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  1. Detroit: The Athens of the Midwest

    March 2, 2013


    Detroit was once called the “Paris of the Midwest,” but following yesterday’s announcement by Republican Governor Rick Snyder that Detroit will run by an emergency manager, Detroit may be more accurately compared to Athens.

    In 2009, the troika–a political body made up of Europe’s most powerful financial institutions–demanded that the Greek government pass a series of harsh austerity measures.  When George Papandreou, acting as Prime Minister at the time, put the measures up for to a popular vote, the troika simply removed him and replaced him with a banking executive.  Following the removal of Papandreou, the BBC commented that, “for whatever reasons, George Papandreou was standing up for democracy.”

    While it’s an admittedly weak analogy–maybe putting style ahead of substance–the imposition of an emergency manager to oversee Detroit is not totally dissimilar from the troika‘s takeover of Greece.  Austerity measures have been imposed on a crisis laden government without the slightest illusion of democracy in the name of averting further crises.  In Greece, as in Detroit, unemployment and poverty levels have skyrocketed to jawdropping levels, and yet further sacrifices are demanded from the poor and working class populations who benefit the most from the programs being cut.

    Michigan’s emergency manager law is likely the most extreme austerity measure in the United States.  The original law was enacted in 1988 during the administration of Democrat James Blanchard to allow for state intervention in local governments facing bankruptcy. The law was expanded in 1990 to encompass school districts.  Emergency managers were rare, however, until the administration of Democratic governor Jennifer Granholm.  Under Granholm, it was used to take over the cities of Highland Park, Benton Harbor, Ecorse, Pontiac, as well as the Detroit Public School system (all majority Black cities or districts).  Granholm’s ready use of emergency managers beat the path for Governor Snyder’s expansion of the law after he was elected in 2010.  Since then Snyder has used emergency manager law to take over the cities of Flint, Allen Park, and the Muskegon Heights and the Highland Park school system (which were both handed over to private charter school operators last year).

    In November 2012, Michigan residents voted in favor of a ballot referendum that would eliminate the emergency manager law altogether.  That December, however, state legislators voted to enact a new emergency manager law, in spite of the electorate’s efforts.

    Under an emergency manager, the power of local elected officials is suspended after the governor declares a city to be in a financial emergency.  The manager than takes control of the municipality’s finances and resources.

    According to the Detroit Free Press when asked if local elections for city council and mayor would continue under an emergency manager the paper responded that “Detroiters will have a primary in August and a general election in November. What powers those elected officials will have — and their salaries — ultimately will be up to the EFM.” [Emphasis mine.]

    In addition to overriding local democratic institutions, the emergency manager will have the power to restructure or eliminate city services and departments, impose new labor terms, sell and privatize public assets, institute layoffs, and declare bankruptcy (thereby taking the city out of its obligation to retirees).

    With Detroit under an emergency manager, over half of the state’s Black population will have no say in local government–objectively rendering their votes meaningless.  The law relies racist dog whistles that appear colorblind, but fall into the tradition of racist stereotypes of Black people, e.g. “financial irresponsibility,” combating “entitlements,” etc.  The emergency manager law, therefore, has specifically targeted majority Black cities in the state.  The only majority white city to be under an emergency manager, Allen Park, asked for an emergency manager.

    Of course, while there can be no doubt that city of Detroit is clearly in a state of crisis, and has been for decades–over half the city is unemployed, and nearly 40% of the city lives below the poverty line–the city’s financial problems have been wildly misrepresented in the mainstream press.  The city’s monumental debt is not the result of overspending or even financial “mismanagement” per se, but the result of tax-free interest bearing debt owed to bond holders–banks like UBS, for instance, which was implicated in last years Libor scandal.  Furthermore, during periods of economic crisis, its expected that municipal governments will run into a deficit.  But both of these things have already been acknowledged in both the mainstream press and even by Governor Snyder’s own appointees–yet both the local press and the administration continue to clamor for emergency management.

    The fact is that this has never had anything to do with fiscal “mismangement.”  Rather, it is part of the general trend of deflecting responsibility for the economic crisis onto the backs of the most vulnerable in our society–something which cannot be left up to democracy, since rarely do people ever vote to slit their own throats.

    Detroit’s Democratic Mayor Dave Bing put it plainly when he insisted that he does, in fact, have a plan for restructuring the city, and that therefore no emergency manager is needed.  The only problem, he said, is that he’s “hindered by several factors, including the City Charter, labor agreements, litigation, [and] governmental structure.”

    Put another way, in his book A Brief History of Neoliberalism, Harvey argues that democracy is a luxury for the few in an age of neoliberalism.  He sums up the ideological foundation for the emergency manager law when he says that democracy is reserved only for,

    conditions of relative affluence coupled with a strong middle-class presence to guarantee political stability. Neoliberals therefore tend to favour governance by experts and elites. A strong preference exists for government by executive order and by judicial decision rather than democratic and parliamentary decision-making.

    While this is a crisis for democracy, the emergency manager law has to be seen in the context of the more general (and global) crisis of austerity.  This is perhaps best illustrated that, only hours after Governor Rick Snyder announced his plan to appoint an emergency manager over Detroit, President Obama signed the order to begin cutting $85 billion dollars from the federal budget–the so-called “sequester.”

    This points us toward the need to not only oppose the emergency manager, but to fight against the austerity agenda in general, no matter who is cramming it down our throats,  whether it be the democratically elected city council cutting their staff’s pay, or an emergency manager privatizing city services.  The 1% can abide democracy as long as it works in their favor–what they cannot accept is a barrier to their profit.  Unwavering opposition to austerity has to be central to our campaign.

    In Greece, austerity has been met with a heroic struggle in the streets: since the crisis hit almost 20 general strikes have been called, the old government of pro-austerity social democrats has been tossed into the dustbin of history, a new coalition of radical Leftists and revolutionaries has surged in the polls, and broad alliances of Greek and immigrant workers have been formed to combat the rising specter of extreme right-wing racism and xenophobia.

    We in Detroit are a far way away from that level of resistance. However, there are lessons we can take.  Voting for Democrats cannot be a solution to this crisis since they set the stage for this crisis.  They are just as willing to use emergency management to dissect public education or privatize public services as the Republicans are.  Neither is the ballot a solution: the government doesn’t even pretend to respect our vote, as we saw in December.

    Our fight back in Detroit has to be rooted in the streets–and cannot be limited to the narrow scope of lawsuits, referenda, or elections.  The only fight that can restore democracy is a broad, mass struggle aimed at smashing austerity using every means at our disposal. In short: Greek-style austerity must be met with a Greek-style fightback.

  2. Capitalist equality

    February 10, 2013

    Illustration showing the capitalist concept of equality: the capitalist pays the worker equal to the output they produce. Of course, if this was the case, there’d be no such thing as profit.

    I love the show Radiolab. For those that aren’t familiar, it’s a brilliant radio program from WNYC hosted by Jad Abumrad and Robert Krulwich on science done in a very creative and entertaining format.

    Their recent episode exploring the concept of speed is fascinating. During the show, they have a segment on the speed of trades in the financial market that’s especially interesting to me.  The segment starts off dismantling some of the preconceived ideas about what trading actually looks like, e.g., men in jackets and suits running around Wall Street with contracts or shouting out bits of jargon on the trading floor.  That still happens, but that’s a tiny fraction of how trades are done nowadays.  Instead, trading takes place electronically.  Billions of dollars are made, lost, traded, and invested, in fractions of a fraction of a second.

    While the show examines the remarkable scale of the trades and the microscopic span of time they take to be made, they leave out the real human side of the issue.  Billions of dollars are traded across the globe in nanoseconds, yet potentially cause a lifetime of suffering for thousands of people.  (In fact, the segment actually argues  the opposite: the piece give a ton of time to the stock traders and the spiteful liberals from NPR’s Planet Money to apologize for Wall Street. They argue that we all actually benefit from a more technologically advanced stock exchange, since it drives prices for goods down–nevermind all the chaos dreamed up by a worldwide free market doped up on cyber speed.)

    One thing that came to mind while listening to the segment was the way “equality” is distorted by capitalism. During the segment they keep talking about how trades are determined by fractions of a second: if one person in Chicago bids on something at the same time that a trader in New York does, the trader in New York will win the bid because their trade took a nanosecond less than the trade coming from Chicago since the data had to travel through less fiber optic cable (even though the data is moving at the speed of light!).

    Because trades are determined by fractions of a nanosecond, it really matters how close traders and banks are in proximity to the stock exchange.  The segment takes us to the NYSE’s server farm: a space the size of three football fields filled with servers.   Any trading firm, bank, etc., is allowed to host their server there–so every firm has a server located an equal distance from the exchange.  Furthermore, every server gets an exactly equal length of fiber optic cable.

    This is what equality means to the capitalist: it’s crude, mechanical, and ultimately irrelevant (for the vast majority of society).  It means equal opportunity for the capitalist to exploit and oppress.  Painstaking effort and massive resources are devoted to ensuring that multi-billion dollar trading firms each get a shot at scorching the Earth, and exploiting people’s labor.

    The segment closes out with the Planet Money schmuck talking about how the stock exchange is trying to figure out a way to set up a radio tower relay for trading firms since data will travel faster through air than through cable–something like one nanosecond faster.  But surely such a massive infrastructural project would cost billions of dollars in materials, investment, labor, etc.  And yet, we’re told that there is no money for public transit, education, housing, or healthcare.

    But there are billions of dollars available for trading firms to fight over which firm gets to exploit which resource, which worker, etc.  But does it make a difference to the homeless person which bank foreclosed on their home?  Or to the indigenous person which oil company displaced them?  Or to the unemployed worker which company laid them off?  Of course not.  Yet, billions upon billions are spent by these firms competing over who gets to exploit whom.

    Equality in a capitalist society is predominantly understood from the perspective of the capitalist.  Everyone is equal as long as everyone has an equal chance to invest their capital and freely earn profit.  Of course, this is an absurd conception of equality.  Not everybody has capital.  And since you need capital to get capital, it’s very difficult for those who aren’t lucky or don’t inherit it to enter into the market.

    Real equality, of course, would be equality in life, e.g., in housing, healthy food, leisure time, means to create culture, education, etc.  But this is only possible in a society where we control the things we create with our work, and the technology we use to create them, and use them for the good of society, instead of for the private profit of a few wealthy and powerful individuals.

  3. Detroit’s Wayne State University Looks to Destroy Tenure

    August 22, 2012

    Wayne State University in Detroit has proposed a new contract that would radically redefine the terms for eliminating faculty.

    The school would be the first research university to effectively abolish tenure, said officials of the American Association of University Professors (AAUP), opening the door for other campuses under pressure from cuts in public spending to try similar moves.

    Traditionally, tenured faculty could be removed only after undergoing an extended peer review or in cases where the university is facing extreme financial stress.

    The contract language management proposed in late July, however, would effectively remove peer review and centralize the power to terminate faculty in administrators’ hands.

    Read the rest at Truthout.