Author: cowboysonthecommons

On Banking, Heitkamp Forgets Where She Lives

by Matt Stannard
March 14, 2018

Elizabeth Warren is in a bloody fight with the handful of Democrats who support new GOP legislation to roll back Dodd-Frank requirements on banks. The new legislation loosens regulations for smaller “community” banks, but also for the biggest, too-big-to-fail, often criminal banks at the top of finance capital’s food chain. One of the Democrats joining the GOP in that rollback effort is North Dakota’s Heidi Heitkamp, who said of Warren on this matter, “She doesn’t live where I live.”

But Heitkamp lives in the state with the country’s only public, state-owned bank, the Bank of North Dakota. And although she told The Atlantic‘s Russell Berman a sob story about “Democrats [watching] as smaller banks and lenders in their states have been eaten up by larger institutions, due in part to the added burden of regulations created by Dodd-Frank,” there are a couple of half-truths at play here, and Heitkamp should know better.

First, Dodd-Frank has been little more than an exacerbating factor on what was already a steep decline in community bank viability. As J.V. Rizzi wrote in American Banker a few years ago:

There are many things to dislike about the Dodd-Frank Act. Causing the demise of community banks, however, is not one of them . . .  the number of community banks with assets under $100 million dropped from 13,000 in 1995 to 2,625 in 2010–before Dodd-Frank was enacted. The number of small community banks had dropped under 1,900 by 2014.

Second, and even more to the point of why Heitkamp’s position is so weird: the Bank of North Dakota has kept community banks alive in that state through financial support for community bank loans, and regulatory compliance support. The results have been astounding if one compares North Dakota’s community banking scene to the rest of the country. I once explained why in a blog post I wrote for the Public Banking Institute:

Public banks offer unique benefits to community banks, including collateralization of deposits, protection from poaching of customers by big banks, the creation of more successful deals, and . . . regulatory compliance. The Bank of North Dakota, the nation’s only public bank, directly supports community banks and enables them to meet regulatory requirements such as asset to loan ratios and deposit to loan ratios. . . . [I]t keeps community banks solvent in other ways, lessening the impact of regulatory compliance on banks’ bottom lines.
We know from FDIC data in 2009 that North Dakota had almost 16 banks per 100,000 people, the most in the country. A more important figure, however, is community banks’ loan averages per capita, which was $12,000 in North Dakota, compared to only $3,000 nationally. . . . During the last decade, banks in North Dakota with less than $1 billion in assets have averaged a stunning 434 percent more small business lending than the national average.

Stacy Mitchell reached a similar conclusion:

With 89 small and mid-sized community banks and 38 credit unions, North Dakota has six times as many locally owned financial institutions per person as the rest of the nation. And these local banks and credit unions control a resounding 83 percent of deposits in the state — more than twice the 30 percent market share that small and mid-sized financial institutions have nationally.

And so did Ellen Brown, who provides some background on how BND was mandated to help with compliance:

In order to help rural lenders with regulatory compliance, in 2011 the BND was directed by the state legislature to get into the rural home mortgage origination business. Rural banks that saw only three to five mortgages a year could not shoulder the regulatory burden, leading to business lost to out-of-state banks. After a successful pilot program, SB 2064, establishing the Mortgage Origination Program, was signed by North Dakota’s governor on April 3, 2013. It states that the BND may establish a residential mortgage loan program under which the Bank may originate residential mortgages if private sector mortgage loan services are not reasonably available. Under this program a local financial institution or credit union may assist the Bank in taking a loan application, gathering required documents, ordering required legal documents, and maintaining contact with the borrower.

So Heitkamp’s invocation of North Dakota is curious. I can’t say I’m surprised though: BND has saved conservative North Dakota’s financial ass countless times, but state officials and electeds hate acknowledging this–in fact, they almost never do in mainstream contexts.

Warren’s criticism of the new Senate bill is sound. The bill ultimately exempts all but only the top 12 banks in the country from regulations and stress tests. The worst thing Warren is guilty of in this instance is believing (or acting as if she believes) that for-profit banking can be saved at all. We can have that debate another time (I personally believe capitalism makes the consolidation or death of small banks inevitable without massive state intervention). But Heidi Heitkamp’s omission of her own state’s success in propping up an otherwise anemic community bank industry is, to use current parlance, sad.

Matt Stannard writes on cooperative economics, law, and sustainable farming. He was policy director at Commonomics USA and a board member of the Public Banking Institute.

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Activists Urge California Public Bank Not Limit to Cannabis Revenue

Grassroots public banking activists respond to CA Treasurer’s Request for Information

by Matt Stannard
March 3, 2018

Commonomics USA (the organization I used to be policy director for, and for which I still serve as a consultant), along with public banking advocacy groups from Los Angeles, Santa Cruz, San Jose, Oakland, San Francisco, Santa Rosa, and Eureka, California, have written a response to California Treasury Secretary John Chiang’s Request for Information concerning a public bank in California, which was written after a year’s worth of public hearings on California’s cannabis banking problem.

That RFI (an RFI is a standard business and governmental procedure made prior to undertaking large projects) was released in late January. But there was a problem with it: It did not reflect the public demand that sparked it. And, given the final direction and gestures of the Working Group, that was a surprise and disappointment.

It should be noted (I’m presently working on a longer piece telling this story) that the public banking movement overwhelmed, and fundamentally changed the focus of, what was initially a reluctant Cannabis Banking Working Group. In early sessions of the CBWG hearings, Chiang went out of his way to instruct participants not to advocate for public banks in general; early scholars invited to the San Diego session insisted public banks were not feasible, and the Working Group was even, at times, jovially dismissive of the idea.

But everywhere the CBWG went, members of the public, during the open comment periods, insisted not only that the Working Group consider a public bank for cannabis revenue, but that it consider a public bank categorically. While Chiang continued to insist that comments be limited to the problem of banking cannabis revenue, members of the public ignored that limit and advocated for the general benefits of public banking.

Chiang’s eventual response was impressive: Rather than further scolding members of the public, the Working Group announced a previously unscheduled hearing in Los Angeles devoted exclusively to the question of public banks, and further, that such a discussion should not be limited to cannabis revenue, but be inclusive of general arguments for and against public banking.

I continue to admire Chiang for that piece of brave leadership (among the privileged, public banking is still seen as a fringe movement, even after New Jersey’s new governor, Phil Murphy, campaigned on creating one in that state). Chiang could have taken a safer way out. Many of us are glad he didn’t.

Nevertheless, the Working Group’s RFI does limit itself to “studying the various administrative and operational structures for organizing a public bank or state-backed financial institution to serve the cannabis industry.” And this has raised the ire of the many groups across California demanding divestment from big private banks and the embrace of a radically democratic model of public finance (more radically democratic, even, than anticipated by the rather conservative, fossil fuel-supporting, pro-police state Bank of North Dakota).

The letter in response, linked below, argues that the best way to envision a public cannabis bank is by envisioning a public bank that is not limited to cannabis:

We invite you to share our vision: a network of public banks (intrastate municipal/regional banks and interstate state banks) that provides a distinct alternative to depositing public monies into Wall Street banks, reflects California’s environmental priorities and social values, and becomes California’s legacy for future generations.
Public banking, at its core, is a shift in the state’s role from mainly providing bank regulatory oversight to also providing banking services, thereby addressing commercial banking market failures. Public banking shares the original ambitions of the postal service, delivering mail to every household, and the rural electrification program, electrifying all of rural America. In our envisioned network, each public bank will provide banking services to its defined community – filling gaps where the market has failed to fully provide affordable deposit, credit, and other investment services. State banks would provide low-cost (probably internet-based) deposit services to large segments of the unbanked population and create pools of credit for large infrastructure projects, affordable housing, and student loans. Municipal and regional banks would focus on developing the small business lending and local investment market; developing financially-responsible alternatives to predatory financial schemes, such as bail bonds and payday lending; and financing local infrastructure projects, including renewable energy and disaster recovery.
The failure of the market is profound and more widespread than is commonly understood. The lack of banking services for the cannabis industry is only one example of this failure. Over 20% of California households are un/underbanked, as documented in 2015 by the FDIC. And, given the ongoing disaster recovery efforts in northern and southern California, the lack of immediate and affordable credit for municipal governments as these communities struggle to rebuild after the fires and floods is a clear shortcoming of the market. Unfunded infrastructure, unfunded new Community Choice Energy organizations, and unfunded affordable housing for public service workers can be financed through a state or municipal public bank. Finally, the state’s revenue shortfall and liquidity crisis during the Great Recession, made worse by the refusal of banks to honor the state-issued IOUs, is another critical example of the need for credit. Without a broader vision, this particular public bank effort by your office may be perceived as exclusive or discriminatory. Such a perception so early on in the public bank feasibility process may be cause for otherwise avoidable resistance from both the public and the Federal Reserve, which may view a public bank “dedicated entirely, or predominantly, to the cannabis industry” as concentrated deposit risk. Moreover, since the Federal Reserve is tasked with addressing financial inclusion, it may be receptive to an expanded definition of financial inclusion based upon a critical analysis of the market failures of the commercial banking system.

While the letter includes specific suggestions that will be helpful to the cannabis industry (such as automated retail cannabis payments), its larger message is that a whole-state, economic and ecological justice approach to public banking is advantageous for the limited policy objective of cannabis banking, because more stakeholders will sign on, and even because the Federal Reserve will be more likely to entertain giving a Master Account Number to a broadly-mandated bank than a narrow one whose only purpose is to circumvent (or, to put it more charitably, make up for the gaps in) federal law. Thus, the response letter suggests “conduct[ing] an ‘intersection’ study throughout state government and its agencies that identifies the specific state social, economic, and environmental policy objectives that a public bank can achieve.”

The letter may be downloaded here:
030218 Letter in Response to RFI

ICE, Detention Centers, and the Commons

(matt)

Despite the threat sanctuary cities are under, I wish I lived in one. I wish I could support public officials who, politically at least, see noncitizens (whatever their immigration status) and citizens as equally worthy of moral consideration, as equal stakeholders in the community. Wyoming is lucky enough to have a few public officials who see both documented and undocumented residents of the state as part of their community family, but the odds, unsurprisingly, are not in our favor.

Wyoming’s ruling class, its cattle and mineral and real estate interests, often exhibits a uniquely and sometimes brutally indifferent attitude towards disadvantaged people. And although Wyoming has always had a significant Latinix community, it hasn’t been easy for them.

Comes now Management and Training Corporation, an allegedly terrible Utah company, to build an ICE detention facility in Evanston, the Wyoming border town an hour from Salt Lake City. Andrew Graham of the ever-important and brilliant WyoFile, described developments as of last October:

Both Evanston’s city council and Uinta County’s commission unanimously passed resolutions in June to support the Management Training Corporation’s plan to build and manage an Immigration and Customs Enforcement detention center just outside Evanston city limits. The jail would have the capacity to hold 500 undocumented immigrants detained by ICE while they await court hearings in Salt Lake City.
Uinta officials are uncertain whether they need Wyoming’s five statewide elected officials to approve the project. It is possible a jail holding immigration detainees does not require the same level of approval as other forms of private prisons regulated under Wyoming law, a county official said. Either way, MTC’s efforts to jail immigration detainees from throughout the northern rockies in Uinta County have thus far gone largely without notice in the state at large.

Except they didn’t go unnoticed for long. More on that in a minute, but first more about MTC, which has come under scrutiny for a number of problems that ought to raise red flags in the minds of the public: corrupt officials, riots, prison breaks, sexual abuse by officers, alleged human rights violations, and a number of other charges ranging from concerning to embarassing to horrifying. If even some of these charges are true, that raises serious public policy concerns. MTC also deploys prison labor and I was told by people I trust in this subject matter that it was very likely ICE will utilize detainee labor –practically unpaid–at the facility it wants in Wyoming. I’ve written articles and talked about this before. Extracting surplus value from the labor of the incarcerated is an especially insidious and destructive form of bio-political control.

MTC knows it’s in trouble. Fortunately, ICE is having problems of its own (notwithstanding the Trump administration’s mandate for ICE to behave like literal stormtroopers). Evanston, Wyoming–in Uinta County–is a chance for both corporation and goon squad to do right. Finding willing jurisdictions for building detention centers has been challenging. The hope is that Wyoming, immersed in a downward trajectory of economic insecurity, and highly supportive of unhinged border nationalist Donald Trump, will be a willing partner.

But there’s fierce resistance (partly due to Wyofile‘s coverage) and it’s growing throughout the state. Thanks to groups like Juntos, the ACLU, and the Equality State Policy Center (and many other organizations, churches, groups, and individuals, an organized effort is underway to pursue numerous political, legal, and social pressure-oriented means (check out #WyoSayNo) of stopping the project. I’m helping.

I’m not just helping because immigrants are human beings, detainees are human beings, and we’re all potential aliens and detainees (that’s all true though). I’m helping because our vision of the Commons, of community, and of cooperativism will not work alongside a regime of regulating human movement based on violence. If we are to “regulate” migration, let us do so democratically and cooperatively. That’s the spirit of the Commons appropriate to the tens of thousands of years of cultures migrating, traveling cyclically, escaping bad things and journeying to better places, together. Welcoming the stranger, giving the outsider the head seat at our table, is a recognition of our universal dependence on the Commons. If we have to regulate the way and where we move, we need different criteria, and different voices, in place to exist with and honor how and why we travel across, out of, and into shared spaces.

More later on this, here at C on the C, and elsewhere.

Photo credit: aljazeera.com

7 Reasons Your Economic Insecurity Isn’t Your Fault

. . . and why that matters

by Matt Stannard
January 29, 2018

The sobering assessment at the end of 2017 by Philip Alston, the UN’s special rapporteur on extreme poverty and human rights, concerning the 40+ million Americans living in poverty, left a question unasked: Why have there been so few effective grassroots political revolts against inequality and material deprivation in the United States?

The seeming lack of class consciousness is even more surprising when we consider that economic insecurity doesn’t just affect those below the poverty level: over 215 million Americans–which I count as 66 percent of the population–couldn’t cover a $1000 emergency with the money in their savings account. That’s over five times as many of us who technically live in poverty, and it suggests that economic insecurity is now an intrinsic feature of the American identity.

This knowledge alone, that there are well over 200 million people just like us, should help temper the feeling of failure that Americans tend to feel about their economic insecurity. But the cultural and rhetorical forces of capitalism are strong. The billionaire class invests a lot in teaching us that our material insecurity is our fault. That unique capitalist apologia has an illustrious history.

Such shaming, along with the condition of economic insecurity itself, extracts terrible tolls on our health, and makes us less effective in fighting the underlying socioeconomic and political conditions responsible for the difficult conditions so many of us are in. The shame of economic insecurity demoralizes and weakens us and makes it less likely we will join in struggle with others against unfair economic conditions.

So I actually hope that if you are economically insecure–whether in poverty or swimming a few days above it, as you read this short article, your shoulders will feel less tense, you’ll breathe more deeply, and let go of the guilt that the oligarchs and moralists want you to carry. Then, I hope you’ll find the strength and love to become more resolute in your determination to help create a world without this kind of abuse, and with the opportunities that come from egalitarian, cooperative security–the kind of world that, frankly, the majority of the world wants and has always wanted.

Here goes: This is a meditation. Your economic insecurity is not your fault because:

1. . . . wages aren’t under your control

Wages haven’t kept up with productivity gains or inflation over the last several decades. The work you are doing now could very likely have been enough, on its own, to support you and a few others, and own a house and car. Even low-income work could sustain a decent apartment. None of that is true anymore. The elites have many reasons for wanting to keep wages low in most sectors of the economy, including protection of their profits, but other reasons too. I’ll just let Richard Wolff explain it:

Capitalist enterprises keep moving their operations (first manufacturing, now also many services) from high to low-wage regions of the world to raise their profits. Departing capitalists leave their former host communities with unemployment and all its social costs. Such conditions force desperate competition for jobs that drives down wages and guts job benefits. Public services decline as government budgets suffer. Capitalism no longer delivers a rising standard of living in the regions where it began and developed first: Western Europe, North America and Japan. Instead of goods, capitalism delivers the bads.

Wages suck, the wage economy is designed to suck for most of us, and none of that is your fault.

2. . . . capitalism is like a roller coaster

Our economic system is subject to periodic crises. During those crises, people who’ve been “doing the right thing” all their lives are often ruined. A haunting Wikipedia page, “List of economic crises,” traces economic crisis from first century Rome to the present. The crises proliferate over time, with one crisis in the 14th century (it was a banking crisis), eight in the 18th century (including the Bengel Bubble Crash and the collapse of French enterprise on the Mississippi) to twenty five in the 20th century. Every economic crisis devastates countless lives and re-boots generational economics. Those devastated lives are then dehumanized further by public discourse blaming working class and poor people for the state of the economy.

3. . . . capitalism reproduces itself in social relations

Although pointing this out makes postmodernists cringe, it’s not unreasonable to conclude that the way a society produces and distributes its goods, and the patterns of mass scarcity that may result from inequality, influence the way we interact with each other vis. institutions and cultural behavior. We can debate about how much, but it seems to me that economic determinism is more true the poorer or more insecure you are, which is another way of saying that scarcity “overdetermines” the cultural expression of economic relations.

A description of the important anthology Millennial Capitalism and the Culture of Neoliberalism lists those various relational themes:

how the triumph of the free market obscures rising tides of violence and cultures of exclusion, and the growth of new forms of identity politics. The collection also investigates the tendency of neoliberal capitalism to produce a world of increasing differences in wealth, environmental catastrophes, heightened flows of people and value across space and time, moral panics and social impossibilities, bitter generational antagonisms and gender conflicts, invisible class distinction, and “pariah” forms of economic activity.

4. . . . a few powerful entities could make the system work for us all but won’t do it

Although pointing this out makes revolutionary socialists cringe, a few basic reforms –far from the new paradigms of ownership cooperativists ultimately advocate — could solve many, if not all, current manifestations of economic insecurity. A reasonable regime of taxes on capital and the recovery of the trillions of dollars hidden in tax havens could eliminate the effects of poverty and economic insecurity, if not the root causes. All that would take is a tiny group of Americans deciding to end their intransigence on just taxation–but we all know this is unrealistic.

But please tell us more about how our inability to rent one-bedroom apartments in Denver and San Francisco is our fault.

5. . . . “money” is a construct

The increasing realization among scholars and activists that “fiat currency is a social construct” could not have come at a better time. Economist James Galbraith calls the axioms of Modern Monetary Theory “factually uncontroversial.” Governments choose to order and symbolize their financial endorsements the way they do. Both governments and banks create what can be called money, and the real questions are how to manage that process, how to incentivize social goods and ameliorate social bads and deal with other actors, like workers, businesses, and consumers. As Atossa Araxia Abrahamian explains:

The decisions about how to issue, lend, and spend money come down to politics, values, and convention, whether the goal is reducing inequality or boosting entrepreneurship. Inflation, MMT’s proponents contend, can be controlled through taxation, and only becomes a problem at full employment—and we’re a long way off from that, particularly if we include people who have given up looking for jobs or aren’t working as much as they’d like to among the officially “unemployed.”

Irrespective of what money “is” in either a metaphysical or practical sense, the value of your money is not under your control. When our parents accused us of “not knowing the value of a dollar,” they were more correct than they knew.

6. . . . “work” is a construct

I remember sitting with activists at a community center in Detroit in a snowy January in 2014, talking about their revolutionary approach to inner-city unemployment. The reemergent phrasing was that there’s no jobs but plenty of work. This truth has been pointed out all over the country. Anyone looking around immediately sees things to do–things that would improve life for everybody, things that could make the planet happier, busy work, dirty work, dignified work. Under our current wage-based paradigm, “jobs” are what private shareholders want to extract from us to increase their profits, and whatever public and nonprofit work can be painfully extracted from these powerful interests. As our crumbling infrastructure and shrinking social service networks testify, there’s plenty of genuinely valuable work not being done.

Moreover, a “work week,” a reasonable number of hours to work in a day, the way differently-abled and differently-privileged people are capable of arranging their work lives? You guessed it: all arbitrary and a function of what economic elites want the extraction of your labor power to look like. For this caprice and myth of order, we’ve been shamed for our inability to always do the kind of work they want us to do.

7. . . . “personal responsibility” is a construct

Even if personal responsibility exists, a person can incur neither credit nor blame for endowments they possess or lack. Even if you can trace your financial mistakes–a job you fucked up, a bad marriage, a criminal record, these mistakes fall differently on different people. The late John Rawls caused a stir among philosophers of “moral desert” when, in A Theory of Justice, he argued that people cannot claim moral credit for their natural endowments and tendencies. Sure, Rawls argued, people can expect to get paid well for doing good work, but that doesn’t mean we deserve or do not deserve good things in a general sense based on what we’re good or not good at.

People resist this because they think personal responsibility is important. But, like the foundational assumptions of MMT, the assumptions of Rawls’ dismissal of moral desert are perfectly reasonable, and their consequences are dependent upon what we do with the understandings we have of our moral, material, and political agency. The real question isn’t whether you are genuinely or absolutely culpable for your individual economic condition (have I mentioned you aren’t?), but what we can do, acting together, to achieve real moral agency, which is control over our material lives.

The think tanks and spokespeople deeply invested in making you feel guilty for not having enough money to live are also deeply invested in systems of production and finance that ensure it will stay that way. As we stop feeling guilty, we’ll find new layers of energy with which to defeat and bypass them.

Should you hold yourself accountable for bad choices you made when you know you can “do better?” Sure, if you think it will help you do better. I’m not suggesting you shouldn’t. But we’re all part of a larger set of systems. We’re smart enough to understand that responsibility is dialectical. It’s just that we’ve been pushed so far in the direction of absolute moral desert that we are, per Kenneth Burke, “rotten with perfection.” We should try forgiving ourselves and each other and moving forward together to overthrow the existing economic order.

Matt Stannard is a legal and policy advocate for sustainable farming and cooperative economics.

Image: The Panic – Run on the Fourth National Bank, No. 20 Nassau Street. Illus. in: Frank Leslie’s Illustrated Newspaper, 1873 Oct. 4, p. 67.

Walter Wangerin Jr.’s The Book of the Dun Cow and Imagining Contemporary Evil

Matt Stannard
Jan. 21, 2018

This afternoon, after several months of periodic readings, my kids and I finished Walter Wangerin Jr.’s The Book of the Dun Cow. I had, with only minimal resistance, proposed to read it out loud to my teen, tween, and ten year-old, in partial recognition of having read the Great Brain series, Alice’s Adventures in Wonderland, The Wonderful Wizard of Oz, Sadako and the Thousand Paper Cranes, and a few others to them when they were much younger. Those were sweet days.

I’d rediscovered, or spontaneously remembered, Wangerin’s epic novel, that some have called a “Lord of the Rings with Farm Animals” (although Wangerin’s prose is far more pleasing to read out loud than Tolkien’s, in my opinion), decades after first finding it when I was about 13, reviewed in an issue of Dragon magazine. I enjoyed the book then and learned a lot about the form of the Christian allegory in literature from it. Some might try to call it a “Christian Animal Farm,” and that would be clever but not really accurate. Orwell’s novel was really, really cynical compared to Wangerin’s story of a basically innocent, decent, somewhat emotionally immature rooster being charged by God, through the whispering voice of the Dun Cow, to fend off an attack from the manifest evil coming from a coop and farm far away, and created by a giant devil-worm that lives deep in the earth.

And it is unapologetically Christian, although it’s a Christianity that admits to and celebrates doubt, doesn’t promise happiness to believers, and invests even the simplest characters with a lot of personal autonomy–at least in terms of letting each farm animal set their own route to fighting the great evil that threatens the farm. There are no humans in the book, but there is a chicken coop and hints of other artifacts, presumably implying some now-distant human intelligence. But it’s the animals who are entrusted with defeating the evil animal-gods and demigods put before them.

It’s the nature of that evil, though, that inspired me to read the book with the kiddos this time around. Some of it is chaotic evil, to put it in RPG terms: the evil rooster demigod, the mirror-image of the hero rooster except much more physically powerful and able to create millions of tiny poisonous snakes with its vomit or something, reminds me of both wannabe and real Nazi trolls today, with their performative brutality, their deliberate use of low-grade irony, and simple self-declared mission to destroy all who aren’t them. Some of the book’s evil is lawful evil, a giant wyrm in the earth who believes its very presence and size entitles it to rule and who tries to seduce the hero with promises of power before opting to try and destroy anything that opposes it (that’s what the billionaires do–first they try to buy you and then if they can’t they must silence you at whatever cost).

I’m aware that these are Christian images too, and I don’t know anything about Walter Wangerin’s politics, but if he is an orthodox Christian, his politics are probably pretty different from mine. But I also have to say that my concerns with the alt-right and the billionaire class are more than just “political” in a conventional sense. The important thing is that Wangerin knows that the violent exercise of asymmetrical power and dishonest manipulation of good people are bad things, and his animation of them produces beautifully hideous and revolting villains that, like the heroes in the book, are essentially cartoon characters, but not shallow caricatures. That takes some skill and aesthetic vision.

So as I read the book to the kids a couple of hours at a time over a period of months (I can’t quite remember when we started), I wanted to speak the voices of good, imperfect beings fighting back against others who either wanted to eradicate them for existing (the gratuitous racist violence that’s irreducible to just wealth acquisition), and those who would seek to manipulate or destroy others for the sake of economic gain. These are the twin evils, I think, represented by a large part of the current political order and culture. But my hope is they’d get something more than just politics out of hearing a story about how good, imperfect, mistake-making beings hold their own against those who want to exploit or destroy them.

There are two more books in Wangerin’s Dun Cow series. If you’ve read them, I’d love to hear what you think. I told the kids (who enjoyed the book and admitted on their own they miss sitting around hearing me read to them, I swear) that if any of them wanted to read the other books I’d buy them. I think I’m good with just this one, but that doesn’t mean it wasn’t beautiful in every way–the incredible wordsmithing, the very deep and emotional development of the characters–and, where it was a tiny bit traditional-gender-roles, easily bracketed and deconstructed (at least I felt so, but obviously could be wrong. Christianity is what it is, unless Wangerin were UCC, which as an M.Div from the Lutheran Christ Seminary-Seminex, I will guess he’s not).

But I want to thank him for doing a very good job representing bravery amid moral frailty, destructive and manipulative evil, depression and self-loathing, vulnerability and forgiveness, even the ineffable tragedy of losing family members, all in a fantasy novel about rooster warriors and farm animal armies.

The drawing above is by Abby, and was inspired by the book. 

The Right to Fear

by Cate Morrison

An astonishing thing happened in Rhode Island last Thursday morning.

I will piece together the complicated timeline to the best of my ability, mostly on the basis of the Providence Journal reporting.

9:00 am: Donald Morgan is being transported to a court appearance for vehicle theft by a state trooper, when the trooper stops to assist a car crash. While handcuffed but unsecured, Morgan gets into the driver’s seat of the police cruiser and drives away. The cruiser is located by GPS and found abandoned. According to an eyewitness, 40-50 police officers descend on the scene.

(roughly) 10:30 am: A call goes out over police radio to be on the lookout for a “white Ford F150” with “something hanging out the back.” A Cranston police officer assumes the truck must have something to do with Morgan. He then sees a white Ford F250 “driving erratically,” and pulls the driver over. The driver stops, but then drives on. The Cranston officer loses sight of the truck.

At some point, so far unclear, Providence police officers spot the truck entering I-95 north at the Providence Place Mall. What follows is an astonishing show of force.

There are unofficial estimates of 30-40 marked and unmarked vehicles that converge on the truck. Bystanders said the police officers themselves were driving in ways that would endanger the public.

Penned in by police vehicles, the driver attempts to first reverse and then go forward—though from videos, it is unclear if the lurch and drive forward is intentional or if Joseph Santos has already been shot dead with his foot on the pedal. Officers open fire on the truck’s cabin. Driver Joseph Santos is killed. Passenger Christine Demers is critically wounded. At this point, 5 Providence police officers and an unspecified number of state troopers all opened fire at some point at Santos and Demers.

They had nothing to do with Donald Morgan. They were unarmed.

Five officers were involved in the shooting, according to police officials. Estimates from bystander videos suggest 40 rounds fired.

When I first heard the story, my first mordant thought was “how soon will the victims’ arrest records be released?” The answer was a bit over 24 hours. The ProJo online headline announced “Police Identify Two Shot Thursday on Highway On-Ramp.” The identification was solely legal—the lead: “Both Joseph J. Santos, 32 and Christine E. Demers, 37, who remains hospitalized, had extensive involvement with law enforcement and the courts.” The following texts struggles to substantiate the claim. The records were revealed for the sake of shaming the victims, but they told of a far more disturbing pattern of human suffering at the hands of the law—where small infractions, petty arrests and add-on charges snowballed into more and more time, warrants and infractions, and struggles with addiction became criminalized. These were no great dangers to society, and given the number of officers responding, were also not threats to specific members of the public at the time. The chase was officer-initiated, sustained and heightened.

Aristotle, in his account of the emotions, comes to a very uncomfortable conclusion about the connection between individual and social feeling. Some people have rights to emotional responses that others do not. Deprived of a social standing that could be threatened, the slave cannot feel anger. Daniel Gross explains it as an economy of emotion, where social collectives invest concern in some and not others, and a system of not rationality but reason. There are reasons to be hopeful, angry or afraid, and to feel kindness, shame or admiration. Before even the word, emotional response expresses a rough system of judgment. One is worthy of pity, another indignation, some feared, others admired—this tells us about the originating reason of the world before it is laundered into more genial types of justification. My reaction tells me about what I am before I even know what I think. If I’m angry, you cut me down without cause. If I’m afraid, you can, want to and will cause me harm. If I am kind, I want to help you for no benefit to myself when you need it.

There is a caveat. The emotions are social. Some people have the right to feel. Others don’t.

What did Joseph Santos do to die, and Christine Demers to be gravely wounded? At most, Santos drove badly and Demers did nothing. They panicked after an initial stop for driving a white Ford truck, triggered by a fallacious state-wide bulletin. They then had police from several different towns and jurisdictions swoop down on

The enabling conditions of fear are a presumption that a) someone or something has the ability to hurt you, b) that it wants to or is going to hurt you, c) that it is close by and thus can hurt you. Santos and Demers both knew about the ability for the law to hurt them. They knew that they were being pursued with sudden, unexplainable and overwhelming force. They found themselves surrounded by this force without any way to understand why, when even bystanders were astonished. They were right to be afraid, to act in ways that are extreme and unreasonable, but their actions became instead justification for their nearly inevitable deaths once the horrible machinery began moving.

We know that the reaction of fear is deemed generally socially acceptable, because one of the most common responses to officer-involved shooting is that they feared for their lives or for those of members of the public, and thus deviated from standard practice.

Fear, however, is granted to some and not others. Santos and Demers were not allowed to fear. They weren’t given the benefit of the doubt.

What happens to members of public who fear for their lives? Why do they have no right to fear?

When police officer shootings occur, the feeling of fear is processed through its reasoning. The suspect was capable, willing and realistically in that situation able to hurt you. The specific Providence police were wound up and ready to fire on who they believed to be Donald Morgan. But Donald Morgan wasn’t there. It was two people with a history of petty crime, wrung through an uncompromising system, who got scared and tried to run when an unimaginable phalanx of police descended on them. Overwhelming force came down upon two people who had done nothing to deserve such a response.

They panicked. The officers did not. They killed with absolute control.

I thought that the body cameras and bystander films would show a scene of chaos and confusion. They did not. Officers cover the truck and systematically shoot into it, calmly and in formation. The videos show an execution.

We ask—how to process a mass shooting? How do we even comprehend a person shooting 26 in a church or 58 at a concert. We have a far greater vocabulary, though, for a single person shooting dozens of people than we do multiple people shooting 40 times at two unarmed people, whose greatest crime was panicking. What do we say then?

Cate Morrison is senior lecturer and director of debate at the University of Rhode Island.

Photo credit: ABC news, from bodycam footage.

Sears CEO Eddie Lampert F***ed Up & My Friend Paid for It

by Matt

Over at Occupy.com, you’ll find my new essay on the fallout from Sears’ financial debacles (the result, among other things, of Lampert’s decision to do stock buybacks instead of, umm, maintain and repair the physical stores where people were actually showing up to buy things). It’s a personal essay, because my friend, a married father of several young’uns, is now unemployed because of Lampert’s bungling. It’s also an essay about morality. And that’s been on my mind for the last several months: the way that it’s really impossible to have a coherent normative or prescriptive moral theory when one’s practical moral culpability is inversely proportional to the amount of money one has. So give it a read and a share, okay? And I’d love to hear your own thoughts on the way class differences fuck up our ethics.

A Quick Q&A: Phil Murphy & Public Banking

by Matt Stannard

Q: Phil Murphy campaigned for New Jersey Governor –and won– on a public banking platform. What’s a public bank?

A public bank is a state- or city- (or other government entity) owned bank. The bank typically takes as its deposits the revenue or holdings of that government entity (such as taxes). The bank then lends to various entities and can do so at low- or no-interest, in order to finance public goods.

The only significant public bank in the U.S. now is the Bank of North Dakota. BND is one of the most powerful and solvent banks in the country, and it makes low-interest loans to the state for infrastructure; to municipalities to build schools and repair things; to farmers; to students (it supports student loans and offers good refinancing options); and to small businesses. BND supports community banks in North Dakota, and because of it, the state enjoys the healthiest small banking sector in the country.

There are public banks, or strong public banking sectors overall, in other countries like Germany and Costa Rica. Germany’s public bank has helped finance that country’s cutting-edge post-carbon energy transition.

A public bank has been a central piece of Murphy’s economic agenda, rather than just some idea he’s casually mentioned. He’s a believer, which puts him in a small list of good company that includes Bernie Sanders.

Q: Why do public banks have such potential?

Banks, whether private or public, have the power to create value through fractional reserve lending. Although it’s somewhat misleading to straight up say banks “create money out of nothing,” they sort of do that: If I borrow $10,000 from my local bank, it’s not like they go downstairs to their vault and bring out $10K in cash to give me. They essentially create $10K in credit. I pay them back with interest. That’s how they make money.

The theory behind public banking is: “Banks have a lot of power to generate public value. That power should be treated as a public utility, not just a private business.” Private banks have to make profits to satisfy their shareholders. Public banks make a (small) profit too, but that surplus can be paid back into the state or city coffers, essentially creating dividends for residents, all the while lending in the public interest.

Public banks keep communities financially healthy in hard times because their economic benefits run “countercyclical,” lending at low interest when private banks won’t lend even at high interest.

Public banks also help break state and local governments’ dependence on risky Wall Street finance. Had a public bank been in place in New Jersey starting around twenty five years ago, it could have helped the state save over a billion dollars on pension fund fees alone.

Q: But I thought Murphy had been a Goldman Sachs executive. Wouldn’t Goldman Sachs hate public banks?

I wrote about this question a year ago when Murphy announced his candidacy, in an article entitled “In Praise of Class Traitors.” I interviewed my former colleague at the Public Banking Institute, Ellen Brown, who speculated that a person from the financial sector might be exactly the kind of politician with the credibility to push a public bank. “Our biggest hurdle has always been that legislators don’t understand how banking works,” she told me. I also interviewed socialist economist Rick Wolff, who said Murphy probably “knows what shenanigans go on in big banks and investment houses like Goldman,” but that “as a Democrat, he cannot attack pensioners the way other, especially Republican governors have,” and that a public bank would, among other things, be “less politically costly” than letting pension plans burn.

Q: Why should we trust Murphy? Once a thief, always a thief, right?

I’ve already seen many of my friends on the left express skepticism about Murphy based on his banking pedigree. I get it. That skepticism is healthy. But Murphy is Governor of New Jersey now whether we think he should be or not, so let’s see what happens. He wouldn’t be the first person of privilege to facilitate egalitarian economic ideas. He wouldn’t even be the thousandth.

Q: How hard will it be for Murphy to actually establish a public bank in New Jersey?

There will certainly be a lot of hurdles to overcome. The legal hurdles will likely revolve around New Jersey’s constitutional prescription against the state “lending of credit.” But overcoming that hurdle will be relatively easy, Such provisions didn’t prevent North Dakota from running its own banks, and several other states (and Puerto Rico) have quasi-public infrastructure banks that offer loans and credit assistance to public and private sponsors of construction projects. After all, in the status quo, Governments deposit their revenues and invest their capital in private banks. Those banks, in turn, lend money–but they aren’t “lending the state’s credit.” The banks lend their own credit, which is distinct from the “credit of the state.” This distinction may seem complicated, but it’s good enough for the courts. Throughout the 19th century and in reference to the Bank of North Dakota in the 20th century, courts have agreed with states’ efforts to have public banks lend money instead of private banks.

The larger hurdle will be political–and this is where the public banking movement often flounders. Opposition from the private banking sector will be fierce. Wall Street will lie, steal, and cheat to discourage public officials from opening public banks.

What will be needed is a mass movement of people in New Jersey willing to write letters, make phone calls, and physically show up to demonstrations in favor of Murphy’s efforts (assuming Murphy goes forward with a public bank). It’s not like there will be many counter-demonstrators. But public officials are risk-averse, and there will be rich people in suits telling them not to do it.

In other words: Public banking is a good idea, but being a good idea is not enough. It’s not even enough, in an age of Wall Street hegemony, to be the Governor of New Jersey and push for a public bank. You need lots and lots of ordinary citizens willing to keep issuing the demand loudly and clearly.

Q: Where else are people pushing for public banks?

All over the place! City governments, spurred on by local economic justice coalitions, are exploring public banking all across California. Santa Fe, New Mexico is in its third stage of policy study on implementing a public bank. There are vocal movements and sympathetic public officials in Washington, Oregon, Hawaii, New York, Illinois, Pennsylvania, New Hampshire, Maine, and at least a dozen other states. Whether they succeed or not will depend on whether they have behind them large coalitions of people willing to push past the resistance they’ll encounter from big banking interests.

Q: Will a public bank usher in an era of egalitarian, socially responsible, progressive economic policies?

This is a good question–and the answer is another reason why public banking requires a mass movement in order to work effectively. Public banks in and of themselves are not a guarantee of good economic policy, and are especially not a guarantee of economic justice. For all the positive aspects of the Bank of North Dakota (disaster relief, support for farming, building schools and community centers on the cheap, supporting local business development), that conservative state has used its socialist bank to do things like finance fracking and a toxic oil economy. The BND even financed police repression at Standing Rock last year through its emergency financing program–probably the most depressing and hurtful use of public financing we’ve seen in a long, long time.

The lesson here is that public banks are tools, and whether a tool is used to build good or evil things depends on who wields it. But in the hands of a democratic government committed to transparency, ecological sustainability, and socioeconomic justice, a public bank can do incredible good.

Matt Stannard is a legal and policy advocate for sustainable farming and cooperative economics. He previously served on the board of directors of the Public Banking Institute and was policy director for Commonomics USA.

Brief Note on Exploitation and Abuse

We all have needs and lacks, some because of the system, some because we’re hardwired to have them, some because of trauma, some just because of ordinary life experiences. There are healthy ways to take care of these needs, account for and address (or resign oneself to) the lacks, generally to function and meet needs in a healthy way. It’s clear that most of us don’t know how to do that in every instance and many of us don’t know in any instance. We are constantly damaging, exploiting, and abusing one another, and we do damage to others commensurate with our position in social and economic hierarchies.

When we abuse, harass, or exploit, we’re using other beings to fulfill those needs without behaving requisitely ethical–without their consent, or without just compensation, or without considering their needs and wants, or without repairing or restoring what we have taken.

This causes great damage. Sexual abuse and harassment ruins people, families, communities. Economic exploitation ruins people, communities, regions.  Ecological exploitation ruins communities, regions, the planet. Each form feeds from and to other forms, so that being sexually abused messes up your economic life, ecological destruction creates scarcity that makes economic and sexual exploitation more likely, economic exploitation reproduces itself in cultural norms like hypermasculine competitiveness, and so on.

Each of these forms of abuse and exploitation is unique and requires commitment to unique processes to address it. But there are common forms to the processes required to address all of them. Each requires (1) a personal commitment to do what we can to address them; (2) an understanding of how we–I, personally, and we, collectively, are part of the problem and necessary for the solution; (3) concrete materialization of abuse- and exploitation-free culture and structures.

Cooperativism, whether economic, cultural, political, or in all manifestations, has to begin with that commitment, because what we’re really addressing is that dynamic of exploitation and abuse, patterns which cut across everyone and everything in a world of hierarchies.

~matt

 

Resisting Prison Labor

by Matt

Black Agenda Report: “Prisoner rights advocates will converge for what aims to be the largest abolitionist demonstration in U.S. history, [Saturday, August 19], in Washington D.C. The Millions for Prisoners’ Human Rights March is centered around the demand that the exceptions clause, which allows for slavery to continue in United States prisons, be removed from the Constitution’s 13th Amendment.”

Since we’re in a period of heightened consciousness about slavery and its legacies, this is an especially important time to talk about compulsory prison labor, or, more bluntly, prison slavery; enslavement of incarcerated people.

I have no desire to break down the components of the moral case against slavery, but must at least partially do so to point out how enslavement of the incarcerated is an especially nefarious kind of human exploitation.

Labor produces value. Prisoners’ compulsory–or even very-low-paid–labor facilitates the production of value for privileged entities (the state, private corporations who get in on the action) and extracts that value, working the body and mind of people at their most vulnerable. Not even the weak justification for the wage system (people are free to walk away and find other work, live in other labor communities) is present in the context of incarceration. I believe this all amounts to something foundationally evil and unjust, which bypasses whatever moral judgment may fall on the prisoner. I’m betting most people reading this believe the same.

Nazism, the Confederacy, China’s authoritarian capitalism, all have slave labor as their material foundations (so does Classical Greece, but that’s another post). That’s the backdrop of Nazis in Charlottesville, and prison labor is another head of the Hydra.

The Black Agenda Report piece by Kyle Fraser summarizes the corporate and governmental profiteering that steers the prison labor ship, and is a good starting read. Last year’s Think Progress piece by Carimah Townes is a longer and more detailed read, definitely worth the time.

Confederate statues should be removed because they are non-living remnants of slavery. Prison labor, on the other hand, should be abolished because it’s a *living* remnant of slavery.

Photo By Royalbroil – Own work, CC BY-SA 3.0, at Wikimedia Commons