tv The Cure for Capitalism LINKTV March 12, 2016 10:00pm-1:31am PST
returning vets or wounded vets? do you get with the v.a. or anything? rod: we're jusworking on that now. joanso you're serng anyon with a barrier to employment, not just with dd, correct? rod: we run--work skills corporation has always run like a for-profit, because our philosophy has always been you're going to make a buck or lose a buck. we have always paid very good wages. we are healthier today than we've ever been, making more money than we've ever made. this is hugely, hugely profitable for us. yeah. and this never stops running, so we don't have any downtime. joan: you're doing what i want to do. i have been lobbying hard to look at a different business model, because we know that this inot sustainable. and we have three facilities-- well, we did havthree facilities. there was a facility up on telegraph, north.
it's owned by lucas county, but we supplied work there. and we're shutting that down in july. employees are going to have to move from telegraph. some will come to hill avenue to work, and others will just focus on habilitation and activities. sean: good morning. i'd like to open this meeting at 9:23 am. my vice president here will help address any issues that come up. lou: as you heard, a short time ago, administration has decided to do a major restructuring of lott industries. this entails the closing of telegraph adult service center. you guys have worked together as a gro for deces. what are the rumblings out there right now about the closing of telegraph? wanda: some of them is a little bit upset. they want us all to be together, and to split us up,
i get a lot of feedback about that. me of them is upset. sean: rich people and the ones that are the head of the board, they could care less, because they make more money than all of us here, including the staff. they should try trading places with all of us to see how they like it. wanda: as sedentary people with disability, like we are invisible. sean: that's right. wanda: we're not there. when we talk, they don't listen. sean: they sure don't. wanda: they close their rs and ey prete they're deaf. but if they stopped and opened up their ears and opened up their minds and opened up their hearts to say, hey, we are people, too, but we are working people just like you.
kris: so kevin, if you worked out here, you would be working on a crew such as this, and what they're doing right now is taking the product from the belt and they're going to put it on the pallet. and there's a pattern for each product. jeannine: people with disabilities are community members, so we're trying to get th closer the comnity, at leasget the mmunity to understand that these are not aliens. these are human beings like everybody else. man: wh's war made o anybodknow thehemicals? kevin: h2o and carbon dioxide. man: exactly. h2o. jeannine: with kevin, it's, you know, just because he has this label called autism, he hasn't ceased to have the same sense of being a part of something, a sense of being a part of a community. i see him working. i see him--i don't know, just doing his own thing. well, tell me more about the job.
what kind of job are you looking for? or what kind of job would be best for you? kevin: like stocking, shelving, organizing. jeannine: you really like that? kevin: yeah. jeannine: like kind of the stuff you did at the library? kevin: yeah. jeannine: okay, you understand at the library you don't get paid. that's just a volunteer job erybody arts worng a job you kn, a job that just gets your foot in the door. and everybody has to pay their dues. kevin: all right. annine: what's the mo importanthing abt a job you? kevin: being on time. jeannine: being on time? so that's important to you? not important to the employer. kevin: well, no. well, i mean-- jeannine: because i want you to be happy. because you've got to work for the rest of your life.
tim's father: you are going to throw the first ball. i'll throw the second ball, and then we'll move the jack. tim's mother: tim got me this i think for my 50th birthday. all these he ordered over the computer, i think, and he would get me a different one all the time. i've always liked "peanuts." that's how i had my nursery decorated, with "peanuts" stuff. i guess i was really the proudest over his bocce, because he tried so hard to be in a sport program, that he was determined he was going to have some kind of sport. and he has worked years
and years to do that. [applause] tim's father: so the final score is three... tim: to one! tim's father: one for dad. [laughs] tim's mother: when he was in school, there was always somebody to help him. but now the challenges have been since he's been an adult. and i's beuse you nt so much f him, anyou list to what 's sang abouthat he was, but y don't know h to hp him geit. so... like theobs. he was so depressed when he lost that one job, and there was nothing i could do. we were trying every place-- the different agencies that are supposed to be able to help you, but there just was no job
for him. i wouldn't even want to think if something happened to lott's and he would lose his job. john: it's a deep hole, whatever the number is. if it's going to get deeper, we're going in the wrong direction. do we closed the door and just kind of work through this generation, so to speak, of what we have, continue to try to make it as efficient as possible and certainly not grow it. matt: john, you can do this. if you can hang in there for a little bit of while and plant some seeds, there's no reason yocan'- my gut is that you c get this bk up to least the level it was before. john: i'm not sure in the end, given the fact that this is a very complicated human service system that we're operating in, that it's realistic to assume that any time in the near future lott industries would be profitable.
joan: but what i'm talking about, we'd still be providing opportunities for individuals with dd, that you would still have this other population that wouldn't qualify as dd, but they have barriers to employment that opens up all sorts of other income streams. john: things are complicated, be it funding, political issues. matt: something's got to be done, and these people are depending upon you and us to figure it out. joan: there is absolutely, i think, a danger that it will slip towards the social service side, which would make lott completely dependent on the lucas county board. there's lots of bs i think we can do that others feel thate can't. obama: it's too hard for someone to ask you to pay more so that somebody who's making millions and billions of dollars can pay less. that's not right. [applause]
so i tell you what. as long as i continue to have the privilege of being the president of the united states, i'm going to keep fighting alongside you for a future that is brighter for this community, for toledo, for ohio, for america. thank you. god bless you. god bless the united states of america. andrea: yeah, but the problem is that now what else are they going to do? they're going to close this place down. what's next? wanda: the state had nothing to do with closing down telegraph. it's the economy. they had to close down telegraph. then that will help lott industries to keep the other buildings open and running safe and sound. andrea: how come we can't just say, hell, no, we won't go? like protest. wanda: you know what? we can protest.
they're still going to close. we are all in the same boat. we also can sink or we can swim. that's how i look at it, and i thought, well, if that boat's going under, i'm going to swim. kathy: question. can we talk about friends? do you have any like really close friends? tim: no. kathy: no? you grew up in school and then you had some friends in school. but did you go out with your friends when school was-- did you go out? no, you never went out. so you only go out with your family right now? okay. yeah.
do you feel lonely like every day you're feeling lonely? communication is difficult? yeah. nobody calls me on the videophone. ooh, i'm sorry. i didn't know that. kevin: hello, my name is kevin tyree, and i was wondering if you had a position open for me. woman: i have applications. i'll be glad to give you one. kevin: all right. woman: just fill it out and bring it back. kevin: all right. woman: stand over there and fill it out. it's very hard in toledo right now. yeah, we have people coming in
every day saying they've been all over looking for a job. but we always take applications. peter: so the question is now where do we go frohere? we've had a lot of almosts, okay? you've done several work experiences, and we just haven't found that right thing yet, but it's coming. so could i let ray take it over? kevin: yeah. peter: okay. ray: oh, boy. here we go. my focus, my mission, my intent is to help you find the job you want. are there any limitations you have to do a job? can you lift 25 pounds? kevin: no. ray: no? jeannine: he can lift 25 pounds. ray: he can lift 25 pounds. if the employer says, my job is from 8:00 to 5:00, can you work those hos? kevin: yh. y: the eloyer mit say, well, i'm sorry, but my job is from 4:00 to 11:00.
could you work that? kevin: no, 8:00 to 5:00. ray: i'm sorry, but my job is only from 4:00 to 11:00. would you like it? it's a good paying job. kevin: i'll try that. ray: you would consider it. kevin: yeah. ray: would a job dealing with stocking shelves and taking inventory, could you do that? kevin: yeah. y: wondeul. so 's no a one-way street this way. it's a two-way street with a handshake. got it, buddy? kevin: yeah. ray: that's all i have for today. jeannine: so how did those jobs and stuff sound to you? i mean, did any of it sound interesting to you or... kevin: stocking would do. jeannine: what about working like at a hotel or something like that? putting the rooms together. kevin: yeah. jeannine: maybe doing some light maintenance and stuff. kevin: mom, can we not-- not worry about that? jeannine: okay, works for me. we're just a ball of conversation here, aren't we?
[laughs] wanda: it's got to be over there, isn't it? debbie: got to find huber. wanda: you're say you know where we're at. debbie: it's got to be right here somewhere. wanda: you found it? debbie: because remember, there were two bushes. i remember there were bushes there. wanda: well, the bushes are gone, you idiot. you ain't looking down. debbie: it has to be... found it! i found it! wanda: you better be sure. debbie: we're back, mom. wanda: hi, mama. debbie: we're back. wanda: hi, mama. debbie: yep. wanda: hi, daddy. bbie: we're here, mom, dad. wanda: i know i've been
a long time. debbie: kneel down, buddy. kneel down. wanda: god, i miss you. hey, you know what? on july the 8th, they're closing telegraph. i'm going to hill. debbie: [crying] i miss you guys. wanda: i do, too, mama. hey, you probably know. probably looking down from heaven. i got my own place. you believe that? debbie: come on. wanda: before i sleep on the couch. the last thing i told debbie was be careful.
wanda: mm-hmm. when i seen the accident on tv, i didn't even recognize our car. and i just thought i'd brush it off, you know. i was getting a little kind of angry, because they were late getting home. and two police officers knocked on my door and they said that debbie huber and elsie huber was in a serious car accident. first thing i said, i say, ll, how's debbie? she's okayi say, h's mom? and they kind of went silent, and they said, she's not doing too good. and so i had the neighbor come over and watch christopher, and they took me to the hospital, and we decided to go to the chapel, and we prayed. debbie: yep. wanda: i said, god, you took my father away from us. please, it's not time to take
comfortable with somebody. ray: areou an host perso kevin: very. ray: are you a sincere person? kevin: i hate to be, you know, fake, you know. i'm ready to do anything. ray: it's important for me to know, because i can articulate and talk about some of these skills and abilities and things about you to a potential client, to a potential customer, and i have that as my background information about you, discovering who you are, okay? all right, thank you. goodbye. joan: the lucas county board of dd won't let us break out on our own. john trunk said this conversation is really how, you know, i guess we need to give you more direction. and he said, joan, do you have everything you need from sharon and i?
and i said, well, no. joe: no, i don't have anything because- joan: no, and i said, in fact-- joe: we're tied at the hip, and there's nothing we can do without you. let's be for real. what we do? i mean, just close the doors? just forget it, turn it over to lucas county board? joan: i just want to run a business that happens to employ people with disabilities, barriers to employment. i think it would really serve a huge need in this community, but if the county doesn't go that way-- joe: everybody's slowed their pace for a social service agency, and that's not what a business can do nowadays. in the meantime, while you were slowing your pace, all the other businesses were picking up. joan: and it's really frustrating that we're still going around and around and around while we're running out of money. but it was not the ending i guess i would have liked to have seen for telegraph.
kathy: this is for the best run work floor crew we've ever had. [applause] you guys have done anything and everything we've ever asked of you without crabbing or complaining. that's only me and jan that do that. [all laugh] we have pizza for everybody. [cheers and applause] okay, sandy. wanda: i want to thank you guys. jan, i want to thank you for being my boss. i know i would probably be in a different room without your help. but if you be nice and quiet, you can hear my big mouth, i'll tell you. jan: wanda, the county pays me a little something extra every week just to be your boss,
because they realize what a job that is. wanda: [laughs] kathy: it's a sad day. i'm going to miss all of you. i'm going to miss all of you very terribly. wanda: we know ain't nothing we can do or say to keep this place open. i wish there was. i wish we had a miracle, but it don't happen to people like us. but telegraph will always be our home. sean: sure will, and it will always be in our hearts, too. wanda: oh, yeah. what i heard was the government
is cutting back on some of the people with disabilities on account of the economy being so bad right now. sean: well, the county doesn't have any money to keep it open. that's just the way things worked out. wanda: why don't they cut somebody else instead of--and just leave us--people with disabilities, leave us alone. kathy: all right, pull yourself up. wanda: i'm going to miss the people. kathy: you're standing. hug me. you're holding me. wanda: especially the staff. jan: can i have the next dance please? woman: bye, kids. bye. i love you. joan: hey, gary. have you heard what's going on over here at telegraph? well, this was not supposed to be ripped down until about 2:00 this afternoon, and it got
ripped down first thing this morning. it's pretty chaotic. kathy: it's going to be fine. you will be fine. all right, baby? think of the positive. just because there's different four walls doesn't mean it's going to be a different us. wanda: are you going to be sad? you saying goodbye to telegraph? woman: yeah, me, too. woman: me, too. wanda: i'll find out where you guys are at and stop in and say hi. woman: okay. wanda: i know. it's kind of sad. joan: this was a very productive facility. they had good work ethic and good culture. so, yeahit's sad. but we'll move on. we'll move on. hey, guys.
wanda: this is a farewell goodbye, and wherever you guys end up, we'll still be friends. goodbye and good luck. bye-bye, you guys. joe: we've got every type of job imaginable here that helps with the businesses in toledo, and i don't know if these kind of boards know what's going on. i just don't think they have a good sense of what it takes to keep this place going, to get people jobs, and i don't think they have a good sense for the area on what's going to happen, the reality versus some of the philosophy. so this will always be needed, and the individuals in the
kevin: very angry. you know, i mean, all art is beautiful. i mean, you just have to appreciate it, you know. the italians had a talent for this. this art was far ahead of its time. there's like a real beauty in it. i mean, it's not ke "i'm a supermodel" or like "i'm a celebrity" about it. it's just real. nothing added. just pure art. when it's something like this, you can see what you want to see.
i mean, it can be anything. i mean, it allows me to see all of the beauty in the world, you know. john: i mean, john, really, lott is on very thin ice. if 're gng to ha lott beomethingit'got to g figured out pretty soon, because it's going to run out of money. joan: with all due respect, everyone around this table and on this phone, we've been having this discussion for, you know, maybe not the first year i was here, but certainly the next three. john: the board is the parent in this situation. i think we have some responsibility in defining them, and maybe we need to take the lead and we've dropped the ball in that regard. bill: so rather than be on pause, let's be proactive
and work towards that. when aree going have th conversation with the board of dd? john: we've got an accreditation team coming in in another week, so i'd love to say in the next couple weeks, but i know that's not realistic. joan: [laughs] you're watching me bang my head against the wall? goodness gracious. john: we've struggled with the concept of shifting public funds or using public funds that have been designated to this board to supporting individuals that have velopmenl disabilities to also supporting a model that creates opportunities for other people.
wanda: they said between 6:15, 6:30 my bus should be here. okay, here it is. i'm not used to getting up this early. [laughs] woman: are you anxious for your first day? wanda: yes. friday the 8th was our last day at telegraph. so this is my new job at hill. you know, this is a new adventure. i mean, you know, i didn't want telegraph to close because i work at telegraph for 13 years. but, you know, life goes on, and i love the challenge. whoa! woman: well, this is all new for me, too. some of the streets i've never
even heard of. good morning. man: good morning. i'm working from 7:30 to-- woman: 2:30. man: yeah. get on with it. i'm a little nervous about being at hill. wanda: yeah, me, too, honey. i'm in the same boat. ♪ row, row, row your boat [laughs] woman: here's our new home. wanda: yay! woman: yeah, i need it. woman: all right, karen. wanda: i hope they know where i'm going. i like to know where i'm going.
i don't want to walk--this is the door they told us to come into. woman: miss lizzie. woman: locking people out already. good morning, wanda. wanda: good morning. woman: hi, sandy. wanda: do we have to sign in or-- woman: heck, yeah. woman: there you go right there. just sign your time in. woman: wanda? wanda: hmm? woman: hi.
kris: so is everyone ready to do their best today? kevin: yes. kris: yeah? what's our goal today, guys? kevin: get as much work as-- kris: and get a job, right? get a job. man: work as fast as we can. kris: exactly. that's right. eric: kevin, let's talk briefly about what your intention is, what your goal is here. why do you want this job? kevin: hourly pay. eric: okay. is this to help support yourself? kevin: yeah, eventually live on my own. ericokay. so of the bs we ha here reire litt bit of lifting. do you enjoy lifting? kevin: it depends on how much the box weighs. eric: ay. 30 pnds. is that an acceptable weight? kevin: yeah. eric: and we have what they call a probation period, and that timeframe is where we evaluate
your performance, and that is the most important time for you. peter: i talked to ray the other day about kevin at propo books, and they have already, i guess, done the interview. this friday will be the end of the work trial. so far, the reports are he's doing well and he's very happy doing it. jeannine: i don't want him, just because he has a developmental disability, to only be relegated in his whole life to those types of jobs. you know, if you have a disability, do you have a job, or are you going to have a career? is this going to be a career for him? hopefully he will be in a culture that is more inclusive of him, as opposed to, you know, the whole idea that we talk about, well, if we can just get these people to look right, be right, act right, then the culture will accept them, the culture taking that step towards them and saying, hey, you know, these are citizens, these are, you know, they are part of our community
and wanting that to happen. kevin: i need to work, i mean, to earn extra money so then i'll have saved enough money to move into my own place, buy my own car, pay my own rent. the ecomy real is the same everywhere. not everybody has a job. joan: i haven't yet come up with the words to describe what i'm feeling. the county board has decided that they're going to take over everything. so they're going to take over.
my position in effect is going to be eliminated. you know, the sad thing is, pat, is they could accomplish the same thing with our model. and quite frankly, i think it's a better use of their resources, you know. we have people that have studied it, that, you know, they're business oriented. they're not set up for this. i must admit, i did not expect this today. and you know what? honestly, i'm not so sure that they're not hoping that that's the conclusion, not only that i leave, but that the lott board dissolves. john trunk was very clear today. i'll say it again. he was very clear. one of the very last statements he said is this is the direction my board has decided they want to go. bill: he has repeated to me several times he wants to squeeze the doors shut to people that have a higher level of performance, becae they
shoulde in comnity employment. joan: what they're doing is they're stopping the funnel and they're decreasing the abilities of the people working there. and eventually, they will close it altogether, and we have then in effect put ourselves out of business. joe: they don't realize that they will shut things down in less than a year. john: it's been messy at best during the last several years, and knowing that there's fiscal issues that we all face, i think we felt it was in our best interest collectively, including lott, to bring the direct supervision of those staff back under our umbrella.
man: you don't want me to go to work. joan: you're right. [joan laughs] i'm going to miss you. yeah, i am. absolutely, the people on the floor, it's just hard to say goodbye to all of them. here's one that signed, "yr best fend." those are sweet. and i think i'll probably use this tonight. woman: you're very loved here, so-- man: yes, very much. joan: thanks.
woman: yeah, our world's pretty small, and you me a difference. joan: thanks. woman: thank you. joan: take care. woman: see you later. joan: i don't think anyone's won. i don't think anyone's won in this circumstance, and i just hope no one loses. wanda, i want to tell you goodbye, honey. wanda: what? joan: today's my last day. wanda: oh? joan: yeah. yep. wanda: where you going? joan: i'm going to take some time off, and then i'll probably start working again. but today's my last day. wanda: aw. joan: so thanks for all the hard work you guys do. keep doing a really good job here. you're important to this lab.
tim's mother: i never thought when they put all that money in that lab-- i mean, they bought a lot of equipment and everything--that they would just close it up. i never thought it would. i always thought that's what lott's was for is to employ these people, give them something to do. i didn't know it was going to be like this. because i don't know what's going to happen to all those people. tim's father: concerns is lott going to be able to survive. tim's already lost a lot of self-worth. last week he made $36 for two weeks. the skills he has and the demand for that type of skill
is gone. he's just like basically assembling little fasteners and things like this, and that's not his expertise. he does not want to sit home and collect a federal subsidy. he wants to work. joan: um...i think i was more sad than angry. but, yeah, i certainly had my moments of being angry. so the lott board eliminated my position, a then they all resigned as well. lucas county board's plan is to close the door on lott. they say they want to focus on community employment, which is great, but the model we proposed would've done that and would have providemore options. i'm always going to care.
you know, that certainly opened up my life when i took this job. i was not really aware of what a life was like for an individual diagnosed with a disability. something that has really struck me is just this lack of civility, being unable to somehow meet or somehow in the middle for the better good of everybody. i poured my heart and soul and so did a lot of my staff, so it's not something you st walk away from.
the man on the court. you got one more game. good job. wanda: hey, pretty boy. you're so pretty. i mean, it's the bright orange. it's so beautiful. i hope in the next few years that i will get offered a job that i love, and i hope my employees and my staff will be nice to me like lott has. maybe settle down, get married. i met a guy in church. we've been dating off and on, so we'll take it slow. and i hope in the next few years i'll be married. that's my dream. you know, it's time for me to settle down and live and enjoy, you know, share my dreams with someone else.
i'm going to take it one day at a time. if it works out, it works out. if it don't, hey, there's always another dream at the end of the rainbow. woman: on court four, we have the gold and silver medal match. mitch: it is the finals... for the gold medals. [applause] man: nice shot. tim's father: we're going to see
ray: mr. tyree. kevin: yes? ray: how are you? kevin: i'm doing fine. ray: good to see you again. kevin: all right. ray: every time i call here, they're always saying you're doing a great job. kevin: thank you. ray: and i'm proud of you and the store's proud of you and your mom's proud of you. we all are. so i just want to say congratulations. you're doing a great job. keep up the good work. kevin: i mean, it's more of a privilege to be even working here i mean, i was one of the lucky few who got offered permanent position here. ray: you're doing more inventory and stocking, and that's great. i'm not going to keep interrupting you here because you've got a job to do, right? kevin: yeah. how long do you
think people like me stay here? ray: how long do i think people like you stay here? well, my hunch is-- kevin: for more than a year? ray: my hunch is this is the start of your career. you're here. you've got a career here. kevin: yeah. ray: you know, your hard efforts made this happen. [chuckles] jenine: i ink beina parent of a child that has special needs, it changes you. i've been to best buy several times to see kevin, just to look at the man that my son has become. a part of me knew that he was capable of it, but all the different voices telling you all those different conflicting things can be overwhelming. and it's such an honor. i told him, i said, now people will see what i've known all the time, and that's what a cool
person you are and how wonderful you are. man: on the back wall there. kevin: and if i wanted longer hours, i want to work from like 7:00 in the morning till 5:00 in the afternoon. man: those are good hours. it probably takes me like eight minutes to get to work, but gas now is like over $4.00 in certain places, so that's where it's getting bad. kevin: i really wish that the u.s. could bounce back from this economy. man: all right, kevin. enjoy your night. kevin: mm-hmm. 3w3wño]ñ]ñ]ñíñíñíñ
[applause] >> well, i want to welcome you. i want to acknowledge the awe-inspiring environment that we're sharing this evening. the religious overtones might make you think you were in one of the two party conventions-- [audience laughter] but i hope in a few minutes to make you clearly aware that, other than the environment, not that much that i share with either of them. so let me begin by promising you two things: first, to provide to you a different way of understanding what's happening
to the economic system and our position in it than perhaps you have heard before. and even more important, and what this book is about, an alternative solution for dealing with it different from what you might have heard before. so, first, where are we here in the united states and in the world economy? and i'm not gonna tell you what you already know, which is that this is the worst economic crisis in my lifetime and therefore in yours, that it began in 2007, which means it is now coming to the end of its fifth year and that there is no end in sight, that the efforts of governments around the world, including the united states, to end it long ago have not proved successful, that the prognosis is not good, that the problem is almost like
a disease in the sense that it begins in the united states in 2007, 2008, and 2009. the europeans look at the united states and thank their lucky stars that it isn't so bad only to discover that it has metastasized over there. and the last 2 or 3 years, it's a terrible problem in europe, and americans are thanking their lucky stars that it isn't quite so bad here. the chinese are discovering that it is spreading to them. the russians and the indians have already discovered it, and the united states is now beginning to recognize that our own chances of coming out of it are being undercut by the realities in russia, china, and so on. it keeps going because they haven't found a solution. most of the effort to explain it involves games of blame. right now, we're all aware that the republicans blame the democrats and vice versa in an endless
chorus that begins to sound the same after the 14th speech by whoever's looking for a job promotion in whichever party. and then the blame goes beyond that. people on the left like to blame bankers. people on the right like to blame poor people who take out loans. so forth and so on. i want to break from all of that. i want us to acknowledge that in this economic system that we have-- which has a name; it's called capitalism--there are a set of rules. and that most people, because they really can't avoid it, play by those rules. bankers make loans in order to make money. corporations do what they do in order to make money, because that's what the people who make decisions in corporations are hired to do, and working people try to have a job that's decent and try to earn an income. and if they can't do what they think they ought to do as good citizens, as good pents with the jobs and incomes they have, well, then they borrow money,
and that works out real well because the banks are real eager to lend it to them, and we have everybody performing pretty much the way they are supposed to. when a society has people who are all playing by the rules and can show you that that's what they're doing and the end result is the kind of disaster we have, then it isn't any more appropriate to blame this or that actor. it's time to recognize that the system of rules is the problem. everybody's playing by the rules. everybody hopes that will all work out, but it doesn't. in my profession of economics, we have a great philosopher with which all economics courses begin. his name is adam smith, and he's famous for the following line: "if erybodyursues his or her n self-ierest, 'll wk out for the best for everybody." most of you know that that's silly. it's a wonderful
rationale to go out there and do what you want for yourself and not care about anybody else, but where that leads is exactly where we are... in a very, very bad crisis. so, let's begin by analyzing this crisis as the crisis of a system. and we'll go on to talk about this system even when it's not in crisis, because that's as big a problem as the crisis itself. but crisis is where we are. 2012 is the fifth year of this crisis. what does that mean? first and foremost, it means that we have in the united states today something on the order of 20 million to 25 million people who either don't have a job at all, have been without a job long enough that they've given up looking-- so-called discouraged workers-- or folks who have to take a part-time job because that's all they can find, but they would like to have a full-time job. the bureau of
labor statistics in washington keeps records like this. and so, it's roughly 20 million to 25 million of our fellow citizens, something on the order of 15%, 16% of our workforce. that's staggering. alongside of these people, there's another statistic. this one comes from the federal reserve. it's a statistic called the capacity utilization rate. it measures what proportion of the tools, equipment, machines, office space is being used for production and what part is sitting idle, what part of our capacity is being utilized. and the federal reserve has now pointed out, for some years it's roughly hovering around 20% is not being utilized. 20% of our tools, equipment, machines, vehicle fleets-- you name it--sits idle. ok, you don't need an advanced degree in economics-- i have one, but you don't need it--to understand that
if there are 20 million to 25 million people who want to work and don't have a chance, and we have 20% of the tools, equipment, raw materials for those people to work with, that a system that cannot put these two together to produce a quantity of wealth that would solve most of our social problems quickly is a system that doesn't work very well. that's a fundamental problem of our economic system--that it produces a crisis of this sort. i won't take the time to tell you the details of what happens to people who are unemployed, particularly for long periods of time, and the current unemployment is very long for people who are without work. they suffer self-esteem problems. they suffer mental and physical health problems. their families are more likely to break up. they lose the skills that they once had when they're out of work for long periods of time. their children have more difficulty in school. the costs
of these kinds of crisis last for generations. the amount of human damage, the amount of waste of resources is beyond calculation. a system that does this, let alone a system that does it repeatedly, cannot talk about efficiency because whatever the efficiency is of a particular factory or a particular production process is completely overwhelmed by the inefficiency of massive numbers of unemployed people, un-utilized resources, and lost output that could meet social needs. but it's worse. it's not just that we're in a crisis now of horrific proportions for 5 years. it's that this is the second major breakdown of this capitalist system in the last 75 years. the last one was the 1930s. begins in 1929 and isn't really over until 1940, '41.
a terrible crisis. and between the end of that one in the 1930s and the beginning of this one in 2007, the national bureau of economic research, which is the official agency that counts crises, counts 11 more--11 more downturns in which millions of americans--and i'm not even talking about other countries-- lost their jobs, capacity un-utilized, output foregone, again and again. crisis is not an occasional interruption. crisis is part of how this system works, and it always has as far back as the last 200 years of capitalism. it has a crisis every few years. and it's important to stress this, because politicians tend to like, for obvious reasons, to characterize each crisis as if it were a special occurrence. so, for example, every president
in the united states since franklin roosevelt has, during his tenure as president, had at least one economic downturn. every one. and every president said at one point, "here are the policies i am proposing, and they have 2 great qualities. number 1--they will get us out of this crisis. and number 2-- they will make sure we never have a crisis like this again." every president promised it. no president has delivered on the promise yet. that tells you something. the system is crisis-prone, and that is a very serious defect to say the least. but i don't want to limit myself to crises. i want to also talk about the system when it's working well, when the unemployment is relatively low. what happens
then? first, capitalism has a tendency everywhere to polarize income and wealth. it's a kind of driven system in which the competition, as you all know, of enterprises one with the other, is pretty cutthroat. and most of the time, the company that wins the competition literally eats the one that has been defeated-- buys its equipment, hires away its workers, and so we get the ever-larger winners. that's why most big industries have 2 or 3 left. they've consumed all the others. they become very big and powerful. these days, they become so big and powerful, they're all household names. and when they begin to have trouble, they make us all pay for their problems by telling us they're too big to fail. that's how big they've come. so, we polarize in a capitalist system. we produce poles of great wealth at one end and poles of real poverty
at the other. sometimes, sometimes when the system really breaks down, masses of people get so angry that they begin to push back. very interesting. in america, that happened in the 1930s when we had a terrible depression, when the unemployment rate, which today is about 8.5% officially--the number of adults looking for work as a percentage of our labor force. if you look at the comparable number in the depths of the depression, it was 3 times that--25%. really very bad. and interestingly in the 1930s, the american people pushed back. they were not passive. they were active. let me tell you what they did, because it's a part of our history that americans tend not to learn too well in school for reasons i will leave to your speculation. we had the biggest labor movement organization that the country ever had. something
called the congress of industrial organizations organized millions of workers in the 1930s in the depths of the depression. workers who had never been in a union before. we'd never seen that in the united states. we had never seen it before, and we've never seen it since. in the midst of that misery of a depression, of that poverty, american workers decided that a labor union could maybe save them, and they were ready to join. and joining was often tough, working against government, working against a corporation, working against the police. alongside the unions, the c.i.o. that did the organizing, were 2 other institutions that were important then, and that may surprise you. soalist parties here in the united states and the communist party of the united states were powerful. they had a lot of people, and they worked together with the c.i.o. and together, they went to the government at that time, and they said 2 things: "we represent
the mass of working people, and we don't want to suffer the way we're suffering in this breakdown of capitalism. you gotta do something." and they addressed themselves to a kind of middle-of-the-road democratic politician who had just gotten elected president on a program of a balanced budget-- franklin roosevelt. and they said to him, "you've gotta do something for the people." and the socialists and communists said, "you gotta do something for the people," but they added a little barb, "because we think that there's a better system, an alternative system, to capitalism. and if you keep performing as badly as you're doing in the depths of the depression, we're gonna try to establish that alternative." and they pointed across the ocean to the soviet union, said, "see? like them." that scared folks. and mr. roosevelt was a good politician, smart. he listened, and he responded because he knew politically that these 3 forces--c.i.o., socialists, and communists--
had enormous support in the united states, they were very powerful, and that they could mount a serious problem for this country. so, roosevelt went to his friends. you know, he came from a very well-established, very wealthy family. and he went to his wealthy friends, many of whom were businessmen, and he said, "look, i think i gotta do something here, because if i d't,we're gonna have a lot of trouble. and, dear gentlemen, you who are very wealthy and you who run the big corporations, not only do i think we need to do this, but you're gonna have to pay for it. the government has no money. w're the depssion. nobo's pang any tes. body hasobs. so u'reonna have toay--the ch and e corporions. d here's whatou' nna pay r. i'm gonna ta care ofhe peopl i'm gonnahelp por people uneloyed pele, an arican popuation th's troubl
i'gonna hp them b-time, and u'reonna payor it. andou know why? because if you don't, coming down the road are those socialists and communists, and they're gonna cut you a lot less attractive deal." and, you know, something interesting happened. the business community and the rich were split. half of them did not buy that argument. they were not convinced by mr. roosevelt. but half of them were. and roosevelt was a good politician. with half of the businesses in his pocket, he knew he could count on the c.i.o., the socialists, and the communists to kind of work something out, and here was the deal. "i'm gonna get the money from the corporations and the rich. i'm gonna help you on a scale you've never seen before. and in return, you're gonna stop talking about getting rid of capitalism. you're gonna mute that part of your message. you're gonna celebrate me as the guy who gives
the mass of people something they never got before." so, what did roosevelt do? three interesting things that i'll mention. one--he created the social security system. we never had that before. in the midst of a depression worse than today, when there's no money in the hands of the government--none is coming in; it's really hard; we can't do anything--the president goes on the radio and announces that every american over 65 years of age who's had a lifetime of work is now gonna get money from the government for the rest of his or her life. thank you very much. what? where would all the money come from? but you know. i've already told you. from taxing the corporations and the rich. and no sooner did he do that than he announced another new program: unemployment compensation. we never had that before in the united states. in the midst of a depression, when tens of millions of people are out of work, the president announces, "i want to tell you all that everybody who is out of work is now gonna get a government check every week for a year or two to make this
easier." and who's gonna pay for that? mm-hmm. the corporations and the rich. but now comes the third program. president roosevelt says, "if the private enterprise system of the united states cannot provide work to tens of millions of american citizens who want to work, well, then, i'll do it." and between 1934 and 1941, roosevelt created and filled 12.5 million jobs. well, you're hired by the federal government. and who paid for all of that? mm-hmm. the corporations and the rich. wow. i'm not describing the soviet union or some fantasy or some impossible dream. i'm just describing american history, and not so long ago, either. wow. just to drive it home, roosevelt--how did he actually do this? he was
very courageous and clever. in the midst of world war ii, to make this point really strong, he proposed a novel income tax. here's how it would work. above a certain level--and the level in those years was $25,000 a year-- the income tax rate that would have to be paid is--president's proposal--100%. that's right. $25,000 a year would become a maximum income. you know how we have a minimum wage? this would be the maximum income, the other end. the republicans, predictably, went crazy. and they fought and they yelled, and they reached a compromise. and the compromise was that above the top, the highest rate, the richest americans would henceforth have to pay 94%. the law signed by the president.
if you were rich in the 1940s, every dollar over the top limit, the highest bracket that you earned, you got to keep 6 cents. and the other 94 cents went to the president and to the government. and, by the way, in the 1950s and '60s, it continued. 91% was the top bracket. republicans endorsed it. democrats endorsed it. republican and democratic presidents maintained it. and, by the way, why? the answer was easy, and everybody understood it. it went like this. we have just come through the greatest depression of our economic life, the 1930s, followed by the most severe war threat we've ever had, world war ii. the country has to pull together to overcome and rebuild from these two great sequential crises, and from each must be taken their capacity to
contribute. so we're taking from the rich their capacity. here's some statistics for you. beside the--income tax on individuals, in 1945-- i did a little calculation-- for every dollar that the federal government got in income taxes on individuals, it got from corporations $1.50. corporations as a whole paid taxes on their profits 50% more than individuals as a whole. what's the relationship today? for every dollar that is taken from individuals, corporations today contribute 25 cents. and what's the highest tax bracket? is it the 91% of the fifties and sixties? no. it's 35%. what's the lesson here? in the 1930s, the gap between rich and poor was reduced
because the government took from the rich to take care of the mass of people who had been suffering in unemployment and poverty through no fault of their own. through the breakdown of the system. no sooner was the war over than the business community and the rich went to work to undo what had happened in the 1930s. to undo the high taxes on corporations and bring them down to where i just told you they were, to undo the tax on wealthy people to bring them down to where they are today. and therein lies a lesson that it was the upsurge of a militant organized working class that overcame for a while the tendency of capitalism to polarize. but the lesson here was better learned by the business and the rich than by the working people because the business
and the rich went to work. no sooner was the war over, they went to work to undo what had been done in the 1930s. the economic history of the united states in the last 30, 40, 50 years has been the undoing of the new deal. that was the name roosevelt gave to what he did in the 1930s. from which the following lesson can be further distilled. the problem for corporations and the rich, who keep running a system that plunges us into crisis after crisis, who have really no effective way to prevent them, who likewise tend to polarize into rich and poor, the problem for corporations and the rich is this--they've got an economic system that constantly provokes the mass of people into thinking that they might be able to use
the political system to offset the effects of the economic system. the danger for capitalism has been, if you actually give everybody the vote that the vote will be the way. the political way will be for the majority to recoup for themselves in politics what they lost in the capitalist economic system. that is a great fundamental danger for capitalism. and how has american capitalism, and that in other countries, dealt with this? and the answer is, you've got to control the politics. because if you don't, it will come back and undo what you've achieved in your economic life. they learned that in the great depression by watching what the c.i.o. and the socialists and the communists did. so in the last 50 years, the business community went to work. they destroyed the labor movement. they destroyed the socialist
parties. and they destroyed the communist parties. i don't have the time to go into that. but if you read your history, you'll see it. in the private sector of the united states today, the official percentage of workers that are members of a union--represented by a trade union--is under 7%. 93% of private sector workers in the united states have no union. the notion of unions as a powerful social force requires a lack of understanding of what's going on in our society that boggles the mind. so what have we got? we've got all the mechanisms in place that allow the business community and the wealthy to control the politics. you all know these stories. they're the ones who fund the candidates; they're the ones who fund the parties; they're the ones who hire huge armies of lobbyists to work on an ongoing
basis with whoever gets elected. and they fund all these think tanks that produce endless resources and reports and researchers and specialists for the radio and the television to shape the consciousness of what americans see, hear, and thinkand the d result are events sort of like the two political presidential conventions in which not a word is said about the system, not a word is said of the sort i've just finished telling you about in which they each blame each other as if the politicos had the power to do much about all of this. but there's no systemic analysis, no systemic recognition. what else about this system is bizarre? well, one of the results of the shaping of consciousness is the following kind of really strange idea. it goes like this: if you give
corporations a chance to make profits, then good things will happen. so, for example, we have to create a profitable business climate because then businesses, say by cutting their taxes or by deregulating them or by allowing them to do all kinds of things, then good things will happen to the rest of us. there's a simple logical problem here. if you cut the taxes of business, then they have more money because their taxes are lower. what they do with that money is their decision. andheir decion is gerned by making as much money as possible. that might mean that they will create a job, ok, but not here. in a place where the wages are much lower--say, in asia--which might be nice for them but isn't particularly good here. or they might lend it to a government or they might play the stock market.
or they might do--i don't know-- let's see. what did they do over the last 30 years? the most impressive things big corporations did with the money they saved from taxes and with the profits they were able to get from deregulation, really, one of the most spectacular things they did was to begin to pay corporate executives at the top stupefying amounts of money. we are the leader in the world-- i'm sure you're all proud-- we're the leader in the world in the gap between what we pay our top executives and what the average worker in that company that the executive is leading gets. in other places, the numbers are like 30, 40 times. in our country, it's 300 or 400 times. the big people at the top took the advantage of the lower taxes they had to pay to make themselves stupefyingly rich, which in a free enterprise they're free to do. the notion that if you do something good for a corporation, they will in some sense pay you back is childish.
that's not what they do. that's not what they're hired to do. in this system, they always try to pay fewer taxes. they always try to find the most profitable thing they can do with their money. what that does for the rest of us, who knows? but there's no control here. it's also like allowing a company to go and close a factory in cincinnati and open it in shanghai. the justification of the logic of the way our culture works is, "well, we will all benefit because the prices that they will charge for the things they make over there will be less than what they"-- but they're not requid to do thatwhen theclose e factorhere ando to china, it's precisely with the big idea of selling the good at the same price to you in the supermarket but just having to pay lower wages to get it manufactured
over there. why should they lower the price? they make more money if they didn't. it's not their job, as they will explain to you, to take care of the american economy. they weren't hired by the american economy. they were hired by the shareholders of that company to make money for that company. every technological breakthrough made by capitalism in the last 300 years has been justified by whoever was making it on the grounds that, "with this new machine," or, "with this new process, human labor will be less drudgery." machines will replace people. we will not have to work so hard and so long. how interesting. according to the oecd, americans today, where we have the most advanced technological breakthroughs imaginable-- americans today do more hours f paid lor than y other workig classin any untry
on thplanet. ere wasll the lsure pposed tcome fro l the wk that w saved? ss work r mom fr all those appliances in the store-- that you could buy. meanwhile, mom has to go out and work because the family can't survive unless she does. she's not doing less work. she now has two jobs--the one in the house and the one in the labor force. it's absurd. and, by the way, that's not the fault of the technology, which really was liberating, but it's the fault of a system that has to keep making money whether the technology's advanced or not and drives people, because that's how it makes money. last thing about this system before i talk about a solution-- not only does it produce crises and the terrible waste and damage, not onlyoes it polarize unless people react,
and not only does it deny us the fruits of technical change, the fruits of all kinds of breakthroughs, but, even more, what it does to us as individuals needs to be understood. and that's a perfect transition to what i think the solution is. most production in the united states is done by large corporations. we are a society that celebrates small businesses. there's something very poignant about that. "small businesses," we are told, "are the backbone of america." no, they're not. big business is what runs this economy. small business is a long, old story. small business, we are told, creates 3 out of 4 jobs. quite true. small businesses also go out of business on a scale that is fantastic and loses 3 out of 4 jobs. see, that little detail is left out. a small business is
a very hard thing to survive. and the reason is it's dependent on big business from whom it buys many of its basic needs and they therefore control. so the big businesses are where the work and the basic employment and production is done in the united states. and how does a big business work? it's a remarkable institution. a tiny number of people make all the decisions. here's how it works-- the group is called major shareholders-- the handful of people who have big blocks of stock, because in a corporation, you get a vote for each share you own. it's not one person, one vote. it's how many shares you own. so, for example, if you own a million shares, you get a million votes. if your grandmother left you two shares, you get two votes. if your grandmother had no shares and you don't have any, you get no votes. so the major shareholders control the bulk of the decisions. and what's the most important
decision they make? they select the people who run the corporation. they're called the board of directors, usually 15 or 20 people. and they make all the decisions to produce; how to produce; where to produce; and what to do with the profits. all the basic decisions. the vast majority of people come to work monday to friday 9:00 to 5:00, and they do what? they make whatever that board of directors decides that company's going to make, and they make it in whatever way with whatever technology that board of directors decides working on whatever raw materials that board of directors presents to those workers. and the board of directors decides whether the workers are here in the united states or over there in india or wherever. and when the work is done and there are some profits, the board of directors decides what's to do with it. for example, to pay the top executives spectacular salaries. that's a decision they make.
or to move production to another country or whatever. they make that. the vast mass of the workers--a thousand in a small company, 100,000 in a big one, or in the case of really big ones, say, wal-mart, a million. a million people who come to work at wal-mart, and a group of 10, 15 people-- if you look at the board of directors, you'll see a stunning number of them have the name walton. but even if you didn't pay attention to that, a tiny group of people. now, for a country that defines itself as committed to democracy, there's something stunning here. democracy means that if you're affected by a decision, you get to participate in it, the idea being if a decision made by a mayor or a congressman or congresswoman or a senator or a president is something that affects us, which it obviously does, then we all
get to participate. "well, uh, let's see. in where you work, what they make affects your life." how they make it with this chemical or that, that affects your health, your life. whether they do it here or they fire you and do it in another country, you bet that affects your life. so what exactly is your participation in the decisions you have to live with the results of? answer--nothing. you come to work, and you do what you're told. and at the end of the day, you've poured your brains and your muscles into making something. and you know what you're supposed to do. and you all know because we all go to the same schools. at the end of the day, you leave there whatever it is you helped to make. and you go home. and if you forget and try to take with you when you go home one of those things you helped
to make, a few hours later there's a knock on the door and people in dark blue uniforms hurt you and take it back. because it's not yours. you made it. it's a very clear idea. you do not participate in controlling your own product. how do you square that with democracy? there is no way to do that. and so we conveniently as a society don't ask the question. don't think about it. that's the success of the business community and the wealthy who want to make sure we don't think about it because it is an impossible contradiction of the way we've organized things. and it has extraordinary effects. everyone who goes to work for a corporation feels on some level--consciously or unconsciously--their
powerlessness, their irrelevance to the decisions that affect them, including whether they have the job next week or not. that inculcates in people a fatalism, a lack of care, a feeling of ripped-off-ness. i'd like to remind everybody that there's an interesting admission of that in our culture because on the way home from almost every corporation, when the workers are finished with the day, they pass a bar or two, which invites them to come in after work to enjoy a happy hour, which is a very subtle way of reminding them what the quality is of the hours that precede arrival at the bar. those are the unhappy hours. and they're unhappy because you are a drudge. you're a drone. you're almost like a piece of machinery. and so you don't care
that much about your job. you're interested in how much it pays because your excitement is elsewhere, maybe with what you can buy with the money you get from working. but the job itself for most workers is purely a means to get money. and yet it's amazing, if you think about it, 5 out of 7 days for the major part of the day, you go to work. it's the most important part of your adult life. why isn't it made to be a learning experience, a joyous experience, an experience that develops you and develops your potential and develops your understanding? it ought to be. but you accept, don't you? we all do that it isn't, that all of that is subordinated to making money, and the people at the top think the best way to make money is to stick you in a little cubicle with a little computer and throw muzak at you until you go crazy.
that has very bad effects on human beings. and those are ramified in our culture. many of us think that there really isn't a lot of commitment to our democratic system, even in the little space we have for it, which is politics, because it's excluded from our economic system, in the way i just said. but we do have it in the community, sort of. and so we're kind of disappointed that half the american people don't bother to vote. and half of those who do bother to vote seem to be more interested in details, like whether they can have a gun in the back of their truck than in some of the larger issues that might affect them even more than the question of whether they can have a gun in the truck. their attitude towards politics is one of not caring that much, not learning that much. maybe going in and voting, but who knows? we're kind of disappointed.
our democracy seems formal. well, i got a thought for you-- if you deny people, 5 out of 7 days a week, any real say in something that really shapes their daily life, which is the conditions of work, you're basically teaching them that they're not decision makers, that that's somebody else's job. you train in every day. you understand all the decisions are left to people. you don't even know where they are. they sit in a boardroom a thousand miles away. so why are you gonna, then, get excited about politics, which looks to you more and more like the same thing? somebody far away makes a decision. you're supposed to get excited once a year, go into a little booth, move a little lever? you're gonna have some say? nah. you want politics to be real in the community, you have to make it real where people are, where their job depends, their income depends, most of their life is spent. otherwise, you can't blame them
for not being interested in politics when you've really trained them into not participating, denied them a participating role. here's another way it stunts human beings--we all have complicated and mixed capacities. in order to find out what you're really good at and what your contributions to society can be, you have to have a chance to see what you can do. and it doesn't even stay the same across your life. you have different capacities at different times. why should some people have all the control, the design of what's going on, the direction decisions and other people just do what they're told? if all you're doing is what you're told, you're not gonna develop your capacity to innovate, your capacity to redesign a process, to redirect a process. because you don't have any place to develop those skills. imagine how much innovation we could have if we really gave everybody a chance to learn--
and how the system works and how the production of this--whatever you help to make--how that's done if we gave you some training when you were growing up in the design. wow! we would all be different people because we wouldn't have divided the society into a tiny number of people who make all the decisions and therefore have to learn how to do that, and the rest of us who--"no point in learning that and no point in teaching that to you because you're never gonna do that." "you're just gonna be a barista at starbucks." and for that, the amount of directn and sills youeed are small. i don't mean to pick on starbucks. i enjoy picking on starbucks, but i don't mean to pick on starbucks. ok. what, then, is the solution? well, you can see from the logic of what i've done that it isn't blaming the banker for doing what bankers do, and it isn't
blaming workers for doing what they do. workers are told to enjoy the american dream. they are paid until the 1970s-- they're paid more every decade. it's remarkable, the american wage system. a hundred years before the 1970s, wages go up and americans could afford with a rising wage to have a higher standard of living, which is half the reason why millions of immigrants came from all over the world. in the 1970s, as i hope most of you know, real wages stopped rising in the united states and have never resumed. that was, of course, a crisis for the american worker, who had promised to himself, to herself, to his and her children the american dream--a home, a car, a vacation, a college education. all of it. what a torture to a population that has learned to believe that with every decade, you'll make more money and that'll allow you to have these better things and to give them to your children, and you promise it and you believe in yourself,
as you're capable of doing it, and suddenly the wages don't go up anymore. and it's not explained to people that the wages didn't go up anymore. they're just left without the wherewithal to achieve the american dream. and if you don't make it a national conversation and if you don't explain it to people why that happened, then americans blame themselves individually. "i didn't go to the right school." "i didn't take the right courses." "i didn't major in the right thing." "i didn't work hard enough." "i didn't please my boss," whatever. "it's me." and they turn inward and blame themselves with all the social consequences of that. and when that doesn't solve the problem, they do something very understandable over the last 35 years. they want to hold on to that dream. and if the wages don't pay for it, borrowing will. and so the american people go on a borrowing binge the likes of which no working class in the world has ever seen.
they borrow everything. we had to invent the credit card for mass consumption starting in the 1970s. that's when master card, visa, all that got going. so everybody could borrow. we now have a new generation we never saw before-- college students who come out of college with 100,000 or more in debt only to discover that we have such a collapsed economic system that they either will not get a job or never get a job to ever get out of that debt. nobody prepared them for this. and they're very upset. these are systemic problems. we're gonna blame the college student for borrowing too much? we're going to blame that worker for trying to hold on to what every advertisement told him or her was the nature of a successful life? how cruel can you be. this system isn't organized very well. and it's producing lots of dysfunctional people,
everyone in this room, of course, excepted. but out there. so what, what do you do if the system doesn't work? well, you have to take a very big step. you have to ask yourself, what are the alternatives? is there another system? and americans have been taught for a long time not to go there because that gets you into a dangerous area. but tonight, safe as we are in this place, we're gonna go. and i may surprise you as to where i think we ought to go. but i've given you a lot of hints along the way, and now you'll see. i think we ought to bring democracy to the workplace, to bring it where it has never been brought before. and here's how it would work. and this is not a complex
idea. and it isn't a new idea. and i'm not the only one who thinks it or pushes for it. it's an old idea, as you'll see. but here's the idea. let's organize our enterprises, big and small, in a new and different way. let's democratize them. let's arrange that all of the people who come to work together make decisions. no more major shareholders, no more board of directors. the workers themselves become their own board of directors. here's a sketch just to have an idea in your mind. monday to thursday, you come to work. you do what you always did. friday you come to work, you don't do what you always did. together with all the other workers, you have meetings all
day on friday. and together in those meetings--one worker, one vote--you decide what to produce, how to produce, where to produce, and what to do with the profits your work has produced. another name for this that's old in american history--and even older in other countries--is called cooperative, community enterprise. lots of words. i really don't care what word you use. but i want to stress the democracy at work theme because we're a country that's kind of obsessed about democracy. so let's use that. let's bring democracy to the place where most of us adults spend most of our time most of our lives. seems reasonable if you're committed to democracy to institute it where you are most of the time. otherwise, what does your commitment amount to? wow! think about it.
i'm now gonna take you through some of the implications of doing this because i want you to see potential, where it is. so first... if the board of directors is the workers themselves, then one of the decisions they have to make, which is the decision made by board of directors now, is how much different people get paid. aha! in capitalist countries, like our own, the board of directors decides what to pay the top managers. and as i've already mentioned to you over the last 30 years, they have been extraordinarily generous, so that top managers of major american corporations get salaries in the millions or tens of millions of dollars every year. that's normal. well, if you're upset, as most
americans who pay attention to this are, that the gap between rich and poor has become more extreme and that that poses all kinds of dangerous social problems and tensions, then i have news for you. perhaps the single biggest factor accounting for the growing divide in the united states are the immense salaries paid by corporations to their top executives. if the workers collectively decided what everybody got, what can you imagine might happen? would the workers collectively give a tiny number of themselves huge salaries and everybody else would have to scramble and wouldn't have enough? would the majority of workers vote to hobble themselves in that way? nah, not likely. kind of, "gosh, not at all. not gonna happen." so if you're concerned, as many americans are,
to do something about the gap between rich and poor in t unitedtates,ere' a really werful w to get that--ke it a mocratic decisio that wod allow workers to pay some people more than others if they thought that's appropriate. but my guess is the ratio would be 3:1 or 4:1 or 5:1, not 300:1 or 400:1. and, you know, we have a hint-- an actual practical example to show this. right now in the world, the single most successful enterprise that has converted to a democracy at work system exists in the north of spain. some of you may know about it. it's based in a little community, a little city called mondragon in the basque region, just below the pyrenees mountains in the north of spain. this is a company that has been growing since its founding in the mid-1950s.
so it's a good half-century old. it started with 6 workers. it's a system of cooperatives. it has grown quite effectively. it now has over 100,000 employees. it's the seventh-largest enterprise in all of spain. and it's just a set of cooperatives that coordinate with one another. in each of them, the workers are their own board of directors. and, guess what, the workers made a rule-- the highest paid person in the co-ops, in any of them, doesn't get more than 6 1/2 times what the lowest-paid worker does. so there is no such enormous gap between rich and poor. and if you travel in the north of spain, where this company is the largest company in that part of spain, you will see that their cities and towns--i was there this summer--you can see right away.
you don't have the slum over here and the fancy neigh-- you don't have any of that. there are people with more and less, but it's, the gap is completely different. it's a part of the world in which you could say something like the following and not be lying through your teeth: "everybody's in the middle class." they really did that. but if you want that, this is a way to get it. here's a second thought: you think if the workers made the decisions collectively, they would decide to close the factory or the office where they're working and open one in china, thereby destroying their jobs, their incomes, and the community? ehh, i would guess not. not a big chance of that. you know what they would do instead? they would say, "whatever problems our company
has"--like all companies, they have problems--one of the solutions that are not available is leaving. you can't do that. and, by the way, there's nothing new about this. there used to be a time not so long ago here in the united states that companies said, "the only way we can survive--we have to be able to compete--is we need to be able to hire these 6 year olds." it's called child labor. "and if you don't let us do it, well, then the british will allow it to be done. they'll do it and the spanish and the french. we'll never be able to compete. and you must..." and at a certain point, the american people looked at the conditions of 6 year olds-- and we had that working-- and said, "we understand you have competitive problems. we understand you have the... but that you can't do. you can't have kids, and you can't do what you're doing to them. that's out. you have to find another way." now, does that make sense? why exactly didn't we say to them, "uh, you have problems.
we understand. we'll try to help you. but one option you don't have is you can get up and leave. you can't tell your workers on friday, 'don't come in on monday. we're moving to shanghai.' mm-mm. not available. you lose. find another way. get a better machine. reorganize your production pro-- produce something else. 50,000 things you can do to try to save your situation, but that you can't do. and you know why? because it destroys people's lives and it destroys the community. kind of what it does to the children, which is why we don't let you do that. and we don't let you make one worker work 18 hours. wouldn't let you do that either. it'd be nice if you could, but we don't let you do that." well, if workers made the decision, they would long ago have ruled out destroying themselves and their jobs. and so the whole question of losing your producer facilities to other countries would not have happened.
here's another example. suppose the workers run their own factories. we have a little acronym, wsde. it's called worker's self-directed enterprise. to summarize what we're talking about, the workers make their decisions collectively. they are their own board of directors. let's turn to the question of using a technology that is difficult or dangerous-- a bad chemical, a very noisy piece of equipment, something that pollutes the water or that throws something out of your smokestack that is not good for people to breathe. well, in most american corporations and in most international corporations, the board of directors sits in new york or london or paris or something like that and they make a decision based on what's best for the bottom line. that's their job. and if that means a technology that's toxic for people, "well, we'll put a filter on the smokestack," or, "we'll
throw something in the water to neutralize the acid," or whatever it is. but if the workers made the decision, you think they would do that? it's them--they're the ones who have to breathe in the air, their children. it's their neighbors. it's their community. they're not going to do it. they're going to be much more vigilant about the environment because they live in it. they're not a distant decision maker. they're an on-the-spot. and that's one of the old ideas about democracy. you make the decision because you live with the results. so i think we would have had a different distribution of income and wealth in this country; we would have had a very different relationship to keeping the jobs and the production here; and we would have had a very different relationship to the environment. or to make a long story short-- i could go on with examples all night--we would have had a different history as a nation. we'd look different; we'd feel different; we'd relate to one
another differently. and guess what. if the gap between rich and poor was narrowed, that wouldn't, then, allow the rich to buy the political system the way they do now, would it? so it'd make a contribution there, too. wow! sounds interesting. let me take it another step. is this feasible? i know some of you may be entranced by the idea but be wondering to yourself, "well, you know, how do you do this?" well, i've already told you about mondragon, which is a very successful corporation composed of hundreds of these co-ops that coordinate with each other. so they do prove it can be done. plus, there are co-ops all over the place. not very far from here around san francisco are a group of bakeries-- arizmendi bakeries. maybe some of you know them. they're set up like that. there's a cab company in
san francisco--yellow cabs. 33333 that you call there, that's a co-op. america's full of them. people have figured out that this is an interesting way to organize businesses. so there really is no problem in doing this. people have figured that out. "well," you might, say, "yes, the examples, like the arizmendi bakery or the yellow cab company, those are small enterprises." you're right. they're small. but let me remind you of something historically-- the origins of capitalism out of feudalism, that was always small businesses. in the midst of big feudal landed plantations, little capitalists grew up. a little capitalist with 3 workers or 6 workers. that's how it started-- in the cities of europe. out of feudalism, the system that preceded, capitalism was
born in little enterprise-- that's typically how this is done. new systems emerge beginning with small ones. can they become large? again, i refer you to mondragon. from 6 workers in 1956 to over 100,000 now. they managed it. they're very big. they're very successful. well, the second question you might have is, where are they gonna get the money? how could workers start a collective business? with what? this is an interesting problem. where would the money come from? and guess what. there are solutions to that, too, because this isn't a new idea. and there's lots of examples. i'm just going to give you one to tantalize you with the possibilities. but i'm going to choose one that comes from the real world just so you know people have tried it and done it. this time, i'm referring to
something called the marcora law, which is a law in italy, passed in 1985. here's what this law does-- what an interesting idea, which in italy it is still on the books. if you become unemployed in italy, you have a choice: you can either get your weekly unemployment check the way a person in the united states does--and in italy, it runs 2-3 years that you're eligible--or you have a second option, which we don't have in the united states. the italian government will give you your entire 2-3 years of weekly unemployment checks up front as a lump sum on one condition--you must have at least 10 other workers, unemployed like you, who make the same decision. and the money, the lump sum, has
to be used as the capital to start a collective business run by the workers. what? did i make this up? no. go google it. "marcora law." you'll read all about it. the italian trade unions and the italian socialist and communist parties-- surprise--pushed for this. wow. and it's been a big success. it has helped launch hundreds of cooperative enterprises in italy, which has a long tradition of this sort of thing. and guess what. workers-- surprise--choose rather than being unemployed and collecting a check, which is a depressing condition to be in, to rather have a business that they can devote themselves to. they put much more of themselves in it. and guess what. from a social point of view, which is, kind of, better, 10 workers collecting
a weekly check or 10 workers building a whole new business that they really care about? and which they'd better care about, because if that fails, they can't go back on unemployment. they've gotten their unemployment. a very interesting idea. and the italian government provides assistance along the way--technical assistance and so on--and subsidized loans. and are there precedents for the government helping in other ways? of course there are. here in the united states, for example, we have a longstanding government entity called the small business administration, the sba. here's the idea: in the united states-- it's been going on for decades-- small business complained that there wasn't a level playing field. when they competed with big businesses, they had disadvantages. and they wanted to have a better shot at succeeding as a small business, so they wanted the government to set aside money and support to help small businesses--not available to big ones--to help them compete more success...
and we have that. the small business administration gives grants, makes loans at a subsidized rate to help small-- the idea being, america's better off if it has more small businesses than would otherwise be the case. we do the same thing with minority-owned businesses for the obvious reason. here's a thought: a worker's self-directed business administration. why? because the american government would like to see these kinds of enterprises develop and grow. and why that? here's a democratic thought for you: if the government supported that, helped to develop cooperative enterprises everywhere, then all americans would have freedom of choice in a way they've never had it before. we would all, as young people or old people, be able to compare what it's like to work in a top-down hierarchical capitalist enterprise--because they're all around us--but for the first time, we would have a choice. there'd be lots of cooperative
enterprises. they'd be as common as anything around the neighborhood. and you could ask people--your friends and neighbors who work there--what that's like. you could even intern for a summer or try it for a while and see whether the kind of job you'd have, if you're not just a worker, but also a director with other people that are in the same boat with you, might be a much more interesting, much more self-developing, much more exciting, much more democratic workplace. and americans could choose it. and the rest of us could even ave the following--we could have a law that says on a piece of clothing or an appliance or whatever it is you buy in a store--the label no longer simply says "made in china." but we could require the label to say, "does this come out of a capitalist top-down hierarchical enterprise," whatever words we use, "or does it come out of a cooperative enterprise?" and we could see which one makes better products, and we could support what we believe in by buying that.
it's a little bit of a play on the fair-traded idea that some of you know of. just imagine what could happen if you thought like this, how different our economic system would be if we took seriously the idea of democracy at work, and what it could do to get us out of the inequalities we suffer in this society, the loss of jobs and income, the disappearance of our "middle" class that everybody whines about, the destruction of our environment. last point. and then we'll open up to some questions. there has, of course, been a debate in the last hundred years between capitalism, the system we've been criticizing, and an alternative.
and that alternative had various names, socialism and communism the most famous. and i'm not here to give a long discourse about that, but we have to face that. what was the hallmark of the socialist and communist systems, whether they were in china or cuba, russia and so forth? two things. one--socialism meant that the property, the productive property--tools, equipment, factories, land--was no longer to be private property owned by individuals but rather the property of the whole people run and administered by the state. so from private property to social property. and the second big difference between capitalism and these alternatives was that in capitalism, you used the market as your mechanism of distributing things, whereas in these societies, governments planned the distribution, decided who would get what
and so forth. so the differences between the two systems were understood to be private versus social property, markets versus planning. what always struck me is interesting--whatever you thought about that alternative was that nobody said a word in this great hundred-year struggle between the two about the organization of the enterprise. it's as if it didn't matter. it's as if in capitalism, you had a bunch of workers going to work every day. then there was a revolution. the flags changed their color. and after the revolution, the workers went to work again, but instead of it being a board of directors selected by the major shareholders, it was a board of commissars selected by the communist party and the government, and that the actual difference it made to the worker, who was sitting up there doing it, eh, wasn't all that exciting. i think there's a point to that criticism of the socialist and communist alternative, but
it's a criticism that this idea of democracy at work gets at. because if the workers are the ones who make the decisions, then it's the workers who provide the state with whatever resources it gets. it's those workers who pay the taxes, either as individuals or as the directors of their corporations. the people at the base will finally control the resources of the society. and the state will have to be accountable to them, not just because they're the voters but because they're where the wealth is; they're where the money is; they're where the resources are. and instead of having fancy ideas about how to democratize the old examples of socialism and communism, this is a practical way to institutionalize the power at the base of the mass of people. closing point--whether or not
i've persuaded you, let me invite you to take a look at this book. and the point of this book, which is new, is simply to make the best case i can, which, you know, an hour of conversation doesn't allow me to do, but the best case i can for what i've been talking about. but the real reason to pursue these ideas are two, two real reasons. one--you will not hear a word about them from the established voices of this culture. not from the republicans, not from the democrats. they won't make a criticism of the system because they're cheerleaders for the system. whatever their disagreements, it's never about this system. if you want to think critically, you have to go somewhere else. and these kinds of ideas open up the space of a change of thinking about the system, not being trapped within one way of
thinking how to organize an economic society. and the second reason is that this opens a vista for a whole different kind of life. imagine what it would mean if all workers now had a new definition. you're not just a person who does this thing on the assembly line or does this thing in the office or has this job in the store. yeah, you have a particular function, but you're also part of the decision-making organization of the work. you're gonna have whole parts of your brain and personality being developed on the job that were never utilized before, that were never developed before. we're gonna have a whole new kind of human being coming out of this experience. we're going to have to reorganize our educational system. we're not going to have elite schools for a handful of people who run everything and then the community college for everybody else. uh-uh. we're now going to have to give
proper education, finally, to everybody because that's what the job requires. it's a whole new way of organizing life. we do not have to be prisoners and victims of a system that doesn't work well. we have options. all we have to do is learn from the past experiences of co-ops of all kinds how to build on that to make it possible to change things. and people are doing it around the world and around the united states. you don't have to feel alone. they used to do it as an interesting experience. many of them did it as a religious commitment. many of the communes and collective--come out of all the religious communities. but we now have a new and additional reason-- capitalism, like every other economic system we've had,
was born, evolved, and eventually dies, like everything else. it may be difficult to understand and scary to see. we've had a run with capitalism for a while--for 200, 300 years, but two major collapses in 75 years. the vast waste of people and resources that every one of these crises produces. and everything else i've talked about tonight ought to be more than enough to at least allow us finally to discuss, to debate, to explore alternatives that might allow us to live a lot better lives than we do now. there's a new political party in germany that has a remarkable slogan. and it, by the way, sits in the german parliament with 12% of the vote in germany. one out of 8 germans
votes for this party. the slogan of this party is, "germany can do better than capitalism." thank you very much for your attention. [applause] >> i'm curious--your thoughts on the role unions might play, either as they exist today or in some other...form, other things that come to mind, like maybe, you know, like some more old- fashioned guild system where the unions are simply trade- based or other ones that operate across industry, like--like i'm an seiu member, for example, right? or are they just sort of anachronistic, sort of workers' vanguard spectacles that we can just kind of throw aside? >> good. wonderful question. let me try to answer. and again, rather than my spinning out my own thoughts about that,
let me start from a concrete example. the steelworkers union here in the united states, one of the largest unions in the afl-cio, here, stunned the world of american labor two years ago when they issued a press release announcing the formal alliance-- i'll use their words--the formal alliance between the steelworkers union of the united states, which--i don't know how many members it has, but in the hundreds of thousands, big union--with mondragon, the corporate--that huge, successful worker's self-directed enterprise in spain. and i remember many of us were taken aback. "what an interesting idea. an alliance." what did it mean? well, the details were hard to come by. it seems as though there was discussion, obviously, between them. they issued a joint press release and had a press conference. but it's hard to tell, so i'm now going to imagine where this might go. i'm
not saying that's where they're taking it. i don't know exactly where they're going to take it, or even whether they're going to take it somewhere, but here's what i would do. imagine a trade union movement with a completely different strategic idea from what it has typically been. unions have typically been organizations who make it possible for workers, instead of bargaining individually with the employer, to get particular conditions of work. the union bargains for the workers collectively. collective bargaining. and so it enters into a negotiation with an employer to get a contract that covers all the workers in a workplace. what unions do. and they try to get better wages than the workers have been able to get, better working conditions, and so forth. well, imagine now the following: the union sits down and bargains for the workers, but it esn'just say"hey,
we would like higher wages or better working conditions, and if you don't do that, we may strike" and all the usual that i think you understand. but now they have a new weapon, a new chip, if you might say, to play. "if you don't come to a reasonable agreement with us about wages or working conditions, we have another plan. we may withdraw the workers from your plant and set up our own." what? that's never happened before. what an idea. indeed, the union might begin to develop small enterprises that do things like a company that they're bargaining with, just to make it a little more realistic, so that when they say that to the employer, the employer has a new problem.
imagine an employer saying, "i want these and these concessions from you workers, or else i'm leaving the country." it happens every day in the united states. and the union, what is it going to do? it's afraid of losing the job, so it gives away a benefit program or a wage diss or something, medical coverage, in order to hold on to the job. it's very understandable. yeah, but suppose a union had another option. "ok. we want you not to leave, and we don't want to give you a concession." "but we're telling you, if you do not accept--you leave? we're going to take every one of the workers you fire, and we're going to set up a factory right here. right here. we may even take over the one you have abandoned, buy it from you, and we're going to go around the united states and we're going to explain to people that you went to china. and they can go ahead and buy it from you, or they can
buy it from us--the workers you abandoned that are here and that are asking you, as a fellow american, to support us." ooh. that company might think a little longer before it takes off for china because it's got a new problem. it might not want to do that. it might not want to take that risk. it might not want to face that kind of competition. it's a whole new ball game. it might also allow unions to do something for workers that they can't do now. when workers are unemployed who used to be members of such-and-such a local or such-and-such a union, they're now unemployed. they go get an unemployment check. suppose the unions areno, there's something else we can do for you. we can help you. we can bring in specialists. we can help you set up, under the auspices of the union, an enterprise that will sve this mmunity all
kis of way and we ll go to the counity beuse we're based in it and urge peoplto buy from this co-op rather than from where they've been buying. we can begin to develop a network." that's what mondragon did. that's how they grew that way. everybody helped everybody else. i don't know what all the benefits would be, but let me make a suggestion. a labor movement that has been declining without interruption for 50 years better come up with something new because what it's been doing hasn't worked. i'm not being disrespectful. i mean, i don't have the numbers. the graph that i teach in my classes of what has happened to unions is unambiguous. the line goes from here and it keeps going down. it's long overdue to change the strategica, and here's an idea. and wouldn't it be interesting if unions became known in america not just for doing the work for collective bargaining, for their members in
such-and-such an industry, but part of a social movement to rebuild a new society around a concept of democracy at work, becoming the champions for a whole new way of living and working. would give the unions a role in society that they once had, as part of a better world for people, a whole new set of opportunities going far beyond the job and the conditions of the particular place where the union was born. what an exciting new vista for a labor movement which really badly needs new ideas and new--so i was very excited by what the steelworkers and mondragon making an alliance might mean. but it'll take many people pushing in that direction to realize the potential. sir? >> because of your interview with--on "charlie rose"--
i'm fascinated, first of all. i watch him almost every evening, so i get a pretty good sense of the way he responds to different people. he seemed to be a little bit uncomfortable... >> yeah. [scattered laughter] >> with some of the questions that he was trying to elicit answers, so i'd like your impression of that. second... >> heh heh! >> i'm fascinated by this concept of mondragon because i think that, you know, clearly we have a problem that we do not have an answer for. but at the same time, i look at this and i think in terms of the capital formation. so one of the things that'd be helpful for me to understand in the context of the employee, since 1956, what did they do to prepare themselves for after they retired? was there a capital formation within the company
itself, and within that context, because of their success, have there been other companies or other organizations within the spanish culture that have fostered like-minded...companies to go in competition, and what is the result of that? so that's 3. heh heh! >> yeah, real quick because we're running out of time. um... charlie rose's, uh...team came to us. we did not solicit the opportunity. they came in, and i think that's very significant. i think that "charlie rose," ike othemajor ne outlets d commenry sho like th, are beginning to recognize that a part of the conversation that folks like us were kind of kept
from, public conversation, where now-o make it very simple, the critique of capitalism is now part of the national conversation, and that wasn't true for most of the last 50 years, one of the points i tried to make on that program. so i take it as an enormously courageous thing that he did because he knew he was kind of pushing the envelope there, invite david harvey and myself. and i thought he handled it pretty well. he was very straight with us and he was partly uncomfortable because there was supposed to be a third person there who never showed up, and that always throws a-- you know, he had gotten prepared for a 3-way, and that chair had to be removed, for the tv audience shouldn't see. i understand mr. eastwood does that, but we can't do that. [scattered laughter] so there's no--the chair had to be removed and he was a little shaken by that. also, if you've
ever been in one of these shows, it's a collective hysteria. i mean, it has a logic to it, but there's all these people running around and these lights and cameras. it's--and we're all covered with pounds of makeup and it's very--it's a stressful--i mean, he's used to it, but it's a stressful situation. but i was pleased. i thought that really wen prettyell and at we goa lot of feedback fr it. i keep getting, like you, people who have seen it and talked about it, so that's very impressive to me. and i feel grateful that i had an opportunity to talk. mondragon understood this problem long ago. when you're as big as they are, they developed a number of specialized enterprises. for example, they have their own bank and so they handle all their banking, and that bank actually lends outside to non-mondragon entities as well. and they also set up retirement homes, and the bank runs its own retirement program for all
workers. so a portion of the net revenue of every enterprise is siphoned off, put into this thing, which it also, then, uses as seed money for more new co-ops, which then have to repay, and that builds up the fund for retirement. so if you work at mondragon, not only is your job guaranteed, so is your retirement for the rest of your life. and they have a growing retirement industry because they're so big. they have all these people who are--who need that when they reach 60, whatever it is. little younger than it is here--62, i think. and so they have all of that. i really do urge you--and i'm on the last point--are their people learning? they have a whole apparatus that does nothing but run courses in what they do. they have something called the mondragon university, has 4 different campuses. this is an enormous operation. when you visit them, you think you're walking into an amazing, large corporate headquarters because that's what it is. and they have
lots of buildings in various towns, and as i say, i went there and i was taken under the wing of a professor at one of their mondragon--that's what it's called, mondragon university. and he happened to be an american who went over there and he teaches business methods for co-ops. that's his specialty, is to help people from around the world who come there from all over the world. you can come for a day, you can come for weeklong seminars, all kinds of programs to teach exactly what they've done, but with an awareness that in each different country and in each different region, there will be the local customs and culture that have to be taken into account. and they can only do so much, but it's a very elaborate proselytizing, if you like, but all within the university kind of framework, a very--and very beautiful seminar rooms which we were taken to and all the latest audio-visual to help teach all of this stuff, and so they're
very--a very serious operation and very successful. that's why--and you can go. i mean, you just have to go in advance. you get in touch with them and you can come there, and they'll take you through and answer your questions. very good english. you know, they make sure to teach the different languages that they have, as europeans. very sophisticated operation. i was not ready for that. the corporate headquarters looked, you know, with manicured lawns and fountains and all of that stuff, you know? it looks like a--like what it is, a very successful corporation. they're very careful to avoid politics. i asked about that. "we keep away from spanish politics." they are clearly left-wingers. that's very obvious. but they're very afraid of the--they don't want to become part of the struggles among the parties, so they're very--and every government now needs them. every spanish government needs them. i should mention, if you're in--very
briefly that there are special conditions. the beginning of this thing was--the man's name was arizmendi. that's why the name of the bakeries in san francisco is in honor of a catholic priest, father arizmendi, who began this. so already you notice something unusual because this co-op was started by a catholic priest. this is a--spain is a very catholic country. i mean, it's a catholic country squared. i mean, you know, it's like ireland or poland. i mean, they take that very seriously there, which is very different from france where--i know from my family that--catholicism in my family, and they are nominally catholic. it's a joke. i mean, the priest is always the butt of a funny story, is an idiot, and the way the catholic church is viewed by catholics in france, by many, is clownish. it has to do with the french revolution. spain is not like that, so it's very serious so that it got protection in the early years
because it was a project of the roman catholic church, and that gave them--plus, this is a part of spain that is its own ethnic group. it's called basque. b-a-s-q-u-e. basque. they have their own language. i'm good at languages. i couldn't understand a word of it. and they speak it; it's not a language for festivals. it's a language of every day for many villages in this--it's a mountainous area. so they have an ethnic uniqueness, they're roman catholic, and the church protected, in a sense. they couldn't be attacked quite so easily. it wn't if the communist party did this or something like that. it was the church. and finally, there's a long history of the basques not being very comfortable within spain, so they demand independence, they had their own military. there were times when the spanish government tried to control them, but it's a hilly country and they had guerrilla,
basically. so the spanish government is very eager not to have fights with these people because they fight back, so between the church and their own language and customs and their willingness to fight, they had certain privileges, if you like, special conditions that helped make that possible there. that's true. ma'am, i think you were going. >> what role does competition play here? do the co-ops compete with each other? do they compete against the regular corporations, or what keeps them from becoming cutthroat in order to win? >> good question. again, i'm going to use a concrete example rather than a hypothetical. i'm going to use mondragon because it is a very rich source. and there are loads of books and articles on mondragon, including on our website, democracyatwork.info, where we gather all this material, all of which is available to you at your leisure and no cost and
so on. here's how mondragon has done it. mondragon's first commitment is to preserve jobs. it's very interesting. when you ask them, "what is your bottom line?" the answer is jobs. so if, for example, and i'll take an example from them. one of their successful production lines is the fagor. f-a-g-o-r. i's frly wellnown in rope and ound theorld. it oduces washing machines, appliances like that. and the fagor washing machine company has suffered from the international crisis like everybody else, and so the demand for these washing machines has fallen. so they had about 2,500 workers in the town of mondragon, at this factory, and they couldn't use 600 or 700 of them that just--there wasn't a demand for it. so the question is, what do you do? and they
have a two-step answer. first answer: "we are going to share the pain." in other words, if you don't need 600 or 700 workers, the other way of saying that is "you don't need as many hours of labor because there's no point in producing the machines you can't sell." but the question is, why would you want to impose the need to cut back on an all-or-nothing basis? why would a person either be employed or unemployed? because if what you want is x-hundred hours less labor, then it could be that everybody does two hours a week less. that would be what's called sharing the burden of unemployment. so the first rule they have is, you never impose the unemployment exclusively on a subset of people. that is fundamentally unjust and creates
terrible tensions inside the union--if any of you are members of union, you know this--between the workers who are bitter that they lost everything, particularly when many employers will then impose overtime on the workers still working, rather than bring back somebody who's unemployed. so that's the first rule. second rule is, if there are workers that really are redundant because nothing more can be done in this area, or that we've got to a limit of how much we can share the unemployment, then we will find work for those people in another co-op because the mondragon is a parent company of hundreds of co-ops, and they do that. they're very proud that in the current climate of spain-- for those of you that are not familiar with it, spain is now the worst economic downturn of modern spanish history, the worst in europe, 25% unemployment. the unemployment rate in spain today is what it was at the
worst of the depression of the 1930s. young people between the ages of 18 and 30 have a 50% unemploymt. halff them re not working, cannot find work. it's a--but not in mondragon. mondragon hasn't fired anybody. between the sharing of the unemployment and finding--moving workers around--because that's part of what makes them one company--they have held on. they're becoming wild--more popular than ever because they've been able to do that. they have another rule, and that rule is, whenever a member co-op buys anything, if they can get a better machine or whatever they're buying or a cheaper one outside the co-op, they are told to do it. "we have to be competitive, because otherwise we will die." that's their recognition that they live in a capitalist world and they have to be able to compete, and so they do. the fagor company--it's
like a--it's a bigger building than this--i toured it this summer. it's actually like a football field, but, you know, inside like a big airplane hangar, and it has one huge machine--because this is highly automated--and that machine is german. comes from germany, from a german capitalist enterprise which makes this kind of machine that they use. and we asked them, "well, why didn't you buy it from one of your own?" and the answer is the germans make a better machine. it's a better deal, and that's the rule. "so we have to succeed in a capitalist world, but we can do it"--and this, perhaps, the most interesting thing--"because there's all kinds of advantages we have that a capitalist enterprise doesn't." and they gave me an example. number one, if you're a capitalist enterprise, the price you charge for something has to cover your labor costs, your material costs, and all--like that, but it also has to cover something else: the profits you pay out to your shareholders. so with a big
grin on their face, they say, "we don't have any of those. we don't have to charge that kind of price. we're not a profit-driven enterprise, so we can bring our price down because we don't have to make a profit." they also say, "we don't pay our top executives a wild amount of money, and so we don't have to have a higher price to bring in the revenue that pays these people these outlandish salaries. so we have--we can do something that they can't do." second argument: when every worker is a director and every worker understands the problems of competition, every worker is constantly engaged. every worker is looking for a way to save a buck, to cut a corner, to figure out a way of doing things better, and you're given a lot of recognition and celebration if you come up with a cost-saving. a worker in a capitalist enterprise isn't
thinking about that. he's thinking about happy hour. [audience chuckles] but it's very important because the everyday flood of technical innovation is much more important than the occasional big breakthrough by the scientist. it's all those little things that are cared for by people--and this an old american idea, you know? it's the old idea: if you're invested in it, if it's your little business, if it's your home, you take care of it better than if it isn't. if it's your business in the fullest sense of the word, you have more. then he gave another example. he says, "you know, we are rooted in the community. when something is wrong at the factory, every worker goes and tries to figure out whether the neighborhood they lived, there's somebody who knows something about that who can maybe solve that problem, or someone who's had a similar problem in their line of work. we bring in the entire community because it's all of us. we're not--to use a modern term, we're not alienated from the
workplace the way a worker in capitalism is, and so we have a whole raft of these advantages that give us a chance to out-compete a capitalist on many occasions." and mondragon is, again, a paradigm case. they are the seventh-biggest corporation in spain. they have out-competed all kinds of capitalist enterprises. by the way, just to give you an idea that might surprise you, mondragon has partners, people--enterprises in other countries that admire what they do in certain areas and partner with them. they have labs to develop new techniques. i'll give you the name of two partners you'll recognize: general motors and microsoft. th could hp each oer. microft gets me of th chnologal stuffhat mondran is ahe, and
mondragon gets from microso. might rprise y. so th're quitable. th'rquite confidenthey canompete. gin half ahance, ty can coete. ariendi bakies are doing fine in san francisco, and so is the yellow cab company, and so are many, many others. in amherst, massachusetts-- because i taught most of my adult life as a professor at the university of massachusetts-- there's a little copy shop that was set up 25 years agoalled colctive coes--hintand ty are a rker co- and they've been nderfuly succsful, anone of t reass is theappeal tthe univerty. theyse lots udents apart-timjobs, an ty cultived a rutation nd they're wilng to gon extrmile for studenwho' mmed up d needs mething 3:00 in e morn--ey do so this that ctivate a elationip withhe commuty,
and thy out-coeted kio, things like that, and they were able to do that. and, again, i understand these are isolated, small examples, but i want to remind you capitalism comes into the world, beginning with isolated, small examples, and those have to be struggled over and reproduced and grown, and then something else is possible. another way to put this, and it goes back to your question about the unions, i like to use a parallel with slavery. there are two ways to react to slavery, and you always see whenever there's a struggle against slavery, as there was in this country in the 19th century with our slavery in the southern states. one response to slavery, of people who are critical of it, is to work very hard to improve the conditions of slaves. feed them better, clothe them better, don't allow their families to be ripped
apart in the slave market. all those things we understand. and the movement, the critical movement against slavery all over the united states, including the south, often took the form of a desire to improve the condition of the slaves. but then there was always another wing of the criticism of slavery: the abolitionists who looked at the first group and said, "are you kidding? the problem isn't that they're not well-fed or well-clothed or--the problem is that they're slaves. and even if we had a big struggle and even if we were successful in improving the conditions of the slaves, as long as they're still slaves, it's always possible for the master to take back whatever improvements in the conditions you were able to extract from him. the way to break out is to end the institution of slavery." and there was a big struggle in the united states between these two groups. in the end, lincoln
went and abolished slavery. well, it's really the same issue now, isn't it? either we work real hard to improve the conditions of working people-- their wages, their salaries, their benefits--or we say, "wait a minute. the problem isn't the conditions. the problem is that they're an employee of somebody else who's the employer. and even if we get the benefits, the employer can and will take them away." i already did that 40 minutes ago when i explained to you that what was won by workers in a reform movement in the 1930s--higher taxes on the rich, social security, unemployment, government jobs-- all of that was then taken away. you can't leave it, then, that way. the first time you try this
and it's taken away...call it a learning experience. but if all that is done now is to do it again, then it isn't "shame on them for taking it back"; it's "shame on us for not having learned the lesson." that's why having the alternative, which can succeed competitively, is crucial to opening up the space to think a little more ambitiouy than ather rou of reformist improvements that will be taken away. that's a key part of what this movement is about. other questions? please. >> so what is the new party in germany doing? how is it different than the communist and socialist parties that are all over europe, and does it have anything to do with co-ops? >> yes. the name of the party in germany is called the die linke. "die" is "the," and
"linke" is the german word for "left." they didn't want there to be any ambiguity about where they were coming from, so they basically call themselves the left party, die linke, and it is a party that came together out of two other parties. first was the left wing of the social democratic party, the old established socialist party that has been in the government, has been the government. last leader of germany before angela merkel, the current leader, was a man named schroeder, and he was a member of the social democratic party in germany. the left wing under a very, very charismatic leader, which was important, a man named oskar lafontaine, withdrew from the socialist party in order--excuse me--to found this new party the die linke. the other part of the die linke is the party that used to be the dominant party in what was east germany. you know, the east
german and west german separation ended, and the two countries were unified early in the 1990s. so there's now one germany again, there aren't two, but in the east, which was a communist part of the eastern european block, that party was called the socialist unity party, sed, sozialistische einheitspartei, and that party dissolved, but large numbers of it moved also into this linke. so it's a coalition. in the eastern part--this is something americans tend not to know for reasons having to do with our newspapers and our media--in eastern europe, in eastern germany the mass of people still vote for that party. so that party runs a number of the regional governments. in germany, they don't call them states like we do, 50 states. they call them laender, lands. so many of the laender in eastern part of germany are governed by this die linke party now, and increasingly,
they've become powerful in the west. as i said, the last national election, they got 11.9% of the vote. 1 out of 8 germans votes for a party, one of whose slogans is "germany can do better than capitalism." i like to talk about that party not because it's the same as what we would do here in the united states, but it's an important lesson. the notion that a party could develop politically in a modern, highly industrialized, advanced country, which germany surely is, that is critical of capitalism, you don't have to imagine that it's maybe a possibility. there it is, and germany, by the way, is the number one economy in europe right now. its unemployment has gone down over the last 5 years, whereas almost everybody else's has gone up. germany was a strong economy before. it's much stronger now. it is really the center of the european--the
eurozone, the european common market. so in a relatively successful capitalist economy, the critique of capitalism has a very big resonance in a very large part of the society, and the resonance is magnified because of german law. and let me say a word about that, too. again, for american audiences, very important. under german law, every political party that gets more than 5% of the vote gets two things. one, you get seats in parliament. they do not have the american system of winner-take-all. if the republicans get 51% and the democrats get 49%, the republicans get it and vice versa. all european countries have what's called proportional representation. you get as many seats in the parliament as you get percentage vote in the population. the idea is if 20%
of the people believe what you believe as a party you should not just be able to run, but you should be able to participate in the making the laws. otherwise, those people aren't represented. it's a kind of idea of, i don't know, democracy. [laughter] because you're not gonna exclude 20% of the people, which you do if the winner takes all, and by the way, in the united states, we do that sometimes. some of the primaries of the two parties are--if you read that ron paul got x% and romney got y%, then they each get a certain number of delegates. that's proportional representation, and we've had that in elections in the united states, too, but we got rid of it. the europeans have it. so in germany when the die linke party got 12% of the vote, they get 12% of the seats in the parliament. so 12% of the people who are in the parliament are members of a party that believes that germany can do better than
capitalism. highly successful, capitalist economy produces a criticism, and if you get more than 5%, not only do you get your seats--and that's true in the laender, in the state legislatures, too--but you get something else. you get money from the government because the democratic idea in germany is if you get more than 5% of the people interested in what you have to say, then it is important that you have a platform in which to explain to people what your positions are, what your proposals are so that the population can make an informed vote, and so the government allocates money, which is given to the party for educational purposes to bring its view of what's going on to the population. the die linke therefore qualifies, and they get money from the german government. how much money? 80 million euros. that's a lot
of money. and they set up a foundation, which all parties that get 5% or more--and do you know what the name of their foundation is? the rosa luxemburg foundation. hmm. if any of you are not sure who that is, ask me, and i will explain it. rosa luxemburg, a revolutionary in german history. that's the name of their foundation, and they give money to people all over the world to study critical--concepts critical of capitalism. they just opened an office in new york city. they have offices in many countries around the world. they have opened an office for work here in the united states to meet with and exchange ideas of criticism of capitalism with interested americans. hullo! i can see from your faces you're interested. one more fact about germany. there's a law. every company that has more than 2,000 workers
employed must have 50% of the board of directors elected by the workers. that's the law in germany. they're the most successful capitalist country in europe, and they give more power to their workers than any other one. the notion that if you were to do that you would cripple the capitalist potential--uh-uh. it's the same silly argument that says, "gee. those europeans, they're just not doing real well because they have such a big social safety net," national health for everybody, basically free public higher education, and all the rest. germany has one of the most expansive programs of welfare for its people, and it's the most successful country. their unemployment is significantly lower than that in the united states, but on the other hand of course, for a german worker, like for most
european workers, being unemployed doesn't have the meaning it does here because since they all have a national health system you get your national health whether you have a job or not. when you lose your job, you do not lose your health insurance. you can't lose your health insurance. it's yours by right of citizenship, but i wouldn't want to go into that because i wouldn't want to get americans upset. [laughter] someone else was about to go--please. >> as a student, what role wouleducatioplay in e cooperate ethic,nd how cou we cultate coopative education for people instead of the competition that you see at places like stanford of which i'm a student? >> heh. ok. i was once a student at stanford myself, so i feel a certain amount of compassion and--with your suffering. excuse me. your education. [laughter] our education system would have
to radically alter like everying else in our culture. we're not talking about a marginal adjustment. we're talking about a basic change. production is how we live. what, we get up in the morning and have a cup of coffee? that's a product of labor. and we put on our clothing. those are products of work. and we get in the car. that's a product of work. work, production is central to literally every day, every minute of our lives, so if we reorganize that, we are gonna change everything else, and education would be an example. well, i said a little bit before. let me expand on it. we have a highly stratified, ranked education system, and since i'm a product of it in spades, let me use myself as an example, all right? as an undergraduate--i'm the child of immigrants. my parents are european, so i was born in the united states, but english is my third language. i spoke
french and german because my parents--my father was french, my mother was german. so as an immigrant, i came here as refugees. i had no money or anything else. so i go to school, i go to harvard as an undergraduate. then i go to stanford because there was a professor there i wanted to study with, and i got a master's degree, and then unfortunately this professor had a heart attack and died, and so i completed my education at yale. so here i am, harvard, stanford, and yale, by most american standards sort of a poster kid for elite education. that's what it is. it's elite education. it is designed for people not like me. i was one of those allowed to come in, and they've regretted it ever since. [laughter] allowed to come in on scholarsh--i had to have financial aid. my folks didn't have the money, et cetera, et cetera. i had to work all the time, that kind of thing, but it's an education--let me give you an example. as a freshman,
we had an orientation about 5 days before the semester began of my freshman year. we all came early, and we were gonna get oriented, and we sat--we were brought into a big room, and in those days, harvard was separate from radcliffe, which was sort of the female up-the-street school, and so they didn't meet with us for whatever the thinking in those days was. so it was all young men, and the president, whose name was nathan pusey--that was his name--president of harvard, welcomed us with the following speech, and it stuck in my mind. 18 years old at the time. he said, "look at that man on your left," and we all dutifully did that. "look at the man on your right." said, "one of them is going to be a captain of industry, and one of them is going to be a senator. that's where you are, and we're here to teach you how to run
the world." that's what he said! you know, you're 18 years old, your head is getting larger as the man talks because you're being given this sense of what's expected of you, what's in store for you, almost nigh what you're entitled to when you come here, and it produces a fundamental human quality that many of you have noticed in graduates of these institutions--arrogance, mind-bending arrogance of the sort that assumes that if you go to one of these schools something really magical happens to you. i can assure you it doesn't. if you have learned that when you see an advertisement for a bar of soap and the advertisement explains to you that if only you use this bar of soap overnight your sex life will be transformed, well, you all giggle, as you
are giggling now, because you understand th is an aempt to t you to buy the soap. you don't take seriously that it's gonna have that result, and if you did have that result, it probably wouldn't be because of the soap. you kind of figure that out. when harvard says to you that "something really extraordinary happens to"--it's like that thing with the soap. ok. all that would have to change. you could not have schools that train the people at the top versus schools that train the people in the middle and schools that train the people at the bottom, which is what we have. we don't admit it because it's a little awkward, but we all know that. we know that. we know it from the way budgets are allocated. we know it from the qualifications of the teachers. we know it from the quality of the textbook. we know it unless we really are committed to make-believe. we can't do that anymore, and it's
not out of some abstract idea. we've had generations of very good people trying to change our educational system by saying, "it's really not appropriate. we don't know what the skills of young people--we shouldn't segregate them this way. we shouldn't track them this way," but it goes nowhere. it's an endless effort of good people, but it never lasts even if they get it for a while. you have to make it an institutional requirement. if workers have to be able to run an enterprise, you're gonna have to teach them, too. you're gonna finally have to democratize the education process and not out of some abstract idea because, as many of you think i'm sure when i said this, when i said to you, "the workers will run it," you go to yourself, "my god. i can think of a worker down where i work. i don't want him to run. he doesn't know what he's doing." of course! how could he? why would he? why would she? nothing in their lives ever prepared them for this. their parents never gave
them the idea they would ever be in such a situation because they weren't. the teachers didn't likewise for the same reason. why develop an appetite in somebody who you can't ever satisfy that appetite? all that has to change because we need people to have the skills, the qualifications, the sense of themselves, the confidence, the desire to be a director, to be a planner, to be part of the decision-making because it makes your life much more interesting than coming to work and doing what someone sticks in front of your nose and tells you to do. that's a fundamental democratic idea, and, yes, i think our education system would have to change, and again, let me use a concrete example. because part of my family is french, i go to france a lot, i speak french, i have since i've been a little child, and i remember once years ago having this little epiphany moment speaking to a friend of mine. i went as a visiting professor to the university of paris. it's a big
university, has several units in paris. university number one--they're numbered 1 to 10 or 12. one is what used to be called the sorbonne, old, in the middle of the city, old--beautiful buildings coming out of the louis whatever who built it. so i taught there, and i got to know some of the professors. i sat down with the one who had invited me, and we kind of compared notes about his salary and kind of how he lived and what he got. so let me tell you. he'd get about the same salary i did. so we had the same amount of money more or less except the following things. he had a daughter--i think she was 6 or 7--named sandrine, a common name in france, and the first thing that blew my mind was he was eligible to take her to the local municipal child care center. that's everywhere in paris. he could bring her 6
days a week from as early as 7:00 in the morning, and she could stay there as late as 7:00 in the evening or any part thereof, some days, some not, some hours, whatever you wanted. she would have a--she had a little outfit there. she comes in. you know, french, they're very nicely done, and then she takes off that and has a little smock that is for the children in the school. she's given meals if she's there at mealtime and snacks. a very elaborate program, and the flat rate, whether you use it 1 day a week or 6 days a week, $17.00. so the first thing i realize he gets the same salary as me--heh heh--but he doesn't--and then i got the other part, the university. it doesn't cost anything, nothing. $100 a year or $100 a semester, i don't remember, fees, but nothing. now that doesn't--they don't have dormitories, i don't believe, and that kind of stuff really, so that's your own expense. they don't pay for that, but you don't have any expense to go to school, and
then i said, "my god. it's amazing. what about the private schools?" and they looked at me and said, "we don't have that." i said, "what do you mean you don't have it?" well, they said, "if you had a private school and a public school, that wouldn't be democratic. the rich people would all go to the private school, and everybody else would be done--so we don't. do you have that in america?" [laughter] and i told them, "yeah, we do, and i come from--ehhh--the private one, very expensive." it was a revelation. this was a very worldly guy who knew--but he didn't know that just like americans don't know what i just told you either. they don't know that--this is common in europe. very common in europe because it's thought of as like having, you know, first and second class in the train, which by the way the french did have. they don't have it
anymore, but they use to have on the subway, for those of you who remember, the old metro, the car in the middle was the first class, and the cars on either side were second class, and the ticket was cheaper--on the same train--if you went in the one car than the other, and the cars were cleaner and a little neater and a little nicer if it was first class, but then with the--in the 1960s, part of the great 1960s uprising, they got rid of that because the population said, "no more of that. that's outrageous." so now it's only one class on the french parisian subway. but, yeah, i think uni--i say all this because universities would have to change, would all become public or would all become a kind of complicated, serious education for everybody. another way of putting it. liberal arts education was always the idea that what you want is you want to develop a person with many capabilities. remember the--many of you
notice when you're a freshman or a sophomore you're required to take a course in the arts and a course in social science and a course in natural. the idea is you're a young person. you don't know what your capabilities are. you should take a lot of different courses to find out what really excites you. maybe for you it's anthropology and for you it's chemistry and for you it's astronomy and so forth. the idea is you want to develop multiple capabilities, and the implicit notion is because you're gonna be a person who runs this society, and if you have to make decisions, the most important thing for you is to know is a lot about things, to have not so much detailed, specialized knowledge but the ability to be flexible, to see a situation and imagine an alternative, and for that kind of education, you should read some greek drama, and you should read some history of polynesia and a whole bunch of other things that are gonna reverberate in your--and not be a vocational education student who learns how to do with a
ball-peen hammer and certain kinds of metal. not that that isn't a useful function, but it shouldn't be limited to that. we don't do liberal arts education except for a very small portion of our population, and it shows because even compared to other countries, like european countries, there's much more of that kind of generalized education for all kinds of historical reasons. my parents were astonished when i was a young student that we didn't have to learn greek and latin. my parents had to learn greek and latin. they had to read greek literature and latin literature, and when i came home and scoffed at my parents and said, "it's a dead language," they got enraged and went to talko the achers, o repeated that it as a dealanguage. so therefore, who needs this? we only need the latest hot stuff. very sad. so, yes, i think it would be a radical reorganization of our education system because it would need to
give everybody the capacity to be a member of the board of directors of a collectively run enterprise. we would need to do that to make this system work just like capitalism doesn't need to do it, and so it doesn't. let me be hard with you for a moment because i spent my entire life as a professor. that's all i've ever done, so i'm an education person. most of the people that i know who are serious professors hate giving grades. i hate it. most detestable part of my--there i am. i've barely met a student over a semester, i've given a bunch of lectures, read a few little exam questions hysterically written by an overpanicked young person who's probably imbibed all sorts of substances in the preceding 24 hours, et cetera, et cetera. present company excepted. um, and i'm supposed to give them a grade, an "a" or a "b." you know what that's
like? that's like sorting potatoes. there's an "a" potato and a "b" potato. this one has little knobbly things on it. so it's not an "a" potato. i'm not in the business of potato grading, and who is that for? d the answer is that's for the employers, and it's for e emplors to know who to hire. i'm the first grid. you know, you perform nicely, so you're an "a." you don't perform, you're a "b." you really performed lousy, you're a "d." that's help to the employer. i don't want to help the employer. that's not what i signedp for. 'm n interted in ts, and here's even worse. this meritocracy fakery that we do in this society, that is a scandal and a cruel one. we don't have enough jobs in this country for the people whore perfely capable fillinghem. we got a oblem. w too manpeople th good ills forhe jobs
we produce. now the rational solution would be to find the jobs, to give them a chance to do what they want to do and they can do. we don't do that. we have no way of doing that. we're not driven by providing people with work. that's mondragon. we're driven by making money, so we don't want these people, but it's very dangerous. they want an education, and they got one, so now they want the job, but we don't have the jobs. how do you solve this problem? as and bs and cs and harvards and the local community college because it allows us to say, "we got jobs for you, you, you, but not for you and you and you, but that's not because of anything wrong with the system. it's because of you. you went to blehh school. you got a buhhh
grade at a blehh school, so don't blame the system. it's you. you didn't work hard enough, you didn't go to enough school. you didn't take that extra course. you didn't take the princeton prep to get your sat scores up. buh buh buh buh buh." you know the horrible routine, but the cruelty is you're blaming the individual for a failure of a system to make use of its resources, of its people, and so people get very down on themselves, and they spend their rest of their life feeling really inferior. very, very cruel way to not solve a problem in a rational way. all that would have to stop. you'd have to really reorganize education, and as someone who has watched this cruelty play out on 10 generations of students, it is awful to watch. my colleagues,
who are not--as you might have guessed, i am not on the right-wing end of politics, but my colleagues, some of whom are and others who are in the middle, one of the few things we could always agree upon was that there is--the problem with our graduate students and our und--was never their capability. it was mostly their sense of their own capability. they actually had the ability. they just didn't believe it, and by the time they got to us, that was so deep in them not to believe in it that it was a self-fulfilling kind of belief. very tragic. you know, most people who begin a ph.d. program in the united states never finish it, the majority, and that's not because they don't have the capacity. it has nothing to do with it. no correlation at all between the capability shown when a student enters and the probability of their completion, none. we've done that work. none. these are
psychological problems. the most important thing that an economics graduate program in the united states could ever have is a full-time professional shrink. [laughter] would be the best thing that could happen to the students in the--no. i'm very serious. it's the best thing that could happen to the students. the success ratio would go way up, the quality of the program. very serious issue. so i'm glad you asked the question. it's about a dramatic change in the education that would have to happen. how many more do we have time for? last one. ok. >> very quick question because this is election season, and given that we're in a system that precludes systemic critique, occupy protests not withstanding, to vote, or not to vote? >> well, as i drove down here, which by the way since i come from new york city i do have to say in all honesty we don't
have traffic as horrific as i just had driving from san francisco. i sat on 101 for an interminable amount of time. incredible. anyway, as i was sitting in my car, i had the bad luck to listen to the democratic national convention speeches, which were an exercise in b.s.--to be as polite as i can about this. there's not only no systemic critique, there's no alternative. the solutions offered are more of what they've done. they're pretending that it's been wonderfully successful because they're the in president just like the other guys had to claim it was a big disaster. first of all, the president politics in this country is a very peculiar institution. let me closeith thatecause 's really important. the united states is unique in the world,
i think, for the following. we have been the most successful in convincing the american people of something that's patently absurd, and that is that when they have an economic problem it's the fault of the government. it's stunning. 95% of the people who've lost their job in this crisis--and there are millions of them--were fired by a private capitalist employer. if you're gonna get angry at somebody because of unemployment, the logical target is the company that fired you. not in america. our people are trained. they leap over the company that fired them to the politician, the senator or the congressperson whom they're very angry at, who had absolutely nothing to do with it. the overwhelming majority of people who've been foreclosed out of their homes were foreclosed by a private capalist bank or lender, and
who are they angry at? "um, um, politician"!" what? just the best possible system for capitalists. you kick the mass of people, they get angry at somebody else. you kick them again, they get more angry at somebody else. you are exempt. this is stunning. how did you do this? and then there's this general blame the government, blame the government. the government is the problem. why do i say it's patently absurd? george bush, our president--do you remember him? that one who disappeared for the republican national convention? he must have gone fishing. george bush vanished, but he and the republican party had every interest in making sure that the last 6 months of his presidency were not a time of economic collapse because what it would mean is that the republicans would be run out of office on a rail, which they
were, and his political leadership was unable to do anything about it. they rode bush out of office. obama rode in because bush couldn't stop the economic crisis. mr. obama may be ridden out of office for the same reason because he, with all of his clever advisors, has been unable to solve this crisis. so don't tell me the politicians are in control. clearly if they were in control, they wouldn't possibly do what they're doing, but that's all they can do, and the reason they can is because the separate decision-making is in the hands of the corporations who make all these basic decisions for their own reason and in their own competitive struggles, but this--this notion of the government and then the blaming the government for everything, it makes the people angry at the government, and why would that be interesting? that goes
back to something i said to you before, and it's a good way to end. the danger of politics in capitalist systems is that when the mass of people are screwed bad enough in the economy they're going to turn to politics to try to undo what ppens tohem in t economy in the economy, they are dependent. their jobs disappear, their income is shrunk, all the suffering that we know of, and they're gonna turn to politics where it's one person, one vote. maybe they have a chance to compensate, to undo the economic disaster they're suffering by a political intervention. the business community long ago understood you got to deal with that. it's [indistinct] understanding. if fewer and fewer people become richer and richer, they've got to worry that the mass of people that are excluded from this enjoyment are gonna get angry, and they're gonna try to use politics. solution--control the politics, neutralize the
politics. the american training--"the government stinks, they're all crooks"--these are ways to get people away from the political engagement that might otherwise give them a way forward in this situation. very dangerous, very strange. so my response--we're stuck. we got two terrible problems. we don't have proportional representation, which is a staggering ntradictn with docracy just like the way we run our businesses is, and secondly, we've got tweedledum and tweedledee as the two parties, who exchange positions every few years, and we sit there, and with each convention, like the last week and today--by the way, the reason there aren't more people here is they're at home watching barack obama, right, so tough competition for me. so we have to do something
to break out of a system that doesn't allow minority parties to have a voice the way they do in all of our allied countries and to have more than the choice of two. you know, if you went into your local supermarket and there were two kinds of soup, chicken and rice, and two companies that made them, campbell's and progresso, you'd feel as though this was not a very good store. you'd like more choice. we want 27 kinds of toothpaste and 16 kinds of soup and 12 kinds of ice cream, but two parties is enough. what is that? what is that? why two? what is--their magic number? it's a sange cntry. don' want me choice than two. even if it's hard to tell them apart, you don't want more than two. it's very strange, but the whole politics is handled here as a bizarre kind of excuse, and the
contradictions are legion. the same politician that you mock and that you call a crook, when he sends your kid to war, you go and you stand at the parade. the same politician is a great commander in chief. he was a rotten crook last week. so when it comes to the foreign, "ohh, ohh, ohh!" the contradictions here--if he was a crook at home, maybe he's a crook abroad, too. it's possible. very strange. all of that has to be opened and questioned, but my conclusion is it's happening, and again, i'll use myself. people like me are on "charlie rose," and i'm traveling all over the country, do 1, 2, 3 radio and television programs almost every day, and i turn down as many as i get because i can't physically do
it, but the only sad thing is i wish there were a lot more of me around, but i'm part of a generation that didn't produce very many of me since it wasn't what harvard, stanford, or yale wasnterestein. madelenty of good onomistsut not wh a critical perspective. none helped them do that, and it wasn'good forour care, so they dn't that wa but this country is changing, and i really am living proof. my audience is bigger than anything. in the last two years, i've done more public speaking than in the previous 40, and i've always been active, but it's just completely different. now a critique of capitalism is an acceptable part of what people want to hear. it's not that they necessarily agree yet. no, but it's part of the conversation. it used to be outside, beyond the pale, too scary. that's gone. that's just gone. whatever you're worried or
thinking about the tea parties and what they represent, sure, they're there. they represent a point of view, but on the other end of the spectrum, the change has been at least as profound, and so it's a wonderful time for folks like me because we have audience in the united states we have never had in at least half a century, and it's therefore a time of extraordinary opportunity. we've taken more of your time than we should have. thanks again. [applause]