A Rare Moment

by: Chris Bowers

Tue Sep 23, 2008 at 01:00


I just watched the BBC News. It appears that at their party conference in the UK, Labour is once gain calling for the nationalization of industries, openly rejecting Blair-ism are the abandonment of Clause IV. Meanwhile, back here in America, conservatives are blaming the financial meltdown on minorities and diversity. In the midst of it all, an African-American leads the campaign for President and, after previously nationalizing the mortgage sector, Congress now openly talks of nationalizing an additional 5% of the national economy. Republicans, by contrast, just want to hand over more money to corporate executives. Oh yeah--and there are no more investment banks.

More in the extended entry.

Chris Bowers :: A Rare Moment
When I was in college, I was obsessed with the first third of the twentieth century. It wasn't because I thought things were better back then-far from it. However, they did at least seem exciting and full of possibility: monarchists, communists, fascists, imperialists, anti-colonialist nationalism, and civil rights movements operated simultaneously in what was certainly the most diverse ideological mix the world has ever seen (the literature and art wasn't bad, either). Compared to the incredibly boring and corporate loving 1990's, it certainly was alluring. However, after the last decade, I wonder if I will ever feel that excitement envy again. This is a rare moment, and the past two weeks have been the real turning point.

The reason the last two weeks are the key is that there is once again, after a long lag, overt and populist discussion about nationalizing key industries. And this talk is kind of popular, too. I taught The Commanding Heights alongside anti-globalization literature to freshman writing students for a couple of years back when I was a teacher, but as a lefty I never really held out hope that we would somehow get to this point again. The triumph of right-wing corporatism seemed so absolute that real ideological debate appeared dead. But now, here we are, as both the USA and the UK argue over whether or not to nationalize a few more industries. The debate is once again opened.

It won't necessarily stop with mortgage brokers and banks, either. If we get the right sort of deal out of this, and also win the election, a couple of years from now we might seriously be having a discussion about nationalizing the automotive and oil industries in America. Seriously-if nationalizing banks and the mortgage industry works, people are going to start to call for more of it the next time a major US industry seeks a bailout. Or, maybe we won't want a bailout-maybe we will just get sick of being gouged by oil companies and realize there is another path. This could even, long-term, spell the end of corporate welfare. The American people might lose their taste for bailouts. So, from now on, we will engage in public sector buyouts instead. And the best part is that the Bush administration itself opened this line of discussion when it nationalized the mortgage industry. Even Republicans are now suddenly communists, although they do it the Soviet crony way by rewarding communist party leaders corporate cronies with huge buyouts.

This is a huge, monumental opportunity to reshape the country. Every economy is a mix of capitalism and socialism-that is, a mix of public and private ownership. The question is how far you go in either direction. For the first time in a long time, the idea of taxpayers handing over money to corporate executives has become unpalatable. Perhaps it is because this is the most blunt instance of corporate welfare presented to in a while. Perhaps it is because no one really believes that the public sector is less efficient than the private sector anymore. Perhaps it is simply because conservatives finally were given complete control of the federal government, and virtually all of the left-wing warnings about the disasters that would happen in such a situation came true. Whatever the cause, real ideological debate over the economy has been re-opened in America. This is a rare moment of the sort that we haven't seen in 70 years. The massive populist outrage might even be the exact sort of leverage we needed to turn the Obama administration into a progressive one. Let's not waste it. Let's win it, and reshape history.

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A Rare Moment | 35 comments
I agree with you Chris (4.00 / 2)
I'm frightened, no, I'm terrified about this whole thing. But I'm also exited and interested about what is going to happen in the coming days, months and years.

There is so much at stake, let's not screw up.

John McCain: Beacuse lobbyists should have more power

Dude, you are 14 (4.00 / 1)
What the hell are you scared of anything for? To be scared at your age is a bad thing. Time to be fearless.
[ Parent ]
Way to demean me, (4.00 / 3)
I'm 15 now!

This is a mess, we're potentially seeing the largest economic breakdown ever. Ever, you can't exactly be totally bright and cheery about that if you've got a brain in your head.

On the other hand, it's also a opportunity to fundamentally alter the course of our nation on the scale that Lincon and FDR did, and that's pretty darn exiting.

John McCain: Beacuse lobbyists should have more power

[ Parent ]
Dude, when I was 15, Carter was tanking (0.00 / 0)
and Reagan was about to be president, and, being old enough to remember Nixon, Watergate and the last few years of Vietnam, I found THAT to be terrifying, relatively speaking--even though in absolute terms, now is obviously far more terrifying.

Assuming that the world doesn't end as we know it in the next few years, you're actually at the perfect age to be going through all this. Too young to have to worry about losing your life savings or finding a job (although of course it's likely to affect your family, and possibly college plans), yet old enough to be able to understand what's going on so that when you look back at it someday, you will be able to appreciate how major what's going on truly is.

I was alive during most of the important parts of the 60's (except the JFK assasination), yet have absolutely no memory of it but one (6 day war, nursery school, bomb shelter). Yet I remember the 70's almost as if they were yesterday. And it kind of feels like we're going back to them. Which can be a good and bad thing. We're sort of rewinding the conservative era back to where it derail the progressive movement, and unfortunately appear to have to be going through lots of turbulence on the way there.

Anyway, take it all in, commit it to memory, realize that as bad as it gets, we'll eventually get through it, and it will all be an amazing memory for you someday. Trust me on that.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton

[ Parent ]
Crisis offers opportunity as the Chinese say (0.00 / 0)
See my hot tip for Robert Reich's outline plan.
Yes! Crisitunity! (4.00 / 2)
as Homer would say.
[ Parent ]
Funny, (0.00 / 0)
that's what the Bushies say too.
[ Parent ]
"Every economy is a mix of capitalism and socialism-that is, a mix of public and private ownership. " (4.00 / 1)
Correction, "successful economies" as many people blinded by the last 28 years are now realizing.
No, every economy (4.00 / 4)
You show me an economy that has never had at least some of both, and I'll show you fantasy land. Even communist nations had black markets.

Every single economy in history can be placed somewhere along the private-public continuum. The question is where it falls.  

[ Parent ]
Well if you want to split hairs sure (0.00 / 0)
But you could argue that the U.S. (except for a brief period during the Civil War) until WWI had a very laissez-faire type economy which of course resulted in 50% unemployment, child labor, and all the evils of unfettered capitalism.

It wasn't until we had a true mixed economy that we started to really have a successful economy.

Sure, Soviet Russia had black markets. But was that a successful economy? My point was that if you want to have an economy that works for everyone you have to have both. Going to far one way or the other is where failure happens, like now.  

[ Parent ]
The trick, (0.00 / 0)
is in getting the right balance. I fear a cumbersome overly-managed left-wing economy almost as much as the "free market" corporate cronyism of our current economy. But I fear fascism the most and we are right on the brink. The silver lining in this moment of crisis is that we may be able to save democracy as Americans wake up to their economic fears. Then we can get back to a debate about the size and role of government in the economy.

I guess these are pretty interesting times. Just throw in a witch-hunting, moose-killing, writhing-fundie, beauty queen for spice.

[ Parent ]
i disagree (4.00 / 2)
I don't see this as expanding the range of economic options. The current crisis is being framed as something we need to 'fix' so we can get back to the dominant economic paradigm. None of our progressive elected leaders are (publicly) talking about a fundamental restructuring of the relationship between government and industry the way you are.

I don't know what has to happen to precipitate that conversation, but I don't think this is it.

Well if we keep not buying GM, Ford and Chrysler (0.00 / 0)
I can almost guarantee they will be nationalized in some form in the next 4 years.  
[ Parent ]
Not really sure I agree with you on some of this (0.00 / 0)
Especially this point
a couple of years from now we might seriously be having a discussion about nationalizing the automotive and oil industries in America. Seriously-if nationalizing banks and the mortgage industry works, people are going to start to call for more of it the next time a major US industry seeks a bailout

I'm just not certain this "bailout" is a "nationalism" of of the banking system.  It seems more just a holding process, assuming the Dodd plan or something similar passes.  The banks will eventually be private again (yes I realize that they will get a benefit under the proposed legislation, but not to the extent of the original Paulson proposal).

And that's a good thing.

I am definitely to the left, but not so far that I think the permanent nationalizing of industry is necessary.  I think, as you allude to, that a mix of private industry under national oversight, or regulation, is the best way to go.

The idea of of the US taxpayer "owning" the banking and mortgage industry just strikes me as wrong.  I just want them properly regulated so they don't shaft the rest of us more then usual.

Anyway, has there ever been a case when a nationalized industry worked well?  I'm not so sure.

Coal in Britian (0.00 / 0)
The Blessed Plot, by Hugo Young (1999) is actually about the 50 year debate in Britain about joining the EU. (A terrific read, starting in the '20s, it walks us through the economic/foreign policies of each goverment, against a backdrop of the socio-economic conditions of the time.

In doing so, there is quite a bit of writing on the nationalization and re-privatization of the coal mining industry in the 1950s. Definitely worth the read...

[ Parent ]
The Mortgage Industry WAS Effectively Nationalized (4.00 / 1)
during the Great Depression.  Fannie Mae was only semi-privatized in 1968. This is what enabled the modern American mass midddle class to be created after WWII.  It was the combination of generous union wages (or wages set high enough to thwart unionizatioin) and government mortgages after WWII that did it, all supported by the Keynsian consensus.

As for successful nationalizations, every other advanced industrial nation has nationalized health care in some sense or another, with lower costs and better health outcomes.

Education is another example.  Here in the US conservatives always complain about how far we lag behind other countries, and tout privatizatioin as the solutioin--but those other countries outperform us with lower levels of private school education, and our under-performing inner-cities schools are a direct result of the failure to nationalize education, as they are dependent on local, depressed tax bases.  Our affluent suburban schools perform as well as Japan, Korea or anywhwere else.

Then there's our highway system.  You'd prefer a system of private toll roads, with booths every 10 or 20 miles, perhaps?  All carefully regulated, of course!


"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3

[ Parent ]
Nationalized Industries That Work Well (4.00 / 5)
Just a few examples:

1. The Postal Service. That nationalized industry is written into the Constitution and has worked quite well for over 200 years.

2. Rail systems all over the world, including Amtrak. Amtrak is actually a case where some more nationalization (of the tracks) would help since that's the major impediment to running on-time. Amtrak is currently boarding record numbers of passengers. The U.K.'s rail privatization has been a disaster.

3. Primary education. Again, that's a case where more national responsibility would likely be helpful since there's so much burden on local government. The more nationalized systems do better.

4. Student loans. The federal government does a much better job loaning money to students than the private sector.

5. Air traffic control. Eurocontrol and NavCanada are disasters: higher costs, lower safety. Huge majorities of pilots -- we're talking 90-plus percent of the direct users -- want ATC kept nationalized.

[ Parent ]
don't forget (0.00 / 0)
the BBC and CBC.  Public media function better at their primary job:  Informing the public of issues that matter.  
[ Parent ]
NOT the auto industry (0.00 / 0)
Huge error by Chris.  Will not work at all.  No understanding of the things that capitalism does do well.  The gov't cannot run a car company.  Nationalizing industries is for the public good....not for consumer products.  
[ Parent ]
Random cold drugged thoughts (0.00 / 0)
How about the Ural, the  Russian copy of the BMW motorcycle?
How about the Yugo? Soviet cars?

Actually, GM is behaving just like a nationalized auto maker--in league with big oil. They actually killed their electric car program, to appease big oil IMHO, before they revived it. Now they are way behind.

I believe in good public infrastructure (roads, trains, education, research, healthcare, etc).  Good infrastructure supports entrepreneurial enterprise.

The postal service is good but so is UPS and FedX.They do different things.

[ Parent ]
Good on you, Chris (4.00 / 6)
More progressives need to be paying attention to Labour, which is facing a catastrophic defeat in next year's election. The number one reason is because they adopted neoliberal economic policies, and when those policies predictably failed, Labour had nothing left to offer voters.

This is a truth which Democrats have consistently failed to learn - embracing neoliberal economic policies has only ONE outcome, which is an even greater victory for the right.

True, an embrace of truly progressive policies might also lead to right-wing victories, as in 1946 or 1968. But there's a fundamental difference - when progressive policies are embraced, they tend to last, and the nation can weather a period of right-wing government. When neoliberal policies are embraced, however, right-wing government becomes catastrophic instead of a nuisance.

Obama and the Democratic Congress WILL wind up in the same place as Gordon Brown and Labour if they do not abandon neoliberal economic policy and start channeling FDR.

It is especially welcome to see social democracy, and even democratic socialism, making a return. The absence of an actual, realistic, appealing socialism has been devastating for American politics.

And this is the problem (0.00 / 0)
We're going to lose. The move to reintroduce Clause IV is a giant fuck-you from the unions and delegates towards a party leader they no longer trust and would probably have deposed had the party hierarchy not worked hard in the past 15 years to crush intre-party democracy.

Britain's likely to go right, or at least towards a Conservative Party that does Blairism better than Blair ever did. If the conference gives us any hope, it's that there is enthusiasm for a Labour civil war once we lose the election so that we can come back in five years time with a party that stands for something.

Forgotten Countries - a foreign policy-focused blog

[ Parent ]
Blair Was The Perfect Post-Partisan, Wasn't He? (0.00 / 0)
"Third way." Got on famously with both Clinton and Bush.  No principles whatsoever, but an implicit sneer towards anyone who had them.


"You know what they say -- those of us who fail history... doomed to repeat it in summer school." -- Buffy The Vampire Slayer, Season 6, Episode 3
[ Parent ]
You got Blair ... (4.00 / 1)
We got Clinton. Hard to say which was a more depressing specimen of slick sleaze supplanting a worthy tradition.  

Can it happen here?
[ Parent ]
I've come to the view that Blair was worse (0.00 / 0)
Clinton had to work with Republicans (granted that was partly his fault). Blair had huge majorities and continued where Major left off, even though the gang we sold the railways to were just flat out incompetent.

And he wasn't even good at politics. He attacked Major for sleaze after his 'Back to Basics' campaign went down the tubes, then lost that attack and found his own party irretrivably branded as sleazy when he took a million from noted slimeball Bernie Ecclestone. He lost the socially liberal members of Labour to the Lib Dems, even though he followed positions that were much more in the SDP tradition than that of Labour, he faced threats in the poorer and whiter base areas from the BNP because he demonised those living there (and only the corruption and unpleasantness of the BNP saved him) and he made the youth vote toxic to Labour.

He laid the groundwork for an anti-Labour coalition that could last a generation. He did this after the biggest election victory since we got rid of that fucker Wellington, and he gave us little but spending increases (easily repealed given that he sent the Overton window in the wrong direction) to show for it. It's a ten-mile high statue of pure electoral shit.

New Labour had a reputation for being good at politics, for being very slick. Sure, they were very slick. But like a crooked estate agent.

Forgotten Countries - a foreign policy-focused blog

[ Parent ]
Idea (0.00 / 0)
We can start shaping history by imposing conditions on Wall Street as stated in Senator Dodd's proposal but not give Wall Street any of the money.  
Theory (4.00 / 1)
When I was in high school I decided that needs should be handled by socialism and wants should be handled by capitalism.  While I no longer think that way, I'm quite willing to re-reconsider.
A Kindred Spirit at 38 (0.00 / 0)
Nationalization, privatization, state intervention & regulation, deregulation, technocratic management, state planning, free enterprise zones, etc etc have all had some degree of success and failure over the past 100 years. None of these has an unblemished record...which those prone to needing a rigid ideology may find frustrating, as they can't squeeze the world and human nature into a one-size fits all rubric.

I find it liberating. For those of us in our 30s, the national conversation has always been tightly controlled and tightly constricted in terms of policy options. We have tried to solve every problem with deregulation, tax cuts, and vouchers, which are only three tools in our toolbox. You wouldn't try to build a house with only a hammer, a bulldozer, and a level, and you can't build an economy with dogmatic restrictions on policy. It didn't work for Soviet communism, and it didn't work for Anglo-American capitalism.

I eagerly look forward to the day when policy prescriptions in America can be built using a wide variety of tools, in a wide variety of combinations. Only then can we build a social democratic society.

Of course, that is going to require some basic education, as some of the posts above demonstrate. While experience shows that some sectors should be permanently nationalized (healthcare, the railways), when Chris is referring to nationalizing the auto industry, I assume he is referring to a temporary nationalization, in order to rescue an ailing industry through reformational technocratic management, before returning it (revived, and stabilized) to the private sector. The British did this with the coal industry in the 1950's, to great success.

Nye Bevan
Barbara Castle
Harold Wilson
Clement Attlee

I find them as inspirational as their American New Deal counterparts...our predecessors.

Re-privatisation didn't work (4.00 / 1)
Read up on the coal strikes of '72 and '84-5. The same kind of corrupt oligarchs kept running it right through the period.

Re-privatisation relates much more to the cowardice of the Labour right and Churchill's lack of foresight except where Germany is concerned than to rescuing an industry. The idea had been to take it over, not to package it up and hand it back.

Forgotten Countries - a foreign policy-focused blog

[ Parent ]
Near to mid-term nationalization, most likely (0.00 / 0)
Long-term, I doubt it, except for vital infrastructure that is never likely to be profitable if it truly serves the needs of all, such as passenger rail. Eventually the government will sell off these firms, or parts of them, this time hopefully under much better regulation (that is enforced), and better management (the two being intimitely linked--no rule or umps, and the players tend to get rather unsportsmanlike). I think that ultimately a WELL-REGULATED "free market" is what will work best, in most sectors. The government shouldn't be making cars or memory chips.

This feels so weird for me. Years ago, in the early 90's, I worked in IT support for a major investment bank that was one of the spearheads of the privatization movement. They did TONS of business in Latin America. I didn't really pay it much attention back then, since my work didn't directly have to do with IB. Now everything's moving in the opposite direction. And that firm no longer exists, having been bought out after never quite recovering from a major trading scandal, by a firm that was itself bought out by a megabank (that still exists, but who knows for how long, or in what form). The 80's have finally ended, 18 years late.

Thoughts now turn to Yeats, and rouch beasts.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton

I meant rough beasts, consarnit (0.00 / 0)


"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton
[ Parent ]
Next generation of models (4.00 / 2)
The spiral theory of human development says that rather than go back to the previous models, society is likely develop a new version of the earlier model.

In this case, I think rather than revert to the same concepts of nationalization or socialism, we will end up with a new "progressive" version of the ideas.  The question is what this would look like.

I am a systems researcher from India.  Our center is trying to understand the nature of enterprise systems (leading into architecture and design).  So I am very interested in these questions.  However, my actual understanding of existing models (socialism, capitalism etc) is relatively superficial.

In constructing a new model, I think we can separate some concerns:
- Who provides the investment?
- Who provides governance ("board-level") decisions?
- Who provides management?
- Who shares in profit or loss?

The capitalist system says the investors do all four.  The socialist (or is it communist?) system says that a central authority (government) does all four.  The co-operative society concept says the participants (employees) do all four.

I think a much wider variety of models is possible.   Also, the same model may not be applicable to every industry / enterprise, even among critical industries.

The following are possible guiding principles:
- The reward for investment could be interest, not profits.
- Fault-tolerance suggests that there is high value to distributed management decisions, rather than central decisions.
- Governance is about imposing constraints to achieve systemic objectives.  This is separable from decision making.
- Competition and reward are powerful self-organizing forces that should be harnessed.

The design objectives are probably societal interests, fairness, opportunity for all and effectiveness.

One possible design is a franchise concept, where the government awards "franchises" for providing a function, creates common rules for functioning (and perhaps provides some common infrastructure), and then does periodic evaluation to determine whether the franchise should continue.

What do you think?  How can we combine the strengths of the capitalist and socialist models to achieve system goals?

ha! fast forward to 2:45 -- 3:40 (0.00 / 0)

or just watch the whole thing....

NOT the AUTO Industry (0.00 / 0)
If you think this is a good idea, you have a lot of learning to do...it's foolish.  It won't work.  It's a consumer product.  Very, very, very different than a public good.    
A century later... (0.00 / 0)
Are we truly in a moment similar to the first few decades of the 20th century? I am pessimistic. Even the more principled segments of the left lacks leadership and obsesses endlessly about tactics and message (both of which are necessary but cannot precede public moral arguments and organising).

As an old man I respect wrote on a left mailing list (not quoting verbatim): "typically the problem with attempted movements is too many chiefs, but the left today faces the opposite problem of a lack of leadership". All we have are Obama and Markos! ;-)

I don't blame the current crop of leftist luminaries [what I perceive as] their reticence to step out of the relative safety of the blogistan and take on a bigger role and personna. That way lies greater poverty, risk of lesser impact, and almost certainly the unlikely possibility of living to see their work come to fruition.

A Rare Moment | 35 comments
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