Progressive Populism and the Business Community

by: Mike Lux

Wed Apr 14, 2010 at 13:15


We progressive populists spend a lot of time banging on big business, and rightly so. Concentrations of money and power dominate our political system way too much, and head to the exploitation of worker, the degradation of the environment, distortions and traumas to our economic system, and many other ills.

At the same time, I think it is important to be thoughtful both on the policy side and the political side about when and how we progressives want to work with some industries some of the time. My friend Leo Hindery wrote an intriguing post yesterday  arguing there is no way to produce the kinds of jobs we need to produce in this country, especially in the manufacturing sector, without having big business play a major role in that job creation. Leo makes an important point. I don't know of anybody across the political spectrum who doesn't want to support and encourage small business. It is also true, though, that the small business sector alone will not pull us out of the deep hole we are in regarding jobs. Government, small business entrepreneurship, and big business are all going to play a role.

I think progressives should be very clear about which business sectors we want to align with and which we want to push against. For myself, I am very clear about sectors I want to downsize, break apart, and diminish in power: the biggest banks need to be broken apart and restrained from gambling recklessly; health insurance companies should have their anti-trust exemption revoked, their competition increased, and their rates and practices far more regulated; pharmaceutical companies' power and profits should be reined in; and oil and coal companies should be downsized and phased out as quickly as possible.

Other big industries should be better regulated; kept from harassing their workers when they organize, kept from hurting the environment, kept from producing unsafe products, and kept from growing so big they stifle competition. But in general, we want to encourage healthy and growing industrial, technological, green energy, and construction companies. Progressives should ally themselves to these sectors as long as they keep a decent social contract with their workers and communities. Creating these kinds of alliances can encourage better behavior by these kinds of companies, and build the political power we need to take on corrupt industries and political conservatives.  

Mike Lux :: Progressive Populism and the Business Community

Tags: , , , (All Tags)
Print Friendly View Send As Email
Progressive Populism and the Business Community | 38 comments
a lot of work to do (4.00 / 5)
Clearly, the knee jerk reaction to progressive visions is to dismiss them as anti-business or anti-capitalist. What you never hear is that progressive policies, including rehauling oversight and regulation, can have the long term benefit of actually saving capitalism by restoring public trust in markets and private institutions. You never fucking hear that from the CNBC and CoC crowd. Or much anywhere else for that matter, the only person I can recall making this kind of assertion explicitly on TV was Elizabeth Warren (and maybe Dylan Ratigan implicitly). The rules of the system were changed to encourage short term profiteering and outright robbery, and I think the public is somewhat aware of this but at the same time they're constantly hearing about the onus of regulation, even today. Obviously it's very rare to hear anyone talking about long term economic prospects, but that's exactly what needs to be part of the discussion, and progressives will have to frame the argument in terms of long term economic viability, robustness, trust, etc. to start getting through to voters out there...  

"I think the economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable and we should face up to that."
-Lawrence Summers
Intriguing (4.00 / 2)
"My friend Leo Hindery wrote an intriguing post yesterday  arguing there is no way to produce the kinds of jobs we need to produce in this country, especially in the manufacturing sector, without having big business play a major role in that job creation." May I ask who is stopping or deterring big business from job creation?  Which laws are in their way?

"Progressives should ally themselves to these sectors as long as they keep a decent social contract with their workers and communities." OK. You give a prerequisite. Fine. But could you spell out what business gets from progressives and what progressives get in return? What is the basis for the alliance? Tax cuts? Both parties do that already ...who needs progressives? Eased regulations? Seriously. You talk of an alliance. More productive might be to outline the common symbiotic basis for such an alliance. Without that, this is just more Obama-speak.

Please quote button, its easier to parse paragraphs quickly. (4.00 / 1)


--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky
[ Parent ]
no idea what you mean (0.00 / 0)
nt
[ Parent ]
Sorry. I think tyour points raise very valid questions about Mikes post. (0.00 / 0)
There are very important grey areas here, and Mikes point needs both uinderstanding and clarification, and possibly soem disagreement.

So, when replying to a comment on a post, a dialogue box opens, at the bottom of the box there are three buttons, Bold, Italic and Quote. If you select text, including soem portion of the text you have just pasted into the box to criticisze, you can add the code for italics, bold and blockquoting.

For example you could select this - I am a very tall person - paste it into your reply box, select it, hit the quote button, and all the selected text will be between two html code blocks and upon hitting preview and later hitting post it will look like this

I am a very tall person


--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky
[ Parent ]
thanks (0.00 / 0)
nt/
[ Parent ]
You're welcome sir. (0.00 / 0)
or madam.

--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky
[ Parent ]
Huh? (4.00 / 1)
May I ask who is stopping or deterring big business from job creation?  Which laws are in their way?

Mike didn't say anything about laws being in the way. I don't think Hindrey did either.  The sad state of the economy is the biggest reason.  Hindrey does suggest that existing law discourage big business from building more good jobs, and a different set of laws (an explicit industrial policy, mainly) could encourage them.

But could you spell out what business gets from progressives and what progressives get in return? What is the basis for the alliance? Tax cuts? Both parties do that already ...who needs progressives? Eased regulations?

Clearly not, because at the beginning of the paragraph you quote, Mike said this:

Other big industries should be better regulated; kept from harassing their workers when they organize, kept from hurting the environment, kept from producing unsafe products, and kept from growing so big they stifle competition.

Mike explicitly called for better regulation. He also did say something about the alliance. or at least, what progressives should be willing to work together with some elements of big businesses on:

But in general, we want to encourage healthy and growing industrial, technological, green energy, and construction companies.

Both parties are not doing that. Mostly, I think Mike's point is that stopping bigness itself is not the best goal in all industries, even if it's a very good idea in some, and even if big businesses must be better regulated.  

Politics is the art of the possible, but that means you have to think about changing what is possible, not that you have to accept it in perpetuity.

[ Parent ]
The incentives are all wrong. (4.00 / 3)
They lead jobs out of the country instead of in.   Regulation also leads companies to innovate.  Stripped of their legacies and heavily involved in innovating product, automotive employment is picking up again.  Laws and policies need to be put in place that incentivize supporting US growth instead of dismantling it.  
[ Parent ]
industrial policy (4.00 / 5)
The point I am trying to get at in this post is that progressives can and should embrace a real industrial policy in this country, a policy that consciously seeks to help certain business sectors (green energy, unionized and non-polluting manufacturers, for example)as we also seek to phase out or break apart others. I don't think that is happening right now.
[ Parent ]
I embrace an industrial policy. (4.00 / 2)
The devil is in the contractual details. Industrial spending can be allocated based on stipulations. For example, th4e Democrats attemtped to pass legislation that would eliminate pork earmarks to any for-profit organization, allowing the necessary spending, allowing the work to be done, but preventing the spending for pork, spending for graft (because its harder to set up a non-profit solely for graft).

Federal industrial policy could set union rate jobs, or even Union jobs, or even green, sustainable, job filled, spending with a requirement that workers have a voting representative on the board.


--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky

[ Parent ]
That's not an industrial policy. (0.00 / 0)
That's bureacracy.  
[ Parent ]
Yes sir, that is exactly, exactly industrial policy. (4.00 / 1)
It is why Finland not only has everything we want a society that cares for itself as if our teachings tell us that all of us are loved individuals, and it has the HIGHEST rate of Productivity on the planet.

And levels of unemployment that are very hard to shake a stick at.

But an odd comment. I did not see that coming.

--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky

[ Parent ]
The concept of union and its role need to change. (4.00 / 1)
Having watched GM and the UAW go through all the machinations necessary to survive, there are lots of changes in the way unions work that need to be made.  Unions need retooling just as much as the plants do.   Your comment rang that bell for me.   If I was off track, sorry.  
[ Parent ]
Yes. Thom Hartmann has been emphasizing this for years. (4.00 / 5)
And I agree to a point. We should be converting our industrial base to rebuild this country. Yes. That requires government policy and public investment. But I am not so sure I see a genuine interest in this endeavor coming from automakers, steelmakers, et.al. Rebuilding America is something that makes sense from a national standpoint, from the standpoint of workers and unemployed, from the viewpoint of the environment. Many of the same corporations who would benefit here from such investment, have interests abroad in very profitable, low labor cost, outsourced facilities. My impression is that they are not looking for an "alliance". Do youy have anything more than Hindery's comments that there is a genuine interest in such an alliance by the once powerful industrial interests?
[ Parent ]
That is exactly right... (4.00 / 2)
...most large corporations are looking to reduce their costs and increase their profits.  That nearly always means moving production and eventually intellectual resources to LCC countries(Low Cost Countries).

Without a whole new set of trade laws and the implementation of tariffs you are just not going to see any major investment in this country for the foreseeable future.  In order to make yourself attractive for investment a country needs to be able to provide a large poor class, very little or very weak regulations (for instance no pollution controls or worker safety laws), and preferably a business friendly totalitarian government.  If a country wants to compete in the new "free trade" world, you will have to offer the above desirable incentives.

We are not there yet, but it is coming faster than I ever imagined, and that is one thing both political parties are working on in a bipartisan manner.

Regards,

Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me-and I welcome their hatred. - FDR

[ Parent ]
Interesting take. (4.00 / 2)
It fits well with allowing our entire infrastructure, physical and human, which are prerequisite for any real growth in the industrial sector, to crumble and decay. The other day jeffbinnc posted about how it was almost a concerted effort to destroy public education. The two parties cannot turn back the clock fast enough.
[ Parent ]
I totally agree with that... (4.00 / 2)
...in some ways the Democrats are worse enemies than the Republicans...because in effect they are illusory progressives...so in the end though they appear to be a progressive party they are in effect an impediment to progressive change and stifle a real progressive movement.  Look at the last election, people go out and vote for what they think is progressive change and instead get an Administration and a Congress that is trying to destroy public education, coddle multi-nationals, prop up banks, and come up with a health plan that empowers and enriches insurance companies beyond belief,
etc, etc, etc, the list can go on an on.  I think this leads to many progressives just giving up and becoming disillusioned.

Regards,

Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me-and I welcome their hatred. - FDR

[ Parent ]
I agree entirely. (4.00 / 1)
Best.
[ Parent ]
Here is a great example of this (4.00 / 5)
Thomas Friedman interviewed the CEO of Intel on March 2nd.  The CEO of arguably the most important manufacturing  company in the world said this:

The things that are not conducive to investments here are [corporate] taxes and capital equipment credits," he said. "A new semiconductor factory at world scale built from scratch is about $4.5 billion - in the United States. If I build that factory in almost any other country in the world, where they have significant incentive programs, I could save $1 billion," because of all the tax breaks these governments throw in. Not surprisingly, the last factory Intel built from scratch was in China. "That comes online in October," he said. "And it wasn't because the labor costs are lower. Yeah, the construction costs were a little bit lower, but the cost of operating when you look at it after tax was substantially lower and you have local market access."

I support and industrial policy, but in many countries that policy is to give tax credits to the most profitable companies in the World.  Intel blew away profit estimates today.  It made 2.4 Billion last quarter, and it's gross margin is 63%.

And the CEO is essentially demanding tax cuts to build plants in the US.

The reason he gets away with this is that he knows he can build something in China and still access US markets. A starting point for any industrial policy has to be to impose a tax on imports from companies that receive tax incentives in other countries.  

No way this ever flies in Washington, though.

[ Parent ]
re: imports (0.00 / 0)
The reason he gets away with this is that he knows he can build something in China and still access US markets. A starting point for any industrial policy has to be to impose a tax on imports from companies that receive tax incentives in other countries.

yes, unless a tax on imports is imposed, they won't stop from building those things outside the US

[ Parent ]
Important, common sense, conservative, naive (4.00 / 4)
1. Progressives need to accept that the 'bigness' of big business and the weak competition in most economic sectors is the natural form that business/industry takes. 'Proof': there are virtually no industries in the U.S. that are not at least regional oligopolies. Acknowledging the 'natural oligopoly' phenomenon is one important basis for strong consumer-oriented progressive government regulation of industry. It's a heavily promoted but obvious myth that competition does that job, or would do that job if we just 'try harder'.

2. Some day oil and coal industries may be down-sized and phased out, but only if they cannot adapt to a greater emphasis on the environment and global warming. Progressives should advocate for strong environmental regulation and not for down-sizing or destroying entire economic sectors that -- in one way or another -- employ hundreds of thousands of Americans.

3. The most progressive countries in this planet's history, Scandinavia during the '40s thru '70s, had lots of big business and monopoly. U.S. progressives should ask themselves why they want to parrot conservative talking points -- that increased competition is a key to making business/industry responsible -- rather than just learning from the economic make-up of history's greatest progressive success stories.

Very well said. (4.00 / 2)
U.S. progressives should ask themselves why they want to parrot conservative talking points -- that increased competition is a key to making business/industry responsible -- rather than just learning from the economic make-up of history's greatest progressive success stories.

Paul Rosenberg speaks often of ideological hegemony. The progressive populists often operate with the same premises as their enemies.

And around and around we go.

"This is what change looks like"  Barack Obama on the adoption of the health care bill.  

[ Parent ]
I was just getting started. (4.00 / 2)
It also irritates me that, compared to small businesses, our demonized big monopolies and oligopolies have typically and predictably provided their employees better wages (often as a side product from the fact that they are easier or much easier to organize) and much better job security. Compared to how things are at today's communications industry grunt jobs, what average working gal wouldn't want to contemplate 40 years of union wages and job security at Mama Bell?
[ Parent ]
I also could've mentioned (4.00 / 2)
that the country with by far the best income distribution over the last 50 years - Japan - also has lots of monopoly and oligopoly. Instead of trying to change that, by the way, the Japanese government for a very long time dealt with that reality as the natural ground on which to build the most successful industrial policy of the 20th century. The policies in the preceding sentence have been abandoned over the last 10-20 years, as the country's economic policy became increasingly dominated by its financial sector's needs and desires, and by pressure from a U.S. government promoting market fundamentalism.
[ Parent ]
I totally agree with point #1 (0.00 / 0)
1. Progressives need to accept that the 'bigness' of big business and the weak competition in most economic sectors is the natural form that business/industry takes. 'Proof': there are virtually no industries in the U.S. that are not at least regional oligopolies.

This is the problem with teabagger philosophy, insofar that it exists.  They don't want big business but they don't want a big government with regulation either.  So how do they keep big business in line?  "Competition!"  But they don't realize that one of the main ways that businesses compete with each other is precisely getting bigger, and acquiring competitors and monopolizing the market, and capturing politicians and regulatory agencies.

[ Parent ]
I'm not confused. (4.00 / 3)
Business - large or small - is obligated to the bottom line.  Business is in business to make a profit.  Having been a business owner, I'm not inclined to fault business for pursuing its purpose.  My outrage is directed at those participants in our political domain who elevate the desires of business above the needs of their constituents.  Government has at its disposal the means to promote and support business in such as way as to serve the common good as opposed to at the expense of the common good.  It is not unreasonable to ask why, as Dick Durbin asserted, Congress is owned by the FIRE industry and how that happened.

Government has a function in relation to business.  I'm not confused about that either.  This is an example of positive effort, this is an example of where it fails.  I don't fault business for looking for ways to use government to suit its purpose, but I do fault government for allowing itself to be used against the very people who elect them.  

Eg (4.00 / 4)
Elizabeth Warren on Rachel Maddow's show last night (06:19)

The Banks:  Don't push us too hard because we don't plan to cooperate.

Warren: There are many tools available if Treasury wants to use them.

One in four homeowners are under water.  Talk about an economic drag.  Why is Treasury not using those tools that Elizabeth Warren says exist?

Warren notes the response to the initial "we're all in this together" is now: Well, we're not all in the same boat here.  Those guys want to go their own way.

Warren for SCOTUS?  Hell, no!  Warren for POTUS.

[ Parent ]
I like her a lot. I like her every time I hear her speak. (0.00 / 0)


--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky
[ Parent ]
Small business often (4.00 / 1)
is quite reactionary and anti-union.

Besides, progressive populists are so weak as to be virtually useless to others as allies.

Why would small business want us?  What do we bring to the table?

 

Economic growth (4.00 / 2)
Democratic administrations have much higher economic growth rates than Republicans.  Republican growth is skewed towards the very, very wealthy and big corporations.  The worst environment for many small businesses is a Republican administration.
[ Parent ]
A labor small business alliance is immensly workable. (4.00 / 3)
The problem, the thing hurting our planet is not the corner store, and if understood a nation, a neighborhood full of unionized workers means a thriving small business, because there are, many many more potential paying customers, would like a helmet with that bicycle?

The small business has 25% higher wage payments, and fifteen times more revenue.

Small businesses hate the giant coercive businesses that ruin their lives, but they think they agree with them about "workers" and "taxes" --but that isnt were their interests lie at all.

--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky

[ Parent ]
Two main problems (4.00 / 1)
#1 Shareholder value is over-emphasized in our economy. Because of tax laws and the unwillingness of government regs to acknowledge the external costs of risky investments, companies are driven to please Wall Street rather than please their customers.
#2 The over valuation of scale means that any small enterprise that manages to be successful on a local level will inevitably be overwhelmed by the need to compete with global enterprises. The external costs of this are monumental in terms of jobs lost and lives ruined. Yet global corporations are not required to pay for any of these costs.
Until there is some acknowledgment from the business community that the over valuation of shareholders and scale are antithetical to democracy and sustainable business, there is absolutely no hope for a productive alignment between big business and progressives.

Save Our Schools! March & National Call to Action, July 28-31, 2011 in Washington, DC: http://www.saveourschoolsmarch...
If we really want economic sanity... (0.00 / 0)
then we need to inhibit growth, not encourage it!


Agitate.Liberate.Create.
we need to alter growth, not inhibit it. (4.00 / 2)
We need more hospitals, more schools, rebuilt schools, electric buses and windmills, we need solar voltaic cells on most roofs, we need pollution cleaned up, we need filters to block pollution and replacements to stop them we need non profit day care centers, we need research centers and the decommissioning of nuclear power plants....

--

The government has a defect: it's potentially democratic. Corporations have no defect: they're pure tyrannies. -Chomsky
[ Parent ]
Why again is big business necessary? (0.00 / 0)
Perhaps I should really ask this of Leo Hindery, but here's what seems to be the key paragraph in his post:

No matter what the theory of 'comparative advantage' argues, America -- with its very large population, wide geography, and great diversity -- simply can't prosper with less than 12% of its GDP coming from manufacturing. If this sector again generated 20% of GDP, which can only occur through the (re)growth of large manufacturing businesses, 12 million more workers would be employed directly and, because of the very high multiplier effect of new manufacturing jobs, up to another 30 million new workers indirectly.

... I just don't understand where those magic numbers come from.  What's so great about 20%, aside from it having been the share of GDP that manufacturing occupied before the Reagan years?  The other question is, why can 20% only occur through the regrowth of large manufacturing businesses, in the age of micro-manufacturing, manufacturing-as-service, and all that?  I'm not saying it's necessarily a good idea to try to get back to 20% (or any other magic number you want to choose) through new manufacturing models, but these seem to be pretty important, but largely unjustified, assumptions.

Though I do think that industrial policy being the new "it" progressive cause is a good thing (as long as the industrial policy itself is environmentally sound and redistributive).

Business (4.00 / 1)
As a sort of democratic socialist, what about employee-owned businesses?  What about employees running the companies?  We could adopt a "pro-business Marxism" of sorts, by pointing out that ending inflations and depressions-mastering material destiny-would be beneficial businesses too, by keeping them in business.
gains for big (and small) business...market growth (4.00 / 2)
The reason the multinationals need trade barriors destroyed and access to the U.S. market is, they can sell only a fraction of their product in the slave wage countries where they place production.

The reason the U.S. has a market is the (past) success of organized labor in raising purchasing power of the producers of goods and services. Any who doubt this should remember the atrocities in the U.S. before unions and the conditions of life for the vast majority in contries worldwide without strong unions now.

Obviously, continued falling purchasing power of the producers (the vast majority of population) will only lead to a smaller and smaller market in the U.S... Just today Natasha's post points out the tiny amount left for discretionary spending in a frugal $50,000 income household.

I posit that the obsession with quarterly bottom lines inflicting most multinationals must be changed to a longer term outlook. Decades or centuries of planing for the future would require much better treatment of the workers, designed to expand the market. However, convincing the corporations of this is like convincing a child that taking a shot now means he won't be sick later.

This should get easier as we continue the race to the bottom, and the market shrinks further. But the "captains of industry" are loth to admit they are wrong so the decline won't be stopped by them.

In the final annalisis, I don't believe what Mike proposes can be accomplished at this time. The wealthy will not relinquish anything without a fight, even if it is for their own good too. And we are not strong enough at present to win this fight.

They may be more likely to consider positive change in the near future as their profits inevitably follow the decline that plagues the general population currently. And the escalating pain in the general populas continually adds to our strength.

 

Government by organized money is just as dangerous as government by organized mob..... FDR

Progressive Populism and the Business Community | 38 comments
USER MENU

Open Left Campaigns

SEARCH

   

Advanced Search

QUICK HITS
STATE BLOGS

Home | RSS/XML Feed | Register | Contact

  © OpenLeft 2007-2010, Powered by SoapBlox

Powered by: SoapBlox