Meditations on the Politics of Limited Knowledge

Taking Ownership of Our Democracy – 2020 and Beyond

In Current Events, Economics, Political Theory, Politics on June 13, 2019 at 2:41 pm

Looking out at the Democratic primary field for the 2020 presidential election, I am hopeful for what may come out of debate over the most urgent, rational, achievable policies and the most viable means of saving the democratic project and advancing it into the future. I lay out some thoughts here on what I would like to see prioritized by a Democratic president elected in 2020.

While I am happy to see leftward movement in the party, I believe we need to think seriously about an agenda that is more socialist than even leftist social democrats by tackling distribution of wealth and ownership, and at the same time less statist by centralizing decision-making power only to the extent necessary for each challenge we face.

Bernie powerfully lays out the stakes in recent speech on his vision of “democratic socialism” as an extension of the unfinished work of FDR’s New Deal. Worth watching and keeping in mind throughout primary.

As I see it, right now Bernie Sanders has the most credibility of any progressive candidate in terms of realistic assessment of the structural problems we face, a record of integrity in standing behind proportionate solutions, and a national movement of supporters. I will remain one of those supporters unless a candidate emerges with roughly the same realistic assessment but more innovative policies and visionary framing that break out of the imaginative constraints of 20th Century social democracy. I don’t see a contender, especially now that Bernie is talking about worker ownership as a policy priority. This is not only structurally necessary, but politically shrewd for both the primary and the general election.

I see a number of great running mates for a Sanders ticket. Elizabeth Warren is an obvious pick, but diverges from Sanders more than is often recognized, clinging to technocratic regulatory schemes of the sort I critique below. A Sanders-Warren ticket may be necessary if Joe Biden continues to lead going into state primaries, and could be great if they bring out the best in each others intuitions and platforms along the lines I lay out here. Kirstin Gillibrand also is a great possibility, having worked in the Senate in close partnership with Sanders on Medicare for All, employee stock ownership, and postal banking. Executive experience, foreign/military service, and regional identification outside the Northeast would be helpful. Others to consider: Sherrod Brown, Stacy Abrams, Andrew Gillum, Jay Inslee, Kamala Harris, Pete Buttigieg (ironically he’d win the older demographics while Sanders sweeps the youth vote), Tulsi Gabbard, Van Jones, Keith Ellison, Gavin Newsom, Beto O’Rourke, Nina Turner. I will try to update this post with relevant candidate info as the primaries unfold.


Ideological Anchors & Strategic Commitments


I prioritize democracy in my political thought and value socialist strategies that not only seek their legitimacy in the democratic process, but also aim for structural changes that will sustain rather than undermine democracy. Unfortunately, we have not found the way to muster the democratic will to achieve such policies. The greatest successes of progressive politics in the last century have at best temporarily slowed (not reversed) long-term trends of growing inequality of wealth and power that pose an existential threat to democracy. Meanwhile, we have brought our natural environment and the social fabric of our body politic to the brink of collapse. We have lost trust in our public institutions and in one another. We cannot be certain that any of these trends can be turned around in time and to the extent needed for a democratic future. But we must offer solutions that rise to the magnitude of the challenges we face—solutions that are as bold as they need to be, simple as they can be—realistic about the political limitations these conditions put in the way of change, but insistent that our most urgent policy priorities shift these structural constraints.

I remain idealistic enough to believe that the American democratic tradition retains the values and institutions needed to bring hope and solidarity to our polity. Any credible candidate has high minded rhetoric and concrete policy proposals. The most challenging philosophical and rhetorical work is rigorously connecting the two. I strongly believe there is a huge political payoff for anyone who can. Voters respect and reward this even when the starting principles differ from their own. But I have not found a candidate or movement pull together the right formula to move from this historical moment to a more democratic future. I do, however, draw inspiration from Gar Alperovitz and the Democracy Collaborative, with whom I worked a decade ago, before getting a masters degree in New York while opening a cooperatively owned and run bed and breakfast in Brooklyn, and then embarking on my PhD in American social-political philosophy while renovating my home in a rapidly gentrifying neighborhood of Atlanta.

“Call it democracy, or call it democratic socialism, but there must be a better distribution of wealth within this country for all God’s children.” — Martin Luther King, Jr.

Most of the leftward energy in the Democratic Party at the moment seeks to intensify the strategies of 20th century model of social democracy to rely on corporate capitalism as the driver of productivity but achieve public goods through: (1) the state regulatory apparatus to “manage” the market in the public interest, (2) tax-and-spend redistribution through targeted programs of the social welfare state to smooth out the sharpest inequalities, shore up the starkest precarities, and incentivize outcomes that technocrats perceive to be necessarily good, and (3) some public works to solve collective action problems neglected by private efforts. The most encouraging thing about the leftward intensification of these strategies, for me, is movement toward solutions that may actually rise to the challenges we face. The most discouraging thing, for me, is that the strategies are too reliant on the state, thereby centralizing power without improving structures of accountability, while ironically being not socialist enough in terms of tackling the fundamental problem of concentrated wealth and ownership of the means of production that has rendered world-making decisions unaccountable to the demos.

Democrats have appropriately worried about income disparities, but we have not come close to correcting the wealth gap and the concentration of ownership in our economy. There is now talk, especially from Warren and Sanders, about taxing back obscenely concentrated wealth from the top. But there has been shockingly little talk about building up wealth (not just income and services) of average citizens, moving toward substantial employee ownership of businesses (rather than relying on dwindling unions and regulations forcing co-determination without removing the contradictions between the interests of labor and capital), intergenerational wealth transfers, the racial wealth gap, innovative and highly democratic forms of community wealth like renewable energy cooperatives, community housing land trusts, municipal utilities, state-owned banks, etc.

George W. Bush was onto something when he heralded the Ownership Society. We need the progressive version of that. Ownership is not just about material outcomes (enjoying the surplus value of labor). It is crucially about participation in decision-making about how property is used, how enterprises are developed. With that comes responsibility for risks taken. The political right has a nice clean vision of how those fit together—a vision that ignores structural inequalities and corrosion of democratic accountability. I think that a pragmatic democratic socialism in the American vernacular could correct this in a way that appeals to the common sense of American voters whose trust in the state is at an all time low—and not without justification.

There is so much work to be done rebuilding trust — work that cannot simply be short-circuited by a tasty menu of social democratic policy proposals. American citizens (in various ways across ideological, partisan, and other divides) do not trust that the federal government is working for them and/or for most American citizens. Other countries have lost trust in America as a partner in global affairs. Average folks do not trust that the economy is being directed for the benefit of American workers and their children and grand children. The American people have lost trust in one another, as citizens of one polity committed to a future that is inclusive of those with whom we disagree. We lack a strong sense of belonging, which entails lost sense of purpose and meaning, weakened solidarity and good will, and the failure to affirm interdependence and mutual accountability that should be at the core of a democratic ethos. I hope this situation is reparable, but it is bleak and must be addressed. The good news is that the same situation presents an historic opportunity for ideological realignment and radical change.

At the level of political consciousness, the first step to building trust might in fact be naming the problem and building solidarity around fixing it together rather than seeking domination in a state of war. The Democratic Party, the Left, and the resistance movement to Trump must attend to this (1) at the level of rhetoric and characterization of those not yet in the fold, (2) at the level of political strategy when pushing for policies that would be great to have but that require trust in democratic governance to be enacted and executed as law, (3) at the level of policy objectives such that any accomplishments in the short and medium term create the conditions of trust for additional collective action and progressive policy-making in the future. This opens a path for the Democratic Party to adopt a genuinely new vision, better in both policy wisdom and political efficacy, orienting socialist drives of the party base toward the strongest possible general election strategy in 2020.

I believe that we must actually be more socialist than even leftist social democrats by tackling distribution of wealth and ownership. At the same time we would be better served — in terms of both policy wisdom and political expediency — by less statist approaches, centralizing decision-making power only to the extent necessary in any domain, fostering autonomy and harnessing the accountability of markets when useful (e.g. carbon tax with universal dividend and universal inheritance for every citizen) and going all in on public programs (not corporate partnerships) when needed and adequately accountable to the people (e.g. national single-payer healthcare and high-speed rail).

This combination of principles seems to be the only way to redeem the promise of democratic accountability in the 21st Century.


Some Thoughts on Policy Priorities


The next Democratic president needs to focus on the fundamentals of responding to the most urgent national problems (climate change, wealth inequality, and a failing healthcare system, from my perspective) while putting our government on solid democratic footing moving forward (including government and campaign reforms, but also reducing antidemocratic wealth disparities and substantially democratizing the economy). All of these priorities should seek structural changes that strengthen our democracy. But we cannot simply ask voters for their trust without earning it by building up the institutional and material conditions that assure democratic accountability. Apparently irrational voter preferences in favor of state programs but against the taxes needed to pay for them reflect, in part, a rational perception that we need the state as an instrument of collective action but cannot currently trust the state to competently execute this mission for the general welfare. That is the challenge before us as we identify policy priorities.

We should not respond to the political limitations we face be recapitulating neoliberal centrism. At the same time, we should appreciate the wisdom that the federal government cannot effectively solve all of our problems. Individuals, families, neighborhoods, businesses, cities, states, international organizations all solve problems at different levels of social organization. The federal government should focus on the problems that must be solved at the federal level, tackle these with bold politics that every American can understand, and empower (through legal frameworks and material conditions) all the other agencies of our politics to flourish democratically.

The right wing of American social democracy has argued that less is more when it comes to government (less) and social prosperity (more). The left wing has argued that mo’ progress is possible only with mo’ government. In recent decades, the centrist consensus has latched onto public-private partnerships, promising the best of both the public and private sectors (democratic accountability and market accountability respectively), while often delivering the worst of each (inefficient allocation and unchecked greed) as the power relations of both sectors get distorted by the other (through special interest capture and moral hazard). These are not the only options.

Fewer can be more. The federal government can focus on doing a few things more intensively. Larger outlays can go hand in hand with less centralized decision-making, especially through simpler, more universal, and more direct channels of redistribution.

Consider the replacement of federal guarantee of free college and additional social welfare programs aimed at adults with a “democratic trust fund” or universal inheritance: every citizen at age 18 receives access to, say, $100,000 (indexed to 2x mean income per capita), for capital investments of their choosing in education, business equity, and/or real estate property. The appropriately large magnitude of this outlay would involve less intervention of the nanny state, demand personal responsibility in place of ongoing dependence, avoid unintended consequences of more restrictive policies (e.g. exacerbation of higher education inflation), and help democratize the economy in ways that require less state intervention to correct for the distortions that come with concentrated ownership. At the same time, without creating divisions and resentments across a distrustful polity, this could make great strides in addressing the racial wealth gap, both urban and rural poverty, and the precarity of social marginalized persons dependent on parents or bosses whose material support is conditional on oppression and repression. Finally, this would powerfully deliver on the project of reclaiming freedom for the left, going beyond the ways that more targeted expenditures give (some) folks the freedom to do this or that (without deciding for themselves what that is). Removing all restrictions would render the policy more interchangeable with a universal basic income, the greatest merit of which is its libertarian simplicity. But I believe it is in the public interest to restrict the use of these funds to the kinds of investment that build up enduring capital.

A strong package of policies to build up worker ownership could cut across ideological divisions in our politics, drawing precedent in Marx and Reagan alike. Bernie Sanders is finally taking this on as a policy priority, drawing the headline, “In Appeal to Moderates, Sanders Calls for Worker-Ownership of Means of Production”. The other leader on this in the U.S. Senate is Kirstin Gillibrand, who managed to include employee stock ownership provisions in legislation passing the Senate last year despite Republican control. The importance of worker ownership should be common sense and has the potential to be if offered up as a bold new idea seeking to do justice to our commitments to democracy, freedom, equality, and economic growth. This is an opportunity to value work, insist on the personal responsibility that comes with ownership, foster democratic belonging in the spaces that dominate our lives, and much more seriously face down the structural challenges of concentrated capital than simply taxing the rich to pay for state programs. Much of this could be accomplished through tax reform: e.g. raise corporate taxes and cut loopholes, but then allow for corporations to offset their tax burden by meeting thresholds of distributed employee ownership. Alternatively or additionally, corporations could simply be mandated to contribute a small fraction of stock to a worker fund, as has been suggested by Sanders. Proposals like Warren’s for accountable capitalism, e.g. German-style co-determination measures forcing representation of unions on corporate boards would make much more sense if that representation were rooted in “labor’s capital” and the result of further alignment of interests. Further policies could create ways for labor unions to pool investments in an economy-wide diversified portfolio. The public stake in the economy could be increased through the public investment of the social security trust fund or even tax policies that allow corporations to pay some of their taxes with shares transferred to the U.S. Treasury. There is a lot that can and needs to be done in this space, with plenty of innovative ideas waiting in the wings to be tapped in the name of radical pragmatism.

There are two basic approaches, each with their liabilities: (1) workers own substantial share of the company of which they are employees, underwriting their power in corporate governance while aligning the interests of labor and capital within the firm, but overly concentrating investment and thereby exposing employees to substantial risk, especially if they do not collectively hold majority share and power to hold management accountable; (2) employee stock pool across firms in a giant trust, like a sovereign wealth fund, aligning interests of labor and capital across the entire economy, but failing to achieve the right alignment at the level of the firm. My intuition is that we should go halfsies on this. By whatever mechanisms we expand worker ownership, half of a workers shares should go into a worker pool at the level of the firm (or held by individual employees or some combination) and half should go into a national common wealth fund (or divided into state and national funds) distributing risk widely and aligning long-term financial interests with the economy as a whole. This requires some serious legal reforms, but then very little government intervention and allows markets to function efficiently and in the interests of the working public. Whether and how inter-firm pools of capital could exert influence over the governance of individuals firms is a challenge, but one worthy of imaginative consideration. That same commonwealth fund could also function as a bank, providing capital to start-up or transition to worker cooperatives. In the amazing Mondragon model, first-order worker cooperatives are the shareholders of second-order cooperative firms, like banks.

Consider appropriately aggressive responses to climate change. We must put a price on carbon, regardless of other Green New Deal public works. Despite the urgency, few want to touch a “carbon tax” because they consider it politically unviable, especially at any level that would put a dent in the problem. People are unwilling to foot the costs while trusting that government will competently use that money. It is even harder to accomplish at the state level given concerns of comparative advantage. The only politically viable thing to do here that is also defensible on policy grounds is to push for tax and dividend, an aggressive national greenhouse gas emission tax with 100% of revenue refunded to Americans as an equal per capita dividend. This would need to include climate-adjustment tariffs on imports based on climate remediation achievements of the exporting countries. It is smart policy and savvy politics to decentralize the decision-making on how to use these funds, trusting consumers and producers to adjust according to their particular needs. An equal per capita dividend would not only avoid the regressive effects of a consumption tax, but even constitute a progressive redistribution of income. This is what moderate, rational conservatives are pushing. It needs to be combined with leftist collective actions at all levels of government and society. Buttigieg has got the tax-and-dividend piece, Biden has the tariff piece disguised as “carbon adjustment fees”. Others need to combine these and make them way more aggressive than the B Team is ever likely to do.

Managing the risks of catastrophic climate change also requires collective action at every level of our society, but should be presented as a parallel intervention to tax-and-dividend market correction, separately funded without raising costs for poor and middle-class Americans. The federal government will need to invest heavily in a new electricity grid that accommodates geographical differentials of renewable energy sources (particularly wind in midwest and offshore, solar in southwest). We need a national high-speed rail system. We need major investments in research. And we need to retrain workers and transition regional economies as a national responsibility. Funding for these efforts should come from a combination of sources like repealed fossil fuel subsidies, defense department cuts, and tax increases on the wealthy. Much of the most important collective action (morally required and now economically forced) should be taken on by states, cities, cooperatives, and families. The federal government could remove legal barriers and create new legal frameworks to facilitate this, in addition to consideration of good old block grants. We have great precedent in rural electrification of the midwest during the New Deal through federally supported cooperatives. Facilitating cooperative purchasing of renewable power and actively supporting worker-ownership in new areas of the green economy, could bring the principles of decentralized democratic socialism to the heart of the Green New Deal.

Finally, healthcare reform is urgently needed and appropriately central to Democratic primary debates. It is incredible that Medicare for All has gone from non-starter to non-negotiable, but frustrating to see how quickly the term gets emptied out. This is an area where the state should go all in by socializing health insurance. We need national single-payer healthcare. This simple, bold approach is the right thing to do in terms of policy, less prone to sabotage and demagoguery than more complex schemes, and stands on stronger constitutional footing with a judiciary hostile to regulatory intervention. It is the right thing to do in terms of policy given a national commitment to universal healthcare, an urgent need to control healthcare costs (through monopsony power, more rational internalization of risk over the full lifetime of patients, scale, and relative administrative simplicity), and the distinctive aspects of insurance as risk pooling that does not benefit from a free market in the way that widget factories do. That said, establishment of genuine Medicare for All would increase the freedom of individuals, families, and employers who have been irrationally saddled with the burden of providing health benefits. We are at a moment where this is politically viable and the Democratic base is right to try to make it politically necessary for its nominee. I share your pragmatic insistence that we lay out a responsible pathway for such a massive reshaping of the economy. A transitional period that includes the ability to opt in to Medicare as a public option should be part of that pathway, but it is not enough. We should go further than this by lowering the existing eligibility for Medicare, consolidating Medicaid, SCHIP, Tri-Care and maybe even the VA into Medicare, and enrolling everyone under, say, 18, in the program for life. That is a pathway, not a punt.

As a final note on the above, I will say that just as important as getting each of these policies right is weaving them together into a unified vision. This is where our shared penchant for a philosophical approach becomes essential. We can give progressive meaning to ideas like freedom through concrete and cohesive application to policy. There are also opportunities to connect up policies through really concrete visions of pragmatic policies. Post office banking could displace predatory lenders and increase access to banking while also creating a simple mechanism for disbursement of carbon tax dividends and democratic trust funds. Gillibrand has also been a leader on this. Investments in green energy could not only create jobs but massively expand worker ownership and community wealth in a new green economy. The expansion of the Medicare bureaucracy could be an opportunity to begin spreading out locations where the federal government does its work and is appreciated as an employer. Many departments of the federal government do not need to be headquartered in Washington, DC. Why not spread them out, helping to build up cities especially in less populous states and then connecting those cities with high-speed rail? Bold new visions arise out of the connection of these proposals as much as the other way around, even when we begin our politics from big philosophical ideas like democracy and freedom, faith and humility, security and belonging. I would absolutely love to help you with this work if this is the kind of work that you want to do.

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