jobs building solar
panels and wind turbines; constructing fuel-efficient cars and buildings;
and developing the new energy technologies that will lead to even more jobs,
more savings, and a cleaner, safer planet in the bargain.
Like previous forms of production for use, this plan is a bete noir for
those who think "production for use" is a crime against capitalism. They are
already mobilizing against it, tea bag by tea bag.
But there is another lesson from hard times past:
Economic adversity creates an intense social dynamic in which people
become less and less willing to wait for "pie in the sky." That is why they
demand jobs, take over and run their enterprises, pursue self-help mutual
aid, and transgress the established boundaries of private property.
The unemployed movement of the 1930's used the slogan: "Don't starve -
fight."
Who knows what the result will be if we combine that with the slogan,
"Don't let the planet burn - let us get to work."
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This article was previously published on ZNet.org.
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