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Fifty Years of Fred Hampton’s Rainbow Coalition A look back on how multiracial Chicago-style coalition building has influenced organizing to this day

27 Feb

BY JACQUELINE SERRATO SEPTEMBER 27, 2019FEBRUARY 13, 2021

The Rainbow Coalition

Chicago-style coalition-building helped to produce the first Black mayor of Chicago and put its first Latinx representatives in office. Some even believe its legacy led to the election of the city’s first Black woman mayor. But unbeknownst to many, this form of organizing started in the streets fifty years ago with what was called the “Rainbow Coalition”: a progressive, fundamentally socialist movement that set the foundation for radical ideals and civil disobedience in Chicago. ✶ ✶ ✶ ✶

On a February afternoon in 1969, Chairman Fred Hampton and his contingent of Illinois Black Panthers went looking for a Puerto Rican kid by the name of Cha-Cha in Chicago’s Lincoln Park neighborhood. Hampton had just read in the paper that the Young Lords street organization had shut themselves in the 18th District police station—along with the police commander and the media—to protest the ongoing police harassment of Latinx residents.

The Illinois chapter of the Black Panthers established themselves on the West Side of Chicago in 1968 and functioned under a ten-point program of self-empowerment and service. Their Oakland, CA founding members were already involved in multiracial movement building through the left-wing and anti-war Peace and Freedom Party. 

The Young Lords formed on the streets of Chicago in 1960 as a gang, but in 1968 they declared themselves a civil rights organization. In trips to the West Coast, they were exposed to the Black Panthers, the Brown Berets, and the American Indian Movement, who were mobilizing together for racial justice there.

Shortly after meeting, the two youths would found the original Rainbow Coalition: a “poor people’s army,” as José “Cha-Cha” Jimenez refers to it, that joined forces with working-class whites from the city’s North Side. As men were landing on the moon for the first time in a global display of American exceptionalism, the Rainbow Coalition was drawing citywide and nationwide attention to police brutality, premeditated gentrification, and institutional racism in Chicago.

“Fred took the Young Lords under his wing. He gave us the skills that we needed to come right out of the gang and start organizing the community,” said Cha-Cha, now seventy-one, leader of the gang-turned-political organization, in an interview. “We were already fighting for our rights in our neighborhoods, and we needed to form a united front. Our mission was self-determination for our barrios and all oppressed nations.”

In Chicago, the Black and Latinx activists became natural allies. Both communities had been battling Italian, German, Irish, and other white street gangs that were enforcing redlining at the street level. Black and Latinx Chicagoans lived together in the Cabrini-Green projects, attended overcrowded schools, and were denied entrance to certain beaches, restaurants, and public spaces; their parents had practically no access to city jobs or home ownership. 

The youth, who rocked black and purple berets as their respective colors, began to identify the “pigs” at the Chicago Police Department and Mayor Richard J. Daley as their common adversaries.

At the time, Chicago was a deeply segregated city, recovering from the violence of the 1968 Democratic National Convention and the assasination of Dr. Martin Luther King Jr.—who, years earlier, led the Chicago Freedom Movement, a campaign against racist housing practices that cemented segregation. Widespread public discontent—and the possibility that the neighborhoods could erupt again—could be felt.

Those who remember Hampton say he had the leadership skills to arrange gang truces and bring together unlikely groups. Billy “Che” Brooks, Deputy Minister of Education for the Illinois Black Panther Party, credits him with reaching out to William “Preacherman” Fesperman and the Young Patriots, a street organization of white youths whose parents and grandparents had migrated from Appalachia seeking jobs, but now resided in slum-like conditions in and around the Uptown neighborhood. 

The newly formed Rainbow Coalition embraced the historic momentum of 1969 to organize an unprecedented partnership between blue-collar workers from the countryside and a variety of  poor urban dwellers. Hampton understood that creating these alliances was necessary to engage in a “protracted class struggle,” according to Che, who today mentors youth at Chicago Public Libraries.

“Our thing was that Black people organize in the Black community, Puerto Ricans organize in the Puerto Rican community, ‘mexicanos’ organize in the Mexican community, and poor white people organize in their community”— and then they come together, he explained in an interview. “Today, we call it coalition politics,” Che said. 

But at the time, the Rainbow Coalition’s ideology dismissed electoral politics, according to Che, and did not aspire to mere representation politics or a colorblind society, either. Rather, they sought to empower “all peoples of the world” to determine their own destiny —beginning with their own neighborhoods—“by any means necessary.”

The Panthers were aware of the social uprisings taking place in Haiti and African countries to overthrow colonial-era dictators, while the Young Lords were just gaining consciousness of their status as second-class citizens from Puerto Rico—a “modern-day colony” of the United States, they said. This internationalist ideology and model of solidarity distinguished the Black Panther Party from separatist militant Black groups, and the Young Lords from other nationalist Latin American groups. 

Hampton would often ask white liberals: “How can you go all the way to Vietnam without first going through the West Side of Chicago?” 

Despite the gestures of solidarity, it was challenging for the youth of color to completely trust their hillbilly counterparts in the Young Patriots Organization who, in Southern tradition, wore the Confederate flag as their emblem. Che “was not ready for all that,” he said, and many Black Panthers and Young Lords were not enthused to break bread with the Young Patriots. 

Enter Bobby Lee, a college-educated Texan and cousin of Black Panther Oakland chapter co-founder Bobby Seale, who had demonstrated great ability and patience when communicating with the white community. In the documentary American Revolution II, Lee speaks with a sixteen-year-old white boy in a straw hat who wants to take up arms to defend himself from detectives who slapped him around. Lee deescalates the crowded room in the film, speaking eloquently, and convinces them to go protest the police station instead. Noting Lee’s restraint, Hampton assigned him to help the Young Patriots launch their Survival Programs in Chicago.

Youth from the Young Lords and other community groups occupied the 18th District police station to protest the harassment of the Young Lords and its leader, José “Cha-Cha” Jimenez. Published in Y.L.O., a publication of the Young Lords’s Ministry of Information. (Young Lords Newspaper Collection Y.L.O. Vol. 1, No. 1, Special Collections and Archives, DePaul University, Chicago, Illinois.)

The Survival Programs of the Black Panthers were meant to fill a void left by the municipal government and institutions that were not fulfilling the basic needs of all segments of society, in particular the Black community, they said. In response to the lack of healthcare for poor people in Chicago, the Panthers opened a network of clinics in North Lawndale and other Black neighborhoods with the aid of Quentin Young, MD, and other volunteer medical students. The Lords and the Patriots followed the Panthers’ model in their own communities. 

The Rainbow Coalition youth—made up of Panthers, Young Lords, and Young Patriots—also launched free breakfast programs that were supported by donations from community businesses and ran free daycare centers for neighborhood children. Several operations were upheld by the women of the Black Panthers and women’s focus groups like the Young Lordettes and Mothers and Others (MAO). The federal government institutionalized the School Breakfast Program in 1975.

“We’re gonna fight fire with water. We’re gonna fight racism not with racism, but with solidarity. We’re not gonna fight capitalism with Black capitalism, but with socialism… We’re gonna fight with all of us people getting together and having an international proletariat revolution,” Hampton was recorded saying.

The overarching grievances of the Black-brown-and-white alliance revolved around the impact that both urban neglect and urban renewal, as gentrification was then called, were having on the slums and ghettos where they lived. The city wanted to “rehabilitate” some of those areas in their efforts to erect a twenty-first century world-class city, according to Mayor Daley’s proposed fifty-year development plan he called Chicago 21.

Across racial lines, poor and disenfranchised youth were routinely harassed, beaten, and incarcerated by the Chicago Police Department. In May 1969, Mayor Daley and State’s Attorney Edward Hanrahan declared a “war on gangs” in Chicago, deploying 1,000 additional police to the streets. Twice, Hampton and Cha-Cha, along with Obed Lopez, a Mexican from the Latin American Defense Organization (LADO), were rounded up by 13th District police and charged with mob action for picketing a Wicker Park welfare office. 

Hampton and Cha-Cha were sent to solitary confinement at Cook County Jail multiple times as a direct consequence of their street organizing. “This was an effort to criminalize us, to bankrupt our finances, to cause fear and put us away for life,” Cha-Cha said. 

Che, seventy-one, remembered Hampton was sentenced after taking ice cream pops from the ice cream truck to pass out to neighborhood kids. Cha-Cha was jailed for stealing lumber to repair the Young Lords daycare center in order to meet city inspection, he said. Both served their time for those crimes. At one point Cha-Cha had accumulated eighteen cases and Hampton and Lopez each had nine cases.

As a high school dropout and former gang leader, Cha-Cha was a man of few words. Old press photos tended to depict him balancing a cigarette in his mouth. But his confrontational tactics were in line with Hampton’s and remain a hallmark of direct action.

In Lincoln Park, which has since become a playground for the rich, the first recorded acts of collective resistance to gentrification took place under Cha-Cha’s command. At the time, several institutions—among them the Children’s Memorial Hospital, and the McCormick Theological Seminary that was later absorbed by the DePaul University campus—were collaborating with the city to expand high-end housing near the lakefront: prime Chicago real estate. The developments were designed to exclude the Puerto Rican working class, the Young Lords found after studying the city blueprints.

The Young Lords became emboldened after one of their members, Manuel Ramos, was killed by an off-duty cop, and another, Pancho Lind, was beaten to death by a white gang. The Lords notoriously occupied the institutions that were taking over their neighborhood and presented landlords with a list of demands for institutional access. But first, they trashed the Urban Renewal office in Lincoln Park, shutting it down for months and sending a clear message of resistance to the city. 

The occupations didn’t just put the Young Lords on the map: a $25,000 payout obtained from the occupation of the university building helped to found the People’s Law Office, a social justice firm that represented the Rainbow Coalition against legal pressure from the police and the city.

In public appearances, the Rainbow Coalition was backed by community residents and Black and brown street gangs—but they also had the support of unions, Independent Precinct Organizations, college students and activists who supported the movement through Students for a Democratic Society (SDS), Rising Up Angry, and countless other organizations. Their allies included Concerned Citizens of Lincoln Park, the West Town Concerned Citizens Coalition, the Northside Cooperative Ministry, Neighborhood Commons Organization, and Voice of the People.

“It was really based on common action,” said Mike Klonsky, a former Chicago leader of SDS (who, like Hampton and Cha-Cha, had a reward out for his arrest). “If there was a protest or a demonstration, the word would get out and we would all come to it and support each other. If somebody was arrested, we would all raise bail. If somebody was killed or shot by the police, we would all respond together.”

Klonsky, now seventy-six, appeared with Cha-Cha, Hampton, and Yoruba, a Young Lord-in-training from New York, in newspaper photos of a press conference held by the Rainbow Coalition. The former leader of SDS, which by 1969 was splintering due to ideological differences, said they were publicly distancing themselves from the Weathermen, a militant faction of SDS who organized a three-day series of violent protests in October called the Days of Rage during which the Weathermen rampaged through the Gold Coast and blew up a statue to police who died during the 1886 Haymarket Riot. 

The Coalition knew that Black and brown activists would face the brunt of police retaliation for the Days of Rage—which Hampton denounced as “adventuristic, masochistic, and Custeristic”—and proposed a march from People’s Park (a vacant lot on Halsted and Armitage they had also occupied) to Humboldt Park as an alternative.

“We believed in self-defense, but not provocation,” Klonsky said.

Still, high-profile activists and associates like Klonsly endured government surveillance under COINTELPRO—an infamous program of the Justice Department which sent undercover agents to disrupt radical movements from the inside—and the Red Squad, a CPD intelligence unit dating back to the Haymarket Riot that kept track of their every move. 

“Their specific job and duty was to harass us,” Che said. “We had informants within the infrastructure of our organization who we referred to as provocateurs, who caused dissention and were created to destroy and basically annihilate us.”

The Coalition youth protested the torture of Seale, who was chained and gagged while in court for his participation in the Democratic National Convention protests, and the federal charges placed on the Chicago Seven activists for alleged conspiracy and rioting. Around the same time, the Rev. Bruce Johnson of the People’s Church—a United Methodist Church the Young Lords took over and turned into their headquarters—was brutally stabbed, along with his wife Eugenia, in their parsonage in a case that remains unsolved.

The confrontations between CPD and the Panthers were becoming increasingly intense. They engaged in a shootout over the summer that killed Black Panther Larry Roberson. Then in November, police alleged they were responding to a domestic dispute in the South Side when a shootout broke out that claimed the lives of Black Panther Spurgeon “Jake” Winters and police officers Frank Rappaport and John Gilhooly.

In December of 1969, the FBI conducted an overnight raid on Hampton’s apartment with intelligence provided by an infiltrator. He had just been named spokesperson of the national Black Panther Party. A barrage of police bullets struck him in his sleep as he lay beside his pregnant fiance, Akua Njeri, who survived. Another occupant, Black Panther security chief Mark Clark, was also killed. 

Distraught members of the Coalition unofficially disbanded, and a handful of the leadership went underground after Hampton’s assassination, fearing for their own safety. Thousands of people lined up to witness the open crime scene, while lawyers from the People’s Law Office disputed the later-disproved official police account, which had falsely claimed a heavy firefight on both sides. Having assassinated its most vocal leader, the Feds had effectively crushed the 1960s’ most promising push for united, cohesive social resistance in Chicago.

The Black Panthers, Young Patriots and SDS join the Young Lords in a march from “People’s Park” to Humboldt Park. Published in Y.L.O., a publication of the Young Lords’s Ministry of Information. (Young Lords Newspaper Collection, Y.L.O. Vol. 1 No. 5. Special Collections and Archives, DePaul University, Chicago, Illinois.)

Black Panther Party Deputy Minister of Defense Bobby Rush and the Rev. Jesse Jackson, the Chicago leader of Martin Luther King’s Operation Breadbasket, spoke at Hampton’s funeral. In time, both demonstrated political aspirations. The notion of voting for politicians from the community began to sound more palatable in the absence of revolutionary spokespeople.

Although he was not considered a “viable” candidate by the establishment, Cha-Cha became the first Latinx candidate to announce a run for office in the city of Chicago, a decision he says he made in 1973 while sitting in Cook County Jail. When he was released, Cha-Cha traded his purple beret for a suit and tie, and with North Side organizers Walter “Slim” Coleman and Jim Chapman launched his campaign for alderman in the 46th Ward. 

Cha-Cha ran on a pro-low income housing and anti-displacement platform, and lost, but garnered an unexpected thirty-nine percent of the vote and grew in name recognition. His campaign built a base of newly registered voters—Puerto Ricans could vote, as opposed to Mexican immigrants and many other Latinx Chicagoans at the time—and that carried over to Mayor Harold Washington’s campaign in 1983. 

Washington, who ran on a Neighborhoods First agenda, did not count on the support of most of the Black aldermen in the Council whose wards were beholden to the mayor’s patronage jobs. Up until that point, only one former alderman, Leon Despres, had dared to speak up against Daley. So members of the original Rainbow Coalition network re-emerged to get out the minority and progressive white vote for Washington and other candidates who openly challenged the Daley machine, including Helen Shiller’s 46th Ward aldermanic run.

Rush would later comment that Washington’s election was “directly linked” to the assasination of Fred Hampton and the values he pioneered in Chicago.

Klonsky said he “can trace a straight line between 1969 and […] the election of Mayor Harold Washington, the first Black mayor.”

As the North Side Hispanic Precinct Coordinator, Cha-Cha put together a rally for Washington in Humboldt Park that, according to the Sun-Times, attracted 100,000 Latino residents. “As some of the audience waved Puerto Rican flags, Washington welcomed them in Spanish with a greeting of ‘unity and strength’,” the paper read. 

However, Cha-Cha did not get a job with the Washington administration due to his criminal record and past drug use. He found refuge from law enforcement in Michigan, where he currently resides, goes to university, and maintains a Young Lords committee remotely.

From Washington’s supporters and the organizing network of the Rainbow Coalition emerged a wave of progressive leaders that sought political power in the late ‘80s and the ‘90s. Some recognizable names include former Cook County Clerk David Orr, former 15th Ward Alderman Marlene Carter, former City Clerk and current chair of the Board of Education Miguel del Valle, former MWRD Commissioner Joseph Gardner, former 25th Ward Alderman Juan Soliz, former 44th Ward Alderman Dick Simpson, former U.S. Representative Luis Gutiérrez, and his replacement in Congress and former mayoral candidate, Jesús “Chuy” García, and aldermanic candidates like Paul Siegel and Rudy Lozano. 

In 1984, before President Barack Obama entered the picture as a state senator, Jackson would run for president unsuccessfully, delivering a speech titled “Rainbow Coalition” at the Democratic National Convention. He subsequently adopted the name for the non-profit he founded, and then merged with his Operation PUSH to form the Rainbow/PUSH civil rights organization. Jackson did not respond to requests for comment.

But the electoral power built by the Rainbow Coalition faced pushback from traditional voting blocs. Washington faced legislative blockades from the regular Democrats during the racist Council Wars, in which white alderman (and one Latinx) banded together to systematically vote against the mayor’s proposals throughout his first term. 

The mayor’s death from a heart attack in 1987 caused divisions among Black voters who were split on a Black successor. The tragic loss of Washington allowed for the status quo to fall back into place under Mayor Richard M. Daley, who—among other self-serving maneuvers—enabled the corrupt Hispanic Democratic Organization that recruited city workers to manipulate the Latinx vote in his favor.

Since the ‘70s, more than thirty white, Black, and Latinx aldermen have been indicted or accused of serious corruption charges, ranging from bribery to extortion to embezzlement. Most recently, veteran aldermen Ed Burke, Danny Solis, and Carrie Austin have made headlines for being of interest to federal investigators.✶ ✶ ✶ ✶

And from [Washington], I can draw a straight line to what’s going on today with Black Lives Matter—and even the election of Lori, a gay Black woman,” said Klonsky, who today co-hosts Hitting Left, a political radio show on Bridgeport’s Lumpen Radio. “Her election stands on the shoulders of Harold.”

Mayor Lori Lightfoot succeeded two-term Mayor Rahm Emanuel, whose legacy of police cover-ups led to his decision not to run for a third term, with an anti-corruption platform that sought to eliminate the remnants of the old patronage machine at City Hall. Early in her campaign, Lightfoot promised to reform the culture at the Chicago Police Department and address affordable housing. Her campaign swept all wards—though at thirty-five percent, voter turnout in the 2019 election was significantly short of the eighty-two percent turnout when Washington won in 1983.

The issues that Lightfoot and her opponent—another Black woman, Cook County Board President Toni Preckwinkle—championed were brought to the surface by the organizing work of people at the grassroots level. Throughout Emanuel’s term in office, activists protested the police killings of Laquan McDonald and Rekia Boyd, the mass closure of public schools and mental health clinics, and the ongoing exodus of families from traditionally Black and brown neighborhoods. 

The organizing by youth groups like Black Youth Project 100, and labor groups like the Chicago Teachers Union—along with tenants groups, independent political organizations, and cross-neighborhood coalitions like the Grassroots Collaborative—all helped to set the agenda for the mayoral race. 

Both activists and reformers have criticized the mayor during her first hundred days in office, arguing that she has not made enough progress on the talking points of her platform. And these groups are keeping the pressure on: they are fighting for a fifteen-dollar living wage, an elected school board, eliminating cash bail, nixing a $95 million police training academy, and improving sanctuary city protections for immigrants under President Donald Trump.

These are values that have been embraced by a new crop of young, multicultural Democratic Socialists and progressives in City Council. Their agendas claim to prioritize a people-powered way of doing government—“for the many, not the few” (as Hampton would say)—that removes big money from politics and ensures community benefits agreements for residents as their neighborhoods develop. 

The freshmen aldermen are not only backing, but spearheading measures like a Civilian Police Accountability Council (CPAC) and lifting the statewide ban on rent control. Aldermen from across the city have advocated for the Homes for All, Bring Chicago Home, and the Development for All ordinances that aim to regulate real estate developers and secure affordable living for working families, the homeless, and people with disabilities.

The ideological shift in City Council can be credited to socialist ideas gaining ground in recent years, but also to years of good old-fashioned door knocking and coalition building across neighborhoods. The Black Caucus, the Latino Caucus, and the Progressive Caucus are expected to intersect with one another to a degree that we have never seen before.

Politics in Chicago have come a long way since Hampton met with Cha-Cha fifty years ago.  The trajectory of fearless grassroots, youth-driven, intersectional organizing that was set in motion by the 1969 Rainbow Coalition still resonates today.

There will be an event to commemorate fallen Young Lords and the unsolved deaths of Young Lords allies the Rev. Bruce and Eugenia Johnson at Holy Covenant United Methodist Church, 925 W. Diversey Pkwy., on September 29 at 10:30am, followed by a “justice march” to the site of old People’s Church, 834 W. Armitage, in Lincoln Park. bit.ly/YoungLordsMarch

“All Power to the People,” an exhibit celebrating the legacy of the Illinois Black Panther Party, is open for viewing at the Woodson Regional Library’s Harsh Research Collection, 9525 S. Halsted St., through December 31. chipublib.org

Documentary The First Rainbow Coalition, chronicling much of the history in this article, will premiere at the Chicago International Film Festival on October 24 and 25 at the AMC River East 21, 322 E. Illinois St. José “Cha-Cha” Jimenez of the Young Lords, Hy Thurman of the Young Patriots, and Henry “Poison” Gaddis of the Black Panthers, with director Ray Santisteban, will attend both screenings. $18. chicagofilmfestival.com ✶ ✶ ✶ ✶

Jacqueline Serrato is an independent journalist born and raised in the Little Village neighborhood. Follow her on Twitter @HechaEnChicago.

Capital and ideology: interview with Thomas Piketty.

27 Dec

by Thomas Piketty on 23rd December 2020 @PikettyLeMonde

Thomas Piketty tells Robin Wilson how wealth and power can be transferred from capital to workers and citizens.

Robin Wilson: If Capital in the Twenty-First Century made you famous for one thing, it was the equation ‘r>g’: the rise of inequality in recent decades has been linked to the excess of profit accumulation over economic growth and so to huge rents for shareholders and chief executives. Redressing such inequality then implies taxing heavily capital assets as well as high incomes. But in Capital and Ideology you raise a problem: a feature of globalisation has been the transnationalisation of wealth and the failure of nation-states to keep up—even in terms of the data they collect. So what is to be done?

Thomas Piketty: We have to rethink the way we organise globalisation. Free capital flow is not something that came from the sky—it was created by us. It was organised via particular international treaties and we have to rewrite these treaties. The circulation of investment is, of course, not bad in itself but it has to come with an automatic transmission of information about who owns what and where. It has to come with some common tax system, so that the most mobile and most powerful economic actors have to contribute to the common good—at least as much a proportion of their wealth and of their income as the middle class and the lower socio-economic groups.

Otherwise, we have created a very dangerous system, where a very large part of the population feel that they are not gaining from globalization—they are not gaining in particular from European integration—and that people at the top, large corporations or people with high wealth and high income, get a better deal because the system in a way was organize so that they can just click on a button and transfer their wealth to another jurisdiction and nobody can follow them. It doesn’t have to be this This is a very sophisticated international legal system, in particular in Europe, which has made it possible that you accumulate wealth by, in effect, using the public infrastructure of a country—the public education system and everything—and then you can go somewhere else and nothing has been planned so that we can follow you. This has to be changed.

I voted yes in the Maastricht treaty referendum in 1992. I was very young but still I am part of the many people who maybe did not realise at the time that this would lead us to a very unfair system. Some other people realised very well what they were pushing for: we should have more competition between countries so that countries will make an effort to be more ‘efficient’ and not tax too much.

To some extent, I can understand this argument. Except that, at the end of the day, this is a mistrust of democracy—this attempt to go around democratic choices by forcing the rules of the game to deliver certain types of distributional outcomes, mainly by making it possible for the most mobile and most powerful economic actors to avoid taxation in effect. This is a very dangerous choice for globalisation and for democracy and it is putting our basic social contract under a very dangerous threat.

Let’s focus on the European Union. We are up against a race to the bottom in corporate taxation in Europe as individual states have pursued beggar-my-neighbour approaches, rather than collaborating to match collectively the power of capital. One of the features of the current EU architecture, to which you have alluded, is the constraint of unanimity operating hitherto against action at EU level to reverse this race to the bottom. So how can it be reversed?

We cannot wait for unanimity to change the rule of unanimity. So at some point we need to have a subset of countries, ideally including the largest countries—Germany, France, Italy, Spain, as many countries as possible—which decide to sign a new treaty between them whereby they will take a majority-rule decision on a certain number of tax decisions: to create a common tax on the profits of large corporations, on large carbon emissions and on high-income, high-wealth taxpayers.

This will be done through majority rule among these countries. Ideally, I would like this to be done through a new European assembly made up of national parliament members—a little bit like the German-French parliamentary assembly created last year as part of the new bilateral treaty between France and Germany. Which, by the way, illustrates that it’s perfectly possible for two countries or more to stay in the European Union—France and Germany are still in the EU, of course—and to have a bilateral or trilateral or whatever treaty, in order to create some special co-operation for countries that want to move ahead into more political and fiscal integration.

I very much hope that a subset of countries will put this proposal on the table—and not only make this proposal but say ‘Okay, six months from now, 12 months from now, this will come into force and we will have majority-rule decision-making to have this recovery plan with this new common tax system’ and so on. I very much hope that most of the 27 countries that are currently members of the EU will join, but probably what will happen is that at least for a certain number of years some countries will choose to remain aside from this mechanism.

This is what happened with the creation of the euro, of course. I’m not saying this is perfect—I would prefer all 27 countries to be part of the full process of integration. I would also like Britain to come back and I think at some point this will happen. But if we wait for all countries to agree before moving in this direction we are going to wait forever. So it’s very important that a subset of countries moves in this direction—if we are always waiting for unanimity to make progress, at some point the cost of unanimity is enormous.

We’ve seen that recently with the new recovery plan, which has finally been adopted. But as we all know it has been adopted under the threat that if some countries put in their veto then there would be a separate agreement between 25 countries instead of 27. You cannot rule a large federation forever in this manner. It is not working because, in effect, it takes too much time.

If we decide in three months, in six months, that the recovery plan was too small—which is very likely to be the case—what are we going to do? Are we going to play this game another time, forcing unanimity to happen behind-closed-doors without public parliamentary deliberation, without majority-rule decision-making? We have to move to something else.

In Capital and Ideology, you paint a fairly unforgiving picture of the evolution of the EU, as effectively the only quasi-federal entity in the world to define itself so narrowly in terms of market-clearing measures rather than social policy or a political community. This has, you claim, fuelled alienation from the European project among les classes populaires, as their socio-political aspirations have not been addressed—as evidenced by the Brexit referendum, the earlier referendum defeats on the proposed EU constitution, or indeed the controversy over Maastricht which you mentioned. How can citizen trust in Europe be rebuilt?

Let me first say that I am a European federalist—I believe in Europe. Before describing everything that should be improved, it’s important to remember that European nation-states have been able to build, especially in the decades after World War II, the best social-security system in the world, the least unequal, social-market economic system in the world. This is a great achievement. I am not here to say that everything is bad in Europe—that would be ridiculous. We have built a social system which, by and large, is the least unequal in history, and this is a huge achievement, but this achievement is fragile.

For a long time we thought that it was possible to have the welfare state within each nation-state and then the EU would just be in charge of enforcing the common market and the free flow of goods, services and capital. We realise today that this is not sufficient and if we don’t harmonise tax legislation—and, more generally, if we don’t have some common public policy to regulate capitalism and to reduce inequality—then indeed there is a risk that the divorce between the European project and les classes populaires at some point will just destroy the project itself.

I am very shocked by the fact that, as I show in Capital and Ideology, if you look, referendum after referendum—whether it is in Britain, France or Denmark—wherever you have a referendum over Europe, it’s always the bottom 50 or 60 per cent of income, wealth or education groups which vote against Europe and only the top 10, 20 or 30 per cent which vote for Europe. This cannot be a coincidence.

The explanation according to which the bottom 50 or 60 per cent group are so nationalist, or they don’t like internationalist ideas, is just wrong. There are many examples in history where, in fact, the more disadvantaged socio-economic groups are more internationalist than the elite.

It entirely depends on the political project—the political mobilisation around internationalist ideas—that you present. The problem is that over time the European project has been viewed more and more as being built in the interest of the most mobile and most powerful economic actors. This is indeed very dangerous.

With the Covid crisis, we have an opportunity to try to show to the public opinion of Europe that Europe can be here to reduce inequality. But this will require some deep change in the way we conduct economic and tax policy.

Who is going to repay the large public debt? For now we put everything on the balance sheet of the European Central Bank but at some point we will have to discuss who is going to pay for that. There are solutions which, in fact, come also from the history of Europe itself. Let me remind you that after World War II, in the 1950s, many countries—including in particular Germany—invented some very innovative ways to reduce large public debt, including very progressive tax on very high-wealth individuals.

Germany in 1952 put in place a very ambitious, exceptional, progressive wealth tax, which applied between 1952 and the 1960s: very high-wealth taxpayers had to pay a very large amount of money to the German treasury. This was very successful in the sense that this policy not only helped reduce public debt—it paid for public investment, public infrastructure, and it was part of the very successful postwar growth model.

We are going to have to find something similar in the future, except that now we cannot do it alone. It cannot be just Germany or France or Italy. We will have to have some common tax policy.

Europe has to show its citizens that Europe can mean solidarity—Europe can mean asking more of those who have more and, in particular, of very high-wealth individuals who have more than €1 million or €2 million in assets. They should make an exceptional contribution in the coming years, to repay some of the Covid debt. Some proposals have been put on the table in various countries, including in Germany—very similar in fact to what was actually done in Germany in 1952, when it was a big success.

At some point, we will have to add this up at a transnational level. Through the kind of European assembly I was describing earlier—it could be Germany and France but it would be better if it was Germany, France, Italy, Spain, Belgium, as many countries as possible—we will have to change the course of Europe, so as to convince the middle class and lower socio-economic groups of Europe that Europe can work for them and Europe can be here to reduce inequality, and not only be in the interest of the wealthiest citizens.

Continuing that point about les classes populaires, you have some very striking sociological graphs in Capital and Ideology where you show how the support base for the parties of the left in Europe, which was historically among les classes populaires, has shifted dramatically in recent decades, so that they have come to represent the better-educated and even to some extent the better-off in Europe. And, in the process, you say what you call the ‘classist’ politics of the past risks being substituted by the identitarian politics of nativist movements in the Europe of today. How has such a dramatic transformation come about and can it be corrected?

The biggest part of the explanation has to do with the fact that we have stopped discussing the transformation of the economic system. We have stopped discussing reducing inequality between social classes. For many decades now, we have been telling the public that there is only one possible economic system and one possible economic policy, that governments cannot really do anything to change the distribution of income and wealth between social classes—and that the only thing that governments can do is control their borders, control identity.      

We should not be surprised that 20 or 30 years later the entire political conversation is about border control and identity. This is largely the consequence of the fact that we have stopped discussing the transformation of the economic system.

That’s partly due, of course, to the gigantic historical failure of communism, which has contributed to a general disillusion towards the idea of changing the economic system. I was 18 at the time of the fall of the Berlin wall in 1989 and I can remember, in the 1990s, I was much more a pro-market believer than I am today, and so I can very well understand the feeling that came after the fall of communism.

But not only has this gone too far. We have forgotten that on the other hand you have all the many achievements of social democracy, including progressive taxation of income and wealth, including co-determination in companies, including social-security systems. This big success of the 20th century can be taken further in the future. New thinking about a new form of economic system—more equitable, more sustainable—is the discussion we now need to have.

In the book, you conclude with your version of an alternative, which you describe as ‘participatory socialism’. It involves a progressive tax on all wealth—the proceeds of which, you say, should go to a capital endowment for every 25-year-old, as well as the extension of existing co-determination arrangements in Germany and elsewhere to change the balance of corporate power. You’re saying this would be a way to transcend capitalism without repeating the Soviet nightmare, so can you finally elaborate on that?

The system of participatory socialism I describe at the end of Capital and Ideology some people would prefer to call social democracy for the21st century. I have no problem with this but I prefer to talk about participatory socialism. In effect, this is the continuation of what has been done in the20th century and what was successful. This includes equal access to education, to health, to a system of basic income, which to some extent is already in place but needs to be made more automatic; educational justice needs to be more real and less theoretical, as it is too often the case.

Regarding the system of property, which has always been the core discussion about socialism and capitalism, the proposal I am making relies on two main pillars: one is co-determination, through change in the legal system and the system of governance of companies, and the other part is progressive taxation and the permanent circulation of property.

Regarding co-determination, let me remind you that in a number of European countries—including Germany and Sweden, starting around the 1950s—we’ve had a system where 50 per cent of seats on the governing boards of large companies will go to elected representatives of employees, of workers, even if they don’t have a share in the capital of the company, and the other 50 per cent of voting rights will go to shareholders.

Which means that if, in addition, the workers and employees of the company have a capital share of, say, 10 or 20 per cent, or if some local or regional government, as sometimes happens in Germany, has a share of 10 or 20 per cent in the capital stock of the company, then in effect this will shift the majority, even if you have a private shareholder who has 70, 80 or 90 per cent of the capital. So this is quite a big change, as compared to the usual rule of one share, one vote, which is supposed to be the basic definition of shareholder capitalism. In France, Britain or the United States, or in other countries where this system was not extended, shareholders don’t like this idea at all.

But, in the end, it was pretty successful in Germany and Sweden. I don’t want to idealise the system but it has to some extent made it possible to involve workers in the long-run strategy of companies, in a way that is not perfect in Germany or Sweden but is a bit better at least than in France, Britain and the US.

We can go further in this direction, so the first pillar of participatory socialism I propose is to say ‘Okay, let’s extend this co-determination system to all countries’—all countries in Europe to begin with but all countries in the world, ideally. Let’s also extend it to small companies and not only the large companies where it applies in Germany. In Sweden it applies to a bit smaller companies but the very small companies are excluded. Let’s apply it to all companies, no matter the size, and let’s go further by assuming, for instance, that with the 50 per cent of the vote going to shareholders, a single shareholder cannot have more than 10 per cent of the vote in large companies—say of over 100 workers.

The general idea is that we need to share power. We need more participation by everybody. We live in very educated societies, where lots of people—lots of wage-earners, engineers, managers, technicians—have something to contribute to decision-making in the company.

When you are in a very small company where there’s only one individual who put in the small capital to create the company and hires one or two people, you can see where you want the majority of the vote with the one individual, the founder of the company. But, as the company gets bigger and bigger, you need more deliberation, and you cannot be in a system where one individual, because he or she had a good idea or was very lucky at the age of 30, is going to concentrate all the decision-making power at the age of 50, 70, 90—including in a huge company with thousands or tens of thousands of workers.

So that’s the first pillar of participatory socialism. We start from the co-determination system, as it has been applied, and we try to extend it.

The second pillar is progressive taxation. Again, we start from what has been experimented with during the20th century. Some countries, like the US, for instance, went pretty far in the direction of progressive taxation: the top income tax rate at the time of Roosevelt was 91 per cent and on average between 1930 and 1980 it was over 80 per cent.

And in fact it was very successful, in the sense that productivity growth at this time was much higher than it has been since the 1980s. So the view that was put at the time of Reagan—that in order to get more innovation, more growth, you need more and more inequality at the top—is simply wrong if you look at the historical evidence.

The big lesson from history that I push in my book is that economic prosperity historically comes from equality and, in particular, equality in education. The US was the most educated country in the world in the middle of the20th century, with 80-90 per cent of the generation going to high school, at a time when it was maybe 20-30 per cent in Germany, France or Japan. You had this huge educational advance and the US was also the most productive economy.

The top income-tax and top inheritance-tax rates were divided by two by Reagan, but in fact the per capita national-income growth rate was also divided by two in the three decades after the Reagan reform. So I propose large-scale progressive taxation—not only of income and inherited wealth but also of wealth itself and on an annual basis, so as to avoid excessive concentration of wealth at the top.

And indeed so as to pay for a minimum inheritance for all: I propose €120,000 at the age of 25. This is still quite far from complete equality. In the system I propose, the people who today receive zero euro, which are basically the bottom 50 or even 60 per cent of societies, would receive €120,000, and the people who today receive €1 million, after the tax and everything, would still receive €600,000—which is less than €1 million but a lot more than €120,000.

So we are still very far from equal opportunity, which is a theoretical principle that people pretend they like but in practice—when it comes to concrete proposals—many people have a problem with. We need however to go in this direction. This proposal is actually very moderate—we could go further.

I am not saying this platform should be applied next week in every country. This is a general view of how the economic system should be transformed in the long run. The system I am describing, which I call participatory socialism, of course is different from the welfare or social-democratic capitalism we have today. But it’s very much a continuation of the transformation that already took place over the past century.

The welfare or social-democratic capitalism we have today is very, very different from the colonial capitalism that we had in 1900 or 1910, where the rights of property owners—at the world level, the colonial level, but also the domestic level—were much, much stronger. You could fire a worker when you wanted, oust a tenant when you wanted. This has nothing to do with the system we have today. So there is a long-run process towards more equality, towards justice. And this comes with a more balanced distribution of economic and social rights between owners and non-owners, with the regulation of property and the transformation of property relations.

This evolution will continue. It has already been very strong in the past century and it will continue in the future. This is a discussion we need to reopen—to shift the political conversation away from identity politics and border control towards economic and social progress and transformation.

This is part of a series on Corporate Taxation in a Globalised Era supported by the Hans Böckler Stiftung

Thomas Piketty is professor of economics at the Paris School of Economics and author of Capital and Ideology and Capital in the Twenty-First Century (both Belknap Press).

Popular Resistance Newsletter – People are rising up against the elites!

23 Nov

This weekend, ten thousand people took to the streets in Guatemala to protest the President and Congress over a proposed budget, the largest in its history, that cuts funds for health care and education as poverty rises, and provides slush funds to politicians and governments. In Colombia, the people held a national strike to protest their violent, right-wing government. In Peru, protests against a right-wing power grab have ousted one appointed president and people are demanding a new government and constitution. And people in Chile won the right to a new constitution. Now they are defending the process to make sure it represents them.

Across the Atlantic Ocean in Nigeria, in what began as a response to ongoing and severe state violence, the #EndSARS movement, has evolved to a struggle for full liberation from a corrupt and repressive government. Their new hashtag is #EndBadGovernanceInNigeria. I spoke with Abiodun Aremu, a long time movement leader in Lagos, on Clearing the FOG, about the current conditions and history of looting and exploitation by those in power.

In these countries and more, the people are rising up against the elite power structure to fight for their rights. Across borders, we share a common enemy, neoliberal economies that funnel wealth to the top, deregulate industries so they violate worker rights and destroy the environment, and impose austerity programs to deny our basic necessities. We also share a common vision for a world where the self-determination of peoples is respected and all people have equitable access to a life of dignity and prosperity

The Center for Budget and Policy Priorities has a new report that finds the economy, which improved slightly over the summer, is stagnating again. As the provisions from the CARES Act expire, poverty is rising, especially for black and brown people. Women are also being adversely impacted because of the lack of childcare. Most of the jobs that have been lost, 52 percent, are low-wage jobs.Boxes of food were handed out by the Greater Pittsburgh Community Food Bank. Gene J. Puskar/AP.

They point to a recent study from the Department of Health and Human Services that predicts ten million more people will become impoverished by the end of this year. Currently, 24 million adults say they don’t have enough food in their homes and 80 million adults say they are struggling to afford basic necessities. Without adequate support from the government, the economy won’t recover and people will continue to suffer.

The COVID19 pandemic is surging with more than 200,000 cases in one day last week and deaths are rising again. Across the country, hospitals are struggling without enough beds and the staff to care for patients. The United States is expected to remain at this crisis level through the winter unless drastic steps are taken such as a national shut down, including all non-essential businesses. At present, that is not an option being considered by either President Trump or President-Elect Biden.

Both Trump and Biden are putting corporate profits over the needs of people by focusing on reopening businesses rather than providing the relief people desperately need. The Institute for Policy Studies reports that billionaires have increased their wealth by nearly $1 trillion since the start of the pandemic while their workers are left unprotected and without increases in their wages. They specifically call out a “delinquent dozen” of “pandemic profiteers.”

As Congress refuses to provide support for the millions who have lost their jobs, their health insurance and their homes, people are calling on  the incoming Biden administration to take immediate action. For example, David Dayen points out that a provision in the Affordable Care Act allows the President to use executive power to expand Medicare to whomever needs it.David McNew/Getty Images.

Biden, unfortunately, has made it clear that he opposes Medicare for All.  I spoke about the COVID-19 crisis and our for-profit healthcare system with Chris Hedges on his program, On Contact, this weekend.

This past week, more than 235 organizations called on Joe Biden to cancel student debt, which can also be done using executive power. Student debt has reached a staggering $1.6 trillion, a burden that is crippling people in the current recession. The groups state, “Cancellation will help jumpstart spending, create jobs, and add to the GDP. Short-term payment suspension alone is not enough to help struggling borrowers who are unemployed, already in default, or in serious delinquency.”

In addition to failing to address the pandemic and economic hardship at home, the United States government also inflicts pain and suffering across the planet through the many regime change efforts and military aggressions. Medea Benjamin and Nicolas J. S. Davies outlined ten steps Joe Biden could take immediately to change our foreign policy to one that is in line with international law, provides humanitarian aid instead of bombs and reduces the threat of nuclear war.

Federal spending on the security state dwarfs what is spent on domestic needs. Only 32 percent of the federal discretionary budget is used for health care, education, energy and housing and the biggest chunk of that goes to the Veterans Health Administration. The rest goes to the Pentagon, Homeland Security, the State Department, and NASA. Imagine what could be done to provide universal health care, child care, fully-funded education through the university level, low-cost clean energy and affordable housing if we stopped our wars and brought the military home.

Now that it is clear the next president will be Joe Biden, some people may think it is time to relax and let him go to work running the country. This is the message the power holders want the people to hear. The Biden administration will go to great lengths to give the appearance that it is different and that it will make positive changes, but just as we have experienced over and over again, when it comes to domestic economic policy or foreign policy, there is little difference between Democratic and Republican administrations. Both serve the wealthy class and the military industrial complex.Sean Rayford/New York Times.

The power elites are never going to give us what we need. We must demand it. As we see people in other countries doing, we must organize and mobilize with a clear set of demands now. Joe Biden can take immediate steps to relieve suffering, and in a time of crisis as we are in now, he can do it using executive power. We must not give Biden a honeymoon. We must not be fooled by the excuses used to convince us it can’t be done.

Popular Resistance Newsletter – People are rising up against the elites

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