Democratic Innovative Finance

How we can co-design post-growth economies for a fairer, regenerative world.

By Ekin Al

August 18, 2024

Source: Post Growth Institute

Image created on Midjourney (CC-BY-4.0) and shared via Post Growth Institute

LONG READ

The world is crossing a threshold, and now is the moment to take a pause, catch our breath, and perhaps look more at the sky, the earth, our neighbors, and each other. A new era is emerging that is unlike anything before. Humanity is racing at full speed at the sharpest turn of this transformation. The steps and actions we take today will determine how we navigate this turn.

The global system is collapsing. Life systems are deteriorating, and social justice is crumbling. Our only home in the known universe is experiencing irreparable damage! Should a piece start with such alarming sentences? I don’t know, but what I do know is that the crises we all see are deepening more and more each day. Today, we are in a networks of crises deeply interconnected beyond the climate crisis that has begun to be discussed in the mainstream. Biodiversity losses, ocean acidification, destruction of natural habitats, and the terrifying increase in waste, among many others. On the other hand, rising poverty, human rights violations, industries continuing to practice evolved forms of slavery, the insecurity of marginalized groups, women’s rights issues, and much more…

Our ‘modern’ social system is constructing new deadlocks every day. Alienated individuals, changing societal structures, individualism, an approaching giant wave centered on artificial intelligence, generational divides, algorithms, data, and our dysfunctional relationship with democracy. All this, alongside the environmental and social crises we are experiencing.

PLanetary Boundaries, via Stockholm Resilience Center

Ece Temelkuran says at the beginning of her book Hepberaber (‘All Together’): “The global system is collapsing. And like every system, capitalism is also setting everything on fire as it collapses. It says, ‘After me, the deluge, after me, the apocalypse!’ On one hand, there are young people who say, ‘If we move quickly, this can still be a livable planet.’ On the other hand, there are the old power holders of the system who mockingly say, ‘Don’t dream!’ The system, in order to protect itself, is calling on authoritarian regimes around the world for help.” Just like in this narrative,the creators of capitalism have taken their megaphones, gathered crowds, and are shouting loudly. The world they have turned into a fire pit, the neoliberal policies they have used as armor in the crises they have created, have left them trapped in the wreckage. Capitalism, which made us believe that no other story was possible but its own, has died. Capitalism, which delegitimized, criminalized, and ridiculed others, has collapsed. It is for this reason that there is a sense of unease, gloom, and uncertainty around the world. This is why there is a threshold of pain globally: the panic of not knowing what to replace this collapsing system with. So what now? As capitalism tries to rebuild its identity from its own ruins while writing a new story, it whispers the tale of its own evolution to us. That’s why we need to focus on the center of the crises we are experiencing, to design an economy focused on post-growth. We need to look into the heart of destructive old economies.

Designing a new economy, together

When we delve into the foundations of today’s problems and crises, what we find is undoubtedly the economic designs and the values embedded in the heart of our economies: Unconditional growth, profit maximization; aging, white, hetero, wealthy, and destructive masculinity. No system is poorly designed by accident. The destructive economic system we are experiencing was designed with a focus on the wrong outcomes — namely, the unconditional accumulation of wealth by a certain group and wild, endless growth. The economy has come to serve not life itself but a particular group.

To design a fair, democratic, and just life, and to be able to talk about hope, we need to collectively design a new economy. I specifically choose the word “design” because we have been told up to now that the economy is something that can be calculated. But the economy is something that needs to be designed together with every living and non-living organism on Earth and every system. By using the power of design, by asking the right questions, and ensuring that everyone has a seat at the table, we can set aside calculators and pick up pens. It’s time to design a new economy together, one that does not perpetuate neoliberal policies and convince us that ecology, societies, the state, the family, and women have no place in the economic arena.

To design and navigate post-growth economies, we need to direct today’s financial mechanisms towards four key points.

1. Regeneration

One of the most used and most misinterpreted concepts today is sustainability. Over the past 20 years, this concept, particularly associated with growth-oriented investment worlds, has become an issue on the agenda of international organizations, governments, companies, individuals — essentially everyone. The failure to implement it correctly over time has rendered sustainability increasingly ineffective. Sustainability, in essence, is a damage reduction policy. We see various activities aimed at reducing the harm caused by ways of doing business, business models, and companies, and we don’t think beyond sustainability. Today, reducing harm is not enough for life. When our economies focus on reducing the harm we cause, their relationship with growth becomes quite weak and inadequate. Today, sustainability is the best way to say we will continue to kill life, but we will do it a little less each year. Moreover, even when sustainability is applied correctly, we do not see a profound transformation in business models because the goal is, in a sense, to reduce harm. This brings many activities that do not offer realistic approaches.

(Leyla Acaroğlu, Disruptive Design)

Our new reality is regeneration. We need to replace lost forests (instead of just reducing deforestation) and repair the land and living ecosystems. While continuing to reduce harm, we should design our business models to regenerate the damage we have caused. Otherwise, there will be no world left to live in.

2. Breaking free from infinite growth

The concept responsible for species extinction, child labor, the workers who died in Rana Plaza, and soaring inequalities is growth. Growth comes with the goal of profit maximization, and every maximization problem is also a minimization problem. Our economies, which we try to fit into equations, view societies and nature as costs and seek to minimize them. This has created a decision-making mechanism focused on money and capital. Economic growth is clearly killing us. The perspective we need to constantly keep in mind in designing new economies is to imagine what comes after growth: continuously asking the question of how we can have an economy that does not serve growth builds the path to the new economy.

3. Inclusivity, diversity, and accessibility

To design new economies we must create a social climate where every different voice can exist. Moreover, this must not be done through the top-down perspective of a dominant fixed group claiming, “We include you,” but rather by co-creating a dialogue space that goes beyond the new leadership, power, and masculinity relationships, and the socially constructed ideal human portrait, with an egalitarian perspective. It is impossible to design a new economy without engaging in discussions led by marginalized, left-behind, and othered communities.

4. Distribution

Designing a new economy requires thinking about fair distribution mechanisms for justice, equity, and a fair social system. When looking at the previous three points, we see that the common solution lies in distribution mechanisms. What do we distribute to nature, how are the benefits of growth shared, and what rights do those outside the mainstream human profiles have? How do we distribute which value or concept to whom and how?

In my opinion, if a single macro solution were needed to address all the issues of the 21st century’s economic system failures, it would be to design a proper distribution system. For example, is the climate crisis an environmental crisis? Or is biodiversity loss an environmental issue? No, because today we know what we could do or not do to stop these crises environmentally, but we do not. At this point, these issues cease to be environmental crises. All the crises we are experiencing today are crises of democracy, justice, and distribution.

Global income groups and associated consumption emissions in 2019. Oxfam/SEI.

Local African communities, which have not contributed to the climate crisis at all, are among the first to suffer from it, because we are mis-distributing not only wealth but also death. We need to see how negative externalities are distributed, where and how the results of our actions are distributed. We must observe the history of products and services, and every step in the value chain fairly through transparent blockchain infrastructure. For a long time, we have heard a slogan in climate actions: “There is no Planet B!” But if there were planets B, C, and D, would we have the right to do these things to this planet? Could we see ourselves as having the right to destroy life here? We even defend the continuity of life for ourselves because we believe that the greatest right in the distribution of life belongs to the human species, i.e. ourselves.

The fact that a large portion of the world’s income is concentrated in the hands of a small group represents a much larger systemic problem than we think. It creates a hierarchical system that others nature and the vast majority of societies. If we envision regenerating the world, creating inclusive life, and focusing on a fair life centered on post growth, we must develop technologies for fair distribution. We need a new economy that goes beyond growth and accumulation.

New approaches, same old goals

One of the most important points we need to be aware of is the methods, concepts, and efforts that seem to serve the new economy but actually work for growth-oriented economics. Many concepts and methods have presented a bold and exciting exit for transitioning to a new economy, yet they have never lost the growth-oriented perspective. Among the most dangerous are the newly imagined economic models, such as stakeholder capitalism, which aim to sustain capitalism with new quests, while fundamentally continuing to advocate for capital and growth.. Subsequently, concepts like green growth emerged as efforts to sustain the growth-oriented system. The story was sold as, “Let’s grow, but let it be green.” However, the root problem was making growth the primary goal and obsession. What is even more dangerous is that destructive and seemingly innovative methods have also remained within the growth circle. Concepts that appeared innovative and bold, and could create a new economy rather than serve the old one, have instead continued to serve the same root problem and remained trapped within the existing economic order. What we need to do is to find ways to bring topics like B Corp and impact investing to the financial scales of the new economy. We need to explore ways to accelerate the transition to the new economy by manipulating investment mechanisms and expanding the playing field of the new economy. In other words, we should focus on reshaping finance for economic design.

Reshaping finance

One of the biggest misconceptions about today’s economic model designs is the belief that finance and economics are sometimes the same or at least very similar. We are not entirely wrong, as perspectives from universities, media, business, and public sectors often try to portray and position economics as finance, viewing it as merely a flow of money. This is not entirely accurate, however, because economics is a discipline that encompasses everything related to life, extending far beyond money and markets, whereas finance is a sub-discipline that serves as a bridge between the economy and abstract markets. Over time, this bridge has become the main focus and started to shape our economies. So unless we design radical transformations and innovative processes in finance, we cannot redesign our economic models. We must build a new reality based on the flow of money.

A new reality based on the flow of money

When we examine the capital spectrum, it is quite possible to see proposals and critiques related to shaping finance. “Financial only” creates conventional and destructive business models that focus on growth, aiming to put in one unit of money and get five units back in a short time. Over time, responsible investment emerged, showing progress in environmental and social factors, followed by concepts such as sustainability, sustainable investment, and, most importantly, ESG. However, from the moment ESG investments were invented, they served no purpose other than protecting capital and delivering quick returns. The path was opened for every damage-reduction-focused action to be seen as an ESG investment. A petroleum company, for instance, could claim to have made a successful ESG investment by implementing a very small reduction in its harm, thereby asserting its right to claim it is a sustainable company. ESG has never been used to advocate for the rights of communities or nature. ESG remains a profit-focused goal and continues to address environmental, social, and governance issues that may impact profits. Issues with the potential to negatively affect profits never became part of ESG’s investment and focus areas. Essentially, ESG only reflects a focus on profit and being “better” at being profit-focused. Radical and genuine steps affecting profitability were never part of ESG’s scope. Thanks to media and marketing, however, ESG was able to connect itself with social issues.

One of the concepts that emerged in the new era with significant transformative and just transition potential is impact investing. The birth of impact investing carried more hope because it aimed at the positive side of the zero point, making it a type of investment more easily connected with regeneration. Investing in solving the world’s problems seemed both enjoyable and logical. One of its biggest steps was being quite different from the “impact only” or philanthropic type of investment. Impact investing became a promising investment type positioned between the profit focus of ESG and the hierarchy and dysfunctionality of philanthropy. It did not have the paternalistic, destructive, or exclusionary features of philanthropy, and transferring significant financial resources and business models to philanthropy was quite challenging. (Philanthropy was more than a donation, as it continued to harm the world without changing its business model and without seeking ways to radically change the economy. Attracting large capital to this field was also unrealistic in the long run. ESG, at its core, involved profitability and harm reduction.) Impact investing had the potential to be innovative, bold, and serve the new economy — and it’s an area for which we need to develop new methodologies.

Reimagining impact investing

Impact investing has brought with it not only great potential but also significant disappointment in many parts of the world. While it is supposed to primarily support enterprises and business models with high positive impact, it quickly deviated from its intended goal — adopting behaviors similar to conventional investments, with a reflex towards financial growth. The first focus became financial growth capacity and profitability.

When considering an investment in a renewable energy company, for example,renewable energy is seen as a clean and positive impact business model, and such investments are considered impact investments. The focus, however, was on the financial growth of this business rather than the impact itself. Today, impact investing has supported high-profit enterprises, such as renewable energy and food technologies, positioning impact as a secondary, decorative element on top of the cake. Many destructive sectors and companies, without changing their business models, claim to be making impact investments by investing in renewable energy and food technologies, thus engaging in green and social washing. This leaves us with two questions: Can anyone claim to be making impact investments, and is an investment model that focuses on rapid growth while creating positive impact a genuine impact investment model?

This is exactly the issue we need to address in impact investing. For example, let’s consider two enterprises, A and B. Enterprise A works in renewable energy, delivering portable energy kits to regions experiencing energy poverty. Its goal is to prioritize impact over rapid growth and profitability, rather than building large plants. Enterprise B, on the other hand, also focuses on renewable energy but grows rapidly by setting up massive plants, going through investment rounds, industrializing, and selling energy to oil companies, with growth as its primary goal. Positive impact is an added value that comes with rapid growth. In these two examples, investors usually choose company B because they foresee transforming their investment of 1 unit of money into 5 units over two years. If they invest in company A, they might only receive 2 units of money in 4 years. Therefore, investors focus on growth rather than impact and choose to invest in company B, claiming to make an impact investment. In the current era, we need to decide whether impact investing will evolve towards selecting company A or company B. Initially choosing B might seem logical for taking the first step, but in the long run it will only deepen growth-focused crises. If we want to create a new economy, we need to convince large accumulated funds and investment portfolios to invest in genuine impact investments, like company A.

We also see that conventional investment metrics are increasingly shifting towards impact investing and impact-prioritized business models. This is a normal and expected transition. Consider this: your house is on fire, a huge blaze. Would you want to invest your money in a place that quickly multiplies it for you, or in a place that can put out the fire? Our question is: While our only home in the known universe is burning and collapsing due to crises, will we invest our money in saving our home or in profitability? We must recognize that achieving financial returns should not prevent us from doing good work and addressing the world’s problems, and we need to find ways to increase this. As with social entrepreneurship, in impact investing we should see how possible and transformative it is to achieve fair and good work while obtaining financial returns through investment tools. Especially since the finance sector is a major provider of funds to all sectors, its role in the transformation is highly accelerative. Transformations in finance will significantly accelerate the flow of money and the transformation of other sectors. We need to move impact investing out of the growth circle and make it serve the new economy, not the old one.

To steer capital towards impact-focused areas and to envision post-growth economies, we need to develop investment models that do not prioritize growth. We must act on the reality that an economic transition cannot occur without preparing the financial foundation. The primary concept in impact investing should be to center the purpose. The difference between impact investing and investments that create impact is shaped by the investment’s purpose and where it is made. The investments we make should be aimed at solving impact-focused problems. For instance, investing in a social enterprise that produces alternatives to plastic or a social enterprise that delivers emergency medical supplies with drones to areas in Africa inaccessible by road means we are investing in an enterprise with benevolent goals, meeting the first crucial criterion of purpose. A company is only making an impact investment when it invests in such social enterprises. Simply donating money earned from a bad business model elsewhere does not constitute impact investing. Investors who still view impact investments as charity are hesitant because they are unsure whether they will make a profit. However, many conventional investors, like Y Combinator, ask enterprises about their goals and what problems they aim to solve before investing. They believe that all the enterprises they select offer good solutions to significant problems, but these conventional solutions have not yielded commercial returns. They then ask what characteristics a good problem should have for its solution to yield a commercial return. They identify six key characteristics, and if an enterprise has two of these, they suggest it could have a commercial counterpart. Let’s examine these six characteristics in the context of environmental or social problems:

1. Problem Popularity: When considering an environmental or social crisis, impact investors see it as affecting a large number of people. They view these people as potential customers.
2. Recurrence: If a problem repeats, it indicates it will likely occur again.
3. Problem Growth: The problem is increasing.
4. Urgency of Solution: The solution to the problem is urgent.
5. Cost of Unresolved Problem: The unresolved problem is costly.
6. Necessity of Solution: The solution is necessary.

Evaluating these criteria, we see that the six characteristics developed for conventional investment can also indicate a commercial counterpart for impact investing. This is because the environmental and social problems addressed by impact investing align with nearly all of these six characteristics. Social enterprises, impact enterprises, and impact investing represent significant areas in the new world with substantial trade volumes. Currently, the capacity for impact investing is limited, but it is growing: the direction of capital, increasing crises, demand from young people and social enterprises, and the interest of large pension funds are all factors that will lead to better impact investments. To create an effective impact investment mechanism, we must develop innovative financing models along with proper impact measurement methods, avoiding the pitfalls of conventional investment tools. New business models are needed for designing a new economy, and the number of these models and the types of investments required for profitability must also increase. By creating innovative impact investment tools, we can foster the emergence and growth of new social enterprises, thereby accelerating the transition to a new economy. More support for social entrepreneurs through innovative impact finance methods is crucial.

Innovative tools for impact investing

1. Structured exit options

One of the most important aspects of investments is the exit strategy. Funds, particularly venture capital funds, have a lifespan. They raise money from investors, buy shares in different companies with that money, and then sell those shares as their value increases to exit the investment. With this profit, they pay their investors more. The fear of not being able to exit the investment, especially in impact investing, hinders many investments. Additionally, many companies, especially social enterprises, never go public because they are structurally unsuitable and do not want to surrender control of their capital. Even if a social enterprise promises a valuable return, the lack of exit options becomes an impediment to investment. We need structured exit options here. Revenue-Based Finance is one such tool. In this model, the investor says: I believe in the team, business model, and profitability of this social enterprise, but to eliminate the exit logic, let’s make an agreement. I will give you X amount of money with the expectation of doubling it. I do not expect significant growth from you or that you become a unicorn, meaning I do not want to incentivize constant growth. All I ask is that you earn enough to repay my money twofold over time. I am setting aside my high return expectations. Pay me 3–5% of your revenue each month until you repay twice the amount I initially gave you. This way, the investor’s biggest fear of exit is embedded directly into the investment, and the shares remain with the social entrepreneur. This is crucial for both the development and the social entrepreneur, as it becomes a non-extractive investment. The investor does not take away more than the value created but only earns as much as the social enterprise can provide financially. This type of investment is faster because the investor focuses on profitability rather than growth. For a social entrepreneur, this is a fundamental requirement. With this investment type, it is possible to foresee an increase in the number of social enterprises that do not prioritize financial returns but can still earn money, thereby accelerating the transition to a new economy.

Stanford Social Innovation Review

2. Foundations and public institutions

Foundations and public entities usually provide grants. Grants often limit the innovation space of social entrepreneurs. The public provides the grant, and an authority decides how it will be spent, removing flexibility for innovation. A new concept to consider here is forgivable debt. Public or foundation funds are provided as debt to social entrepreneurs, in order to encourage social entrepreneurs to build a self-sufficient business model. In this investment type, the foundation sets impact targets with social enterprises. If the social enterprise meets X targets, the foundation will forgive part of the debt’s interest; if Y targets are met, the foundation will forgive the full interest; and if Z targets are met, the entire debt will be forgiven. This way, the foundation transforms the money it was already willing to give into an impact tool and ensures the creativity of the impact with the money. Additionally, it stimulates innovation rather than imposing constraints like a grant.

3. Results-based contracts

Previously known as social impact bonds, results-based contracts involve a public institution commiting to pay based on the results rather than the process of an enterprise. An investor supports a social enterprise and assumes all the risks. If the social enterprise creates the desired impact through its efforts, the public institution will pay the initial investor based on the scale of the impact achieved. This establishes an effective financial relationship between the public sector, investors, and social enterprises.

Final evaluation of Peterborough prison pilot

Focusing on impact over growth

Ultimately, if we want to discuss a new economy and a just system design, we need to increase the number of new economic enterprises and social enterprises that focus on impact rather than growth. We must collaboratively design the new economy across different areas with these structures. This includes developing fair financing models for new and just business models. The necessity of bringing impact investing into service for the new economy rests on this. Of course, the responsibility does not lie solely with investors; social entrepreneurs also have a significant role to play. Globally, we face conceptual confusion, and we may be unclear about what we can define as a social enterprise. To increase effective impact investing and attract investors to fair investment models, we need to increase the number of fair and correct social enterprises. We need social enterprises that can generate income but do not prioritize income, growth, exit, or becoming a unicorn; instead, they focus on addressing the world’s problems. Social enterprises that develop regenerative and distributive approaches will become the primary institutions of the new world and new economy because they will be the ones we need the most. As the number of fair social enterprises working to regenerate and distribute grows, we will see an increase in impact investing and, more importantly, the emergence of new financing models that go beyond impact investing. Following examples such as non-profit enterprises and post-growth entrepreneurship structures will provide us with perspectives on making impact investing and innovative, fair financing models more just, democratic, and impact-oriented each day.*

The need for a new economic paradigm is quite clear, and one of the most important steps toward this path is to create fair earnings and business models, and to increase the number of appropriate social entrepreneurs. The three most challenging aspects of systemic transformation are:

1. Spreading over time: The process of transformation must be gradual.
2. Requiring a proper transition structure: A well-designed structure is necessary for the transition.
3. The need for diverse fields to work together in an intertwined manner: Different areas must collaborate closely.

Just like in new-generation investments and business models, to ensure the proliferation of social enterprises that emphasize regeneration and distribution, we need to increase the amount of effective impact investment. To boost effective impact investment and discover innovative models, the number of social enterprises must also increase.

We need to implement new economic foundations by standing side by side without prioritization or hierarchy, learning from each other, and developing dialogues with diverse communities. Creating a new, fair economy is an extremely challenging goal, but transformation is nearly impossible without progress in business models and financial relationships, especially without moving finance towards a democratic direction.

It is time to redesign the core of finance for a fairer world, for post-growth economies, and for the equitable existence of life. We have already surpassed many things that seemed impossible a decade ago, and we are taking steps beyond growth. What seemed like a dream today could become reality tomorrow. Now is the time to work together to make democratic finance a reality. Let’s design a new finance system together!

I drew inspiration from many names in writing this article, but I especially want to thank two individuals: Erinch Sahan and Can Atacık, whose sentences I have used directly.

Democracy In the Workplace, Democracy In the Ballot Box

By Thomas Walker

August 14, 2024

Source: Convergence

Members of United Campus Workers of Tennessee and CWA Public, Healthcare and Education Workers sector demonstrate for a living wage at the University of Memphis. Photo courtesy of CWA.

“As we wrestle with our approach to this election and the need to prioritize mobilization but also strengthen our organization for whatever comes next, the work we are trying out and expanding in our public sector poses back the question: Why not both?”

At a moment of tremendous momentum and potential for labor, and simultaneous real peril and crisis in our political system, it can be disorienting to figure out what strategic tasks to prioritize: organizing and growing our movement, or mobilizing to defeat the Far Right and neutralize its danger. Indeed those options are even sometimes posed as mutually exclusive when we polemicize and debatewhat the Left’s work should be. Should we block or should we build? The implication is, we can’t do both. But we can. Elections present us with meaningful opportunities to interact with millions of voters as workers and connect the fight for democracy through the ballot box with the fight for democracy in the workplace.

For the past several elections, Communications Workers of America has worked with members of United Campus Workers of Georgia to do just that: go door-to-door to potential members of our union and talk with them about what’s at stake in the election for working people and the union, encourage them to vote for pro-labor candidates… and ask them to join our union as a member to build the power we need to get what we want. We’re participating inside the political system, and we’re also organizing outside of it.

Elsewhere in Convergence, my former CWA colleague and longtime labor movement strategist Bob Master has articulated the urgency of political engagement for the labor movement and the profound relationship between labor militancy and success and the political balance of forces. Longtime UCW member and now organizer Melanie Barron has talked about the role unions can play in the broader struggle for democracy. And Marybeth Seitz-Brown has talked about the need for political power in order to advance a working-class agenda and social justice union program. These are critical contributions during this at once auspicious and portentous political moment. Labor organizers, members and leaders need to see our work as going beyond any single election, and need a political program that builds our power.

These pieces have uplifted especially the necessity for the development of rank-and-file members to be leaders and protagonists in politics—through training and education, mobilization and organizing practice, and so on—and have highlighted successful, advanced work like the UNITE-HERE member canvassing program. What we have done is take an additional step by focusing the work of those members to also recruit people to a union, in addition to mobilizing them for a broader political program.
How does it work?

Unlike traditional union canvasses that are member-to-member or labor-to-labor, our canvasses use lists of potential members for our locals. These are lists that can be built through records access for public employees, or in the private sector by mapping and bread-and-butter list work. Matching those lists to voter records and profiles, we can then plan a canvass where we talk to coworkers and colleagues about what we are up to: fighting for everything from bargaining rights to voting rights at the ballot box, and organizing our union for the fights that will come the day after.

We train member activists to have both mobilizing and organizing conversations on the doors.

First, they introduce themselves as colleagues and fellow campus workers–and as members of the growing union on campus. This helps immediately establish a connection beyond a typical GOTV canvass: “We work together (even if it’s at a really big workplace)!” And, it establishes the political identity of our members as being independent from any given candidate: “I’m here with the union that’s on campus!”

Then, they talk about what’s at stake in the election for campus workers. These days, that’s no short list: from attacks on free speech and academic freedom, to threats of privatization and corporate-driven cutbacks of funding, to state legislatures’ plans for increasing pay and benefits for campus workers (or keeping them stagnant). We’ve always got a full agenda that’s make-or-break with who wins Governor’s mansions, state legislatures–and federal offices, too. “What are you thinking about this stuff? What do you care about as a campus worker?”

We don’t shy away from broader working-class issues either: the need for stronger workers’ rights, increasing the minimum wage, protecting the social safety net, and–yes–defending democracy and civil rights.

We collect the responses on these issue agendas that are developed and set by our locals, and solicit other issues of concern from the the people we talk to on the doors.

Then we make our case for why we’ve endorsed our candidate. Whether it’s a race for governor, state rep, or US senator, we share what we know about that candidate’s positions on our issues and our endorsement message. “So in the shortterm the reason we’re out here today is to share our support as a union for this candidate, and encourage campus workers to vote…”

…But we also make sure to communicate the bigger picture. “Look, we know that these issues aren’t going to be solved by any single politician or in any single election. That’s why we’re also organizing our union, so that we have a real voice to continue pushing, advocating, and holding the people we elect accountable the day after election day.”

Then we make an ask: “Are you with us? Are you up for joining other campus workers and our union to vote for the candidates who support us?” And if they are—“Are you up for joining our union, because we need you for more than just your vote?”
Building lists, building base, building power

The system isn’t a silver bullet, though, and sign-ups don’t always immediately happen on the door, in the GOTV conversation. The reality is, a lot of people aren’t up for joining at first, and do think their main political action in that moment should just be to vote. But the interaction does grow our understanding of who our potential members are, and introduces us to them for follow-up. We’ve signedup a lot of people right then and there, and even more when we track them down during worksite visits, follow-up phone calls, or future home visits–where we can build off the conversations we’ve had, the information about their concerns we’ve collected, and often a post-election retrospective that helps us put the work into a new context.

This model works particularly for the kind of “pre-majority” organizing we are doing in the South, where state sector workers are largely excluded from formal recognition and bargaining through a regime of racist, anti-worker laws. In the absence of a union election, workers directly join the union and begin paying dues, immediately becoming members. But there could be applications of this where we use the momentum of an election to collect authorization cards, or make assessments of workers for future organizing.

We’re able to develop a longer-term conversation about our vision of change and power. Public sector workers are keenly aware of the relationship between elections and workplace power, because as CWA Public, Healthcare and Education Workers Vice-President Margaret Cook will always say, “We elect our working conditions.” While some parts of the Left struggle to articulate and understand the deeply connected relationship between workers’ rights and electoral power, our members live it every day.


We elect our working conditions.—CWA Public, Healthcare and Education Workers Vice President Margaret Cook

And they know that it takes more than just getting out the vote. That may be step one, but joining the union and organizing for power to ensure the vote matters and translates into ongoing power is steps two, three and beyond.

As we wrestle with understanding our approach to this election and the need to prioritize mobilization but also strengthen our organization for whatever comes next, the work we are trying out and expanding in our public sector poses back the question: why not both?


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There’s A Future Beyond Economic Growth – Let’s Build It

We have to say no to extractivism - before it tears apart the fabric of our world.

By Robin Boardman

August 19, 2024

Source: RobinBoardman.com


Yesterday in Kiel, Germany I joined the global movement against extractivism – the harmful exploitation of natural resources. Across the globe, communities stood up for the action wave against new, dangerous mining projects. Hundreds marched in Barroso, Portugal and thousands more in Serbia. The movement is growing.

This is a transcript of my speech on the Kiel waterfront:

It’s time for the hyper-consumption of our society to die. The endless grasping for more, more, more is exhausting the human spirit. We are so much more than what we consume—the cars, the gadgets, the clothes. They are all symptoms of the loneliness capitalism instils in us. We search for safety in material gain and status. Advertisers hunt for our emotional weaknesses, like vultures, ready to strike on the fearful and vulnerable.

It’s in the wake of their wanton waste—an eye-watering amount of pollution clogging up the arteries of our planets—that we attack the status quo. We tell them that they can’t have their cake and eat it. The elite can’t have hyper-consumption and renewable energy at the same time. The two can’t be combined. As soon as you rape ancient woodlands for lithium, you are destroying nature’s chances of survival. In other words, you are destroying our chances of survival.

This overexploitation, this destruction of all we hold dear, this isn’t the way forward. Destroying nature’s right to exist and creating so-called ‘renewables’ is a toxic waste to our planet. There’s another way. There’s a simpler, easier, more loving way forward. It’s the way my grandparents taught me. It’s the way Indigenous people have lived for centuries—to live in harmony with the world around us, to not take more than what you need, to repair what’s broken, to allow time for healing.

I have been to Barroso, the Portuguese camp against a massive lithium mine— the project will destroy a beautiful World Heritage site in the name of so-called progress, of so-called green growth. It’s a lie. It’s a corrupt, toxic lie. The amount of water they need to pump this mine will wreck Portugal, a country that’s already being destroyed by desertification and climate breakdown.

T

he Lakes around Barroso. My snap from visiting last year.

People there have a simple way of living, a way that should be a role model to us here in Kiel, here across the Western world —a way of living simply with our natural surroundings. Instead, the lithium mine will kill off their culture and their way of living. We’re seeing it all across the world—Indigenous land is being colonised once again by neo-colonial forces. This is an attack on the guardians of precious knowledge. Knowledge that can really protect this blue, precious sphere that we call home. Beyond that, there’s just the dark cosmos – nothing else.

Across the world, we are in resistance to such delusion and violence. The odds are so stacked against us. We’re not millions of people right here now, we’re not even hundreds, and it breaks my heart. But we are in resistance. The Portuguese grandmothers in resistance in Portugal shared the same saying as the Serbian grandmothers – numbers don’t matter, community matters. Whatever happens in the struggle, at least we got to meet each other. At least we got to meet other caring, compassionate people.

Sometimes the challenge seems insurmountable but that community is a new, revolutionary way of living. I say “new” to us here in the isolated, atomized, capitalist West, but actually, it’s a very old system of living, a very beautiful way of living in harmony as a community.

As a community, we can resist encroaching fossil fuel fascism. We can resist the death of endless species. As we stand here in Kiel, a trigger point of the 1918 German revolution, I want to call on you to rise up against imperial power once again. To recognize our strength as a community and to flourish in the honesty of our truth. In other words—to really live our lives.

The corrupt state will throw everything they’ve got against us. We are revolutionaries, after all. In the UK, 26 of my friends are currently in prison for resistance. As they were locked away they were told they had no defence. That mentioning climate change or fuel poverty in court is illegal. It’s outrageous. It’s the slow corruption of our system by fascism, which will destroy massive parts of the world if we allow fossil fuels and these mining projects to continue.

But together, we can resist. We can make a new world possible. We can start right here in Kiel. It’s time to put our bodies on the line. It’s time for a revolution.

Thank you.

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Robin Boardman is a languages student and one of the cofounders of Extinction Rebellion. He helped to lead a successful campaign to get the University of Bristol to divest its portfolio of £2m from fossil fuels and has been an XR spokesperson on various outlets such as the BBC, LBC and Sky News. He blogs at: robinboardman.com

How US Big Tech Monopolies Colonized the World: Welcome to Neo-Feudalism

US Big Tech corporations are like the feudal landlords of medieval Europe. These Silicon Valley monopolies own the digital land that the global economy is built on, and are charging higher and higher rents to use their privatized infrastructure.

By Ben Norton

August 19, 2024

Source: Geopoliticaleconomy.com




US Big Tech corporations have essentially colonized the world. In almost every country on Earth, the digital infrastructure upon which the modern economy is based is owned and controlled by a small handful of monopolies, based almost exclusively in Silicon Valley.

This system is looking more and more like neo-feudalism. Just as the feudal lords of medieval Europe owned all of the land and turned almost everyone else into serfs, who broke their backs producing food for their masters, the US Big Tech monopolies of the 21st century act as corporate feudal lords, controlling all of the digital land upon which the digital economy is based.


Every other company – not just small businesses, but even relatively large ones – must pay rent to these corporate feudal lords.

Amazon takes more than 50% of the revenue of the sellers on its platform, according to a study by the e-commerce intelligence firm Marketplace Pulse.

Amazon’s cut of vendor revenue steadily rose from roughly 35% in 2016 to just over half as of 2022.

Amazon takes more than 50% of sellers’ revenue in fees (Source: Marketplace Pulse)

In fact, Amazon basically sets prices in markets by using its infamous “buy box”. The platform removes the button if a user sells a product at a price higher than those offered on competing websites. The result: 82-90% of sales on Amazon end up using the buy box.

Neoclassical economists endlessly condemned the inefficiencies of the central planning of the Soviet Union, but apparently have little to say about the de facto price setting being done by neo-feudal corporate monopolies like Amazon.

A monopolist in the 20th century would have loved to control a country’s supply of, say, refrigerators. But the Big Tech monopolists of the 21st century go a step further and control all of the digital infrastructure needed to buy those fridges — from the internet to the software, the apps, the payment systems, and even the delivery service.

Moreover, their monopolistic control extends well beyond just one country to almost the entire world.

These corporate neo-feudal lords can create and destroy entire markets. If a competitor does manage to create a product, US Big Tech monopolies can make it disappear.

Imagine you were an entrepreneur. You developed a product, made a website, and offered to sell it online. But then you searched for it on Google, and it did not show up. Instead, Google promoted another, similar product in the search results.

This is not a hypothetical: this already happens.

Amazon does exactly the same: It promotes Amazon Prime products at the top of its search results. And when a product sells well, Amazon sometimes copies it, makes its own version, and threatens to put the original vendor out of business.

As Reuters reported in 2021, “A trove of internal Amazon documents reveals how the e-commerce giant ran a systematic campaign of creating knockoff goods and manipulating search results to boost its own product lines”. This happened in India, but vendors in other countries have accused Amazon of doing the same.

Toy salesman Molson Hart produced a fascinating documentary that illustrates Amazon’s dystopian monopoly power.

Amazon is more powerful than any 19th-century robber baron could have imagined. It charges exorbitant fees to vendors that sell goods on its platform (goods that Amazon had nothing to do with creating).

While Apple’s 30% rent fees are bad enough, Amazon takes this to a new level, extracting more than 50% of the revenue of the sellers who use its platform.

The neo-feudal corporate landlords at Apple are taking a 30% cut of all new Patreon memberships registered using the iOS app.

Apple is not providing any service, other than allowing people to download an app that it itself does not manage. All Apple does is host the app, nothing more. It is a digital landlord. But because it has a monopoly, Apple can take 30% of the revenue that creators on Patreon receive for all of our hard work.

Patreon itself already charges fees of 8% to 12% of users’ revenue. That’s a lot, but at least the company can justify it because it runs the website and hosts creators’ work. Apple doesn’t do anything; it simply allows people to download the app that is managed by Patreon, while demanding a staggering 30% cut.

We at Geopolitical Economy Report do admittedly have a vested interest in this debate: As an independent media outlet, to sustain our work, we rely exclusively on donations from our readers, viewers, and listeners. We are very grateful to them for their generosity.

These kinds of fees from Big Tech monopolies have a big economic impact on independent journalists and creators like us and our friends and colleagues.

But Apple’s Patreon fees are merely one example of a significant problem plaguing not only the United States, but most of the global economy.

It is the perfect symbol of the future of the economy: neo-feudal rent extraction by corporate monopolies.

This is how the scheme works.

It all started with Big Tech corporations first offering supposedly “free” services (which were paid for by selling users’ information). Those “free” platforms soon became monopolies, and were so deeply embedded into the economy that they became digital utilities, albeit privatized ones.

A 20th-century economy needed utilities like an electrical grid, water plants, sewage system, highways, etc. These natural monopolies should be publicly owned, provided by the state as public goods, in order to prevent rent-seeking by corporate landlords. (Of course, neoliberals have long sought to privatize these public utilities as well, and have had success in some countries — with inevitably disastrous results, like sky-high bills and sewage being dumped into the UK’s privatized water system.)

A 21st-century economy needs all of those basic utilities plus new digital infrastructure. But here’s the thing: all of the necessary digital infrastructure that our economies are built on is privatized! You have internet providers, Microsoft Windows, iOS, Apple Store, Play Store, Google, Amazon, YouTube, Facebook, Instagram, WhatsApp, Apple Pay, Google Pay, etc.

Then there is the cloud infrastructure that apps and websites use, which is dominated by a few mostly US companies. Amazon Web Services (AWS) had 31% of global market share as of the first quarter of 2024, followed by 25% for Microsoft Azure, and 11% for Google Cloud.

Together, these three big US Silicon Valley companies control 67% of the world’s cloud computing market. This is a kind of monopolistic chokehold on the internet itself.

Good luck running a modern economy, in any country, without these privatized internet providers, operating systems, app stores, social media apps, messaging apps, etc.

This digital infrastructure is now nearly as important as the public utilities like the power and water grid.

If you want to make a small business, you will almost certainly go bankrupt very quickly if you don’t use Amazon to sell your product; Apple’s App Store or Google Play Store to download your app; Facebook, Instagram, and YouTube to market your good or service; or WhatsApp to make an order (especially in many Global South countries, where WhatsApp is more common than in the US). None of this is to even mention private ISPs for an internet connection, or private telecommunications companies that charge high data fees.

If your company makes an app that is not available in the Apple App Store or Google Play Store, you might as well not exist. Good luck getting the vast majority of your customer base to download it.

The only large country whose economy is not entirely colonized by US Big Tech is China, where Communist Party leaders were wise enough to realize they had to develop their own electronic infrastructure, to have digital sovereignty, so they aren’t utterly beholden to US monopolies. (This is one of the reasons for Washington’s new cold war on Beijing.)

Now that US Big Tech monopolies are deeply embedded into the fabric of the global economy, with no real competitors, they are jacking up the rents. It is happening everywhere. Apple’s 30% fee on purchases made in apps downloaded in the App Store is just scratching the surface.

These Big Tech monopolists are really digital landlords. They own the land upon which the rest of the digital economy is built. They are the 21st-century version of the feudal lords of Medieval Europe, who owned the land upon which serfs toiled.

Now these neo-feudal corporate landlords are charging more and more fees to use their “free” infrastructure.

This digital infrastructure should be nationalized and treated as a public good, like other basic utilities (which should also be nationalized if they have been privatized, which was increasingly the case in the neoliberal era).

This is global monopoly capitalism.

Of course, monopoly capital is far from new. Capitalism has been in a decadent monopoly stage for decades.

Paul Sweezy and Paul Baran were already writing about US monopoly capitalism in the 1960s. Rudolf Hilferding could see the rapid growth of monopolies in the early 20th century, which he described in his 1910 opus Finance Capital, which in turn inspired Lenin’s analysis of imperialism.

But in the 21st century, US monopoly capital has gone global, and colonized most of the world.

In fact, this has become the go-to model for most new technology corporations coming out of Silicon Valley. Uber is the textbook example. When it first came on the scene, Uber sought to bust taxi unions in major cities by charging very low rates. Rides were so cheap that Uber lost money for years. But thanks to cheap loans provided in the era of ZIRP (zero interest rate policy), it was able to continue rolling over its debt, operating at a loss, and undercutting its competitors in a cutthroat battle for market dominance.

Once Uber successfully destroyed the (highly unionized) taxi industries in major cities and established a monopoly, Uber hiked up its rates. It didn’t really have any significant competition. (In 2023, Uber dominated 74% of the US market, compared to just 26% for Lyft.)

Uber also spread this monopoly model worldwide, waging a scorched-earth war against taxi unions in dozens of countries.

Economist Yanis Varoufakis has referred to this system as “technofeudalism”, in his 2024 book with this title. Although I sometimes disagree with Varoufakis, especially in terms of his criticism of China, I do largely share his analysis of technofeudalism.

Varoufakis is also absolutely right that one of the factors driving Washington’s new cold war on Beijing is the desire by US Big Tech monopolies to destroy their only competitors, which happen to be Chinese. As Varoufakis observed:


“with cloud capital dominating terrestrial capital, the maintenance of US hegemony requires more than preventing foreign capitalists from buying up US capitalist conglomerates, like Boeing and General Electric. In a world where cloud capital is borderless, global, capable of siphoning cloud rents from anywhere, the maintenance of US hegemony demands a direct confrontation with the only cloudalist class to have emerged as a threat to their own: China’s”.

This observation by Varoufakis hits the nail on the head. Where I think he is wrong is in his claim that China, like the US, is becoming techno-feudal.

There is a fundamental distinction between the two: In the US, capital controls the state; in China, the state controls capital.

In China’s unique system, which it refers to as a socialist market economy and “Socialism with Chinese Characteristics”, roughly a third of GDP comes from massive state-owned enterprises (SOEs), which are concentrated in the most strategic sectors of the economy, such as banking, construction, infrastructure, transportation, and telecommunications.

While it is true that many technology companies in China are private on paper, the reality is much more complicated. The Chinese government has a powerful “golden share” (officially known as a “special management share”) in large firms, such as Alibaba and Tencent, which gives it veto power over important decisions.

Although these large technology companies may not be full state-owned, China’s socialist government ensures that they act in the interest of the country and the people, not simply wealthy shareholders.

The US system is exactly the opposite. Large corporations control the government, and create policy on behalf of wealthy shareholders.

The problem is not just that US corporate monopolies control markets; they create those markets themselves, through their control over digital infrastructure.

As Varoufakis has observed in his discussion of “cloud capital”, Amazon does not just dominate the market; it creates markets — and prevents any potential competitors from creating alternative markets.

Some socialists don’t like the terms “neo-feudalism” or “techno-feudalism”, because they are afraid it will distract from the serious problems of capitalism.

But this idea is not like so-called “crony capitalism” or “corporate capitalism”, which are indeed euphemisms for plain old capitalism, as it actually exists in the real world.

Neo-feudalism really does look more and more like a distinct mode of production. Yes, capitalism in the monopoly era has had little meaningful competition, but the markets in which those firms operated were still circumscribed largely by public utilities. Wal-Mart could put local mom and pop stores out of business, but it could not effectively prevent people from traveling to other areas to buy protects from competitors; Amazon and Google essentially can.

In the 21st century, the infrastructure of society itself has been privatized.

The solution is clear: the digital infrastructure upon which the modern economy is built must be nationalized and turned into public utilities, like water, electricity, and highways.

That said, the US government nationalizing Silicon Valley Big Tech companies does not solve the problem of the lack of digital sovereignty in other countries.

If Amazon, Apple, Google, and Meta are nationalized, this would still mean the United States has enormous power over nations whose economies rely on this US-controlled digital infrastructure (which, again, is almost all nations everywhere, with the noble exception of China).

It wouldn’t be realistic for every single country on Earth to create its own social media platforms and search engines. This would also create another separate set of problems, and make it more difficult for people to communicate with their friends, family members, colleagues, and customers in a highly globalized world.

Instead, these digital utilities could remain global, but other countries could nationalize the local subsidiaries and/or operations of these Big Tech firms. Exactly how that could be done would need to be worked out.

Perhaps some kind of answer could be found in Apple’s funny business in Ireland. The US Big Tech monopoly reports its profits mostly in Ireland, whose 12.5% corporate tax rate is lower than that of the US.

In 2022, Apple’s Irish subsidiary reported more than $69 billion in profits, and paid just $7.7 billion in taxes. But it gave $20.7 billion in dividends to its California parent company.

If Apple wants the world to believe that its operations in Ireland are so much more important than those in the US, then is it really a US company, or is it an Irish one?

The answer, of course, is that Apple is truly global, like most big multinational corporations. So each country that these monopolies operate in should have the right to defend its sovereignty and nationalize their local subsidiaries.

This is a serious problem that should be debated worldwide. There are likely some potential creative solutions.

But that is a topic for a whole other article.

Global Wealth Tax Could Raise $2.1 Trillion Annually for Climate Action and More

"To make our economies secure and protect the earner way of life that has defined the modern era, we need wealth taxes that end the two-tier treatment of wealth," says a new report.

By Julia Conley

August 20, 2024

Source: Common Dreams


A sign from a protest in London on April 2, 2022, advocating for taxing the rich and against increased cost of living. (Photo by Alisdare Hickson, Flickr, CC BY-SA 2.0)

With countries set to focus heavily on climate finance for the Global South at the 2024 United Nations Climate Change Conference in November, the Tax Justice Network on Monday offered a proposal that could raise double the amount of money needed to help developing countries transition to clean energy and adapt to extreme weather—and there’s already proof the idea is effective and politically feasible.

The “featherlight” wealth tax introduced in Spain less than two years ago raised hundreds of millions of euros last year by taxing the net worth of the 0.5% richest households, and the group’s report argued that the law should serve as a model for a global wealth tax like the one increasingly supported by finance ministers in wealthy countries.

Spain’s wealth tax, also called the “solidarity surcharge” by Prime Minister Pedro Sánchez, applied a tax of 1.7% to 3.5% to the richest 0.5% of the country’s households—turning away from the “two-tier treatment of collected wealth and earned wealth” that TJN said is “the root of the problem” of growing inequality.

“Collected wealth—i.e. dividends, capital gains, and rent gained from owning things—is typically taxed at far lower rates than earned wealth—i.e. salaries gained by working,” said TJN. “At the same time, collected wealth typically grows faster than earned wealth. Today, only half of the wealth created around the world each year goes to people who earn for a living—the rest is collected as rent, interest, dividends, and capital gains.”

The two-tier tax system allows billionaires to pay tax rates that are half the rates paid by the rest of society, which has allowed the wealth of the richest 0.0001% people in the world to quadruple since 1987 “to the detriment of economies, societies, and planet,” said TJN.

Because the richest 0.5% of households control, on average, more than 25% of any given society’s wealth, the report states, if countries around the world replicated Spain’s solidarity surcharge, governments could raise $2.1 trillion annually—enough to pay for climate finance as well as other pressing needs.


By definition, a billionaire owns more wealth than an average U.S. household could spend in 10,000 years. Wealth contributes a lot less to the economy than it can when it’s pharaoh-tombed like this, making economies poorer than the sum of their parts.

“To guarantee a good life for all citizens and preserve social cohesion despite these challenges, governments around the world need the fiscal space to transform economies in a socio-ecological manner, ensure high-quality education for all, guarantee access to modern health services, and fulfill basic needs like affordable housing, food, and transportation at the same time,” reads the report. “Such measures are only feasible with sufficiently endowed and stable public budgets. A moderate, progressive wealth tax could help countries to raise these urgently needed funds.”

The report shows, said Oxfam International, that “E.U. governments can no longer excuse their ‘lack of funds’ for failing to fight the climate crisis and end poverty. The money they need is in the pockets of the super-rich!”

In each country, half the population holds only about 3% of the wealth—a persistent inequality that is “making economies insecure and is directly linked to people having to spend more than they bring in.”

The current global tax system treats billionaires as though they “earn wealth like everybody else, they’re just better at it,” said Mark Bou Mansour, head of communications for TJN. “This is bogus.”

“It’s impossible to earn a billion dollars,” Bou Mansour said. “The average U.S. worker would have to work for a stretch of time 13 times longer than humans have existed to earn as much as wealth as the world’s richest man has today. Salaries don’t make billionaires, dividends and rent money do. But we tax dividends and rent money much less than we tax salaries, and this is destabilizing the earner model our economies are based on.”

“By definition, a billionaire owns more wealth than an average U.S. household could spend in 10,000 years,” he added. “Wealth contributes a lot less to the economy than it can when it’s pharaoh-tombed like this, making economies poorer than the sum of their parts. To make our economies secure and protect the earner way of life that has defined the modern era, we need wealth taxes that end the two-tier treatment of wealth.”

On the BBC, which featured TJN’s report in a segment on Monday, Bou Mansour debunked the common claim that taxing the richest households would harm countries’ economies by pushing rich people to move away.

“This is an area where public perception has been lagging behind the evidence,” said Bou Mansour. “Recent wealth taxes in Norway, Sweden, and Denmark all resulted in a migration rate of 0.01% among the super-rich who were taxed. So what the data shows is that the super-rich do not leave en masse, and what’s more striking is that the data shows if countries do not implement wealth taxes, that is far more harmful to the economies.”

The report notes that concerns about the super-rich simply hiding their wealth in tax havens are valid, and called on countries to ensure that the U.N. tax convention currently being negotiated “delivers robust tax transparency standards.”

“Countries should collaborate to combat tax abuse by the ultra-rich, a challenge addressed in another strand of literature,” reads the report. “A straightforward starting point for combating this form of tax abuse in the context of a wealth tax is the implementation of full beneficial ownership transparency, at least within the country itself.”

While a number of G20 finance ministers have come out in support of a global wealth tax this year, leaders in some wealthy countries including U.S. Treasury Secretary Janet Yellen have refused to back the proposal.

“The vast majority of countries are currently working on what can be the biggest shakeup in history to global tax rules, to end the scourge of global tax abuse by multinational corporations and the superrich. But a minority of rich countries still seem to be holding back from support for a robust framework convention on tax,” said Alison Schultz, research fellow at TJN and co-author of the report. “This needs to change now—the climate can’t wait, and nor can the people of the world.”

How Progressive Taxation Can Raise Trillions for Climate Action

By Joy Mabenge

August 13, 2024

Source: African Arguments

Image by Denis Onyodi/IFRC/DRK/Climate Centre

Despite being responsible for a tiny fraction of the greenhouse gas emissions, African countries are among the worst affected by the climate crisis and least financially able to cope. Vulnerable communities are being devastated by cyclones, droughts, floods, and heatwaves and need urgent action to adapt. Yet the debt distress that over half of African countries face mean much of their limited budgets is being spent on simply servicing debts.

While those least responsible for the climate crisis are most affected, those most responsible – wealthy nations and corporations that rely on fossil fuels and industrial agriculture – are shirking their responsibility. Although rich countries are projected to have belatedly fulfilled their pledge to provide $100 billion in climate finance per year in 2022, much of this has been in the form of loans rather than grants. The result is that climate-vulnerable countries are pushed deeper into debt, creating perverse incentives to scale up fossil fuel extraction to repay those loans.

This broken system demands a new approach that guarantees a huge increase in financing for global climate responses.

A new report by ActionAid reveals that tax justice offers a pathway to raising climate finance. Finding the Finance: Tax Justice and the Climate Crisis shows that with ambitious and progressive taxes to target the biggest and wealthiest polluters, rich countries can raise the trillions that can give our planet and its people a fighting chance to address the climate crisis.

By increasing their tax-to-GDP ratios by 4%, developed countries could raise more than $2 trillion per year for climate finance. That may sound like a lot, but there is already a 26% difference between Ireland’s tax-to-GDP ratio (21.9%) and Denmark’s (48%). 4% is entirely feasible.

A range of progressive, gender-responsive, and climate-sensitive measures that address tax avoidance and target high earners and big corporations would ensure that the wealthiest and those that are most responsible for causing climate change would bear the burden. As outlined in the report, this could include wealth taxes, property taxes, capital gains and inheritance taxes, trade and digital taxes, as well as personal and corporate income taxes. Every country would need to use a different combination of measures to increase their tax to GDP ratios fairly.

Fair taxation can also help developing countries raise revenues domestically. However, African countries have long been constrained in setting their national tax rates by the OECD, the club of rich countries that currently control the global tax framework. This deeply unfair situation means that international corporations are barely taxed in Africa even as they extract staggering profits from our resources.

There is some hope that this could changes soon. Last year, the UN agreed to develop a UN Framework Convention on Tax, as advocated for by African countries. Negotiations are still underway about how it will work, but initial signs are positive that it could transform global rules in ways that help all countries increase tax revenues through progressive and climate sensitive reforms. This would make a huge difference to developing countries’ ability to raise domestic resources for vital priorities. As ActionAid’s report also shows, if the 60 most climate-vulnerable countries were to increase their own tax-to-GDP ratios by 5%, it could raise over $300 billion per year. This could and should be achieved through the same range of progressive tax reforms that are proposed for wealthy countries, making sure that the burden does not fall unfairly on the poorest, a mistake that recently prompted widespread protests in Kenya.

The new UN Framework Convention on Tax also provides an opportunity for globally coordinated action to introduce a range of global taxes that could raise trillions of dollars through measures such as windfall taxes, wealth taxes, higher tax rates on the income of the top 1%, and financial transaction taxes, as well as through a range of carbon and climate damage taxes, including on aviation and shipping.

By addressing tax loopholes, tackling illicit financial flows, and implementing fairer tax regimes, vast resources can be unlocked for the climate action needed to put our planet on track for survival. There will always be resistance, as we saw from wealthy countries in the OECD who benefit most from the present global tax rules and who have tried to block a new UN Framework Convention on Tax. But the momentum for radical reform is strong and the OECD countries have been consistently outvoted in the UN General Assembly.

Imagine the resilience-building infrastructure, early warning systems, renewable energy, public transport, and sustainable agriculture systems that could be funded with this money. Imagine the empowered communities adapting to a changing climate, not succumbing to it. Critics might argue that this is an internal issue for African nations. However, the historical exploitation, unfair trade practices, and biased tax global tax regimes that persist contribute significantly to the limited financial resources on the continent. Climate justice demands that those most responsible for the crisis accept responsibility and act.

Progressive taxation is also about more than raising money. It is about sending a clear message that those who have benefited most from the system causing this crisis have a moral obligation to contribute to its solution. It’s about shared responsibility within nations and across the globe.

African governments and civil society must push for progressive tax reforms under the new UN Framework Convention on Tax, and at home. And wealthy nations should support these efforts and acknowledge their historical responsibility. The climate crisis demands a global response, and true justice lies in empowering Africa to chart its own way out of this crisis.

Open Rebellion Against Teamsters GP Sean O’Brien

By Edgar Esquivel

August 20, 2024

Source: Originally published by Z. Feel free to share widely.

Image by Ted Merriman, Creative Commons 4.0



This past week the Teamsters National Black Caucus (TNBC) held their yearly conference in Las Vegas. Angered by Teamsters general president (GP) Sean O’Brien’s embarrassing spectacle at the Republican National Convention (RNC) where he paid homage to the most anti-labor chauvinists and xenophobic bigots in the party’s history, the TNBC uninvited him. In defiance to the actions of the attention deficit suffering O’Brien, the caucus instead invited former Teamsters GP – James P Hoffa Jr.

In further defiance and an insult to O’Brien who is obviously gunning for the Secretary of Labor appointment under a possible second Donald Trump presidency, the TNBC endorsed Kamala Harris for president of the United Sates. With approximately 30% of Teamster members being of African-American descent, the endorsement of Harris by the caucus carries serious weight in not only the nation’s presidential election, but also the Teamsters 2026 general election.

A day after the TNBC announced their presidential endorsement, Josh Zivalich of Teamsters Local 769 in Miami countered in a harsh detailed letter to O’Brien over his flirtation with anti-union Donald Trump and his own failure to acknowledge that the Biden-Harris administration saved hundreds of thousands of Teamster members in failing pension funds from cuts. Interestingly, O’Brien’s own New England Teamsters Pension Fund received $5.7 billion at the end of July. In the letter, Zivalich implored O’Brien to endorse Harris for president.

During the TNBC conference, Chris Silvera of Local 808 delivered a gruesome critique of O’Brien over his embracement of the pro Right-to-Work Trump. But more importantly, he also called on the members to make “the general president a one-term general president.” International vice president-at-large – John Palmer who was also present at the event received a great reception after being the first officer to openly lead the rebellion against O’Brien. Already following O’Brien’s fascistic speech at the RNC, Palmer announced he was seeking to build an opposition slate to unseat O’Brien and “send him back to the truck.”

To the surprise of everyone, Joint Council (JC) 28 in the state of Washington headed by Western Region vice president – Rick Hicks, in a press release attacked Trump’s and Elon Musk’s union busting conversation, before endorsing Harris for president. The executive board of Local 186 led by Abel Garcia in Ventura CA became the first local of the largest joint council in the nation, JC 42, to also endorse Harris.

But O’Brien of course retaliated against the TNBC and on the last day of the conference pulled officers who were due to receive honorary awards. Eastern Region vice-president Rocco Calo canceled his attendance and two other vice-presidents: Juan Campos of Chicago and Tony Jones of Columbus Ohio both mysteriously disappeared on the last day of the event. After Zivalich’s letter, O’Brien set a target on him by warning that his local had not met the union’s DRIVE standards. O’Brien also canceled the trip for international staffers scheduled for a training session in Alaska which was to be chaired by Hicks. Three international organizers appointed to Local 186 were also withdrawn in retaliation.

International vice president and head of JC 42 – Chris Griswold remained at the TNBC and stated: “we must elect her!” However, JC 42 has not made an official endorsement.

Not surprising, the Boston leader over the years has gained national notoriety for his thuggish behavior and verbal threats against his own membership. The fourth generation Teamster and University of Massachusetts (UMASS) flunky is proud of the corrupt history of his home local based in Charlestown – a sector of Boston best known for its historic ties to the criminal element. O’Brien’s own father Billy, made the headlines of the local media: Boston Globe, Boston Herald, Howie Carr Show etc. for his association with James “Whitey” Bulger’s Winter Hill Gang and their extra-curricular activities. The gang made a name for itself in Boston after successfully infiltrating and hijacking Local 25s motion picture division of which the elder O’Brien served as a crew chief.

Now after two-and-half years of defeats and concessionary contracts, it will be interesting to see how many more locals, joint councils and caucuses join the rebellion against Sean O’Brien’s authoritarian and incompetent rule. Ironically, the discredited Teamsters for a Democratic Union (TDU) which has become another layer of the most bureaucratized and corrupt union in North America, has remained silent.


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Edgar Esquivel is a Local 952 UPS Teamster, former activist for TDU and first generation-born Mexican-American in Orange County CA. He holds a Master’s Degree in History from Cal State University-Fullerton with an emphasis in Modern Latin America, labor movements and Marxist historiography. He has served as an adjunct professor of History at both Mt. San Antonio College and Santa Ana College in Southern California and have written for Cosmonaut, New Politics and Socialist Worker.

The UAW Is Now a Chief Antagonist of Donald Trump

An all-out war has now developed between the Republican presidential candidate, Donald Trump, and one of the country’s most visible and increasingly militant unions, the UAW.

By Alex N. Press

August 18, 2024

Source: Jacobin




When Elon Musk hosted a conversation with Donald Trump on Monday night using X/Twitter’s “spaces” tool, which allows users to broadcast a discussion, the Republican presidential candidate strayed into legally tenuous territory while praising his fellow billionaire.

Calling the tech figure a “great cutter” of jobs — Musk laid off more than half of X/Twitter’s staff after purchasing the social-media platform in 2022 — Trump then expanded on the subject.

“I mean, I look at what you do,” Trump told Musk. “You walk in, you say, ‘You want to quit?’ They go on strike; I won’t mention the name of the company, but they go on strike, and you say, ‘That’s OK, you’re all gone. You’re all gone. So every one of you is gone.’” Musk laughed before quickly redirecting the conversation.

Those comments are now the basis of an unfair labor practice (ULP) allegation by the United Auto Workers (UAW), which filed the complaint with the National Labor Relations Board (NLRB) shortly after the conversation. Strikes are legally protected concerted activity, and workers cannot be replaced for engaging in such action. That’s the basis for the union’s filing, which alleges that the comments constitute “illegal attempts to threaten and intimidate workers who stand up for themselves,” per a UAW press release that refers to the duo as “disgraced billionaires.” The union argues that the exchange suggests to workers at his companies that he would fire them should they engage in protected concerted activity, including striking — constituting illegal coercion.

The UAW’s filing is the latest volley in what has become an all-out war between the Republicans’ presidential candidate and one of the country’s most visible and increasingly militant unions. Shawn Fain, the union’s recently elected international leader, has repeatedly referred to Trump as a “scab,” citing the real-estate mogul’s history of crossing picket lines and stiffing workers employed on his development projects.

“When we say Donald Trump is a scab, this is what we mean. When we say Trump stands against everything our union stands for, this is what we mean,” said Fain. “Donald Trump will always side against workers standing up for themselves, and he will always side with billionaires like Elon Musk, who is contributing $45 million a month to a Super PAC to get him elected. Both Trump and Musk want working-class people to sit down and shut up, and they laugh about it openly. It’s disgusting, illegal, and totally predictable from these two clowns.”

Which Side Are You On?

When Fain announced in January that the union would endorse Joe Biden’s presidential candidacy before the incumbent dropped out of the race and endorsed Vice President Kamala Harris in his stead, he called Trump a “scab.” It wasn’t the first time he has referred to the former president that way, nor would it be the last. In a UAW video posted on social media following Trump’s conversation with Musk this week, the union repeated the descriptor, stating, “He’s for the billionaires. Not for you. Donald Trump is a scab.”

The criticism is getting under Trump’s skin: in recent months, the former president has mentioned Fain in nearly every one of his public speeches. During his speech at the Republican National Convention (RNC) last month, the former president called for Fain to be “fired.” No matter that Fain is an elected leader and thus cannot be fired; that’s beyond the understanding of a man whose catchphrase is that of a boss obsessed with exerting dominance over workers: “You’re fired.”

Fain is a real thorn in the side for Trump. Not only do he and the UAW members he represents support a transition to electric vehicles (EV), a major problem for a GOP that seeks to halt the EV transition; they’ve also endorsed Harris and her VP candidate, former union member and current Minnesota governor Tim Walz, in the election. The union’s members represent a key voter bloc in swing states like Michigan: according to the UAW, its members accounted for a significant portion of Biden’s vote in the state in 2020.

The UAW’s opposition to the Republican ticket isn’t just a problem in raw voter numbers; it’s also a publicity nightmare for a party that is trying to rebrand itself as pro-worker, even as its policy priorities remain as anti-worker and anti-union as ever. Fain’s willingness to challenge that lie is not easily overcome — even if Fain’s counterpart, International Brotherhood of Teamsters (IBT) president Sean O’Brien, has at times been willing to give the party the time of day.

There’s a clear difference in Fain and O’Brien’s approach to political education and action: both union leaders have a sizable number of Trump voters among their membership, but the former has proven far more willing to explain the threat Trump poses to union membership. That difference is rooted in Fain’s membership in a reform caucus focused on greater rank-and-file democracy and control, both in the union and in the hours of one’s life. The UAW leader has described the union’s core issues as a living wage for all, retirement security, taking workers’ time back, and adequate health care for all as a right. Conservatives are inexorably opposed to those aims, which means that if Fain and his fellow reformers want to advance their project — to fight for the entire working class, as he often puts it — they must take on the political figures standing in their way, Trump foremost among them.

However, Trump’s comments on Monday went far enough that O’Brien too denounced them, telling Politico, “Firing workers for organizing, striking, and exercising their rights as Americans is economic terrorism.” The Teamsters’ black caucus has now endorsed Harris’s candidacy, though the union itself has not yet endorsed any candidate. The AFL-CIO too joined in the criticism, writing of Trump’s comments on Monday night, “Scab recognize scab.”

The UAW also wants to unionize EV plants, including the ones Musk owns. While GOP leaders claim to want to build new factories inside the United States, they are almost uniformly silent as to the quality of the jobs they are proposing, as if such jobs are inherently good — rather than made good, with decent pay and benefits, through unionization.

Musk, for his part, has aggressively opposed unionization efforts among his workforce at Tesla, which has engaged in several attempts to join the UAW in and is now in the early stages of another such campaign. The NLRB filed a complaint against Musk earlier this year, accusing the employer of illegally restricting Tesla workers’ access to technology in a Buffalo, New York, plant (allegations he has denied); while Trump did not specify what he was referring to in his praise for Musk’s retaliation against workers who organize, it’s possible he had the events at the Buffalo plant in mind. (The board also found Musk illegally fired a Tesla worker for organizing in 2021). Anti-union animus appears to be a clear motivating factor in Musk’s decision to build out his future operations in right-to-work states like Texas and Nevada.

That disdain for unionization makes Trump and Musk, despite their differences regarding EVs, comfortable bedfellows. Musk is also leading an attack on the constitutionality of the NLRB itself through a case concerning SpaceX’s firing of nine employees in 2022, which the billionaire hopes to appeal to a sympathetic Supreme Court that will then rule the NLRB’s enforcement structure to be in violation of the Constitution, defanging the regulatory body that is a thorn in the side of employers. Musk has endorsed Trump’s candidacy and is purportedly, as mentioned by Fain, supporting it to the tune of $45 million per month via America PAC, a new super PAC whose other backers include Palantir cofounder Joe Lonsdale. Trump has long been a fan of the Tesla founder, describing him in 2020 as “one of our great geniuses.”

“They thumb their nose at labor law, and there has got to come a reckoning in this country where the billionaires and the corporate class and employers are held accountable when they break the law,” Fain said when asked on CNN about the union’s decision to file charges against Trump and Musk.

A spokesperson for the Trump campaign called the union’s charges a “shameless political stunt intended to erode” the former president’s support from US workers. Musk took to Twitter to speculate that Fain will end up in prison.

It’s always been clear that Trump, who has promised CEOs that he will lower the corporate tax rate to 20 percent if elected — he described a recent meeting with seventy of the country’s most powerful corporate bosses as a “lovefest” — couldn’t care less about working-class people, either at home or abroad. But it’s nice that he offered such an unambiguous reminder to anyone taking in by his party’s desperate attempts to disguise that fact. Whether the charges stick or not — it’s likely the union would have to prove Trump was speaking on Musk’s behalf — it’s about time we had unions fighting back against the most ruthless propagators of America’s class war on the side of capital.