Sunday, July 21, 2024

 BRITAIN

The right after Sunak – and the left‑wing alternative



THURSDAY 18 JULY 2024, BY PHIL HEARSE

As Britain grapples with the aftermath of its recent general election, the political landscape is shifting dramatically. With the Labour left marginalised and the far-right Reform UK surging, the implications for Britain’s future and the international scene are profound.

In an article published here five weeks before the UK general election, we argued that two key takeaways from the election would be the marginalisation of the Labour left and a big surge for Reform UK – and that this would reflect an international push for power from the hard right. This is exactly what is underway. Below we review what this means internationally, but first, it is necessary to look at the outcome in Britain.

LABOUR’S FRAGILE VICTORY

Labour’s huge 410 seats were won with just 35% of the vote on a 60% turnout – in other words by 21% of the electorate. Doubtless, some abstainers didn’t bring any photo ID with them or were worried about their immigration status. But there was an ‘active’ abstention by 35% of the electorate. This low score of votes for Labour underlines the fragility of their vote.

The voters took to the polls with the same attitude towards the Tories as those villagers who attack the hillside castle in Dracula movies – determined to drive a stake through the heart of the vampire. To do this, voters in many cases voted for parties that were not their first choice, especially cross-overs between the Liberal Democrats and Labour. But darker things were afoot.

In the 98 seats where Reform UK came second, 89 of them were in seats won by Labour, leading to Nigel Farage’s boast that in the next election Reform “is coming for Labour”. The total votes were nine million for Labour, seven million for the Conservatives and four million for Reform UK. And around two million for the Greens.

What’s going to happen in the Conservative Party? The four leading candidates for the leadership are all from the hard right – Suella Braverman, Kemi Badenoch, Priti Patel and Robert Jenrick. The predominant discourse in the ‘Conservative family’, which includes newspapers, magazines and broadcast pundits, is that the Tories lost because they were “not conservative enough.” But this cannot be substantiated by the facts. In every poll, voters cared more about the cost of living, social care and the NHS, way above taxation and immigration. Voters expressed scepticism about Labour’s plans to fix these things, and probably many voting Labour did so more in hope than expectation.

Labour has no real plan to fix anything from social care to sewage-strewn rivers because they have no real plan to raise the money needed to do that. Instead, they propose the “magical realism” of growing the economy and public sector reform. Within two years or so Labour will be mired in conflict with the unions, increasingly unpopular because of the failure to fix anything substantial and embattled with progressive voters over the Middle East.

Five independent candidates were elected whose platform was mainly about Gaza or who featured it prominently (including Jeremy Corbyn in Islington North). Other independent candidates like Andrew Feinstein in Holborn and St Pancras got high votes while the Greens won almost two million votes.

Votes for independents suffered from there being no viable national structure or party framework behind them. In other words, whereas Reform had a clear national profile and platform to the right of the main parties, other independent candidates had no such platform or programme to the left, and the Greens have not always been left-wing in this country.

THE DIRECTION OF THE TORIES

In a recent poll, 50% of Conservative members said they would like the party to merge with Reform UK. There’s no doubt Nigel Farage would emerge as party leader from any such deal. But this poll tells us everything we need to know about the politics of Tory members. This now includes more than 200 ex-MPs, unleashed from the Tory whip. But you cannot put a cigarette paper between Reform UK and ex-Tory MPs like the belligerent Jonathan Gullis, formerly representing Stoke-on-Trent North, and the more refined Jacob Rees-Mogg whose sister Annunziata is a leading member of Reform. Another in the category of ex-MPs is Steve Baker, a parliamentary right-wing fixer until he was made a junior government minister in 2022. Also on the ex-MPs list is Michael Gove, still popular among Tory members.

The developments on the British right cannot be analysed outside of the politics of the European right as a whole. On numerous fronts, the traditional ‘centre-right’ are being crowded out by parties that are on the ‘creeping fascism’ spectrum. They make up the biggest bloc in the new European parliament. The participants in recent European hard-right conferences in Brussels in 2023 and Madrid this year were Hungarian Prime Minister Viktor Orban, Italian Prime Minister Giorgia Meloni, Marine Le Pen from the French National Rally and Spanish Vox leader Santiago Abascal. Both conferences were held under the banner of National Conservatism and included right-wing theorist Frank Furedi, Professor Emeritus at Kent University.

NATIONAL CONSERVATISM: THE NEW RIGHT-WING VANGUARD

The National Conservatism conferences targeted allegedly ‘woke’ ideology, especially left and liberal concerns for racial and gender equality. Giorgia Meloni, leader of the Brothers of Italy, and Santiago Abascal of Vox are vocal in their denunciation of “gay agendas”; that “undermine the traditional family and the traditional role of women as mothers and homemakers”.

But what is National Conservatism, and what is Illiberal Democracy? National Conservatism is the idea that we are now (or should be) in a post-neoliberal globalisation phase. According to author and academic Angelos Chryssogelos, National Conservatism is increasingly the ideology of the new mainstream parties that have displaced more ‘moderate’ right-wing parties in Hungary, Poland and Italy, and threaten to do the same in France, Germany and – via Reform UK – in Britain.

National Conservatism cannot roll back the juggernaut of economic globalisation, but it can limit it. A recent example is the American decision to impose huge tariffs on Chinese-made electric vehicles to defend American producers. But this is a double-edged sword. One of the biggest manufacturers in China is Elon Musk’s Tesla, a truly globalised company

National Conservatism promotes, in theory at least, the role of the national state as opposed to international bodies like the IMF, the World Trade Organisation and, especially, the UN and world and European courts.

But most importantly, National Conservatism advocates state intervention to promote traditional values and defeat the ’woke’ agenda. This could involve anything from banning school books that explain Britain’s role in the slave trade to banning the teaching of alternative sexualities and genders. This is the ‘anti-woke’ agenda now on full display in the US Supreme Court, which has effectively banned reproductive rights in many US states.

National Conservatism goes hand-in-hand with Viktor Orban’s ‘illiberal democracy’. This means using the state to manage democratic rights, like the right to demonstrate on issues like Gaza, hold pride marches, and organise political rallies. It also means purging the local and national state apparatuses and doing the same in university and high school teaching.

And of course, National Conservatism means political mobilisation on the basis of anti-immigrant racism and nationalism.

A lot of these things are already happening in Britain but they are imposed in an uneven way, according to national circumstances. In Poland, National Conservatism in power wrapped itself in reactionary Catholicism, which is not the case elsewhere.

Suella Braverman has been an important attendee at National Conservative conferences and she is highly likely to be one of the two candidates referred to the membership in the upcoming Conservative leadership election. If they vote for her, there is sure to be a united front with Farage on many questions.

According to Tim Bale, four leading candidates for the Tory leadership – Kemi Badenoch, Robert Jenrick, Priti Patel and Suella Braverman – all seem to adhere to the right-wing mantra that the Conservatives lost the election because they were “not conservative enough”.

In the general election, the anti-woke agenda was downplayed. But after the Tory leadership is decided in favour of Braverman or front-runner Kemi Badenoch, a full-on anti-woke agenda can be expected, focusing on anti-trans ideology and targeting Gaza demonstrations as racist “hate marches” and left-wing/Gaza demonstrators as “violent” towards MPs and “out of step with ‘British values”. A key target for the anti-woke theorists is teaching, and in particular left-wing or liberal university teachers. These things are out there in the Tory and right-of-Tory ecosystems, but with an effective Conservative-Reform united front in parliament, they could become the focus of a massive ideological offensive.

THE EXTREME RIGHT’S INTERNATIONAL INFLUENCE

The fate of the extreme right in Britain is linked to that of the extreme right internationally. Political leaders on the creeping fascism spectrum are already in government in Italy, Hungary, Turkey, Argentina and the Netherlands. The danger of Donald Trump coming to power again in the United States looks even more likely after the attempted assassination and the refusal of an obviously struggling Biden to step down as the Democratic candidate.

Farage talks of Reform targeting the 2029 election to become the biggest party in parliament. But the extreme right is not the only show in town.

PEOPLE POWER

The Green Party won four seats and came second to Labour in dozens of others. Campaigners for Gaza or a more extensive left-of-Labour programme won five MPs and organised hundreds of activists. In a post-election opinion piece, Jeremy Corbyn outlines how he and local community activists intend to maintain strong roots in the constituency by campaigning and helping local people with their problems. Of those who mobilised around his campaign, he says:

‘…energy needs somewhere to go. It needs to be channelled. It needs to be mobilised. That’s why our campaign will organise with those who have been inspired by our victory to build community power in every corner of the country. Once our grassroots model has been replicated elsewhere, this can be the genesis of a new movement capable of challenging the state two-party system. A movement that offers a real alternative to child poverty, inequality and endless war. A movement that provides a real opposition to the far right – one that doesn’t concede ground to divisive rhetoric, but stands by its principles of anti-racism, equality and inclusion.

‘I have no doubt that this movement will eventually run in elections. However, to create a new, centralised party, based around the personality of one person, is to put the cart before the horse. Remember that only once strength is built from below can we challenge those at the top.’

But this counterposition of building locally from the bottom upwards, against organising nationally, in trade unions, in national campaigns, and inside student struggles is terribly one-sided and avoids the crucial role of socialist organisation.

It would be brilliant if the Islington North model could be repeated in every corner of the country, but it cannot. Islington North campaigners have got to where they are because their candidate is the former leader of the Labour Party, and on the basis of thirty years or more local work, has talked to every local campaign and thousands of local constituents.

Local community and campaigning structures will inevitably face national and international questions. Waiting until Islington-type community power before standing candidates is a very long-term perspective that takes place in the context of an extreme right that will also fight for community allegiance. That is unthinkable in Islington North but a real proposition in northern and midlands ‘red wall’ towns. Reform UK will also advocate a programme that demagogically appears to defend the NHS and working-class living standards by, for example, opposing the two-child benefit cap.

All the evidence from across Europe and Latin America shows that local support has been built from national electoral alliances of parties, not just from ‘the bottom up’. The bold experiment with community power organised 20 years ago in the southern Brazilian city of Porto Allegre was based on the national and local power of the Workers Party (PT).

But this is not a one-way street. The PT emerged by fusing together diverse political trends, and especially radicalised Christians and the militant trade unionists from the ‘ABC’ industrial zone in Sao Paulo. This involved local and national political organisation, including revolutionary political trends. Broad left parties in Spain and Greece emerged from mass struggles in the post-2008 austerity period, but they did not do that by simply linking up local struggles.

To argue in the British context that doubtless candidates will stand once the Islington model of local empowerment has been realised, is to put it off to the indefinite future.

In France in the recent elections, the offensive of the far-right Rassemblement Nationale was repelled in large part by the electoral alliance of the New Popular Front, involving the Communist Party, the Greens, the Socialist Party and crucially France Insoumise (Insurgent France). France Insoumise has not been built by ignoring elections or refusing to build a national political organisation.

Jeremy Corbyn is right to imply that a new left party cannot be built instantly by declaring a new party around one individual. But without some sort of national coordination, a new national party will never be built.

FURTHER READING

Global elections, hard right reaches for power
Creeping fascism, Neil Faulkner et al
National conservatism

Source: Anticapitalist Resistance

P.S.

If you like this article or have found it useful, please consider donating towards the work of International Viewpoint. Simply follow this link: Donate then enter an amount of your choice. One-off donations are very welcome. But regular donations by standing order are also vital to our continuing functioning. See the last paragraph of this article for our bank account details and take out a standing order. Thanks.



LGBTIQ

Pinkwashing and Queer Dilemmas


SATURDAY 20 JULY 2024, BY MARYAM GILANI, JET MENIST, SAMARA GHAZAL



The sudden eruption of a controversy about whether or not to accept Israeli flags at the Amsterdam Pride Walk on the 20th of July 2024, usually one of the few more political events of the two-week Amsterdam Pride, has thrust the issue of the Israeli genocide in Gaza to the forefront of Dutch LGBTIQ politics. It has also exposed some difficult issues around the attempt to incorporate radical queers into Amsterdam Pride, characterized in the past by rampant commercialization and the presence of police, the military and government ministries.


From 1996 to 2005 the whole of Amsterdam Pride was organized by the Gay Business Association. Even after that it remained mostly a politically tame spectacle for throngs of tourists, with relatively small but militant and creative protests by the radical queer group Reclaim Our Pride. The centre-left Amsterdam city executive tried recently to overcome this polarization by turning the second week of Pride over to the foundation Queer Amsterdam, supposed to represent the city’s more radical queers. But Queer Amsterdam’s statement that Israeli flags would violate the Pride Walk’s anti-racist spirit blew the attempt at inclusion wide open.

The decision of Queer Amsterdam to not welcome Israeli flags in this time of the ongoing genocide on Gaza sparked an array of homonationalist reactions across different stakeholders involved in the organizing of Pride events in Amsterdam. Amsterdam Mayor Femke Halsema reported that this “ban” would not be allowed, describing it as “imposing censorship on demonstrators”. In response, Queer Amsterdam initially issued a statement apologizing, making clear that the Pride Walk would be open to people of all backgrounds who shared the basic values of solidarity. It highlighted the presence of an invited speaker from the Dutch anti-Zionist Jewish group Erev Rav. But this attempt at backpedaling failed to quiet the storm.

In their turn, the Homomonument foundation, which claims to have been organizing Pride since its first edition, issued a statement taking over the organising of the Pride Walk on the 20th, welcoming everyone “regardless of their flag”. Queer Amsterdam took a courageous stand in withdrawing from the organizing of the Pride Walk, declaring that they could not accept a compromise that violated its fundamental queer values. It announced that it will hold its own international solidarity protest in the second week of September.
PRIDE, RESPECTABILITY POLITICS, AND PINKWASHING

According to the Lancet journal, an estimated 186,000 or more deaths among Palestinians can be attributed to the current Israeli genocide on Gaza. The International Court of Justice in the Netherlands found earlier this year in January that it is plausible that Israel is violating the genocide convention. Halsema’s stance to consider not welcoming Israeli flags as an act of censorship is absurd to say the least, given this background. Queers have been part of the increasingly strong movement in the Netherlands opposing the genocide. Victories have been won both in mobilizing and on a legal level against Dutch complicity with the genocide. Would Halsema demand tolerance of antisemitic banners at a march against antisemitism? Merely asking the question shows the absurdity of her argument. But clearly sympathy for Zionism is deeply rooted and stubborn, not only in the PVV and on the right but also in the PvdA.

This stance of allowing Israeli flags in the Pride Parade of Amsterdam is an act of pinkwashing the ongoing genocide in Gaza. Pinkwashing is the process which the Israeli state has been using for decades to polish the ongoing settler colonialism of historic Palestine, picturing Israel as a beacon of gay rights and dismissing the lives of LGBTIQ Palestinians in Occupied Palestine.

Allowing Israeli flags in the Amsterdam Pride Parade is engaging with a system that dismisses queer Palestinian lives both in occupied Palestine and in Europe, and is fueled by the growing racism against people of Middle Eastern origin and people of colour in general. The Amsterdam gay scene has unfortunately long been a fertile ground for pinkwashing ideologies. Queer Amsterdam’s courageous stand has now broken a breach in a consensus that has been too solid for too long. In response, BDS Nederland are holding a queer solidarity protest on Saturday 20th of July, to refuse the pinkwashing of the genocide during Pride, under the slogan “No Pride in Genocide”.

The creation of Queer Amsterdam as a major actor in Pride offered promise of reaching broad LGBTIQ milieus, going beyond the relatively small numbers mobilized in the past by Reclaim Our Pride’s actions against commercialization and homonationalism. But now we must ask whether the opportunity depended too much on funding and supervision by the Dutch state, specifically by the Amsterdam municipality. The resulting foundation structure, which has not been open to broad democratic debates and decision-making, has now weakened Queer Amsterdam in its clash with the municipality.

Setting up foundations for interest groups is an old tradition of Dutch multiculturalism, functioning to contain movements by giving them a limited space for visibility and action. Political movements in contemporary Dutch neoliberal democracy, when organized into foundations, face two significant challenges. Firstly, this results in substitutionalism, resulting in a small number of individuals advocating on behalf of the wider population with limited community engagement in politics. Secondly, these foundations are constrained by the rules established by other, often structurally more powerful, institutions with which they must negotiate.

A recent, particularly problematic example of this was the Feminist March NL, which dissolved on the very day of their planned march due to their inability to manage potential police violence against concurrent anti-genocide protests. Built on the efforts of a few activists and lacking the robust support that collective thinking, discussion, and organization provides, these foundations are inherently vulnerable. In contrast to the outcome of the Feminist March NL, we hope Queer Amsterdam emerges from this experience stronger.

In times of repression of anti-fascist voices within the queer community and the weaponizing of queerness to pinkwash a genocide, it is more essential than ever to draw on the historical anti-fascist symbolism of the Homomonument. The monument, erected in 1987, is composed of three pink triangles, similar to the ones stitched on the jackets of gay victims in concentration camps. Each triangle represents a different aspect of queer memory: one triangle at street level symbolizes the oppression and homophobic violence queer people endured in the past, and contains a verse from a poem by Dutch gay Jewish poet Jacob Israël de Haan: “Naar vriendschap zulk een mateloos verlangen” (“Such an Endless Longing for Friendship”).

The pink triangle was later adopted during the AIDS pandemic in 1987 as part of the SILENCE = DEATH movement, and ACT UP New York adopted it as a logo symbolizing solidarity and the struggle for life. They, along with Jewish Voice for Peace, recently launched a significant solidarity event with the Palestinian people, calling on Biden to stop arming Israel, with slogans ranging from “No Pride in Genocide” to “From New York to Gaza: Stonewall was an Intifada.”

As for De Haan, after moving to Palestine as an ex-socialist religious Zionist, what he saw there turned him within a few years into an anti-Zionist. In 1924 he was assassinated by an armed Zionist band led by a future president of Israel. His memory should remind us: queer solidarity must inspire us to intransigent rejection of discriminatory ideologies, never to acceptance of them in the name of “tolerance” or “unity”.

P.S.


If you like this article or have found it useful, please consider donating towards the work of International Viewpoint. Simply follow this link: Donate then enter an amount of your choice. One-off donations are very welcome. But regular donations by standing order are also vital to our continuing functioning. See the last paragraph of this article for our bank account details and take out a standing order. Thanks.

ATTACHED DOCUMENTSpinkwashing-and-queer-dilemmas_a8596.pdf (PDF - 911.3 KIB)
Extraction PDF [->article8596]


Jet Menist


Jet Menist is the pen name of a long-time leading member of the SAP - section of the Fourth International in the Netherlands.

Maryam Gilani


Maryam Gilani is a member of SAP, the Dutch section of
the Fourth International, and a historian, living in Amsterdam.

Samara Ghazal



International Viewpoint is published under the responsibility of the Bureau of the Fourth International. Signed articles do not necessarily reflect editorial policy. Articles can be reprinted with acknowledgement, and a live link if possible.
Most Large US Public Charities Are Now Dark-Money Funds

Finance giants like Fidelity and Schwab are pushing “donor-advised funds” that enable the ultrawealthy to funnel cash to far-right extremist groups anonymously under the guise of charitable giving. Project 2025 has benefited enormously.


Fidelity Charitable — created by Fidelity Investments — allows the ultrarich to anonymously donate to nonprofits like the Heritage Foundation, all the while scoring immediate tax deductions and nourishing investments that can grow tax-free.
 (Jakub Porzycki / NurPhoto via Getty Images)



BY KATYA SCHWENK HELEN SANTORO FREDDY BREWSTER
07.18.2024
JACOBIN


Asignificant portion of the money bankrolling the Heritage Foundation — the conservative think tank behind the sweeping Project 2025 initiative to reshape the federal government if former president Donald Trump is reelected — comes from a growing network of shadowy charity groups run by the nation’s top financial firms that use a legal carve-out to keep their ultrawealthy donors hidden.

These groups, called donor-advised funds, have donated more than $18 million to the Heritage Foundation since 2020, according to a new Lever analysis and research by the Institute for Policy Studies — and the amount is increasing.

In total, donor-advised funds held nearly $230 billion in assets in 2022, $52 billion of which was donated to nonprofits including the Heritage Foundation. Such funds now make up seven of the top ten public charities in the country. What’s more, they have been found to distribute money to anti-government and hate groups at more than three times the rate of other charitable sources, according to a study published this May.

The rapid rise of donor-advised funds — charitable investment accounts run by finance giants like Fidelity Investments, Charles Schwab, and Vanguard — signals a new stage in the dark-money takeover of the political system. Wall Street is now helping the nation’s elite funnel vast amounts of cash to extremist causes with zero transparency or tax repercussions — and it’s spending millions lobbying Congress to keep it that way.

While private foundations like the Bill and Melinda Gates Foundation and the Ford Foundation are required to disclose all of their charitable donations and the recipients, wealthy philanthropists who want anonymity — and a tax break — can instead donate to a donor-advised fund.

Once money is in a donor-advised fund, the original donor can send it to any charity of their choosing, but the ultimate source of the money, and the amount, is completely obscured. It’s an appealing design for those wishing to avoid public scrutiny.

While the Heritage Foundation — like other nonprofits — does not have to publicly disclose its individual private donors, routing the money through a donor-advised fund provides donors an additional layer of anonymity, as well as unique tax benefits. And since financial firms like Fidelity and Vanguard that manage the funds also score tax benefits from the arrangement, they have an incentive to promote these funds to their wealthy clients.

Unlike politically active dark-money nonprofits — 501(c)(4)s — donor-advised funds cannot contribute directly to campaigns or politicians. But increasingly, they are part of a larger network of dark money where the lines between charity and political causes are becoming blurred.

Donor-advised funds can contribute to the Heritage Foundation, a 501(c)(3) charitable nonprofit. The Heritage Foundation can then funnel money toward political campaigns through its separate “sister” dark-money arm, Heritage Action for America.

“The joint presence of a 501(c)(4) organization and an affiliated charity has become an increasingly common phenomenon that makes the ability to ‘follow the money’ and separate charitable from political that much more difficult,” said Brian Mittendorf, an accounting professor at Ohio State University and coauthor on the study on donor-advised funds and hate groups.


From 2020 to 2022, the Heritage Foundation received around $14 million in donations from donor-advised funds, according to an analysis set to be published by the Institute for Policy Studies, a progressive think tank, and shared exclusively with the Lever. Contributions from these funds made up 6 percent of the foundation’s total donations and were second only to donations from private foundations such as the Adolph Coors Foundation, the beer titan’s family charity, which is a Heritage donor.

Since then, the amount coming from donor-advised funds has grown. According to the Lever’s analysis of nonprofit tax filings, four of the largest donor-advised fund sponsors — investment firms Vanguard, Fidelity, and Charles Schwab, along with the nonprofit National Philanthropic Trust — gave even more to the Heritage Foundation in 2023 — donating collectively $4.3 million, up from $2.7 million in 2022.

The amount of giving from affluent anonymous donors to the Heritage Foundation just as it launches a far-reaching right-wing political project is a “poster child of why donor-advised funds can pose a threat to democracy,” said Bella DeVaan, the associate director of Charity Reform Initiative at the Institute for Policy Studies, a think tank that studies inequality.

This May, the Internal Revenue Service (IRS) held a public hearing to discuss proposals to strengthen restrictions around donor-advised funds — but none of the ideas touched on increasing donor transparency.

That didn’t stop one donor-advised fund manager from warning the IRS that any such reforms would result in “negative, unintended consequences, including the reduction of American charitable giving.”

The growing role of donor-advised funds in politics is alarming, said Mittendorf.

“The lines between what’s political and what’s charitable have become quite blurred over the years,” he said. “The whole donor-advised fund space has essentially taken over philanthropy without people realizing it.”
Obscure Donations

John Rockefeller Jr, an American philanthropist and heir to the Rockefeller oil fortune, helped manage the first donor-advised fund in the 1930s to assist people in supporting charities they were passionate about. But these funds didn’t grow in popularity until 1991, when Fidelity Investments — one of the largest mutual fund companies in the country — created the nonprofit Fidelity Charitable.

Fidelity Charitable and other donor-advised fund managers offered people an easy way to anonymously donate to a charity of their choosing — all the while scoring an immediate tax deduction and nourishing an investment that could grow tax-free.

“[Donor-advised funds] obscure who the donor is,” said Mittendorf. “A donor who doesn’t want people to know that they’re the donor, that’s a very effective way to do it, to shuttle [money] through a [fund].”

Furthermore, unlike private charitable foundations, which need to donate at least 5 percent of their assets annually, there are no deadlines for when the money in a donor-advised fund must be disbursed. That means that cash in these funds can reside there indefinitely, all the while accruing interest.

The arrangement might benefit the original donor, but it is also advantageous for the financial corporations that manage the funds. For example, while the donor-advised funds managed by Fidelity Investments are part of Fidelity Charitable, technically a separate nonprofit, they are usually invested back into Fidelity’s mutual funds.

“Most of [the funds] are invested in the mutual funds from which . . . Fidelity Investments draws revenue,” said Alan Cantor, a longtime nonprofit consultant and critic of donor-advised funds based in New Hampshire.

Donor-advised funds have become particularly popular among those looking to discreetly donate to anti-government and other extremist causes without damaging their reputations. Over the years, dozens of organizations designated as hate groups by the civil rights organization Southern Poverty Law Center have received hundreds of millions of dollars from donor-advised funds.

In total, these funds reportedly donated $131.4 million to extremist groups between 2020 and 2022, comprising more than 25 percent of all private and nonprofit contributions to extremist organizations.

The ascendance of such donor-advised fund schemes contradicts the inherent purpose of tax-deductible charitable donations, said Helen Flannery, associate fellow at the Institute of Policy Studies and coauthor of the study on donor-advised funds and hate groups.

“The reason we as a public have agreed to give tax deductions for charitable giving is because, in exchange for those tax deductions, that money is supposed to be used for a common public benefit,” said Flannery. “It’s not supposed to be used to advance specific personal priorities or agendas.”

Meanwhile, the money donated to the Heritage Foundation is now supporting Project 2025, the organization’s political initiative that is pushing for a far-right reimagining of the country as part of a second Trump presidency. The plan’s many proposals include dismantling the National Oceanic and Atmospheric Association, barring US citizens from receiving federal housing aid if they reside with noncitizens, disassembling services for LGBTQ individuals, and tracking confidential medical information of patients who seek abortion services, among many other endeavors.
Stonewalling Reform

Any attempt to make donor-advised funds more transparent has come up against aggressive lobbying from the Wall Street investment firms that run the largest of these funds. Groups that advocate for donor-advised funds and the philanthropic industry have also lobbied against charity reform.

“When you think about all the people that are making money off of these — and the convenience it offers wealthy donors — you can see why reform efforts don’t go anywhere,” said Cantor, the nonprofit consultant.

From 2021 to 2023, thirteen investment firms, along with advocates for donor-advised funds and the philanthropic industry, spent more than $4.6 million on lobbying related to donor-advised funds and other matters, according to a report by Flannery.

In 2021, federal lawmakers introduced the Accelerating Charitable Efforts, or ACE, Act, which proposed a slate of donor-advised fund reforms. The bill would have introduced penalties for such funds if the assets were not distributed within fifteen years of the original donation, though it stopped short of requiring additional transparency around donors.

The legislation drew a firestorm of opposition from philanthropic groups and the financial giants that benefit from donor-advised funds. Groups that lined up to lobby on the bill in 2021 and 2022 included Charles Schwab — which spent $3.1 million lobbying in 2022 — as well as Vanguard’s charitable arm and the Council on Foundations, which represents private foundations around the country.

“If you’re a politician, you say, ‘I don’t want to take on all these powerful vested interests,’” Cantor said.

The bill died in committee, and subsequent attempts to push through similar legislation have also failed.

If Project 2025’s vision for the country is brought to fruition, it will be even more difficult to crack down on donor-advised funds and the larger dark-money web in which they operate. The initiative’s nine-hundred-page tome of far-right policy proposals suggests overhauling the tax system and limiting the resources for tax enforcement — likely making oversight of charity operations more difficult.

Furthermore, Project 2025 is proposing a suite of reforms to the Federal Election Commission, the agency tasked with overseeing campaign spending, that would gut its authority. The manifesto proposes hikes to campaign contribution limits and weakening reporting requirements that could open the floodgates to even more money in politics. It also seeks to limit federal prosecutors’ ability to enforce election laws by requiring approval from the interminably deadlocked election commission before authorities can pursue charges.

And while the Heritage Foundation’s anonymous donor-advised fund contributors watch the fruit of their efforts, they’re getting a tax break at the same time.

“We need congressional intervention,” said DeVaan of the Institute for Policy Studies, noting that because the tax code was at the root of the issue, the IRS and other regulators had limited power to rein in dark money in philanthropy.

“All dark-money and all donor-advised funds need to be more transparent,” DeVaan said.

You can subscribe to David Sirota’s investigative journalism project, the Lever, here.

CONTRIBUTORS

Katya Schwenk is a journalist based in Phoenix, Arizona.

Helen Santoro is a journalist based in Colorado.

Freddy Brewster is a freelance reporter and has been published in the Los Angeles Times, NBC News, CalMatters, the Lost Coast Outpost, and other outlets across California.
BACKGROUNDER

Korea’s Samsung Workers Are Striking for the Very First Tim


Samsung, the flagship of South Korean capitalism and one of the world’s biggest electronics firms, is facing its first-ever strike.

Members of the National Samsung Electronics Union outside the company's Giheung Campus in Yongin on July 10, 2024.
 (Jung Yeon-je / AFP via Getty Images)


BYKAP SEOL
07.17.2024
JACOBIN


The Korean electronics firm Samsung is the world’s biggest manufacturer of memory chips. It also usually outpaces Apple, its main rival, for the production of smartphones. Until last month, Samsung’s workers had never gone on strike throughout its fifty-five-year history as a company, during a period that saw the rise of a strong labor movement in South Korea.


Yet after a one-day stoppage in June, a labor union representing Samsung workers, the National Samsung Electronics Union (NSEU), decided to extend their strike until further notice on July 10 as the company continues to dodge negotiations over pay and holidays. The NSEU represents about 25 percent of Samsung’s 125,000-strong workforce. The open-ended strike is the union’s latest attempt to step up pressure on the global tech giant, which has refused so far to engage in dialogue, citing the union’s lack of majority representation.

The union’s action appears to have strategic leverage over the company, since about 90 percent of the NSEU’s members are employed with device solutions, which is the integral part of chip production. The union leadership has said the strike will gradually cripple chip production: so far, only about sixty-five hundred workers have put down their tools.

As a next step, the union is promising to focus not only on DRAM and NAND chips, in which Samsung has a position of global dominance, but also on high bandwidth memory (HBM) chips, which are essential for artificial intelligence (AI). The company has begun to invest heavily in this area to catch up with the global leader, its Taiwanese arch-rival, TSMC.
Samsung’s Corporate Culture

The strike hit Samsung at a critical time, amid signs of a turnaround after several years of shrinking sales and revenue. In April, Samsung’s first-quarter operating profit was 6.61 trillion won, up a whopping 932.8 percent compared with the previous year’s first quarter, when the figure fell to a fourteen-year low.

The latest quarterly results still camouflaged Samsung’s ongoing failure to wean itself off overdependence on traditional memory chips, which are known for drastic price fluctuations, and a smartphone market that is increasingly in the doldrums. The rosy perspective became possible thanks to the global AI boom, which has finally begun to boost not only HBMs, the key component for AI chipsets, but also Samsung’s established NAND and DRAM chips.

Yet as recently as May, Samsung’s HBM chips had yet to pass the test for use in AI chipsets by Nvidia, the US chip designer driving the global AI boom. This amplified fears that the chipmaker, which has historically been the biggest contributor to corporate tax revenue in South Korea, will be left out of a rapidly expanding AI market.

In April, Samsung’s flagship smartphone, Galaxy, replaced Apple’s iPhone as the world’s bestseller. This was not because Samsung technologically trumped Apple, but rather because of opportunities for expansion in China. Political tensions with Washington enabled local upmarket brands to aggressively chip away at the territory of their US rival in the Chinese market.

This is not the first time South Korea’s largest company has found itself needing to stay in tune with a fast-changing and highly competitive global tech scene. In the late 1980s, Samsung embarked on an ambitious shift to establish itself as a global brand rather than an imitator of Japanese firms like Sony and Toshiba that dominated consumer electronics at the time. Since then, it has consistently managed to outrun competitors by heavily wagering on new niches with massive investments and vast human resources.The strike hit Samsung at a critical time, amid signs of a turnaround after several years of shrinking sales and revenue.

While the South Korean government always shouldered financial risks with tax credits and cheap direct loans, Samsung has gorged on the country’s top talent across the board from R&D to the shop floor. The company made them the best-paid workers with the most generous benefits and perks in the country. An average Samsung Electronics employee earns more than 120 million won ($87,000) a year, compared with the country’s per capita GDP of $32,000.

In a rarity for South Korea in the 1990s, both executive and nonexecutive compensation was tied to a simple, straightforward profit-sharing scheme. This incentivized employees based on a combination of individual and corporate performance targets.

These incentives drove workers to work harder and longer, often at the expense of personal sacrifices. Samsung was proud of this work culture. In 1991, the conglomerate placed an ad in all major publications, titled “A Coffee Break at 3:00 AM,” about researchers working into the dawn to develop a new memory chip.

In 2012, during a patent lawsuit filed by Apple against Samsung over the Galaxy phone, the outside world could catch a glimpse into the grinding reality of work at Samsung. Designer Wang Jeeyuen said she had slept two to three hours a night and stopped breastfeeding to keep up with the schedule designing icons for the smartphone screen. Wang went on to say she had worked as hard as any Apple designer, although the core issue was whether she was creative enough not to have needed to steal ideas from Apple.
Work and Pay

The 3:00 AM ad and Wang’s testimony showcased three decades of ruthless effort that transformed Samsung into the only tech powerhouse simultaneously dominating the global memory chip and smartphone markets. The process was sustained by the trust of its employees in the tradeoff between hard work and correspondingly high pay.

The NSEU now calls for a 3.5 percent hike in wages, down a little from their earlier demand, and an improvement in holiday pay. However, the real point of contention is the metric for incentive pay, known as EVA (economic value added), which accounts for between 30 and 50 percent of total compensation.

EVA is after-tax operating profit minus capital costs, with calculation formulas that vary depending on firms and industry. In other words, an EVA-adjusted incentive pool will decrease when a firm invests or borrows heavily. This shrinks incentive pay for individuals, often regardless of employee performance, with workers effectively made to defray a portion of investment costs such as loans and stock dividends. This is why EVA is rarely applied to nonexecutive renumeration — not even in the United States, which is home to all sorts of financially engineered gambits.

Worse, Samsung’s formula for EVA remains confidential, clouding the clarity of the metric. For 2023, with Samsung’s memory chip line running in the red, many Samsung employees saw their compensation drop while executives still took home bigger paychecks. CEO Han Jong-hee received 6.9 billion won ($5.2 million) in total compensation, up about 49 percent over the previous year, with no rationale for the increase explained.Only four years ago, in 2020, Samsung formally ended a long-standing no-union policy, which it has enforced through surveillance and intimidation.

The NSEU is demanding the replacement of EVA with operating profit as a more transparent metric for incentive pay. They believe the use of EVA will continuously bring their pay under the gun and widen the disparity between executive and nonexecutive compensation at a time when Samsung is aggressively spending to outcompete TSMC and others in AI-specific chips and chip foundry, or customer-tailored chip making. For the first three months of 2024 alone, the tech giant poured 11.3 trillion won ($8.12 billion), including 9.7 trillion won ($7.05 billion) for device solutions, or semiconductors, into capital expenditures.

Only four years ago, in 2020, Samsung formally ended a long-standing no-union policy, which it has enforced through surveillance and intimidation. This was a setback for the new chairman, Lee Jae-yong. The third-generation scion of the conglomerate’s founding family was under pressure at the time as he faced a prison sentence over a case of political corruption.

Lee had taken the helm of the conglomerate by bribing then president Park Geun-hye and her shamanist entourage. They in turn pressured the National Pension Service to use shareholder votes to support Lee’s rise. His malfeasance was the direct reason for Park’s impeachment in 2017, after months of mass protests, now dubbed “the Candlelight Revolution.”

Lee himself received an initial sentence of five years, which was reduced and suspended on appeal. After a higher court ordered a retrial, he received a sentence of two and a half years in 2021. In 2022, the conservative government pardoned Lee in what it presented as a bid to “enliven the economy by allowing him greater freedom to run Samsung.”

In 2018, the government’s broad-ranging investigation into Lee’s bribery turned up about six thousand confidential documents confirming long-held suspicions that the conglomerate has been orchestrating union-busting campaigns and the suppression of labor activity across its affiliates and contractors. Some documents revealed that Samsung had hired “angel agents” since 2012 at least to put union-organizing workers and outside activists under surveillance.

Some of these records led to the indictment of thirty-two executives for quashing a unionization effort at its outsourcing network of after-sale repair services from 2013 to 2016. During these years, much of which coincided with the period in which Lee was ingratiating himself with corrupt politicians to bolster his control of the conglomerate, Samsung’s brutal union busting, coupled with harsh working conditions, caused at least two workers to die on the job and another to end his own life in protest.
Blood Disorders

Nothing better illustrates how a workplace without collective labor representation can wreak havoc on even better-paid workers than the cluster of blood disorders among workers at Samsung. This tragedy likely began in silence during the late 1990s when Samsung churned out memory chips, riding high on the waves of the worldwide personal computer and Internet booms.Nothing better illustrates how a workplace without collective labor representation can wreak havoc on even better-paid workers than the cluster of blood disorders among workers at Samsung.

The blood disorder phenomenon came into public view in 2007, largely thanks to Hwang Sang-ki, a small-town taxi driver who lost his twenty-three-year-old daughter, Yumi, a worker at Samsung’s memory chip factory, to leukemia. After her diagnosis, the otherwise healthy daughter, with no family history of any such disorder, remained bedridden for two years.

She had only worked at Samsung for twenty months after graduating from high school. In the same year, after learning two other coworkers of his daughter had died of the same condition, Hwang and a handful of labor and public-health activists formed an advocacy group targeting Samsung known as Sharps.

As a volunteer, I updated the advocacy group’s English-language blogs in the period from 2012 to 2020. By the time I posted my first entry, the group had already identified the deaths of about a hundred Samsung workers as being occupationally caused. By the time of my last posting, the number had nearly doubled.

Former and current Samsung chip workers continued to die or become permanently infirm, while Samsung denied any wrongdoing or negligence. The compensation agency that was supposed to protect workers’ interests brought in Samsung’s own lawyers to deny the petitions of the victims.

For me, writing about Samsung at that time meant composing endless obituaries for these young female workers. The pattern of their sicknesses and deaths was almost self-evident. Samsung whisked busloads of the best talent from girls’ high schools in small towns to its ever-expanding factories where they turned out memory chips or LCD panels with little protective gear or safety training.Samsung’s brutal anti-labor history and the sacrifices of many of its workers should shatter the myth that good benefits and pay alone can substitute for labor’s own collective bargaining power.

These girls were the pride of their families for landing a job that could help them save enough to pay for their own college education and that of their siblings, as well as showering their families with Samsung gadgets they could buy at an employee discount. This was before they fell victim to a variety of incurable blood disorders before they reached their mid-twenties. Now, Samsung regularly conducts a similar mass recruitment drive in Vietnam where it assembles most of its Galaxy smartphones.

It took four years for Sharps and Hwang to win a 2011 court ruling in favor of his daughter’s posthumous petition for compensation. This was the first public admission that a blood disorder was linked to conditions in the workplace. It was only after a sit-in by Hwang and the group at Samsung’s corporate headquarters, lasting more than a thousand days, that Samsung finally caved in and offered a formal apology and compensation to hundreds of victims.

Samsung’s brutal anti-labor history and the sacrifices of many of its workers should shatter the myth that good benefits and pay alone can substitute for labor’s own collective bargaining power. If there had been a union, Yumi and her coworkers would likely have graduated from college and gone about their lives. The impact of the current open-ended strike will surely continue to reverberate regardless of the outcome because it was sparked by the realization that even the best-paid workers cannot always rely on the benevolence of their employer.


CONTRIBUTOR

Kap Seol is a Korean writer and researcher based in New York. His writings have appeared in Labor Notes, In These Times, Business Insider, and other publications. In 2019, his exposé for Korean independent daily Kyunghyang revealed an imposter who falsely claimed to be a US military intelligence specialist posted to the South Korean city of Gwangju during a popular uprising in 1980.