The American Prospect #323

ROBERT KUTTNER: THE CASE FOR SOCIALISM

LEE HARRIS: TAMING WALL STREET

RACHEL COHEN: DEMOCRATIC DARK MONEY

I D E A S, P O L I T I C S & P O W E R

Where Are the Missing Workers?

David Dayen on The Great Resignation

NOV/DEC 2021 $8.95 PROSPECT.ORG

BONUS ISSUE, 2020 THE AMERICAN PROSPECT 35

“Stuckey brilliantly identifies when and how discourse degenerates to despicable and campaigns deteriorate to deplorable. I highly recommend her exquisitely written, lush, and lyrical exploration of these critical elections.”

—diane j. heith, author of The Presidential Road Show: Public Leadership in an Era of Party Polarization and Media Fragmentation

328 pages | 6 x 9 | November | Hardcover and e-book editions available wherever books are sold

P E N N STAT E U N I V E R S I T Y PR E S S www.psupress.org

“This book will instruct, provoke, and challenge Americans who are ready to reckon with history and plan a better way forward.”

—angela g. ray, author of The Lyceum and Public Culture in the Nineteenth-Century United States

NOV/DEC 2021 VOL 32 #6

Features 16 The Great Escape

4

Why workers are quitting their jobs, after the trauma of the pandemic By David Dayen

26 Burying the Evidence

How the military concealed its best chance at solving its sexual assault problem By Jonathan Guyer

34 What the New Sheriffs of Wall Street Can Do

40

Biden has empowered a crop of aggressive financial regulators. They’ll need to look beyond the banking industry and into finance’s darker corners. By Lee Harris

40 Capitalism vs. Liberty

All that we liberals cherish—socially, economically, and politically—is being undermined by toxic capitalism. What might lie beyond it, and how might we get there? By Robert Kuttner

48 The Democratic Dilemma on Dark Money

Liberal electoral groups are now spending more from undisclosed donors than Republicans. Campaigners don’t readily give up winning strategies. By Rachel M. Cohen

Prospects 04 The Center-Right and Our Future By Paul Starr

Notebook 07 Succession By Alexander Sammon 10 Cowboy Drugstore By Zack Kopplin 13 A Nuclear Cop-Out in Glasgow By Gabrielle Gurley

Culture 55 Maureen Tkacik on Flying Blind: The 737 MAX Tragedy 59 Meredith Whittaker and Lucy Suchman on The Age of AI: And Our Human Future 62 Aaron Bady on The Many Saints of Newark 64 Parting Shot: Greetings From Meta By Francesca Fiorentini Cover art by Polly Becker

26 NOV/DEC 2021 THE AMERICAN PROSPECT 1

On the Web

Visit prospect.org/ontheweb to read the following stories:

Global Warning Building Back America

The Prospect covered every angle of the infrastructure bill passing into law, and the fate of the rest of the Biden agenda.

The Strike Wave

Prospect Editor at Large Harold Meyerson reports on increased aggressiveness from organized labor, including a burst of worker walkouts.

Around the COP26 climate conference in Glasgow, Prospect staff and contributors highlighted the global challenge of the climate crisis, and how we can learn from other countries’ experiences.

The Return of Postal Banking

Executive Editor David Dayen broke the story about a new test program that could become the first postal banking system since 1967. He also explains how one of the pilots, in the Bronx, has so far yielded no customers.

A Global Warning Virtual Panel Event

Senior Editor Gabrielle Gurley and Writing Fellow Lee Harris talk with climate experts about the outcome in Glasgow and where we go from here.

Following the Players in Washington Our partners at the Revolving Door Project tirelessly track who’s getting the top policy jobs, where they came from, and who they serve.

2 PROSPECT.ORG NOV/DEC 2021

EXECUTIVE EDITOR David Dayen FOUNDING CO-EDITORS Robert Kuttner,

Paul Starr

CO-FOUNDER Robert B. Reich EDITOR AT LARGE Harold Meyerson SENIOR EDITOR Gabrielle Gurley ART DIRECTOR Jandos Rothstein MANAGING EDITOR Jonathan Guyer ASSOCIATE EDITOR Susanna Beiser STAFF WRITER Alexander Sammon WRITING FELLOW Lee Harris INTERNS Ahmari Anthony, Connor Bulgrin, Esther Eriksson Von Allmen, Ella Fanger CONTRIBUTING EDITORS Marcia Angell, Gabriel Arana, David Bacon, Jamelle Bouie, Jonathan Cohn, Ann Crittenden, Garrett Epps, Jeff Faux, Michelle Goldberg, Gershom Gorenberg, E.j. Graff, Bob Herbert, Arlie Hochschild, Christopher Jencks, John B. Judis, Randall Kennedy, Bob Moser, Karen Paget, Sarah Posner, Jedediah Purdy, Robert D. Putnam, Richard Rothstein, Adele M. Stan, Deborah A. Stone, Michael Tomasky, Paul Waldman, Sam Wang, William Julius Wilson, Matthew Yglesias, Julian Zelizer PUBLISHER Ellen J. Meany PR DIRECTOR Anna Graizbord ADMINISTRATIVE COORDINATOR Lauren Pfeil BOARD OF DIRECTORS Daaiyah Bilal-Threats, Chuck Collins, David Dayen, Rebecca Dixon, Shanti Fry, Stanley B. Greenberg, Jacob S. Hacker, Amy Hanauer, Jonathan Hart, Derrick Jackson, Randall Kennedy, Robert Kuttner, Ellen J. Meany, Javier Morillo, Miles Rapoport, Janet Shenk, Adele Simmons, Ganesh Sitaraman, William Spriggs, Paul Starr, Michael Stern PRINT SUBSCRIPTION RATES $60 (U.S.), $66 (CANADA), AND $72 (OTHER INTERNATIONAL) CUSTOMER SERVICE 202-776-0730, ext 4000 OR info@prospect.org MEMBERSHIPS prospect.org/membership REPRINTS prospect.org/permissions

Vol. 32, No. 6. The American Prospect (ISSN 1049 -7285) is published bimonthly by American Prospect, Inc., 1225 Eye Street NW, Ste. 600, Washington, D.C. 20005. Periodicals postage paid at Washington, D.C., and additional mailing offices. Copyright © 2021 by American Prospect, Inc. All rights reserved. No part of this periodical may be reproduced without consent. The American Prospect® is a registered trademark of American Prospect, Inc. POSTMASTER: Please send address changes to American Prospect, 1225 Eye St. NW, Ste. 600, Washington, D.C. 20005. PRINTED IN THE U.S.A.

Thank You, Reader, for Your Support!

Convert Your Print Subscription to a Full Prospect Membership Every membership level includes the option to receive our print

magazine by mail, or a renewal of your current print subscription.

Plus, you’ll have your choice of email newsletters, discounts on Prospect merchandise, access to Prospect events, and much more

Find out more at prospect.org/membership

Update Your Current Print Subscription prospect.org/my-TAP You may log in to your print account for change of address,

to give a gift or purchase back issues, or to manage your payments.

You will need your account number and zip-code from the label: ACCOUNT NUMBER

EXPIRATION DATE

ZIP-CODE

To renew your subscription by mail, please send your

mailing address along with a check or money order for $60 (U.S. only; Canada: $66; other international: $72) to:

The American Prospect 1225 Eye Street NW, Suite 600, Washington, D.C. 20005 info@prospect.org | 1-202-776-0730 ext 4000 NOV/DEC 2021 THE AMERICAN PROSPECT 3

S T C E P PROS PAUL STARR

The CenterRight and Our Future The swing toward

Republicans in this fall’s elections—including the victory of Glenn Youngkin in Virginia’s gubernatorial contest—has only deepened the sense of existential dread among liberals and progressives about what will happen to American democracy and the world if a Trump-led Republican Party wins back Congress in 2022 and the presidency in 2024. We are used to the alternation in power of two normal parties in the United States, but the Republicans today are not a normal party, and these are not normal times.

Republican leaders in both national and state politics have made it clear they will not be bound by normal electoral rules. Trump’s lies about the 2020 election, the acquiescence in those lies by other Republican leaders, the Republican efforts in the states to suppress Democratic votes and seize control of the counting of ballots, the disclosures about how seriously Trump was pursuing the election’s overturn up to and during the January 6th insurrection—all these tell the same story. It is as though Republicans were now planning openly and shamelessly a murder that their party’s leader had failed to carry out successfully the first time.

“We are already in a constitutional crisis,” the neoconservative and Never Trumper Robert Kagan observed in The Washing­ ton Post in September. “The destruction of democracy might not come until November 2024, but critical steps in that direction are 4 PROSPECT.ORG NOV/DEC 2021

happening now.” The opportunity for Congress to protect the electoral process and voting rights is slipping away in the name of preserving the filibuster, as though that were a sacred institution. “A Trump victory,” Kagan wrote, “is likely to mean at least the temporary suspension of American democracy as we have known it.”

Beyond that risk lies a second source of existential dread: the threat of climate change and the realization that the United States and other countries have only a limited time to institute the reforms necessary to avert catastrophically higher temperatures. Democrats have had to roll back their ambitions because they depend on the vote of one coal-country senator, Joe Manchin.

As disappointing as that has been, a return to power by a Republican Party given over wholly to fossil fuel interests and climate denialism would be an unmitigated, tipping-point disaster for the entire world.

As the crises of democracy and climate unfold, we are inevitably going to depend on what center-right legislators, center-right judges, center-right bureaucrats (such as election officials), and center-right voters decide to do. They can do what so many Republican politicians have done and go along with Trump and his base, or they can do what key Republican election officials and judges did in 2020 by resisting Trump’s demands and upholding the rules on which democracy depends.

The center-right is not what it used to be.

The more liberal Rockefeller Republicans, even the Gerald Ford moderates that the party used to include, are nearly all gone from Congress and national politics. The center-right today consists mainly of the minority of conservatives who prize constitutional democracy and science above fealty to Trump and Fox News. The decline of the center-right in the United States is part of a wider pattern: As far-right parties have risen in Europe, center-right parties have generally lost support. When George W. Bush was president in the early 2000s, a number of commentators, including the popular historian (and Biden friend) Jon Meacham, described the United States as a “center-right country.” Gallup continues to characterize the dominant pattern of American public opinion as center-right. But since the Bush years, the center-right has suffered an especially devastating reverse: By losing control of the Republican Party, it has lost its political home and consequently most of its political power.

That loss has left Never Trumpers debating where to take whatever influence they have. Kagan calls on “Romney & Co.” to “fashion themselves as Constitutional Republicans who, in the present emergency, are willing to form a national unity coalition in the Senate for the sole purpose of saving the republic.” But there is no sign of that happening; Mitt Romney himself has been unwilling to support even the slimmeddown voting rights legislation that Manchin proposed. Two self-styled “rational” conservatives, Miles Taylor and Christine Todd Whitman, call for anti-Trump Republicans to vote for Democrats in the 2022 congressional elections to block Republicans from taking over the House of Representatives.

(Taylor served as chief of staff at Homeland Security under Trump and in 2018 wrote the famous “Anonymous” New York Times op-ed, “I Am Part of the Resistance Inside the Trump Administration.” Whitman is the former governor of New Jersey.)

Taylor and Whitman are part of a group of 150 former high Republican officials—the “renewers,” they call themselves—who are actively backing some Democrats like Sen. Mark Kelly in Arizona and have threatened to form a third party. Taylor acknowledges that a third party would have limited support. In a recent Politics and Polls podcast with the forlorn title “Where Can the Center Right Find a Home?” he argues that to

STEVE HELBER / AP PHOTO

affect election outcomes the renewers would need only to siphon off enough conservative votes to prevent Republicans from winning in swing districts.

But his strategy has another side. By supporting moderate Democrats, Taylor and other Never Trumpers hope to rein in the Democratic Party. And therein lies the problem.

If Democrats are to defeat Trumpism, they can’t do it only with measures that currently meet center-right approval. They need to deliver on a program that makes a genuine difference in economic security for working people. After failing to stop Trumpism within the Republican Party, the center-right would only compound its mistakes by imposing restraints on the Democratic Party that will prevent it from defeating Trumpism. David Frum wrote recently in The Atlantic that “as former Republicans and conservatives break from old groups, they turn newly suspicious eyes on old certainties.” The “old certainties” they need to re-examine go beyond what Frum had in mind. If Democrats are to work with the center-right on anything beyond the bare minimum of defending constitutional democracy, center-right leaders need to reassess their view of the role and scope of affirmative government.

There is a historical precedent: the reassessment that the center-right made in the mid-20th century when it accepted progressive taxation and the modern welfare state.

In the United States, we tend to think of our politics as wholly distinct from the patterns in other Western democracies. There certainly have been differences, such as Glenn the consistent failure of Youngkin socialist movements and parties throughout American history. The challenge posed by socialism in Europe did affect conservative parties there, beginning in the late 1800s when conservative leaders in Germany and other countries sought to co-opt the appeal of socialists and labor unions by adopting social insurance and other welfare-state measures, well before the United States did. But there are also important parallels between European and

American politics that illuminate the history of the center-right.

As political scientists Noam Gidron and Daniel Ziblatt note, the “core dilemma” of center-right parties under universal suffrage is that although their founding constituencies lie in the upper class, they have to compete for other votes: “Center-right parties could not survive as merely the political front-men of economically powerful employer associations, so they included cross-class appeals to national identity, religion, and other issues that reached beyond their founding core.” Those corresponding “second dimension” issues in the United States have included race.

But the center-right elites who use nationalism, religion, and race to broaden their support risk losing control to far-right factions and parties that make more forthright and extreme appeals on that basis.

So long as the center-right elites control cohesive party organizations and media, they may be able to contain and marginalize the radical right. This was what they were able to do following World War II, in the aftermath of fascism’s defeat, when they embraced a more conciliatory and reformist politics. “In the postwar period,” Gidron and Ziblatt write, “cohesive centerright parties facilitated major historical political compromises, playing a significant role in the consolidation of democracy and welfare states.”

That tradition gave us a working democratic politics and the shared prosperity of postwar societies. It is the tradition to which the center-right could return in the recognition that the politics of austerity and reverence for markets in recent decades has turned out to be just as politically destabilizing as laissez-faire was in the 19th and early 20th centuries. Industrial capitalism then required institutions such as social insurance; postindustrial capitalism now requires a new wave of adjustments reflecting changes in the economy, work, and the family, and the new understanding of global climate. The historic choice facing the center-right is whether to join Trump in playing up nativist and racist impulses or to enter

into a coalition with Democrats in trying to alleviate the stresses now faced by working- and middle-class people and addressing the threats posed by climate change to our way of life.

I’m not expecting a sudden transformation, but it shouldn’t really require one.

Much of what needs doing in the United States is already standard fare for centerright governments in Europe. Consider the family agenda that Democrats have been pursuing, including such policies as child tax credits (known elsewhere as “child allowances” or “family allowances”) and subsidies for child care and elder care.

The costs of raising children, and of caregiving generally, have escalated in an era when both parents work. If the center-right wants to “renew” American society, why not acknowledge these realities and help families cope with the stresses they face in raising the next generation? Likewise for climate reform. The needed changes could fit comfortably within a conservative rhetoric of social protection.

But unhappily, that course seems much less likely than the one charted by Youngkin, who was able to have it both ways in Virginia. By maintaining some distance from Trump while using coded racial appeals, Youngkin was able both to turn out Trump’s base and to win back Republicans and independents who defected in recent elections to Democrats. In “What’s Wrong With Glenn Youngkin?” Jonathan V. Last, editor of the center-right site The Bulwark, identifies “what marked Youngkin as still being part of the sickness that has infected the Republican party.” Throughout the campaign, Last points out, Youngkin refused to admit the irrefutable facts about the 2020 election— namely, that Biden won, and won fairly— and if in 2024 Biden were to win Virginia by a mere 500 votes, Youngkin might not stand up to demands that he “refuse to certify, ‘find’ 501 votes, work with the legislature to appoint an alternate slate of electors, etc.”

This was the true disappointment in the 2021 elections: In Virginia and elsewhere, Republicans did not pay a price for their party’s extremism and violation of democratic norms. If Republicans can continue to avoid paying that price in the next national elections—if voters see a shift toward a Trump-led Republican Party as normal rotation in office—the American experiment will be at the brink of catastrophic failure. n NOV/DEC 2021 THE AMERICAN PROSPECT 5

There are new hurdles to holiday shopping this year, with shortages and supply chain issues making it harder to find gifts on store shelves or available for delivery to your home. Luckily, there are lots of great products already made in America that you won’t have to worry about getting stuck in limbo on a cargo ship.

The Alliance for American Manufacturing’s 2021 Made in America Holiday Gift Guide showcases great products at a variety of price points that are being manufactured by American workers and companies. Including items from every state, the District of Columbia and Puerto Rico, the guide has something for everyone on your holiday shopping list.

When you buy something that is American-made, you support American jobs and send your money right back into the local economy. And, supporting local business is one simple way to help your neighbors.

It may seem like a small gesture, but buying American-made gifts is a simple way to help your neighbors.

And it’s a great way to make a difference this holiday season.

americanmanufacturing.org

6 PROSPECT.ORG NOV/DEC 2021

NOTEBOOK Succession Hakeem Jeffries is the heir apparent to Nancy Pelosi. Little has been made of his record.

ALEX BR ANDON / AP PHOTO

By Alexander Sammon When the credits finally roll on this year’s blockbuster production of Democratic Governance, the names will be familiar.

Joe Biden, Chuck Schumer, Nancy Pelosi will tick by first. Then the breakout stars: intransigent conservatives Joe Manchin and Kyrsten Sinema and Josh Gottheimer; stubborn progressives Pramila Jayapal and Alexandria Ocasio-Cortez and Cori Bush.

Familiar bit players will follow: Jim Clyburn, Steny Hoyer, Kamala Harris.

Only if you wait until the theater has emptied and the lights have come on will you see the name Hakeem Jeffries. As chair of the House Democratic Caucus, Jeffries is the party’s fifth in command in the people’s chamber. He’s a member of both of the caucuses that have arguably played the most important roles recently, both leg i slat ively a nd electorally: the Congressional Progressive Caucus and the Congressional Black Caucus. And yet he’s been relatively silent in the party’s defining deliberations, a disappearing act made stranger by the fact that he is widely expected to take over as the new top-ranking House Democrat.

The octogenarians are on the way out.

Some combination of Pelosi, Hoyer, and Clyburn—House Dems 1, 2, and 3—are likely to retire at session’s end. House Democrats instituted rules at the end of 2018 limiting the chamber’s top three leaders to no more than four terms, a number all three will

have reached by the end of 2022. Add to that Dems’ portentous defeats in the November 2021 elections and the possibility of many years in the minority, given historical trends and successful red-state gerrymandering, and you can see why a bunch of 80-yearolds might finally be willing to step aside.

So, for the first time since 2002, Democrats have a legitimate succession drama on their hands. Replacing Pelosi will be one of the most important battles for the future of the party.

Until recently, that torch-passing seemed to be all but a formality. Jeffries has long

party. He would be expected to serve in the good-soldier role, letting the Speaker preside over her final act. But both the battles he’s chosen to sit out and the ones he’s chosen to wage signal otherwise.

While the CPC haggled with conservatives over health care, paid leave, drug pricing regulation —Biden’s agenda and Pelosi’s personal priorities—Jeffries, a CPC member, was publicly silent. While the CBC took on an outsized role in electioneering and crafting the police reform bill, Jeffries’s contribution was marginal, campaigning for New York’s Eliot Engel, a white moderate, and Mis-

been seen as a rising star, and at just 51 years old, he’s a relative youngster compared to the rest of the leadership. A number of progressive groups that have vocally criticized Jeffries in the past declined to comment for this story, a possible indication of the presumption of his ascension.

In the case of a coronation, it might make sense that Jeffries has spent the past yearplus absent from the defining battles of the

souri’s Lacy Clay, a Black moderate, both of whom fell to Black progressives in primaries, and staying away from those negotiations. When all New York City House Democrats sent a letter to Pelosi urging her to protect all $80 billion for public housing in the BBB, Jeffries was the only member not to sign that missive, especially surprising given that New York Dems are known to act as a bloc.

NOV/DEC 2021 THE AMERICAN PROSPECT 7

NOTEBOOK His signature maneuver in 2021 has been to start Team Blue PAC, a committee to protect Democratic incumbents from progressive primary challenges. Given that Dems are likely to lose the House in 2022, the next leader’s job will be to win back seats from Republicans, not protect safe blue seats from internal contests. And those right-leaning incumbents in safe seats were already most likely to support Jeffries in his campaign for the top job, all of which adds up to signal that the formation of Team Blue was less about winning potential votes for Democratic leader than about settling scores with young Squadadjacent progressives. It’s made stranger by the fact that Jeffries insistently selfidentifies as a progressive.

That he created Team Blue with Problem Solvers Caucus co-chair Josh Gottheimer was even more striking. Gottheimer went

the largest caucus in the party, but has recently chosen to ally himself with its more conservative factions. And while the party’s moderate wing has moved left on everything from foreign policy to social welfare, Jeffries has not moved with it.

Is he the great unifier willing to find common cause with all Democrats, or a score-settler, out to quash an ascendant leftward bloc? More importantly: Is he the next face of the Democratic Party?

“The first time I met Jeffries, he was an outsider,” pines Edward-Isaac Dovere, in an August Atlantic profile of Jeffries. At the time, Jeffries was a lawyer at the infamous BigLaw firm Paul, Weiss. His mentor Ted Wells was busy defending corporate giants like ExxonMobil.

Jeffries ran a handful of abortive campaigns to get into the New York State

Zimbabwe’s Robert Mugabe and Libya’s Muammar Qaddafi.

In Congress, Jeffries climbed the ranks quickly. In late 2018, Jeffries bested California congresswoman Barbara Lee, then a ten-term incumbent, to become chair of the House Democratic Caucus. That marked the highest-stakes leadership battle in the party in almost two decades, one that Jeffries won in part because congressional progressives were weaker then, and in part because he was billed as a Speaker-in-waiting.

As fast as Jeffries moved up, so too did the political ground beneath him shift in those crucial years. On financial services, on education, on Israel, many of his bestknown positions rapidly became retrograde in today’s Democratic Party, both statewide and nationally Jeffries was the leading congressional

on to become the head of the band of corporate Democratic holdouts who imperiled the Build Back Better agenda, which Pelosi has called her legacy. “It should come as no surprise that the chair of the House Democratic Caucus plans to support the reelection of Members of the House Democratic Caucus who are working hard to enact President Biden’s Build Back Better agenda,” Jeffries’s office told The Washington Post at the time of the PAC’s creation, in a statement that was almost immediately proven false.

Jeffries is a mute member of the CPC,

Assembly starting in 2000, but didn’t get his big break until 2006, winning a seat after the retirement of a scandal-plagued incumbent named Roger Green.

Another fortuitous retirement allowed Jeffries to make the jump to the House in 2012, when incumbent Edolphus Towns retired from his Eighth District seat. Jeffries had only to best Charles Barron, whom he dispatched easily, after several former New York political luminaries teamed up to denounce Barron for his support of African nationalist strongmen like

recipient of hedge fund money in 2020.

He banked $1.1 million from the financial sector, real estate interests, and insurance industry in the 2019–2020 cycle. Everyone from JPMorgan Chase to Goldman Sachs to Blackstone contributed. Zimmer Partners, a hedge fund, is one of Jeffries’s top donors in 2021.

From the outset, he has governed with those interests at heart. While Democrats were reconsidering their coziness with Wall Street, he broke ranks to vote with the financial services world, including on

8 PROSPECT.ORG NOV/DEC 2021

Financial industry donors gave Jeffries $1.1 million in the 2019–2020 cycle, including employees from JPMorgan Chase, Goldman Sachs, and Blackstone. a high-profile measure literally written

by Citigroup lobbyists in 2013 that killed the Dodd-Frank “swaps push-out” rule, allowing banks to engage in risky trades backed by a potential taxpayer-funded bailout. Reporting by The New York Times found that “Citigroup’s recommendations were reflected in more than 70 lines of the House committee’s 85-line bill.” His former chief of staff Cedric Grant left Jeffries’s office for a job as an H&R Block lobbyist.

Meanwhile, Jeffries has remained a vocal advocate of charter schools while the party has backed away from them. He was a top priority of Democrats for Education Reform, a pro–charter school PAC that was critical of teachers unions, which named him to their “hot list” immediately upon his announcement of a congressional bid in 2012. He has spoken at fundraisers and rallies on behalf of charter schools across New York City.

On Israel, Jeffries not only started out as an unequivocal hawk, but has maintained that position even as more and more Democrats have shown a willingness in 2021 to condition aid to the country after the siege that followed the evictions of Sheikh Jarrah. But not Jeffries, who signed a letter opposing making aid conditional as recently as late April. Two years prior, he supported the Israel Anti-Boycott Act, which would impose criminal penalties on companies that supported the Boycott, Divestment, and Sanctions movement.

Those positions, though conservative, do have a home in the bigtent Democratic Party. But Jeffries is also one of the rare Democrats to have received donations from Rupert Murdoch’s News Corp PAC, the political-donation arm of Fox News. Jeffries banked donations from them just a few months ago, as well as in 2016.

His presence in state politics has been similarly out of step with a rapidly realigning party. Jeffries has placed numerous protégés in the State Assembly over the years, but recently has seen a number of his acolytes downed by progressive insurgents. In the state’s 57th District, the seat he himself once held, socialist Phara Souffrant Forrest toppled four-term incumbent Walter Mosley, a well-known Jeffries ally;

in the 25th District for state Senate, also his home turf, his hand-picked candidate Tremaine Wright fell to Democratic Socialists of America–backed Jabari Brisport. “In his own district, his constituents have shown they don’t want more of the same Democratic politics,” said Sumathy Kumar, cochair of the NYC DSA. Jeffries lobbied for Amazon to establish its HQ2 in New York City despite highprofile protests over proposed tax subsidies and labor concerns, in a battle that affixed Ocasio-Cortez in the national spotlight. At the same time that showdown was raging, Jeffries turned to Joe Crowley, the conservative congressman and once number four ranking Democrat whom Ocasio-Cortez defeated, for guidance on how to beat out Lee for caucus chair.

Jeffries returned the favor two years later by staging an ambush on Ocasio-Cortez’s campaign for a sought-after seat on the all-important Energy and Commerce committee, helping to install New York Rep. Kathleen Rice instead. Rice immediately used that promotion to torpedo the party’s signature drug pricing reform legislation and knock it out of early drafts of the Build Back Better Act. Jeffries’s commitment to the old Democratic machine was seen, too, in his outstanding loyalty to Gov. Andrew Cuomo.

As noted by Dovere in The Atlantic, Jeffries was “the only New York power player” not calling for Cuomo’s resignation following sexual harassment revelations, after Cuomo had raised money for him and repeatedly endorsed him in the past.

Age is at this moment an all-important consideration for Democrats, the party of young voters and ancient representation.

Barely in his fifties, Jeffries is young numerically, but aligned with an older mode of Democratic politics, and has repeatedly distanced himself from the younger crop of Democrats that is almost categorically more progressive (and more popular). He’s made a reputation for himself as the party’s future by becoming a foremost representative of its past.

If it wasn’t Jeffries for leader, who would it be? The name that’s gained the most momentum throughout the course of the year is Congressional Progressive Caucus chair Pramila Jayapal. After Jayapal overhauled the CPC, now the largest caucus in the entire party, and formed it into a voting

Jeffries is young numerically, but aligned with an older mode of Democratic politics.

bloc, her ability to lead on policy priorities shared by current leadership and the White house may have put her in a better position than even a few months ago. Given that Jeffries’s signature contribution this year has been to arm the party’s breakaway faction, there’s a stronger case to be made that Jayapal has been more committed to its core ambitions. She’s hardly a betting favorite, but she’s on the board, and according to people familiar with her thinking, interested in the role.

Part of the allure of a Jeffries nomination is its historical import; never has there been a person of color at the highest rank of the House of Representatives, and the Biden administration has made a signature out of appointing members of historically underrepresented groups to top posts. But that standard would pertain to Jayapal as well, a woman of color born in Chennai, India. And because she’s foreign-born, and cannot aspire to the presidency, the role would be a crowning achievement more than a stepping stone for another of the party’s rising stars. Add to that the fact that Jayapal is well liked, and shares an aptitude for tactical negotiation that’s Pelosi-like.

Contested elections yield concessions, and if the last 12 months have muddled Jeffries’s case enough to make the leader’s race a real contest, that could change the party as much as the eventual winner. The CPC, with nearly 100 members, could get any hopeful close to the 111 votes needed to win such an election. That means even a percentage of the caucus could trade their support for crucial priorities like the abolishment of PAYGO, guaranteed progressive representation on committees, or an overhaul of the notoriously opaque and powerful Steering and Policy Committee. Those things could mean more for Medicare for All or the Green New Deal than having a leader who supports them. n NOV/DEC 2021 THE AMERICAN PROSPECT 9

NOTEBOOK

Cowboy Drugstore Traces of a kleptocrat from Iraq to Delaware to Miami

By Zack Kopplin A few blocks from the water, in the heart of Miami’s glitzy South Beach, is a drugstore not like the others. Tourists buying sunscreen and straw hats from the CVS on Washington Avenue are financing a Middle Eastern kleptocrat.

The plexiglass building housing the roughly 12,000-square-foot pharmacy is worth $18.3 million and, because of favorable rent terms negotiated with CVS, should 10 PROSPECT.ORG NOV/DEC 2021

generate significant profit for its landlord.

In 2019, based on Miami property records, local press credited a Virginia-based real estate company, KLNB, with purchasing the building. But the Virginia firm’s inclusion in the property registrar was a diversion.

“KLNB is not the owner of this property and had no involvement in the transaction,” a company representative said.

The actual purchase was made by an anonymous Delaware shell company. Buried in incorporation documents for this Del-

aware company’s Florida branch is the name of the building’s real owner: Masrour Barzani, the prime minister of Iraqi Kurdistan.

A semi-independent region in Iraq’s north, Kurdistan is a hereditary monarchy in all but name and has been dominated by the Barzani family for decades.

The Kurdish prime minister has abused his power to attack, torture, and kill his critics, including Saudi-style assassinations of journalists. While he previously served as the region’s intelligence chief, Barzani had a local university student, Zardasht Osman, tortured and killed for publishing a satirical poem about the social advancement that would come with marrying one of the prime minister’s sisters.

The Kurdish prime minister is not a benign pharmacy operator. But because

ALICE MARTINS / AP PHOTO

Masrour Barzani, Iraqi Kurdistan prime minister and owner of a Miami building housing a CVS

Tracing the Barzani family investments explains why America has become an appealing destination for dirty money. of America’s underappreciated role as an enabler of corporate secrecy, if not for a clerical error, South Beach residents would have no idea about the Washington Avenue CVS. No one knows the extent of the illicit wealth hidden inside the United States. Corporate secrecy laws, maintained by states like Delaware, keep it that way. But tracing the Barzani family’s investments, like this Miami pharmacy, explains why America has become an appealing destination for dirty money.

Through oil and corruption, the Barzanis, whose agents did not respond to requests for comment, have amassed enormous amounts of wealth. For example, a real estate investment in Kurdistan, owned by a company secretly connected to one of the prime minister’s brothers, has been valued at $1.27 billion. Like other despots, the Barzanis turned to secrecy havens, the kind of places exposed by the Panama and Pandora Papers, to conceal their money.

Secrecy havens are jurisdictions that don’t require public disclosure of the names of the owners and shareholders of companies housed within their borders. This enables all sorts of financial crimes, from tax evasion to money laundering and facilitating bribery. But, unlike the king of Jordan and Argentina’s former president, whose secret companies got busted in previous offshore leaks, Barzani assets and business deals were not exposed in the Panama and Pandora Papers.

They’ve only been caught in one major leak, a database of Dubai property records, obtained by the nonprofit Center for Advanced Defense Studies, which contains details about the Barzanis’ assets in the uber-expensive Burj Khalifa complex and one of the city’s artificial islands, Palm Jumeirah, along with the family’s connections to United Arab Emirates royalty.

This is because instead of Cayman Island

beaches, the Barzanis opted for an office building in Delaware owned by the CT Corporation, an American branch of a Dutch company, Wolters Kluwer, that specializes in creating anonymous companies.

Though less picturesque, America’s corporate secrecy regime is virtually equivalent to what is offered by any Caribbean island. In many states, rather than disclosing real ownership, wealthy individuals can hire agents and representatives to put their names and addresses on corporate paperwork instead, or aren’t required to supply ownership information at all. A network of accountants, law firms, and consultants, like Wolters Kluwer, will set up and manage these secret companies for anyone who can pay.

The Barzanis have enough secret property, which also includes mansions in California and Virginia, that they’ve now been caught hiding money in America four times. Collectively, the family has paid over $75 million for these four properties alone. These investments likely represent only a small fraction of the family’s secret wealth in the United States. None of these properties were discovered through a Panama Papers–style leak. Instead, all four properties, which had proxy owners and expensive law firms to protect them, were only unmasked because their agents made small slipups.

In the case of the CVS, it was a Pennsylvania-based law firm, Cozen O’Connor, that appears to have exposed their own secret client. Over two months, beginning in December 2018, the law firm opened three Florida companies and a Delaware company all named after the pharmacy’s Washington Avenue address. The paperwork for the Florida companies included the Kurdish prime minister’s name and signature, along with that of one of his other brothers, Muksi Barzani.

Those names were not meant to become public and, shortly after the pharmacy’s purchase, the law firm removed them from the companies. The Barzanis were replaced with one of Cozen O’Connor’s own lawyers, Matthew Weinstein. It wasn’t a perfect solution, but this legal triage was highly effective. You won’t find their names in popular corporation research databases, and it was enough to fool local journalists.

The CVS deal also highlights how far corporate lawyers will go to defend their wealthy dictator clients. When called for

comment, Weinstein categorically denied that the Barzanis owned the building or were clients of Cozen O’Connor. Instead, he said the corporate documents held by the Florida secretary of state were incorrect.

(Later, in response to follow-up questions, Weinstein denied saying any of the things that he had previously said. “If you choose to write an article about the Barzani family, your characterization of my response to you must be ‘Mr. Weinstein would not comment on these matters,’” he wrote in an email.)

His statements were all over the place, but Weinstein’s core claim, that the Florida secretary of state’s records were wrong, is implausible. The names of the Kurdish prime minister and his relatives don’t just randomly end up all over incorporation documents for multiple Florida companies for no reason. “The name is a significant piece of the corporate registry,” said Robert Appleton, a former senior prosecutor for the Department of Justice. These documents were prepared by Cozen O’Connor and many were signed by Weinstein personally.

Submitting falsified documents to the Florida corporate registrar is a felony, but that’s essentially what Weinstein claimed his law firm had done, in a last-ditch attempt to conceal the identity of his clients.

Obviously, the Barzanis do not tolerate errors, but it was a similar mistake that exposed their Virginia mansion. It was purchased in 2010, by an anonymous Virginia company put together by a local law firm. For years, Kurdistan watchers had speculated the property belonged to Masrour Barzani, but documentary evidence didn’t emerge until someone accidentally allowed the registration for the Virginia company to lapse.

Its reinstatement paperwork was signed by the chairman of Ster Group, a Kurdish conglomerate. According to State Department cables published by WikiLeaks, Ster Group is owned by members of the Barzani family.

The Barzanis don’t just use American corporate secrecy to hide their blood money.

They’re even exploiting it to defraud the United States government. Both of their California mansions were connected to a conspiracy to defraud the Pentagon. Purchased in 2018, by anonymous Delaware and Virginia companies, through representatives of another small Virginia law firm, these mansions were one of the largest real estate purchases in Beverly Hills history. The scheme was only exposed when Variety’s real estate vertical discovered the NOV/DEC 2021 THE AMERICAN PROSPECT 11

name of a Barzani family employee, Haval Dosky, on paperwork associated with the properties.

Dosky was a middleman in a scheme where fuel purchases to supply American bases in Kurdistan were steered to the Barzanis’ preferred military contractors, who charged the Pentagon significantly above market prices. It’s quite possible proceeds from those deals were what financed these mansions.

All of this raises the question: How many hidden properties do the Barzanis, and other autocrats, have inside the United States?

Corporate lawyers make mistakes, but not every time and probably not even often.

Delaware officials recently defended the status quo to the Prospect, with one former judge saying “there’s a reason it’s called the Panama papers and not the Delaware papers.” But the main distinction between Panama and Delaware is that there hasn’t been a Delaware whistleblower, yet.

In January, Congress passed the Corporate Transparency Act, which requires companies to file the names of their real owners with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN), with some major exceptions. There’s already evidence this approach isn’t enough.

Providing law enforcement access to

The Miami CVS deal would not have been traced to the Barzani family were it not for an error by a Pennsylvania law firm.

Most journalistic investigations into anonymous shell companies and secret real estate purchases end in failure. Even in the process of reporting this piece, I was unable to obtain ownership records to validate another probable Barzani property in California. The lawyers behind that company made no errors and kept it fully anonymous. As long as states like Delaware maintain corporate secrecy laws, journalistic investigations into corruption will continue to dead-end.

12 PROSPECT.ORG NOV/DEC 2021

ownership records is a step in the right direction, but still inadequate. This ties the ability to effectively investigate corporate malfeasance to the priorities, resources, and legal handicaps of the Department of Justice. Federal investigators will probably be far more effective at catching terrorist financiers and drug smugglers, but anyone who doesn’t threaten national security, like the Barzanis, who are close American military allies, will likely be far less of a priority.

Another major leak of files from FinCEN showed that agency did little to stop financial crimes despite receiving evidence of hundreds of thousands of suspicious transactions from banks. There’s no evidence things will be different in corporate transparency investigations.

A public beneficial ownership registry is the only adequate reform, but even that approach has vulnerabilities. One often illegal service provided by companies in the secrecy industry is nominee ownership. This means that the company provides a fake owner, not just a lawyer or agent, to sign corporate paperwork. The real owner is protected by legal documents, like undated letters of resignation signed by the fake owner and a power of attorney that lets them dictate corporate decisions, all while remaining hidden from the public and law enforcement.

Corporate secrecy is going to remain a problem as long as people like the Barzanis have money to hide.

The only real solution for it, in America, is a leak of the Delaware papers by a whistleblower. Employees of law firms, like Cozen O’Connor, and corporate service companies, like Wolters Kluwer, should take the internal databases of their kleptocrat clients and the names of their secret businesses and make them public.

Corporate whistleblower laws are an imperfect patchwork of protections, and any whistleblower brave enough to expose America’s criminal financial secrecy regime will face serious risks and potential retaliation for their act of civil disobedience. But we need those employees to stand up. They’re the only ones with the power to really bring down this system. n Zack Kopplin is an investigator at the Gov­ ernment Accountability Project, a whistle­ blower protection organization.

NAM Y. HUH / AP PHOTO

NOTEBOOK

More than 3,500 protesters demonstrated against nuclear power in Toulouse, France, in early November.

A Nuclear Cop-Out in Glasgow If the international community can’t make headway on nuclear energy goals at COP26, when, if ever, is it going to happen?

ALAIN PIT TON / AP PHOTO

By Gabrielle Gurley A strange thing happened on the way to COP26. Japanese voters returned the Liberal Democratic Party to power, and its leader, Prime Minister Fumio Kishida, is a supporter of nuclear energy and of restarting the country’s sidelined nuclear plants.

Elsewhere, French President Emmanuel Macron once wanted to backtrack on France’s all-in nuclear strategy, but now he intends to bankroll a new generation of nuclear facilities to replace its aging plants.

The United States trumpeted its pursuit

of state-of-the-art nuclear reactors, while Britain crowed about its commitments to nuclear energy. For its part, concerned about long-term reliance on nuclear power and waste storage issues, Germany stands firm on its post-Fukushima retreat from nuclear energy—and it’s not likely that the French, the world’s leading nuclear energy adopter, will make much headway with the Germans on the subject.

You might suppose that the planet’s premier international climate conference could be a safe space to thrash out the varying takes on the role of nuclear energy in deal-

ing with the climate crisis and getting to net zero. But the world’s second most widely used clean-energy source has had something of a pariah status at COP26. The climate summit’s refusal to acknowledge nuclear power’s singular role in global energy production and its possible viability as a bridge fuel says more than streets full of anti-nuclear protesters ever could about the controversial space that nuclear energy occupies in the global decarbonization debate.

Nuclear advocates and organizations like the World Nuclear Association criticized the COP26 snub, which facilitated NOV/DEC 2021 THE AMERICAN PROSPECT 13

NOTEBOOK their participation but kept them out of public view. Eleven nuclear workers’ unions issued a call for an “active industrial strategy underpinned by investment” in nuclear energy. “There seems to be a real power struggle in Europe right now, and it doesn’t look like Germany is going to be backing down,” says Bob Walker, national director of the Canadian Nuclear Workers’ Council, which signed the letter. “It’s been very discouraging.”

A decade ago, support for nuclear power plummeted in both Germany and Japan after the tsunami spawned by a magnitude 9.0 earthquake off the coast of Japan crashed into the Fukushima Daiichi Nuclear Power Plant, leading to a cataclysmic meltdown. Wind and solar power emerged as primary beneficiaries of the disaster, which cratered interest in nuclear as a bridge fuel to a net-zero world. About 10 percent of the world’s electricity came from nuclear power in 2019 before scheduled retirements, maintenance shutdowns, and reduced electricity demands took hold in 2020.

But in 2021, as developed countries tried to restart their pandemic-addled economies, an energy crisis seized Europe. A historic decrease in wind speeds over Ireland and the United Kingdom earlier this year (a cautionary tale for the U.S.) magnified renewable energy’s intermittency problems.

The Netherlands has all but shut down Europe’s largest natural gas field to alleviate earthquakes. An increased demand for natural gas sent prices skyrocketing, which prompted Germany and other nations to shift to cheaper, and dirtier, coal to produce electricity.

Over the past year, then, nuclear energy has gained new respect, due primarily to wind and solar’s energy storage and intermittency issues across much of Europe.

Until the renewables sector solves the intermittency question and can harness stored energy when winds are calm and skies overcast, nuclear is the only other netzero source already in use. “Nuclear, solar, and wind can all survive in a zero-carbon world; they all play different roles,” says Christopher Knittel, a professor of applied economics at the MIT Sloan School of Management. “But unless we get the right incentive structures in place, I fear, what we’ve seen in some markets is replacing a zerocarbon source with another zero-carbon source and that’s not doing anything to help the climate.”

14 PROSPECT.ORG NOV/DEC 2021

Small modular nuclear reactors (SMRs), a next-generation technology, are key to the nuclear countries’ renewed bullishness on climate, though they exist only on drawing boards. Seventy percent of France’s electricity already comes from nuclear energy, easing the way for Macron to initiate an SMR ramp-up. Although Britain plans to push forward with one large conventional-scale plant, it’s also moving ahead with SMRs. Nuclear energy is the single largest source of clean energy in the U.S., and the Biden administration has leaned into a Foundational Infrastructure for Responsible Use of Small Modular Reactor Technology (FIRST) program that provides a tiny amount of funding, $5.3 million, to boost international research and development partnerships. One such deal, an agreement between NuScale Power (a Portland, Ore-

Small modular nuclear reactors, like this demo from a Chinese trade show, are roughly a decade away from commercial deployment.

gon–based firm) and Nuclearelectrica (the Romanian national nuclear company) to build an SMR plant, got a shout-out from the White House.

Nuclear construction in the U.S. has all but ground to a halt since its apex beginning in the 1970s. Currently, there are about five dozen nuclear plants with licensed reactors providing 20 percent of the country’s electricity. The misadventures surrounding the Vogtle project in Georgia, which is years behind schedule and billions over initial cost projections, have doomed conventional projects of one gigawatt or more that were already faltering because of astronomical costs and safety fears.

Now, the cost sav ings and safety enhancements that come with the SMRs have created new interest in the nuclear option, though such plants are still roughly

AP PHOTO

a decade away from commercial deployment in the U.S. and Canada. Smaller SMRs run up to about 300 megawatts, are factory-built—that is, cheaper—and can be sited in locations that cannot support conventional plants, which must be built near large bodies of water to provide a source for reactor cooling. The smallest subset of advanced nuclear reactors are micro reactors of one to ten megawatts that are suitable for deployment in remote, hardto-reach communities. “The whole idea behind the SMRs,” says Kenneth Luongo, president of the Partnership for Global Security and a former Department of Energy official, “is that you are able to manufacture these modules and hook them together to create a designer output.”

SMRs could minimize intermittency issues. “When people talk about the complementarity between nuclear and renewables, you would have a smaller steady output, as well as this intermittent output, and the nuclear part would take over when the renewable part wasn’t producing,” explains Luongo, who oversaw DOE’s arms control, nonproliferation, and nuclear materials portfolios. Utility-grade energy storage that could render intermittency obsolete in wind and solar is also years away, and batteries come with their own hazards, as a September overheating incident at Moss Landing, a former California power plant turned site of the world’s largest battery complex, demonstrated.

A n Inter nationa l Atomic Energ y Agency explainer notes that these modular reactors rely on a mix of inherent safety features and passive systems that utilize gravity, self-pressurization, and other physical attributes that do not need humans to step in if and when something goes wrong. These systems also would have smaller amounts of volatile materials onsite than conventional nuclear plants and can be returned to a factory site once the fuel is spent. SMRs are being designed to withstand certain types of impacts and sited in such a way to be hardened against sabotage and natural disasters.

On Capitol Hill, there has been rare bipartisan agreement that nuclear has a role to play in the U.S. energy mix. The Trump administration signed two nuclear power research and development bills, the Energy Act of 2020, which aids existing power plants, and the Nuclear Energy Innovation Capabilities Act of 2017, which

facilitates building privately funded demonstration reactors at Energy Department sites.

Whether smaller equals better and alleviates, if not completely banishes, public fears about the dangers of nuclear power, remains to be seen. Promising theories that pan out in controlled demonstration settings can fall apart in the real world. SMR research and development projects, such as FIRST, the international R&D program, have teed up enough theoretical credibility to secure public seed money. But the technology is still in the R&D phase, and until SMRs are thoroughly tested, licensed, and online, it is impossible to gauge how markets will respond or if the safety theories hold. The Seattle Times reported that a Washington state next-generation small nuclear reactor plant being developed and constructed by X-energy, a Marylandbased firm, stands to haul in $2.2 billion, thanks to the recently signed bipartisan infrastructure legislation. Microsoft founder Bill Gates has also branched out into SMRs. His TerraPower company is building an SMR plant at a shuttered coal plant in Wyoming, the country’s largest coal-producing state.

Color the Union of Concerned Scientists dubious about the benefits touted by TerraPower and X-energy. Its March report, “‘Advanced’ Isn’t Always Better,” found that many of the companies’ suppositions rest on half-century-old ideas about safety, security, and cost savings that have never been tested. Moreover, their within-the-decade deployment targets are wildly optimistic: Factoring in the necessary federal regulatory testing regimes adds on another decade, the group suggests. UCS goes even further, recommending suspending federal demonstration programs until the Nuclear Regulatory Commission decides how to proceed with testing and commercial licensing.

For their part, environmental organizations are split on nuclear energy. Groups that planted their flags on the hill of the anti-nuclear movement, including Friends of the Earth and Greenpeace, still oppose nuclear energy. Organizations like the Nature Conservancy embrace both renewables and nuclear energy. UCS supports renewables and decarbonization policies, as well as safety enhancements for existing nuclear facilities.

In COP26’s first week, climate negotiators made significant strides by agreeing to cur-

Until SMRs are thoroughly tested, licensed, and online, it is impossible to gauge how markets will respond or if the safety theories hold.

tail methane emissions and dial back deforestation. The most surprising shift was a commitment to a two-pronged phaseout of coal supported by developed countries and developing countries alike (although the U.S., U.K., and Canada declined to make the leap, pledging only to end investments in fossil fuel plants abroad). But with European Union countries at odds on nuclear, and facing an imminent EU financing decision on which energy sources the bloc counts as green, COP26 opted to keep the nuclear question as unanswered, and undiscussed, as possible, and accorded the lowest of low profiles to the nuclear energy advocates in attendance.

The choices confronting the international community about nuclear power are both urgent and difficult. Countries have to balance concerns over the economic role, as well as the safety and security, of a net-zero energy source already in use against the reality of rapid planetary degradation. That explains the recent dash of some political leaders to SMRs, which give the appearance of being a viable technology though they are years away from deployment. What’s emerging is a discordant free-for-all that edges nuclear energy forward without coordinated leadership, much less consensus. Or, as IAEA Director General Rafael Mariano Grossi, who was advised to stay home but showed up at COP26 anyway, brazenly told Bloomberg Green, “The message to the public is that nuclear will be a very useful element in the equation, whether you like it or not.”

But if COP26 can’t offer a viable forum to kick-start the debate about the role of nuclear energy and new technologies on the road to net zero, just how, when, and where on Earth does it happen? n NOV/DEC 2021 THE AMERICAN PROSPECT 15

THE GREAT Why workers are quitting their jobs, after the trauma of the pandemic.

BY DAVID DAYEN ILLUSTRATION BY POLLY BECKER

The first thing you should know about Caroline Potts of Murfreesboro, Tennessee, is that she loves her pets. “I have five cats and three dogs,” she told me, proudly. “The only thing I don’t have is birds.”

So when she needed a job, PetSmart seemed like the perfect solution. “My sister worked at PetSmart and I was in there so much,” she said.

She started as a bather, and showed enough promise to be invited to the company’s dog grooming academy, where they teach how to cut hair. “I knew it was what I wanted to do with my life,” Caroline said.

“I was really passionate about animals and I loved grooming.”

There was only one problem: PetSmart.

Groomers were pressured to complete as many dogs as possible, through a constant whirlwind of commotion and barking and often verbal abuse and harassment from customers. Without enough staff available, Caroline sometimes worked seven days in a row.

Company policy was supposed to prohibit grooming dogs with seizure disorders or those that couldn’t handle the stressful environment. Managers in Murfreesboro 16 PROSPECT.ORG NOV/DEC 2021

continually pushed Caroline to groom them anyway. “Some can die in the kennel from stress,” she said. “One dog was terrified of the dryer, and they wanted me to dry her straight through. They said, ‘Figure it out.’”

For someone who loved to be around animals, inflicting pain on dogs for a living was a nightmare, Caroline told me. “Every day when I was driving to work, I was hoping for a car accident so I didn’t have to go in. I talked to friends about it, they said, ‘Yeah, that was my thought too.’”

Before going to the academy, PetSmart made groomers sign a two-year contract, without the ability to work for any rivals.

Caroline approached her district manager and said, “I want out of my contract. You didn’t give me the training I needed and you made this experience so bad.” Amazingly, the district manager ripped up the contract.

She went on to Petco, where things are a bit better. But if Caroline gets her way, she won’t be there very long either. She has a vision of going out on her own as an independent groomer. A friend of hers just rigged up a mobile grooming van and has seen the business take off.

“That is all I can ever think about,” she

T ESCAPE

NOV/DEC 2021 THE AMERICAN PROSPECT 17

said. “It’s the dream. That’s how you can make an amazing life for yourself.”

In September, 4 .43 million workers followed Caroline Potts’s lead and quit their job, a new record high. That represents 3 percent of the American workforce leaving their jobs, after 2.9 percent quit in August. In lower-wage sectors like leisure and hospitality and food services and accommodation, the numbers were as high as 6.6 percent, around 1 in every 15 workers.

Things could accelerate from there.

According to a July survey from the Society for Human Resource Management, 41 percent of U.S. workers are either actively searching for a new job, or planning to do so in the next few months. Two-thirds of those searching have considered a career change, rather than moving within their industry. Bankrate’s job seeker survey in August found even more turbulence; 55 percent of the workforce said they would likely look for a new job in the next year.

This trend has been characterized as the Great Resignation, and just about every economist and pundit has taken their crack at teasing out why it’s happening.

Explanations have included health and safety fears, child care needs, a tight labor market, boosted savings from stimulus funds or reduced ability to spend money on bars and movies, enhanced unemployment benefits, increases in business formation, desire to work from home, early retirements, restrictions on immigration, demographic shrinking of the primeage workforce, and my personal favorite, expectations of a labor shortage creating a labor shortage.

Some of these ideas have merit, though none can quite explain everything. In these moments, it’s best to actually ask the workers themselves. I did that, talking to dozens of people who have recently quit their job, or experts who closely track workers who have.

And some patterns emerged.

Work at the low end of the wage scale has become ghastly over the past several decades. With no meaningful improvements in federal labor policy since the 1930s, employers have accrued tremendous power.

Workers were afraid to voice any disapproval, taking whatever scraps they could get.

“The U.S. needs a reset, needs a big push, to get to a place where work is more secure and livable for a lot of the population,” said MIT economist David Autor, who has tracked the 18 PROSPECT.ORG NOV/DEC 2021

misery of American deindustrialization and the shock of China’s rise as a manufacturing powerhouse.

The pandemic functioned as that reset, creating a mental escape hatch from the immiseration and even danger of ordinary work. If you call someone an “essential worker” for long enough, they start to believe it. They start to wonder whether they deserve more, given their essential nature.

Gaining courage from social media, the most vulnerable people in America have started the closest thing we’ve seen in a century to a general strike.

For now, it’s working to deliver higher wages and better conditions. But from my talks with workers, they’re really seeking something more ineffable than a couple more bucks an hour. Work is the largest time block of the day, in a moment where we’ve all learned how precious time can be.

People simply want to spend that time getting the dignity and respect denied to them for so long.

Workers are quitting across the labor force; people I’ve talked to range from minimumwage employees to senior executives. But quit rates and job-to-job transitions in the Great Resignation are mostly taking place among workers with less than a high school education, whose daily toil is typically spent in dead-end low-wage jobs, an engine for corporate profits that produces some of the grimmer existences in the industrialized world.

The particulars of low-wage work have been well documented for years: stagnant wages, short staffs, poor conditions, erratic schedules, no benefits, overbearing managers, and the constant fear of losing your job. The low-wage worker must fend off thieves who are writing their paychecks; a 2014 report from the Economic Policy Institute estimates that wage theft steals $50 billion from low-wage workers every year. The uniquely American innovation of constant worker surveillance, perfected

by Amazon, now has workers’ every move tracked, every ounce of performance measured, every slip punished. All for 15 bucks an hour, if you’re lucky.

The point of this is to deliver lower prices and higher profits on the backs of labor exploitation. Low-wage employers rely on an endless reserve of desperate workers willing to break their backs for a pittance.

Unsustainable wages are a problem for government benefit programs. High turnover

The most vulnerable people in America have started the closest thing we’ve seen in a century to a general strike. is not a problem as long as there’s one more job application in the door.

As of 2020, nearly one-quarter of U.S. jobs were low-wage, the highest percentage in the developed world. “We think it has to be this way,” said Autor. “But look at peer countries, it doesn’t fit. All have rising educational attainment and drops in worker power. But many have higher wages and lower economic insecurity at the low end of the spectrum.”

Overfinancialization has added to the pain. More than 11.7 million U.S. workers, most of them low-wage, now work for companies owned by private equity firms.

(One of those workers was Caroline Potts; PetSmart is owned by BC Partners.) With a business model of extracting as much cash out of portfolio businesses as possible, private equity has turned even more jobs into low-wage nightmares.

For example, Ed Gadomski worked at Waterbury Hospital in Connecticut, in the IT department, for 32 years before Leonard Green & Partners, a Los Angeles–based private equity firm, took over. “In the first year, layoffs became a household word,” Gadomski said. “Longevity employees were particularly targeted.” He lost his job in July 2020 and was offered it back at just $13.46 an hour, just one-third of his previous salary, without health insurance or retirement accounts. He declined the offer; now an outside contractor has his job. “The fear among the current hospital workers is that Leonard Green will outsource department by department and there’s nothing we can do about it,” he lamented.

The pandemic took the drudgery of low-wage work and turned it up several notches. In the initial phase, retail and restaurant establishments laid off everyone and shut down. But essential businesses, as the saying goes, continued on, offsetting

A disproportionate number of quits during the Great Resignation are happening in dead-end low-wage jobs. the risk of viral exposure with a few bucks of hazard pay, if that. “I worked the entire pandemic as an essential worker and got a T-shirt out of it,” Collin Keehn, a beer sales representative in Harper Woods, Michigan, told me.

You can measure a worker’s worth by how they were treated in the pandemic. Reina Abrahamson of Salem, Oregon, was a customer service representative with the credit card division of Wells Fargo. A transgender woman, she had medical issues and asked to work from home. But Wells Fargo would only provide a 50-foot network cable, too small to hardwire from the DSL router to where Reina could perform her job. “I was like, ‘Can we get approval for a 100-foot cable?’” Abrahamson explained. “So [the manager] put in the request, and six months later he got approval. I was on leave for that six months.” The leave offered a minimum salary, but Abrahamson couldn’t acquire bonuses for quality assurance, which comprised a significant chunk of her take-home pay. She ended up driving for DoorDash to pick up extra cash.

Zella Roberts had a separate problem while working as a carhop at a Sonic in

Asheville, North Carolina (another private equity–owned firm, part of the Roark Capital empire). Customers ordered either though an app or through a device at the drive-in stalls. When she got there, neither option gave any way for customers to tip carhops when paying with a credit card.

And yet Roberts was making a tipped minimum wage of $5 an hour. Not only was she exposed to hundreds of unmasked customers, she was doing it for an illegal wage, only allowed because it was supposed to be subsidized through an impossible payment.

“The business model seems to be dependent on paying their hardworking staff poverty wages,” Roberts said. “It was awful knowing I had to go in every day, risking my life for five bucks an hour.”

Health and safety in the workplace went from an afterthought to an all-consuming fear. Stephanie Haynes, a sorter at an Amazon warehouse in Joliet, Illinois, who lost her fiancé to COVID, noted that she would have to team up to break down a pallet of goods with a co-worker. “A pallet isn’t six feet,” she said. Amazon wouldn’t tell warehouse staff when colleagues contracted COVID; Haynes had to find out from friends.

She walked out at the end of March 2020 and didn’t come back until July.

“In the beginning, we didn’t receive no masks,” said Monica Moody, at the time a packer at an Amazon warehouse near Charlotte, North Carolina. When Moody started talking to reporters about the conditions, she was fired. She started driving for a subsidiary of Amazon, where the explosion of people wanting home deliveries, and continued surveillance to hit work rates, made the job unbearable. “At my facility alone, each driver was getting over 300 packages,” Moody said. “Imagine getting to work at 11, in the middle of summer, load my van, go get 300 packages, and get 300 packages out. I’m being overworked and underpaid.”

A study from the University of California, San Francisco found that the professions seeing the highest number of working-age deaths from COVID-19 were cooks, warehouse line workers, agricultural workers, bakers, and construction workers. All of them are low-wage jobs with inevitable contact with co-workers. Employers knew this and saw it as an acceptable loss. A lawsuit last year alleged that Tyson Foods managers in Waterloo, Iowa, placed bets on which NOV/DEC 2021 THE AMERICAN PROSPECT 19

of the plant’s meatpacking assembly-line workers would contract COVID. When lockdowns ended and patrons finally started to return, low-wage workers had a new role: policemen. Stir-crazy from months at home, customers came out angry, with many resisting face mask or vaccination policies. Frontline workers, with no training in conflict resolution, had to enforce these policies, thrust into the heart of the culture wars. The jobs were bad enough before the tension and hostility.

Now, the pitched battles, the fighting and shouting, thudded against the brainpans of already stressed-out workers.

“It’s a horrible place to work,” said Sara Nelson, president of the Association of Flight Attendants union, about her own profession, which has seen some of the most high-profile incidents of rage. This is a job with union support pushing people to such a limit that one flight attendant told The New York Times, “I don’t even feel like a human anymore.” Imagine how those with no such help feel.

Once you understand what workers are going through, then you can see the pandemic as kindling for a fire. As my colleague Harold Meyerson recently wrote, the two largest strike waves in American history occurred in 1919 and 1946—right after World Wars I and II, when infantrymen returned from Europe hailed as heroes and then found that their jobs were significantly less than heroic. They rebelled against menial work inappropriate to their sacrifice.

Today’s low-wage workers, shattered by collective trauma, have similarly been punched once too often, after being exalted all too briefly as America’s backbone.

Leticia Reyes of Sacramento, California, has been on strike twice. But she doesn’t belong to a union; she works at a Jack in the Box franchise.

The first strike was due to malfunctioning air conditioning amid a historic heat wave, causing temperatures in the kitchen to rise as high as 109 degrees. “We asked the manager to fix it,” Reyes told me through an interpreter (her primary language is Spanish). “The first time, she wouldn’t listen to us, she ignored us. The second time, she told us it wasn’t high temperatures, it was us workers going through menopause.”

Reyes had never organized anyone before.

Her colleagues were constantly told that they could have their hours cut, that they 20 PROSPECT.ORG NOV/DEC 2021

Shana Blackwell posted a TikTok video of her quitting a Lubbock, Texas, Walmart over the store’s PA system. could lose their job. But her manager’s disrespect motivated her to try. The shift workers at Jack in the Box united, and with help from Northern California Fight for $15, they walked out. They not only got the air conditioning fixed, they got the manager fired.

But low-wage work in America requires eternal vigilance. Reyes and her colleagues weren’t getting their required ten-minute breaks, or lunch breaks or overtime, while toiling in peril during the pandemic. They decided to strike again for three days.

“On the second day, the owner decided to meet with us. He said he was losing a lot of

money,” Reyes said. “The owner and a few other people, they actually opened the store and were preparing the food themselves. It made them realize that they need us.” When the workers returned, they started getting their breaks and their overtime, and more pay as well.

“I am no longer scared to speak up,” Reyes said. “Big companies need us as workers and we should not be afraid to speak up.”

The Sacramento Jack in the Box is just one among a shockingly high number of pandemic-era walkouts at non-union workplaces. These small mass actions are the

Though the act of quitting is often individual, social media collectivizes it, creating community from an atomized and dislocated workforce. corollary to millions of individual actions of workers shoving off, unafraid of the consequences. A switch has gone off. “The pandemic activated this latent insecurity that was growing as a result of the gig economy, in which no one is an employee,” said Michael Duff, a former Teamster who now teaches at St. Louis University School of Law. “If work is so bad, I will do anything to not do it. What do you have to lose, your crappy, dangerous gig job?”

Mike Elk, an independent labor journalist with Payday Report, has been tracking strikes on an interactive map since the onset of the pandemic, in March 2020. He has counted over 1,600 separate walkouts, in places like a donut shop in Kansas, or an IHOP in North Carolina, or a tortilla plant in Illinois. Nearly 100,000 workers have been involved. Every other day, it seems, there’s a strike at McDonald’s or Instacart or some other avatar of low-wage America. A sign outside a Burger King in Lincoln, Nebraska, went viral for its message: “We all quit.

Sorry for the inconvenience.”

The real number of walkouts is likely even higher, as they are often uncovered by local media. “We check viral stuff on TikTok,” Elk said. “You see teenage Black kids who say, ‘Let’s roll out’; we wanted to put it on the strike tracker but we can’t do it because we didn’t know where.”

This is where the Great Resignation meets the digital age. Walkout signs posted outside businesses routinely go viral, feeding a near-insatiable anger with low-wage work. #QuitMyJob videos have been trending on social media sites for more than a year. On any given day, a nurse, an office drone, a Foot Locker clerk, or a preschool teacher (“Life’s too short to be stuck”) can be seen taking the jump. Though the act of quitting is often individual, social media

collectivizes it, creating community from an atomized and dislocated workforce.

In a splendid dialectic, the same digital technology that facilitates speedup and second-by-second monitoring by the boss facilitates acts of collective consciousness, organizing, and rebellion.

One of the more well-known quit videos came from Shana Blackwell, an $11.22-anhour night stocker at a Walmart in Lubbock, Texas, who filmed herself announcing her resignation over the store’s PA system. “Attention, all Walmart shoppers,” she began, going on to call out managers and colleagues by name for inappropriate behavior. “This company fires Black associates for no reason. This company treats their employees like shit … Fuck the managers, fuck this company, fuck this position … I fucking quit.” The video has over 35 million views and over 125,000 comments.

The week that I caught up with Blackwell, another woman, Beth McGrath of Lafayette, Louisiana, made essentially the same video, condemning her managers and quitting Walmart over the PA. I asked Blackwell if she’d seen McGrath’s video. “I got a notification three days ago,” she told me.

“Everybody was tagging me in it.”

Blackwell, who now lives in Delaware, still hears from people who’ve watched her video, thanking her for her bravery and telling her their experiences at work. “When you watch these videos, you feel that same adrenaline,” she explained. “I think everybody is sharing their experiences and realizing there is something better out there for themselves.”

Despite offering wages that would have attracted people a couple of years earlier, employers get no takers, and have to do the job themselves. This bit of comeuppance has popped up occasionally on social media during the current labor shortage. But it was also found in a cathedral priory chronicle of 14th-century Rochester, England. “Such a shortage of workers ensued that the humble turned up their noses at employment,” reads the account. “As a result, churchmen, knights and other worthies have been forced to thresh their corn, plough the land and perform every other unskilled task if they are to make their own bread.”

This was the time of the Black Death, which in its most highly affected areas wiped out half the population between 1347 and 1351. The extreme labor shortage gave

serfs and peasants, who worked the land for the wealthy, power they had never seen before in their lives: the ability to bargain for cash wages, lower rent, less hazardous conditions. They could find opportunities at artisanal craft guilds in the cities, or just at the neighboring lord’s village. They could use the market for labor to pick and choose their circumstances, for the first time.

Christine Johnson, the history professor at Washington University, St. Louis who unearthed that chronicle, told me that a member of the higher classes going into the fields was such a “dreadful possibility” that few actually carried it out. Since subverting the social hierarchy was unthinkable, lords could only grumble at this turn of affairs.

“The thing that you see so often today is ‘Why won’t these people work for $14, $15 an hour?’” said Spencer Strub, an associate research scholar at the Humanities Council at Princeton University. “You see the same thing from chronicles of these abbeys, the major employers of the day. ‘They aren’t working for what they worked for two years ago.’ It’s a moralized statement that they are lazy, uppity, have forgotten their place in the natural order.”

Where exasperation failed, the nobility appealed to the government. England’s 1349 Ordinance of Labourers, later codified into statute as the nation’s first labor law, set wage controls in rural areas at pre–Black Death levels, restricting the ability to bargain for more pay. (It also included price controls, so no excess profits would follow.)

Everyone under the age of 60 was required to work, in bounded contracts if they were unpledged, against penalty of imprisonment. “If you were found to be free of employment, I can compel your service for a year at the 1346 prevailing wage,” Johnson said. Serfs could not depart their lord to seek out a better deal. And no employers could hire “excess” workers, allowing the labor pool to be spread evenly.

Finally, the ordinance sought to limit practically the only form of social welfare available: beggars who frequented funerals to receive alms from the rich. “Because that many valiant beggars … do refuse to labor, giving themselves to idleness and vice,” the ordinance read, “none upon the said pain of imprisonment shall, under the color of pity or alms, give any thing to such … so that thereby they may be compelled to labor for their necessary living.”

It was an audacious move to prevent comNOV/DEC 2021 THE AMERICAN PROSPECT 21

Medieval chronicles after the Black Death indicate that peasants and serfs bargained for cash wages, lower rent, and less hazardous conditions.

petition among landowners for scarce workers, and to maintain the prevailing social order and keep the serfdom’s new found power tamped down. It was also a failure.

“We know that employers would pay more, they would cook the books,” Johnson said. “Landowners would say, ‘We will pay you more but we don’t want it acknowledged officially.’” Employers in the city of London set higher wages despite being expressly forbidden. Thousands of cases with local justices of the peace show an unwillingness from the lower orders to submit to the ordinance.

People refused compelled service; in one case, an individual claimed he could not be taken into service by another because he was already a serf.

“A poem I study is Piers Plowman,” said Strub. “There are scenes about working in the fields, and they just stop: I’m not going to work in the fields unless you pay me a real wage, give me the real food.” This primitive sit-down strike was a recognition of real worker power, despite a heavy-handed effort to snuff it out.

The peasantry’s refusal to accept suppression led many landowners to sell off small plots to the lower classes.

Eventually, this created a rising middle class, an entrepreneurial explosion, and the end of feudalism, according to some historians. Real incomes doubled in Europe over the next several years. And this is what we’d expect from such a cataclysmic event, actually. An April 2020 working paper from the National Bureau of Economic Research surveyed 19 pandemics stretching back to the Black Death, finding that real wages consistently went up and the return on capital consistently went down, something not paralleled in similarly traumatic events like wars. Pandemics are a leveler for inequality.

What’s most interesting about this finding is that it holds even absent organized 22 PROSPECT.ORG NOV/DEC 2021

mass action; in England, the Statute of Labourers remained mostly in force, with revisions, throughout a period of higher wages and relative prosperity. The change was more informal, seen in an ad hoc undercurrent of commotion, with peasants learning amongst themselves who pays more and who needs labor. It is a social movement as much as it is a political one.

However, the rise of industrial capitalism led to a new cycle of repression of workers. As small farmers were driven off the land, the British Parliament in the 1830s “reformed” the Elizabethan poor laws that had protected peasants from destitution, took away benefits, and compelled people

to work in factories for the going wage or be sent to the workhouse. Will today’s workers be more like those of an earlier age, who used scarcity to increase rights and earnings, or will they end up exploited like those of more recent years?

The parallels between 14th-century Europe and the present day are downright eerie— and hopeful. A catastrophe creates new opportunities and a new mindset for workers, and the employer class can’t take it.

First, like the English aristocracy, employers added a few scraps to attract workers, and then more and more. The Body Shop dropped its educational

Grumbling business owners followed the lead of their 14thcentury brethren: They tried to use the law to force people to work. requirements, background checks, and work experience for new hires. UPS now makes offers after applicants fill out a tenminute online questionnaire. One pizzeria in Alabama announced it would “literally hire anyone.”

Bidding wars for people transitioning to new jobs are routine. Minimum wages at a number of retail establishments are rising, and the average wage at restaurants and grocery stores just hit $15 an hour. Starbucks has raised average pay to $17 an hour.

Flight attendants working holiday shifts at American Airlines are earning as much as triple pay. Wage growth overall in the key low-wage leisure and hospitality sector is at 12.4 percent year-over-year, well above even the elevated rate of inflation.

Amazon is now dangling free college tuition for its workers, as are Macy’s, Walmart, Target, and several other retailers. Tyson Foods has experimented with offering 40 hours of pay for 36 hours of work.

Other meatpacking companies are offering $3,000 signing bonuses; a hospital network offered $40,000 up front for nurses.

When few of these tactics actually worked to fill open positions, the mood soured, and grumbling business owners followed the lead of their 14th-century brethren; they tried to use the law to force people to work.

Over the summer, 25 states ended enhanced unemployment benefits early, on the theory that this would starve people back into the workplace. As in the aftermath of the Black Death, it didn’t work; statistics show that states that ended UI had essentially no difference in payroll growth compared with states that kept it going until September.

Republican lawmakers, infuriated by any stirrings of worker power, went to more extreme lengths. Wisconsin’s state Senate passed a bill in October to allow 14-year-

olds to work as late as 11 p.m.; Ohio soon followed suit. Businesses started advertising for young teenagers to work in their fastfood stores. Rather than offer decent jobs, employers and their allies in government would rather roll back the 20th century.

That’s not likely to work either; younger workers have been instrumental to nonunion walkouts.

And then there’s the ever-present specter of robots taking all the jobs, something raised every time workers find themselves in a decent bargaining position. This also happened in the medieval post-pandemic period, with advancements in smaller sailing ships, the printing press, and other labor-saving devices. Such enhancements to productivity should be welcomed, as long as everyone benefits from them.

Despite employers’ meager efforts, quits keep rising, buoyed by a few factors. The endurance of the delta variant continues to keep a subset of workers off the job, reducing the available labor supply. Millions of parents are staying home to watch their children, though that’s a chicken-and-egg scenario; one major reason for the crisis involves how many child care workers have quit. There are 108,000 fewer workers in the field than in February 2020, according to a University of California, Berkeley analysis.

People do still have money in the bank from the various COVID relief programs, including three stimulus checks and expanded unemployment insurance. Combined with the forced savings of a lot of places not being open for months, it totals extra savings of roughly $2.4 trillion, giving people time to make career decisions.

“I’ve always felt that if you give working people the ability to survive, you give them a choice,” said St. Louis University’s Michael Duff.

We’re also seeing a thinner labor force, from an aging society and severe Trumpera restrictions on immigration. Over two million more workers retired during the pandemic than would have been expected.

All of this tips the balance in favor of those remaining in the labor market.

Employers, seemingly, have only put forward carrots or sticks, when workers are seeking something more. Mark Bolino, a business professor at the University of Oklahoma, talks about a “psychological contract” that workers have rewritten. “Historically, from the 1950s on, we had more of a relational psychological contract,” Bolino told

me. “You look out for the company and the company will look out for you. In the ’80s, there was a shift to a more transactional psychological contract. We’ll look out for our interests and you will too.”

That transactional contract worked for employers when they had workers essentially trapped, with few options for escape. But in the current environment, “workers are renegotiating the terms of the contract, and employers aren’t equipped for that,” Bolino said. What is on that list for renegotiation, I asked Bolino. “I do sense, anecdotally, that people want meaning.”

Meaning looks different to different workers. For Collin Keehn, the Detroit-area beer sales representative, he felt adrift in “a failed career … I was eight, ten years in, making $40,000 a year with a college degree.” His entire family was involved with organized labor, and he wasn’t. He craved that connection to collective action, even taking a class in organizing at a local college. “I was the only non-union person in my class, they thought I was a rat or a mole,” Keehn said, chuckling. “I wanted to do more, I wanted to help people. Fulfillment was a big thing for me.” He managed to land a position at a nonprofit that worked with local unions.

Reina Abrahamson, the call center worker at Wells Fargo, eventually went back to her job after spending months on leave due to technical snafus. “Getting back into the rhythm, it was a whole reminder of how much I disliked customer service,” she said.

So she applied for and landed a job as a school bus driver in Salem, and her stress melted away. “It was way more in line with my want and desire to be able to help people,” she said. “It got me into a place where I can make an impact on people, help kids, be that positive influence.” She’s considering getting a teaching license and moving inside the school.

An October Harris Poll showed that half the U.S. workforce wants to switch careers, and in the business pages you can almost every day find stories about short-order cooks turning into software engineers, or waitresses becoming longshoremen. “I’m hearing a general dissatisfaction with worklife balance following the pandemic,” said Fran Berrick, a career coach for professional development. “People are saying, how did I get here, why am I staying here?”

In addition to switching careers, some have become their ow n boss. Shana NOV/DEC 2021 THE AMERICAN PROSPECT 23

24 PROSPECT.ORG NOV/DEC 2021

you know what, I think I can get jiggy with this,” Moody told me. “You don’t have to be in a uniform, just booking loads. And you’re home! You don’t have to put your gas money into your budget.”

Forty percent of U.S. working hours are spent in the home, The Economist estimated, changing the rhythms and geography of work and introducing desired flexibility.

“People have seen that they can do their jobs pretty well on their own schedule and in their own home,” said Mark Bolino.

“That was a revelation to a lot of people: I don’t need to do all these things that were frustrating, like commuting.” People are valuing fitting work around their life, not the other way around.

All of these are manifestations of the same yearning for simple dignity on the job. The lack of appreciation, the lack of integrity, the feeling of being used pervaded all my discussions with workers. More money could fill that gap, but more likely what’s needed is fulfillment, recognition, and humanity.

Candido Batiz-Alvarez, a sheetrock installer in Houston, who contracted COVID on the job, put it to me succinctly. “Just recently we were rebuilding homes after the freeze in Texas and told we were essential workers,” he told me through an interpreter. “But it’s hard for me to understand that phrase because I don’t see any benefit from being called essential.”

Batiz-Alvarez is with a group in Houston called Workers Defense Project that is attempting to create an essential workers board in the city, which would be only the second of its kind in the U.S. (The first is in Los Angeles.) The board would provide worker perspectives and policy recommendations to local regulators, and give a low-wage sector that has been muzzled for years a voice in their own future. “We want to be treated as the people who build this city and keep the economy running,” BatizAlvarez said.

In May of 2020, as the pandemic was just cresting its first wave in the United States, our colleague Paul Starr wondered how society would change after the shared ordeal of the COVID crisis. The smallpox epidemic from Spanish invasions in the New World triggered a loss of faith within Aztec and Inca communities, that their gods and their leaders were never as powerful as they boasted.

The lack of appreciation, the lack of integrity, the feeling of being used pervaded all my discussions with workers.

Have the scales fallen from the eyes of the low-wage workforce? Will this change be permanent? Will the expansion of lowwage service work, relative to Europe and other industrialized nations, snap back and correct itself?

These trends are really positive for workers’ financial and emotional wellbeing. Plus, it’s hard to roll back wages once they’ve been delivered, at least in the immediate term. And many of the enhancements to hiring might prove popular enough that companies will need to keep them around. But ultimately, social transformations are hard to sustain. The rush of the Great Escape is enlivening, and could signal a real shift in how people want to be treated. But it’s mostly an individual action. The loose confederation of social media and market forces cannot substitute for a strong labor movement that brings collective power to entire workplaces and sectors.

As it happens, labor unions are in the midst of their own walkout wave, triggered by the same level of degradation and pandemic hazardousness on the job as the rest of the workforce. Hundreds of strikes in 2021 have been identified by researchers at Cornell University, a paltry number historically but a spike of action compared to recent years. More important for the future of a desiccated labor movement, organizing in new businesses, like a Dollar General in Connecticut and a Starbucks in Buffalo, suggests a moment for union expansion, buoyed by stronger public sentiment and anger at the experience of work. That this expansion is rooted in low-wage service work seems appropriate for the moment.

What’s notable is that rank-and-file union members are the ones unilaterally shutting

PAMELA DE MARION SILVA DIAZ

Blackwell, who quit her Walmart job in a TikTok video, moved to Delaware with her husband, who’s in the Air Force. She finished a cosmetology course, got her license, and now rents out a small booth at a beauty salon near her house. “Since I was young, I’ve been working since I was 14, I’ve been against the whole setup,” Blackwell told me. “The goal was always to work for myself.”

This has been a pronounced trend paralleling the Great Resignation. Business formation through three quarters of 2021 is on trend to set an all-time high, with over 1.4 million applications to start new businesses filed through September. This is a complete transformation from the anemic business formation out of the Great Recession. “It’s pervasive across the country and across industries, which I think is telling,” said Kenan Fikri, director of research at the Economic Innovation Group, which tracks startups and entrepreneurship. But a disproportionate number of new business applications are in the retail, food, accommodation, and hospitality sectors hit so hard by the pandemic, and so freighted with low-wage workers.

Fikri attributes the startup boom to people having more wherewithal to take risks, thanks to the pop-up COVID safety net. But he also noted a desire for personal renewal.

“With the push of job losses and the existential push of the pandemic, people were wanting to make big choices in their lives,” he said. “The country’s inherent dynamism was subdued in the 2010s, but it wasn’t out.

It took a shock to rekindle it.”

Other people I talked to focus on the conditions of their work. James VanderZanden worked at Pentagon Federal Credit Union in Eugene, Oregon, for 12 years before quitting recently. He saw co-workers retaliated against and forced to either relocate or lose their jobs because they tried to start a union (which he publicly supported). VanderZanden quit and found a job with the state of Oregon, involved in financial regulatory matters. Being able to work from home three days a week was a big factor. At Pen Fed, “upper management was parroting, we have to keep people in the office,” he said. “It created pressure. The king likes to see the serfs picking through the fields.”

Monica Moody, the Amazon delivery driver, told me about a close friend of hers who dispatches semitrucks from her home.

“She showed me what she does, and I’m like

Construction worker Candido Batiz-Alvarez is working to create an essential workers board in Houston, giving lowwage workers a voice in their own future.

down workplaces, and even rejecting contracts negotiated by their own leadership.

There’s a level of distrust and disappointment in the status quo among workers that extends even to their elected representatives in unions.

I asked Sara Nelson of the Association of Flight Attendants what the labor movement

should be doing to support the record-high quit rate in the low-wage economy. “We have a short period of time here to lock this in,” she replied. “We should be looking where we should be striking for recognition. If you have people who are completely ready to walk off the job, why wouldn’t we run in there with everything we have to tell them

to take on the boss, and get a better job for the long term? If you’re willing to walk, let’s make sure everyone else is willing, strike for recognition and find your demands, and you get your contract overnight!” She related it to the sit-down strikes of 1934 that helped lead to the Congress of Industrial Organizations. The CIO’s willingness to fight to open up new worksites that year set it apart from an American Federation of Labor that didn’t want to commit the resources.

Without such an action, the labor movement is simply too small to drive labor changes on its own. It needs to organize many, many more workers to get to a level of countervailing force. Government has also failed to capitalize on this shift thus far. Changes in labor law that would fine employers for unfair labor practices for the first time are slated for passage in Joe Biden’s Build Back Better Act, and that would help. But the aggression Nelson identified would have to be followed through by a labor movement that isn’t in the habit of conducting organizing on the scale needed, and doesn’t have the resources available to get it done.

Non-union workers can say no, maybe for a while. But without the resources and support of an organized workforce, they will not make enduring changes. The labor shortages that yielded prosperity and choice out of the Black Death did not uniformly reach all societies stricken by the disease.

Authoritarian Eastern Europe and Russia maintained serfdom for centuries after the plague, stunting economic development in those regions. And even the gains in Western Europe didn’t completely survive as the labor situation shifted.

“More important for the long-term possibilities and opportunities than individual decisions or a mass inchoate movement, you need to make sure you have a recognized voice in decision-making going forward,” said Christine Johnson. “If you don’t actually change the structures of power, and you don’t actually enact some changes in the labor and social hierarchies, it’s not going to produce lasting improvement in conditions of labor.”

In the meantime, Caroline Potts still daydreams at her job of a better life. “We have just been neglected and forgotten and used and abused by the corporations,” she said. “I think I would walk out now, and even if I had no money, it would be 10,000 times better.” n NOV/DEC 2021 THE AMERICAN PROSPECT 25

BURYING THE EVIDENCE How the military concealed its best chance at solving its sexual assault problem

Brad Carson wanted to do one big thing before leaving the Pentagon: make sure that the Department of Defense accurately counted the number of sexual assaults in the military.

It was 2015, toward the end of the Obama administration, and he had become acting undersecretary of defense for personnel and readiness, the department’s top human resources role. The position is considered one of the most boring in the Pentagon.

But Carson, then 48 years old and a former Oklahoma congressman, was excited to take it on. He had been a progressive leader as undersecretary of the Army.

Officially, 6,083 service members reported sexual assaults that year, but Carson knew the real number was much higher.

He believed that bureaucratic hurdles prevented victims from reporting. And saddled with a buggy database system, neither commanders nor Congress had a complete view of trends in offenses and victims in real time. Carson was convinced that the 26 PROSPECT.ORG NOV/DEC 2021

inaccurate sexual assault data was leading to bad policy.

And so, in the spring of 2016, Carson asked a group of software experts in the Defense Digital Service (DDS) to create a new, more functional database. “It was a terrific idea. It remains a terrific idea,” Carson said.

Four Defense Digital Service staffers set up meetings with military lawyers, victim advocates, Pentagon commanders, and key players in Congress and the Obama administration. A month later, they sent around an initial report. It was scathing. “First and foremost, there is extraordinary low trust in the Department’s sexual assault data and reporting among both internal and external audiences,” they wrote in the internal report obtained by the Prospect.

But when the team presented their ambitious approach, Secretary of Defense Ash Carter’s office cast the report aside. Carter’s chief of staff, Eric Rosenbach, took the report’s authors into the secretary’s confer-

ence room and raised his voice, according to those present. Chris Lynch, the director of DDS, reassigned his staff. Everyone who touched the report was told to move on.

“They completely buried it,” said one person with knowledge of the project.

Carter and Rosenbach now direct an academic center at Harvard, and in speeches, articles, and a memoir, Carter has promoted an ethos of innovation. Lynch founded the military contractor Rebellion Defense; in September, venture capitalists invested $150 million in his two-year-old startup, despite it having few public contracts. Bolstered by a network of connected board members and advisers—including Carter himself—Rebellion has been valued at a startling $1 billion. No one ever publicly mentioned the report again.

The Biden administration has made sexual assault prevention in the military Ash Carter, secretary of defense from 2015 to 2016

STEVEN SENNE / AP PHOTO

BY JONATHAN GUYER

NOV/DEC 2021 THE AMERICAN PROSPECT 27

a big priority, but five years later the problem has gotten much worse. The story of the 2016 sexual assault data report shows that internally, the Pentagon had the same ideas that independent commissions have put forward—yet the military leadership has persistently fought back against change.

To this day, many of the shortcomings the authors identified have not been fixed; untold thousands of assaults have gone unrecorded. In September, the Department of Defense laid out a new process to address the problem, but some of the elements are not scheduled to be implemented until 2030.

Eight senators from both parties excoriated Defense Secretary Lloyd Austin for this leisurely timeline. “The men and women who serve in our military,” they wrote, “cannot continue to operate another day, let alone another decade, under a chain of command that is unwilling or incapable of taking decisive action to address this epidemic.”

Congress may force the issue with regulatory changes, in particular by taking sexual assault prosecutorial decisions out of the military chain of command, in the defense budget in December. But the Pentagon, as the report elucidates, already knows how it can make progress. This year, the Government Accountability Office published recommendations on how to reform the way the Pentagon tracks sexual assaults. The main recommendation: Improve the tracking system. Exactly the change outlined in detail five years earlier by DDS. Teresa Beasley understood the consequences of the Pentagon’s broken database intimately. She worked as a sexual assault response coordinator (SARC) at the Air Force Academy in Colorado Springs. For a decade, she spent hours each day with victims making their way through a convoluted system that she felt did not put them first.

Since she didn’t trust the military’s official database, she kept her own tally of assaults on the campus in an Excel spreadsheet. That paperwork helped her piece together a trend: Around Halloween each year, sexual assaults spiked. One year, six cadets reported being assaulted on a single day, she recalled.

But the system the military uses to track victims’ reporting, the Defense Sexual Assault Incident Database, was so “un-user friendly,” Beasley said, that no one at the academy had ever noticed the trend.

The database’s shoddy interface made 28 PROSPECT.ORG NOV/DEC 2021

A senior official conceded that commanders have little sense of assault and harassment in their own command.

Beasley’s work more difficult. “It’s got bugs, it’s slow, it isn’t intuitive,” she said. Some of the issues are technical: It obscures important data and doesn’t talk to other databases that report these incidents. The system doesn’t include victims who were sexually assaulted by family members or intimate partners (which comprise up to 18 percent of assaults), since those fall into the Family Advocacy Program. The cases of civilian victims are usually not entered.

If a user left a single box blank on any of the 14 different screens, it would cause the system to crash. Beasley interacted with victims all day long, but stepping away to take a call or to speak to someone coming into her office often meant losing an entire report. “Data is frequently lost even while being currently entered,” she said.

The current system is also prone to inaccuracy. Cases must be inputted within 24 hours of an assault (or 48 hours for service members who are abroad). In some cases, Beasley told me, the victim is still intoxicated or drugged, and she felt it was unethical to have them sign legal forms when inebriated. Many victims never get officially recorded since they didn’t want to sign their names on confidential filings at the end of the complex intake process.

There is also no way to log some important information. The “alcohol-involved” box, for example, doesn’t specify whether the offender or the victim was intoxicated.

Other key factors don’t fit easily into the provided squares, like whether there were multiple victims or multiple offenders and the exact location of the assault.

Once in the database, a case cannot be followed through the military justice system. “Within the armed services, they cannot track from the beginning of an

investigation of a crime to the end,” a congressional source told me. “We were told it’s too hard.” Punishments and convictions are not tracked, and if a case reaches a pretrial agreement, it is removed from the database.

Beasley had gotten used to the system’s defects and was determined to act upon her findings about Halloween. “I said, ‘Hey, we found a time of year where we need to up our training or to keep an eye on the cadets,’” she told me. But the academy leadership didn’t want to look into trends. “Officers think they’ll get fired if they have a lot of assaults,” she said.

But the only way to see those trends was in Beasley’s spreadsheets. “It’s like, if you were a police chief, and weren’t allowed to know what the crime history was in the district you’re going to be responsible for,” said Andrew Morral, a senior behavioral scientist at RAND who has led studies on risk factors for sexual assault in the military.

A senior official conceded that commanders have little sense of assault and harassment in their own command. “One of the areas that we have not had visibility is really within the units and at the installation level,” said Elizabeth Van Winkle of the Pentagon’s Office of Force Resiliency, at a Senate hearing.

Coordinators across the armed services shared Beasley’s frustration. Many, like her, had started tracking victims on their own spreadsheets and doing ad hoc analyses for their commanders, who would rather there be no reports at all. “There is always the question of, in my unit, are we reducing numbers of actual sexual assaults or are we reducing numbers of reports,” said one SARC. The military’s own surveys show that as few as 23 percent of assaults are reported.

Experts don’t rely on the official database since it only captures a fraction of victims.

“You know, most sexual assaults are not reported, almost no sexual harassment is reported,” said Morral.

As time has passed, the rate of conviction has been going down, and only a meager number of commanders have been held accountable for alleged crimes that occurred under them. Ash Carter, Obama’s fourth and final secretary of defense, committed the department to ending retribution against These are nine of the 14 screens that must be completed in the Defense Sexual Assault Incident Database. If a single box is left blank, the entire system crashes.

NOV/DEC 2021 THE AMERICAN PROSPECT 29

those who report sexual assaults. Yet 64 percent of survivors who reported, according to a recent military survey, faced retaliation.

In spring 2016, Brad Carson, whose wife is an expert on sexual assault prevention and a senior Pentagon attorney, was “deeply and very personally committed” to using his own high-level Pentagon position to address the crisis. But he realized military sexual assault was not a priority of his boss. The previous defense secretary, Chuck Hagel, convened weekly meetings with his deputies about sexual assault prevention, said Carson, but Carter didn’t hold such meetings.

Carson forged ahead with a focus on mapping the scope of the problem. He wanted to “create a new database to collect data on reports, investigations, and dispositions,” according to an internal planning document obtained by the Prospect. The new resource would be something that could easily extract info from PDFs, be quickly searchable, and allow leaders to make informed decisions about prevention.

Carson also had a bolder idea: “to establish an independent office that would collect data on sexual assault.” The digital project would go further than just fixing a database, and would revolutionize the military’s sexual assault reporting mechanisms with pretty basic technological fixes. “I can actually fix this, and I’m going to,” Carson remembered thinking.

The Defense Digital Service was a new unit within the Pentagon staffed by an enthusiastic group of data analysts and software engineers from the private sector.

These were not military folks. They openly marveled that they had landed a job in the Department of Defense; one posted a photo of himself tinkering on a MacBook while sitting in a military helicopter.

The DDS director, Chris Lynch, was a Seattle techie with no military experience.

He specialized in generating media buzz and networking, and he secured the blessing of Secretary Carter for DDS’s work. “He’s a salesman,” recalled a senior defense official who worked with Lynch.

Lynch carried with him to the Pentagon the bro culture of tech startups. On Lynch’s birthday, a junior colleague brought into the office a cake for him with a phallus illustrated on top in frosting. There was heavy drinking at happy hours. According to his former co-workers, Lynch was having an affair with a woman from Army Cyber Com30 PROSPECT.ORG NOV/DEC 2021

Chris Lynch, a Seattle techie with no military experience and limited technological expertise, directed the Pentagon’s Defense Digital Service. mand who worked closely with DDS. But the project had the positive glow of something new at the Pentagon. Carter brought Amazon founder Jeff Bezos to the DDS office “to see how tech is transforming government.” Through this and other events, Lynch fostered connections that would come in handy in a future move to the private sector.

Carson’s office reached out to Lynch, who assigned four young coders to research the

data problem surrounding sexual assault.

They were eager to get started. A former Google engineer wrote on the unit’s website, “I’m passionate about preventing sexual assault in the military, and I’m excited to get a chance to fix that problem.”

At the end of April 2016, Secretary Carter launched the project at a ceremony honoring six “Sexual Assault Response Coordinators of the Year.” There, he introduced the data initiative to a packed room in the

The authors wrote in plain English, in contrast to the jargony reports from advisory committees, which added power to the recommendations.

PHOTO BY CHRISTOPHER MICHEL /CC 2.0 AT TRIBUTION

Pentagon. DDS staffers sat in the fourth row.

“This project will help the department understand sexual assault data in a more meaningful way, also ultimately leading to more transparency between DOD advocates and others invested in this critical mission,” Carter said. “This will allow for more streamlined, timely, and accurate reporting.” Afterward, the techies ate slices of a sheet cake decorated with the sexual assault response coordinator logo, and talked about next steps.

But Carter would never mention the project again in public.

Carson was not in the audience. He had resigned suddenly a couple of weeks earlier.

He had fallen out of favor with Congress and military leadership by proposing a series of aggressive personnel reforms that he called the Force of the Future.

Under Carson, morale in the office for personnel and readiness had been high.

His staff didn’t mind sticking around till 9 p.m. or later. One aide even happily kept an air mattress under their desk for late nights. Many staffers felt the mood in the office quickly changed when the new acting undersecretary, Peter Levine, took over.

Now, staff cleared out at 5 p.m.

Levine was a longtime Senate aide and a consummate bureaucrat. One appointee who worked with him described Levine as a “hatchet man” who was hired to undo Carson’s reforms. In a statement, Levine said he was brought in to get “over the finish line” reforms that Carson had initiated.

After joining in April, Levine told Lynch not to continue the initiative, according to one source. Levine disputed this. “It was my understanding that Mr. Lynch was work-

ing under the authority of the Secretary,” he said. “For this reason, I did not have the authority to tell Mr. Lynch not to pursue his project and I did not do so.”

Soon, DDS pursued a much narrower research project, or what startups call a “discovery sprint.” Secretary Carter signed a memo that gave DDS the authority to consult with a variety of officials, but they were told to not meet with experts at the White House and Department of Justice. They met with them anyway.

In May, DDS held briefings with a dozen policymakers, military leaders, and experts, including sexual assault response coordinators in each of the military services. In those meetings, almost everyone talked about the Defense Department Sexual Assault Prevention and Response Office (SAPRO) annual report to Congress. It’s typically packed with appendices of complex, almost indecipherable, graphs that run much longer than the report itself.

DDS staffers learned that administration officials and members of Congress were not satisfied with the report and the complex way it presented aggregate data. It was built off of bad information anyway, and the presentation made it even less useful.

But SAPRO wasn’t about to let an upstart office of non-military techies take over their core function. A turf war broke out over the discovery sprint. DDS was told to “tread lightly, ‘play nice’ with SAPRO,” said the knowledgeable person. The SAPRO director “was concerned that DDS was asserting the unilateral authority to establish a data system,” according to Levine.

DDS staff kept their heads down and continued their work. The authors focused on “technical solutions” and presenting “truthful data,” according to an internal DDS planning document that offered talking points for how to deal with their now-shrunken project. It ended with a call to action: “This is too important to screw up.”

It was past 5 p.m., and the authors of the discovery sprint were called to meet with Rosenbach, Carter’s chief of staff. They gathered around a big table in the defense secretary’s office suite. Lynch was traveling in Afghanistan at the time, so the staff shuffled into the boardroom without their director. Rosenbach hadn’t slept for 48 hours, he told them, but had found a short window for a meeting.

Soon he was raising his voice at the members of DDS. He said they were “wildly out

of scope.” They should have stuck with the technical problems of the slow, buggy data collection system, and nothing more. Rosenbach emphasized that they should never have written down their recommendations, according to two people with knowledge of the conversation. Once a report exists, he explained, it could get leaked. Carter popped his head into the meeting.

The DDS staff felt confused; they thought they were doing the right thing. It was intimidating for the coders who were doing brief stints in the Pentagon.

The report had proposed, “From the Secretary’s office down, the DoD must remove any perverse incentives to hide or affect sexual assault reporting.” That was a rebuke from the inside, making explicit years of neglect and even the active intervention of leading officials to prevent the appearance of a crisis. The authors wrote in plain English, in contrast to the jargony reports from advisory committees, which added power to the recommendations.

The Pentagon had long downplayed the mess, but here was a group of data experts noting that, on its own terms, the way the department tracked assault was insufficient, the quality of data was not high, and that “there is an extraordinary lack of meaningful dialogue between Congress and the DoD in the area of sexual assault prevention and response.”

After meeting with Rosenbach, the authors deleted those lines and wrote a more positive introduction, using a quote from Carter’s speech at the SARC of the Year event.

In the report, the authors offered recommendations that anticipated exactly the suggestions that expert panels would publish in the years to come. Some of the suggestions could help SARCs and military leaders better understand the trends within their ranks, like data tools to provide “localized analysis [that] will help identify destructive micro-climates within commands.” They advised “enhanced data collection” that would track cases throughout the military justice system, “from the very beginning to the very end,” which the current database doesn’t show.

DDS pointed out categories of sexual assault victims that SAPRO doesn’t report annually to Congress—maybe to keep numbers lower—like those under the jurisdiction of the family program, military criminal investigation, or local authorities. They also recommended including sexual harassNOV/DEC 2021 THE AMERICAN PROSPECT 31

ment incidents, which were hardly being tracked. The authors urged the Pentagon to “embrace transparency and put itself on a path to public transparency.”

The appendix suggested new data categories to add to make collection more applicable and fixes to improve user experience.

They explained that DDS was “ready to partner” with SAPRO to create a commander’s dashboard, where leaders could see realtime visualizations. “I think it is major,” said a Pentagon official who was familiar with the report. “Just imagine if you had a commander’s dashboard that DDS proposed.”

For Levine, data collection was not simply a technological problem, but a policy problem with potential legal repercussions.

“In my view, DDS was in no way expert on where the lines were,” said Levine. He told me he had never seen the DDS report.

Lynch declined interview requests. SY Lee, a spokesman for the company he has since co-founded, wrote in an email, “Chris Lynch and the team at DDS regarded sexual assault reporting in the military as a top priority.” Rosenbach declined to officially comment, and Carter did not respond to the Prospect. None of the four authors of the report wanted to be quoted.

Lynch quietly reassigned some of the authors to other projects; others departed DDS entirely. When asked whether there were any next steps for the sexual assault report, Lynch said to a DDS staffer, “No,” in a way that intimated that the question shouldn’t be asked again.

Teresa Beasley, the sexual assault response coordinator, left the Air Force in 2017 after 30 years, fed up with what she saw as an intentional effort to conceal sexual assault trends. The academy’s leadership didn’t believe her when she reported back to them an upward trend in the number of sexual assaults on campus. Beasley filed a whistleblower report and was forced out. According to the Office of the Inspector General, her bosses had indeed doctored the numbers to lower the count that would be reported to Congress.

“For people who think data doesn’t count, it does. And accurate data really matters,” she told me. “These aren’t just numbers.

There are real stories behind each one.”

Little has changed in how the military tracks sexual assaults in the meantime.

Though the Trump administration continued to charter independent reporting 32 PROSPECT.ORG NOV/DEC 2021

bodies and committees, his secretaries of defense did not prioritize the issue.

Experts have advised urgent fixes to data collection that reinforce DDS’s findings. An independent federal commission recommended in 2020 that the Pentagon “develop a single electronic database for the uniform collection, storage, and analysis of standardized military justice documents across the Military Services,” but there has been no movement on this front.

When a 20-year-old private, Vanessa Guillen, was found dead and dismembered at Fort Hood in April 2020, the secretary of the Army launched an investigation that described a “permissive environment for sexual assault and sexual harassment.” Watchdogs saw Guillen’s murder as part of a bigger trend of commanders not focusing on prevention.

Updating the military justice system is a major priority for those seeking reform. Joe Biden throughout his career had advocated for sexual assault victims and on the campaign trail said “yes, yes, yes” to moving the justice system away from the chain of command. Secretary Austin, in his Senate confirmation hearing, readily acknowledged the lack of progress on sexual assault prevention and months later supported removing prosecutorial power from commanders.

The 2021 Independent Review Commission on Sexual Assault in the Military made this issue its signature policy change, but the timelines for implementation are exceedingly slow. (Biden supports the commission’s recommendations.)

“The collection and reporting of data should be baked into policy change,” said Lynn Rosenthal, who oversaw the commission. “There should be greater transparency, more accessibility of the data. That’s the only way we’ll know whether this policy change made a difference or not.”

Five years after the DDS report, this year’s defense funding bill may at last put questions of justice outside of the commander’s reach and into the hands of military judges and an impartial justice system. Sen. Kirsten Gillibrand (D-NY) has built a coalition of 66 senators for an amendment that would apply to all felonies, not just sex crimes, and it has the support of both Democrats and Republicans, including Minority Leader Mitch McConnell and Joni Ernst, herself a veteran and a sexual assault survivor. But Senate Armed Services Committee Chairman Jack Reed (D-RI), who has close ties to the defense establishment at the Pentagon,

“The existence of this report makes it clear that the Defense Department knew about its sexual assault data collection problems years ago,” said Sen. Gillibrand. is a holdout. He may bring down an otherwise popular piece of legislation.

Carson believes a data-driven report in 2016—a year before the #MeToo movement—could have accelerated meaningful reforms. “It might have actually been a story that put sexual assault in greater context,” he told me. “It wouldn’t be a negative story for the military. It would allow us to have better, more acute interventions.”

“The existence of this report makes it clear that the Defense Department knew about its sexual assault data collection problems years ago, but chose to bury them rather than address them,” said Sen. Gillibrand in statement. “This report serves as yet another reminder that the military will take every opportunity to drag its feet when it comes to changing its approach to sexual assault.”

The DDS report was further validated by a memo Secretary Austin issued in September, a road map that integrates many of the GAO recommendations and that responds to the Independent Review Commission.

An entire section on data explains how the services will modernize: They will integrate domestic abuse and intimate partner cases into the database, add new categories to data collection, and deploy a “tool that would enable unit-level commanders to collect real-time climate data on sexual harassment and sexual assault,” which is what DDS recommended.

But there’s a catch: “Estimated implementation by 2028.” The timeline is now 12 years outside of what DDS proposed to have done in 2016.

When Lynch left the Pentagon in April 2019, he took many of his DDS colleagues with

MANUEL BALCE CENETA / AP PHOTO

Defense Secretary Lloyd Austin’s September memo vowed to make changes to the sexual assault database, but implementation won’t happen until 2028. him to start a military-tech company. He named it Rebellion Defense after the rebel forces in Star Wars. Rebellion is marketing AI products for military and intelligence.

Lynch’s revolving-door connections helped grease his path, through an interlocking set of influential people. The former secretary of defense, Ash Carter, advised the new company. (He has no financial interest in Rebellion, according to the spokesperson.) At the same time, Carter and Rosenbach took up jobs at the Harvard Kennedy School of Government.

Among Carter’s roles at the university is overseeing a tech-policy fellowship program sponsored by ex-Google CEO and billionaire Eric Schmidt, who is also a key investor and board member of Rebellion.

Lynch holds a prestigious fellowship in Carter’s Harvard program. (“Chris Lynch followed strict DOD guidelines as he transitioned back to the private sector,” said the Rebellion spokesman.)

The mass exit to Rebellion has left the Defense Digital Service understaffed and disorganized, Pentagon officials told me.

Morale suffered under Lynch’s successor, Brett Goldstein. In the spring, 30 staff complaints were made about Goldstein’s leadership and the way he treated women in the workplace, which triggered an investigation.

The inspector general could not substantiate claims of a “negative work environment,” and Goldstein left DDS in June 2021.

Lynch founded Rebellion Defense with the colleague with whom he was having a romantic relationship in the Pentagon. An unwelcoming bro culture endures under Lynch in the private sector, say well-placed sources. (The Rebellion spokesperson says the company has the “highest standards of inclusivity and transparency, with zero tolerance for unprofessional behavior.”)

Meanwhile, a Rebellion colleague recently participated on an all-male panel titled “The Importance of Male Allies.”

Lynch loves to talk about making technology for the “warfighter” in interviews and events, but he has kept quiet about efforts to address deeper social problems that the warfighter faces, like sexual assault.

Sometime in 2018, sources explained, at a reunion with co-workers and friends from DDS and the U.S. Digital Service, Lynch held court at a bar in downtown Washington.

Some of the coders were back in the private sector, and still in shock that they had been spending their days sprinting down the Pentagon’s halls or fixing tech problems for the White House. As usual, they all got a little too drunk.

On the street afterward, someone asked Lynch what had happened to the sexual assault report. They wanted to know why a report that had seemed to solve so many policy problems seemed to have vanished.

They remember Lynch saying, “That’s the only failed project DDS ever had.” n NOV/DEC 2021 THE AMERICAN PROSPECT 33

F F I R E H S T W E E N L STRE L A W DO E H T T A H W OF

N A C

Biden has empowered a crop of aggressive financial regulators. They’ll need to look beyond the banking industry and into finance’s darker corners.

BY LEE HARRIS

Clockwise from top: Treasury Secretary Janet Yellen, SEC chair Gary Gensler, CFPB director Rohit Chopra, Federal Reserve chair Jerome Powell

The most stylish play running right now on Broadway follows the three Bavarian immigrants who founded Lehman Brothers bank.

“When we were in business, people gave us money and we gave something in exchange. Now that we’re a bank, people give us money just the same, but we give nothing in exchange,” frets the middle brother, Mayer Lehman, in The Lehman Trilogy.

The brothers got their start selling cotton fabric— “denim, that robust fustian work cloth”—from behind the counter of a modest shop in Alabama. They grew quickly, layering credit between their storefront and the commodities they traded.

“We’re middlemen,” one brother exclaims when asked to describe his line of work. Dutiful groans from the audience of New York intelligentsia and investors who fill the theater each week. (Jeff Bezos, Amazon’s former

34 PROSPECT.ORG NOV/DEC 2021

CEO, reportedly attended the play on a date.) The actors do not bother staging the climactic scene of September 2008. Why bother? Everybody knows how it ends.

In The Lehman Trilogy, banking is the slippery domain of speculation; capitalism dwells in the real economy of guns and butter. It takes a Victorian, noseholding view of finance. More than a decade after the financial crisis, it seems positively quaint. Progressives now describe the investment function as a public good rather than a presumptive evil, available to be put toward common ends like renewable energy and full employment.

Banks also look tamer today. Too-big-to-fail lenders weathered the coronavirus crisis, partly due to requirements in the Dodd-Frank Act passed after 2008. New buffers requiring conventional banks to hold more capital have made them more resilient.

S F T

NOV/DEC 2021 THE AMERICAN PROSPECT 35

The crisis response has not interrupted the 50-year growth of finance, however. The volume and complexity of financial intermediation has continued to swell, often beyond the scope of bank regulation. A growing share of financial activity now occurs in private markets and non-bank institutions.

If we are said to live in an “hourglass economy” of high and low incomes, investments, too, have polarized between cheap index-tracking ETFs and high-fee alternatives such as hedge funds. New asset classes are flooded with institutional capital, from public infrastructure to farmland. Private equity conglomerate Blackstone built a market in single-family rental housing and is coming back for more. Observing these trends, one scholar has announced a “shift in the predominant function of finance from banking to asset management.” None of this leaves conventional banks struggling, as they arrange new tie-ups with the teenaged “fintech” industry. At the other end, tech giants are pushing deeper into financial services.

Into this protean environment, President Joe Biden has deployed a force of unusually bold financial regulators who are said to represent a break with industry-friendly regulation. The test of their success will be how they react to a set of challenges in financial markets that do not mirror the problems of the post-crash period.

The roster is impressive. Gary Gensler, who earned his reputation as a tough cop cracking down on derivatives in the Obama administration, now leads the Securities and Exchange Commission. He has assembled an all-star team of finreg advocates: policy director Heather Slavkin Corzo, who previously directed investment at the AFLCIO; consumer advocate Barbara Roper, now a senior adviser; University of Colorado Law School expert Erik Gerding, who will head legal and regulatory policy at the Division of Corporation Finance; and general counsel Dan Berkovitz, who served that role for Gensler at the Commodity Futures Trading Commission and later became a commissioner there.

Former Federal Trade Commissioner and Elizabeth Warren protégé Rohit Chopra is running the Consumer Financial Protection Bureau, and has also brought heavy hitters like student debtor advocate Seth Frotman and financial stability expert Gregg Gelzinis with him. At the Office of the Comptroller of the Currency, Cornell professor Saule Omarova has been nominated. As a skeptic 36 PROSPECT.ORG NOV/DEC 2021

Top officials at the regulatory agencies have compared crypto to “wildcat banking” and “fool’s gold.” of crypto and bank entry into physical commodity businesses, she would upend the status quo in a historically captured agency.

Other agencies are stacked with progressives, too. Left think tanks like the Roosevelt Institute happily grumble that their top staff have been looted. Ex-Warren staffers are heavily represented.

Agency heads are suddenly invoking market power and concentration, rather than fiddling at the margins of technical rulemaking. Corporates have taken note.

One Bloomberg article previewing Gensler’s aims blared, “The Everything Crackdown Is Coming.” Firms attempting to upend retail banking are bracing at Chopra’s arrival.

Banks are so alarmed by the prospect of Omarova that they’ve taken to depicting her as a Marxist.

Gensler’s overall goal is to lower the level of finance as a share of total economic output.

That is not a universally shared objective.

Trump appointee Jelena McWilliams will run the Federal Deposit Insurance Corporation (FDIC) until 2023. At press time, a decision on Fed chair Jerome Powell’s reappointment had not been made, but Lael Brainard, who is talked of as the progressive alternative, could bring as much continuity as rupture to the institutionally conservative central bank. And for all the progressive energy at top agencies, new appointments have also pulled heavily from the ranks of the Fed, including Treasury Secretary Janet Yellen.

Early returns on the new finreg mandate

have been mixed. Keenly awaited reports on two emerging risks to markets—crypto and climate change—have been disappointing. More critically, Biden’s regulators could be missing fundamental ways in which the ground has shifted since 2008. While prudential oversight is still needed to keep the system safe from bank overreach, capital has spread out into unregulated territory, becoming both more concentrated and more capillary.

The past year’s unprecedented Fed interventions have papered over areas of fragility, but Biden’s promise of shared growth will require a macroeconomic environment that tamps down on risk, restores markets, and directs public investment.

Fintech: What’s Old Is New Again As the pandemic bore down on cities in April and May of 2020, about 25 percent of Black-owned businesses seeking government Paycheck Protection Program (PPP) loans turned to online lenders rather than big banks, which have long failed to reach minorities. When sole proprietors, which include higher numbers of Hispanic and Black business owners, were made eligible for bigger PPP awards, many chose to go through fintech lenders like Kabbage, Square, and PayPal Working Capital. (Areas with a higher concentration of community banks also saw greater uptake of PPP.) Even before coronavirus, online platforms like Cross River Bank had grown more popular

RS O T A L GU G E R S ’ N BIDEND BE MISSI AYS COUL AMENTAL W UND O R D G N FU ICH THE NCE IN WHHIFTED SI HAS S. 2008 by digitally replicating traditional community banking activities.

Most fintech apps use conventional, mid-sized banking operations to hold and move around cash. Still, even as a wave of recent scholarship has underscored the bias encoded in algorithms, these upstarts have exposed gaps in the offerings of major banks. If the digital economy, which relies on reams of data and credit scores rather than direct evaluation, is punitive and exclusionary, it is a reminder that the personal discretion of bankers also was not without flaws.

On the consumer protection side, banklike lenders that reach consumers through their phones are resurfacing old scams like point-of-sale credit products and buy now, pay later installment plans, and repackaging them as democratizing finance. For example, Chime, a mobile banking service app, markets itself as “fee-free.” But it disguises charges and relies on a voluntary “tipping” model, while often making it difficult not to tip.

Fintech has undercut some systemic abuses by incumbent lenders. But important protections that apply to credit card companies and depository institutions haven’t been extended to tech lenders.

At key regulatory agencies, fintech is in the crosshairs. Donald Trump’s OCC advanced the idea of handing fintech firms special purpose bank charters, which could preempt state regulations. But last month, two fintechs, Oportun and Monzo, abruptly canceled their applications for bank charters, and a proposed industrial loan company (ILC) charter for Japanese fintech Rakuten has been stuck all year, suggesting that the Biden administration will look unkindly on giving fintechs the ability to bank and lend on their own.

At the CFPB, Chopra is attempting a delicate pincer movement: crack down on the abuses of fintech insurgents, while also

attacking older problems that have plagued conventional banking. In his first weeks on the job, Chopra announced a probe into the payment systems of tech giants, requesting information on how firms including Google, Amazon, and Paypal manage user data and financial information.

“In China, we can already see the longterm implications of these forces. Alipay and WeChat Pay are deeply embedded into the lives of the Chinese public,” Chopra said in a notice on the inquiry. “In such a market, consumers have little choice but to use these apps and little market power to shape how their data is used.”

Another early target of Chopra’s CFPB is JPay, a firm that has monopolized email and digital services in prisons across the country.

Rather than an exotic tech-enabled credit instrument, JPay is an old-fashioned pricegouger, which has bought up a controlling stake in prison communications and driven up rates for writing emails to loved ones.

At just 39, Chopra has come of age politically in a period marked by the onslaught of abusive tech firms. Giving a report to the Senate Banking Committee in October, Chopra testified that it is a top priority for the bureau to “restore relationship banking in an era of big data.”

Watchdog groups acknowledge the weirdness of the moment. “It’s ironic that we have been beating up on big banks for years,” said Lauren Saunders, associate director at the National Consumer Law Center, “but today they may be the relative good guys, in the face of tech giants that are pushing into financial services with little oversight.”

Crypto: Token Regulation Gensler and others are scrambling to build a regulatory regime for cryptocurrency. The SEC chair has compared crypto to “wildcat banking” of the 19th century, questioning its long-term viability and warning of dangers to investors. Acting OCC chief Michael Hsu has called crypto and its companion, decentralized finance (DeFi), “fool’s gold” that would inflate the kind of risk seen before the 2008 financial crisis.

Two recent CFTC enforcement actions against crypto firms have netted $140 million, and CFTC chair Rostin Behnam has called this the “tip of the iceberg.” But a highly anticipated report, the first interagency effort to deal with emerging digital currency threats, could be a gift to the banking sector.

Sheila Bair, who chaired the FDIC under two presidents, told the Prospect she is reminded of a jurisdictional battle in the 1990s. That decade saw the mushrooming of derivatives traded directly between banks, off public exchanges and out of sight of regulators. An effort to regulate them sparked a standoff between bank regulators at the Fed, the OCC, and the Treasury, and the market regulators at the CFTC and SEC, led by CFTC head Brooksley Born.

Bank regulators won, arguing that big players like JPMorgan Chase were known entities, subject to bank regulation. Taking a pragmatic tone, Larry Summers argued that the horse was out of the barn: Derivatives were in such widespread use that their sudden regulation could incite a panic. That decision is now infamous, since derivatives levered up the risk of mortgage-backed securities, which touched off the financial crisis.

Bair sees another battle brewing between bank and market regulators. This time, it concerns stablecoins, a type of cryptocurrency that pegs its value to that of another currency, typically the dollar.

Like a money market mutual fund, the key pledge of a stablecoin is that the issuer will buy it back at par, on demand. To make good on this promise, observers have pointed out, stablecoins need high-quality collateral backing the entire account. Enforcing this regulation has made money markets more secure and less profitable. Stablecoins are trying to resist the same requirements.

Regulators who agree that stablecoins are risky are torn over whether to treat them as bank deposits, under the purview of the Fed and FDIC, or allow them to exist as a medium of exchange outside banks. Outside observers have differing views on how to best regulate the product. But the new stablecoin report, published by a President’s Working Group comprised of the heads of key agencies, has left almost no one happy.

“That report is a big win for Wall Street,” Bair said. “The bank regulators went to the President’s Working Group, because it is dominated by the Treasury and the Fed, and came up with this bank-centric model that requires all this activity to be jammed into a bank. That will either kill the business, or, like with derivatives, they will let all the business be in the banks, and then it will blow up in the banks.” Bair serves on multiple boards, including Paxos, issuer of the stablecoin PAX. The report recommends that Congress pass legislation allowing only banks to issue NOV/DEC 2021 THE AMERICAN PROSPECT 37

stablecoins. This has been a trend from the regulators, with the SEC and CFTC asking for additional congressional authority on crypto. To punt the issue back to a gridlocked Congress, said Dennis Kelleher of Better Markets, is an “abdication of duty.”

The only group apparently pleased with the report is the banking sector. In early November, Vikram Pandit, the former CEO of Citigroup, told the Singapore Fintech Festival that within the next three years, he expects every major bank to consider getting into crypto trading.

Taming BlackRock During the pandemic, the Federal Reserve Bank of New York contracted BlackRock to administer an array of emergency securities purchase programs. (The firm played a similar role in 2008, helping to price and sell troubled assets in the wake of that crash.)

This put BlackRock in the position of buying its own exchange-traded funds on the government’s behalf.

Defending the choice to hire BlackRock, Powell explained at a hearing that they had little choice. “It was done very quickly, due to the urgency and the need for their expertise,” he said. Indeed, the Fed would be hard-pressed to find another manager with the same scope and reach.

BlackRock also sits directly in the administration: National Economic Council Director Brian Deese, Deputy Treasury Secretary Wally Adeyemo, and the chief economic adviser to the vice president, Mike Pyle, are all veterans. “It’s a bit like Goldman ten or fifteen years ago, when everybody figured out the revolving door,” Mark Blyth, a political economist at Brown, has said.

“Goldman has fallen out of favor. Now it’s these big asset managers.”

BlackRock is not only a sprawling market-maker, but also has extraordinary visibility into markets through Aladdin, its portfolio and risk platform. “Aladdin is like oxygen. Without it we wouldn’t be able to function,” said Anthony Malloy, CEO of New York Life Investors, one of many firms that pay steep fees to use the platform. Other customers include rivals like Vanguard and State Street, tech giants like Apple and Microsoft, and top insurers. As of 2020, just a third of Aladdin’s 240 clients had $21.6 trillion sitting on the platform, according to a Financial Times analysis.

BlackRock and other asset managers have lobbied hard against any suggestion 38 PROSPECT.ORG NOV/DEC 2021

that they should be regulated as a systemically important financial institution. More recently, they have fought an effort in the Build Back Better Act, led by Sen. Ron Wyden (D-OR), to tax ETFs. Some regulators have an appetite to go further. Graham Steele, the assistant Treasury secretary for financial markets, authored an influential report about the big asset managers’ oligopoly, with a particular focus on BlackRock and its Aladdin system.

But analysts who share Steele’s worries about BlackRock’s influence are split over how to respond.

“One route is breaking people up, and relying on competition. The other is accepting that this entity has become critical and is almost like a utility within the financial system, and putting tighter controls on what they do,” said Marcus Stanley, the former policy director at Americans for Financial Reform.

Pursued on its own, either path has drawbacks. Dan Awrey, a law professor at Cornell, thinks BlackRock should be identified as a SIFI because it is a giant liquidity pool.

Awrey said he is unconvinced by “the neoBrandeisian logic of ‘If something is systemically important, it’s either infrastructure, or I have to break it up.’”

BlackRock may be uniquely suited to antitrust action, however, since it enjoys not only scale but unrivaled vision into markets—and rivals. The fact that it was indispensable to the Fed in the pandemic meltdown may be proof enough that Aladdin is a kind of public utility. And others caution against what they see as a new enthusiasm for labeling key market players as too big to fail.

“I’m not so wild about institutional designations,” said Bair. “Certainly, if you’re going to do a significant designation, you’d want to designate BlackRock. But with all the BlackRock people in this administration, I’m not sure that’s ever going to happen.”

The Climate Switch “Climate risk is investment risk,” Larry Fink has been widely praised for telling investors.

The statement has the same tautological ring as Hillary Clinton’s “women’s rights are human rights,” another remark celebrated as brave and masterfully critical of the Chinese. Fink basically just means that climate perils create attractive, investmentgrade risk.

It pairs well with the most recent re-christening of the climate crisis, once known as global warming. Whereas “crisis” implies

ING C U D N IN NTO A H T ER SI RATH TE ACTOR , A PRIVAN LENDING GREE UARD OF WANT VANG YMAKERSNT TO POLICOVERNME THE GTHE WAY. LEAD considerable balance-sheet risk, a major downer, business leaders now stress that we are on the threshold of a financially intriguing, multi-decade “energy transition.”

Reframing the climate crisis as a business opportunity is a good idea. But, giddy with the discovery that politically distasteful climate change can be spun as a chance for economic growth, policymakers are neglecting to do more than nod at systemic risk.

A new FSOC report on climate, which was expected to fire a starting gun for regulation, does not include a single timeline or specific recommendation for action by a financial regulatory agency. The report registers alarm about climate change as an “emerging threat” to financial stability, including credit and market risks. But it is studiously nonprescriptive.

It omits any mention of a climate component for capital risk weighting, among the most direct tools that could convey environmental hazards to markets. Currently, capital rules do not capture risk of exposure to asset classes that could be impacted by a severe climate event.

Bold talk on fintech represents a substantive break with the previous administration. By contrast, the rhetorical shift on climate was already under way during the Trump administration. From the Trump CFTC to the Defense Department, agencies have increasingly acknowledged climate as a threat multiplier.

Regulation aside, whether this administration takes climate risk seriously will be measured not only by how safely it fences off environmental liabilities, but by creating a macroeconomic environment conducive to climate investment.

Evergreen Action, an environmental group, has floated the idea that the next Fed chair might rely on the Community Reinvestment Act to spur green financing.

BlackRock enjoys not only scale but unrivaled vision into markets, and its rivals.

MARK LENNIHAN / AP PHOTO

Lael Brainard has championed the idea of modernizing it, and was a holdout vote during the Trump administration’s attempt to gut the law, which is meant to encourage lending to areas banks have neglected to reach. Now, the Trump-appointed chair of the FDIC functionally has the same veto vote as Brainard, making an overhaul less likely.

But rather than inducing private actors into green lending, a vanguard of policymakers want the government to lead the way.

Lender of Last Resort Last year, the Federal Reserve went far beyond its 2008 crisis playbook, purchasing corporate bonds and offering new emergency facilities. In one popular telling, centralbank authorities had learned the lesson of the financial crisis: This time, the Fed would bail out not only Wall Street, but Main Street.

That story is wildly inflated. The Fed did set up a “Main Street Lending Program” for midsize firms, and announced loans for cities through a new Municipal Liquidity Facility (MLF). But those programs were designed to lend on unfavorable terms, and barely used. (Low pickup rates were actually touted as proof of success. While there is a logic to the penalty rate, it is selectively applied; the Fed happily lent on friendlier terms to corporate clients.)

Biden has not yet announced his Fed chair pick. But some of his top officials urge a new monetary policy that would benefit ordinary Americans. Bharat Ramamurti, a Warren veteran who is now deputy director of the National Economic Council, chaired

an oversight commission for pandemic emergency lending, where he criticized the prohibitive terms of the MLF and supported proposals for a permanent version designed to actually compete with private lenders.

The NEC’s second-in-command is also fond of pointing out that North Dakota—the only state in the country with a public bank—was most effective at distributing PPP money.

The possibility of permanent lending facilities has raised worries about the Fed being pulled into politics. Following pressure from the Trump administration, the central bank extended its Main Street program to bigger firms, in a move that made wildcat oil and gas companies eligible. The Fed and Treasury have denied the suggestion that they did so at the urging of energy lobbyists. But as a result of the expansion, fossil fuel companies received more than 10 percent of Main Street loans, compared to just 1 percent for renewables.

Instead, corporate bond purchasing could be tilted toward green companies. Several central banks, including the European Central Bank and Bank of Japan, already routinely buy corporate bonds. Given that they are already engaged in picking winners and losers, some central-bank analysts have begun to study how quantitative easing (QE) might be limited to green companies.

Some QE supporters think the Fed should just say the quiet part loud. “The Fed should be explicit about support for public borrowing,” the economists J.W. Mason and Mike Konczal wrote in a 2017 report that argued for the Fed purchasing the debt of cities.

Others think the central bank is the wrong entity to invest directly in businesses and other economic activity. The Fed has effectively seized the role of a national investment authority, according to Lev Menand, an academic fellow and lecturer at Columbia Law School. That is a political task, he argues, which Congress should confront explicitly and assign either to the Fed or to an independent entity. Omarova, the OCC nominee, has been a leading proponent in these pages for such an authority.

Given that we are living in a liquidity supernova for the foreseeable future, some argue for making use of the high foreign demand for U.S. government-backed debt with an investment agency that does not need to seek funding through the appropriations process. Benefits that accrue to the rich can, in theory, be taxed away.

The Fed’s extended reliance on expansionary monetary policy, which makes asset owners richer, has triggered some unease on the left. Loose monetary policy can also cause asset bubbles. Some attribute the emergence of crypto and other digital assets with few real-world uses to the glut of liquidity. Wherever you stand on easy money, you’d better hope that your financial plumbing can handle the pressure.

“In an environment where you want to allow the economy to run hot for a period of time,” Judge said, “it is all the more important that we have a robust financial regulatory scheme, and understand the interconnections and common exposures in the financial system that could trigger dysfunction.”

Biden’s new cohort could well rise to the occasion. At the moment, however, more liquidity is churning through opaque financial channels, a prospect that seems unlikely to change even under Lael Brainard, the relatively progressive alternative to Powell.

Expansionary monetary policy can trickle down to real growth. And it is surely a preferable alternative to austerity. But a tax-the-rich regime offsetting the resultant inequality is not around the corner. Neither is clean-energy investment at the needed scale.

In that environment, a renewed call to politicize economic growth, rather than endlessly buoying up asset prices, seems appropriate.

Perhaps there is something to be said for Mayer Lehman’s childlike, even metaphysical, distinction between makers and takers, speculative and productive investment.

Biden ran on a simple pledge: “It’s time to reward work, not wealth, in America.” n NOV/DEC 2021 THE AMERICAN PROSPECT 39

CAPITALISM 40 PROSPECT.ORG NOV/DEC 2021

M VS. LIBERTY All that we liberals cherish—socially, economically, and politically—is being undermined by toxic capitalism.

What might lie beyond it, and how might we get there?

BY ROBERT KUTTNER ILLUSTRATION BY ROBERT MEGANCK All of my adult life, I’ve considered myself a left-liberal, tending toward social democrat. Much of that sensibility reflects the era of my early adulthood, a time when reformed capitalism seemed plausible and practical. The New Deal had created a fundamental shift of power and ideology. Freemarket ideologues and Wall Street moguls were discredited and disgraced by the Great Crash. Financial markets were tightly regulated. Labor unions were empowered. Government demonstrated the value of public investment and social insurance. The mixed economy had arrived, seemingly for keeps, well defended by grateful voters.

But that moment turned out to be all too transient and fragile. What followed was not just a reversion to the laissez-faire of the 1920s. What has ensued is hypercapitalism, impervious to the usual strategies of reform, turning humans and social institutions into expendable commodities, destroying the ability of people to thrive.

Saving democracy, the planet, and decent lives for regular people requires moving beyond capitalism. To be an effective liberal today, you need to be a socialist.

I’ve long resisted the socialist label, on several grounds—partly because the habit of sectarian infighting sometimes makes socialism seem a caricature of itself; partly because the word “socialism” gives the right too fat a target in a country without much of a socialist tradition. Then again, socialist-

baiting is standard Republican playbook even when Democrats propose the most timid of programs. After the House belatedly passed a badly stripped-down infrastructure bill, scores of Republicans absurdly claimed that this was socialism. If only.

I’m also uneasy in the company of some people to my left who indulge self-defeating slogans like “defund the police,” which are gifts to the right; or who are unhelpfully scornful of President Biden’s efforts. (Where do they expect him to find the votes in Congress for an even more robust left program?)

Conversely, some admired friends from my generation who were once founders of Students for a Democratic Society and who are unabashed socialists are fervent Biden supporters. They’re political realists, while also pushing Biden to be more progressive in his aspirations. That’s my stance, too. So this essay is an exploration of the deepening toxicity of capitalism and the alternatives, not a brief for no-enemies-on-the-left.

When I was young, the liberal tradition was far more robust. “Liberal” evoked FDR. There was no Trumpism because New Deal liberalism delivered for the working class.

This magazine was born very much in the liberal tradition. When Paul Starr, Bob Reich, and I founded the Prospect in 1989, we paid calls on two iconic older liberals to seek their blessing, Arthur Schlesinger Jr. and John Kenneth Galbraith, and not on socialists Michael Harrington and Irving NOV/DEC 2021 THE AMERICAN PROSPECT 41

The liberal tradition, as represented by Franklin Roosevelt, was once far more robust.

42 PROSPECT.ORG NOV/DEC 2021

Politically, socialism is no longer fringe.

Bernie Sanders, a democratic socialist, very nearly won the Democratic presidential nomination twice, because he articulated the frustrations and aspirations of working people. There is a good case that he had a better shot at beating Trump than Hillary Clinton. In 2019, YouGov reported that 70 percent of millennials, ages 23 to 38, have a positive view of socialism—not surprisingly, given their lifelong experience of hyper-capitalism. (Our friend John Judis goes more deeply into this shift in his 2020 book, The Socialist Awakening.) Standard economics has a concept called “revealed preference.”

New products and prices reveal preferences people didn’t know they had. Same with ideologies, evidently. The surprise support for Bernie and democratic socialism was a revealed preference.

Biden has attempted to govern with expansive spending, taxing, and regulatory measures in the spirit of FDR. But his aspirations and credibility are being blunted by the corporate Democrats in his own party, reflecting the persistent undertow of capitalism. Biden’s heroic efforts, like Roosevelt’s, are well worth supporting—without illusions. The deeper

sickness of the economy and society is hypercapitalism, and we need to supplant it.

I’ve come around to this view gradually, not because my values have changed but because reality has changed. I’m a child of the New Deal. My parents and grandfather cashed in their war bonds in 1948 for a down payment on a 900-square-foot house in suburbia, financed with my dad’s 2.5 percent GI loan.

When my father was stricken with cancer in 1952, the VA, which provided high-quality socialized medicine for an entire generation of men, paid for all of his excellent care.

After he died, my mom was able to keep our house with a part-time job, thanks to his veterans pension and Social Security.

So I was a New Dealer in my bones before ever studying Roosevelt. Two sacred words in my house were VA and Social Security. I also acquired a sense of social class growing up as a poor kid in a rich town. Yet this was an era of substantial upward mobility.

Like others of my generation, I was able to go to college with no debt.

Despite the loss of my father, despite the vague worry of being blown to hell in a nuclear exchange, despite the persistent

AP PHOTO

Howe (though both were personal heroes of mine as well as friends, and I’d written several pieces for Howe’s Dissent). A Pros­ pect slogan, emblazoned on our cover, was A Journal for the Liberal Imagination.

That era and those assumptions have been overtaken by events. The system’s excesses are becoming steadily more grotesque. The profit maximization strategies of Amazon repeat the worst sweatshop conditions of a century ago, as if the labor movement had never existed. Likewise today’s slaughterhouses. Ultra-commercialization is infecting every corner of the medical system, harming patients and health workers alike, mocking the idea that markets are efficient. The supply chain crisis is the result of excessive globalization and deregulation. The platform monopolies have built their business models around surveillance capitalism and cultivation of addictive behaviors. Private equity firms and hedge funds are taking over sector after sector, from retail to nursing homes to newspapers, undermining workers and the viability of underlying enterprises. Wealth has never been more concentrated. What’s needed is substantial social ownership and a political consciousness to animate it.

What’s needed is substantial social ownership and a political consciousness to animate it. racism and the inconclusive struggles for civil rights, America seemed like a hopeful place when I went off to college in 1961.

When I became a journalist and for a time a Senate investigator, my sensibility continued to be left-liberal. Reform seemed worth the struggle, and it seemed possible.

One of my proudest achievements was an investigation and a series of hearings for the Senate Banking Committee on redlining and community disinvestment. Guided by local activists, we demonstrated that banks in many urban neighborhoods were pulling savings out of the community but refusing to put mortgage loans back in. Under the leadership of a great progressive, Wisconsin Sen. William Proxmire, we passed three bills. One required banks to disclose where they were making their loans, so that activists could pressure them. A second created an affirmative obligation for banks to reinvest in communities. A third created a housing assistance program for moderateincome homeowners.

One of our star witnesses was an idealistic and smart community banker named Ron Grzywinski, who had built the South Shore National Bank in Chicago (later renamed ShoreBank) as a model institution to finance low-income homeownership and local business on Chicago’s mostly Black South Side. A little later, after I moved back to journalism, other legislation used that bank as a template for a new kind of lender, the community development financial institution, spawning dozens of others following the ShoreBank model.

This was heady stuff. Working with local organizers, you could actually legislate, and it could make a difference on the ground.

And then it all turned to shit. And how it turned to shit is instructive.

While we liberals were idealistically promoting community reinvestment, the real power players on Wall Street and their allies

in Washington were inventing subprime.

Bill Clinton was supporting ShoreBank and kindred community lenders with one hand.

(He actually made the ShoreBank model part of his 1992 campaign stump speech.)

But with the other, he was promoting the extreme financial deregulation and speculation that led to fraudulent mortgage-backed securities and the 2008 financial collapse.

Subprime “exploding” mortgages designed to default were cynically targeted at exactly the populations and communities our work on community reinvestment sought to help.

In the wake of the collapse, close to ten million families, disproportionately Black and brown, lost their homes. Three decades of work increasing homeownership for working people was wiped out.

In a perfect final touch, the government bailed out all the big investment banks that had bankrolled the subprime lenders and underwritten the faked mortgage-backed bonds that collapsed in 2008. They were too big to fail. But ShoreBank, which had not participated in subprime at all, got caught in the general downdraft of falling property values. It was deemed too small to matter.

Barack Obama was not embarrassed to bail out Wall Street. But since ShoreBank was in his old neighborhood, his handlers were concerned that saving the local community bank might not look good. So ShoreBank got no federal aid and was allowed to fail.

Look at the past century, and you see good people doing hard and noble work that produces results that stick—for a time: labor organizers, community activists, civil rights workers. And then much of it, even most of it, gets wiped out and worse.

During a lifetime that has blended journalism, activism, scholarly research, and teaching, I’ve tried to get my mind around the relationship between markets, social justice, and democracy. My most ambitious book, published in 1997, was called Every­ thing for Sale: The Virtues and Limits of Markets. In that book, I looked at every sector of the economy and demonstrated that contrary to the conceits of orthodox economics, “market failure” was not an exceptional case; in much of the economy, market inefficiency was the norm. You could improve on it with social investment and regulation. As one reviewer aptly wrote, my quarrel “is not with capitalism per se.”

Rereading that book after 25 years, I now realize that my conclusions were right

but my framing was off. The problem was not “markets” or the technical mistakes of economists. It was capitalism as a system.

Why, after all, would a nation come up with a health system like ours that is so staggeringly inefficient, inconvenient, and brutal? What kind of system would tolerate surprise billing that bankrupts families, or deny sick people lifesaving drugs that cost a few cents to manufacture? What kind of system would overuse profitable procedures for the insured, such as endoscopies, while disallowing lifesaving surgeries and drugs for people who can’t pay? A capitalist one.

All of these seeming inefficiencies are in fact highly efficient—from the perspective of profit maximization. They are so totally ingrained that efforts at incremental reform only make the system that much more convoluted. Recently, The New York Times ran an obtuse piece titled “Why Aren’t More People Comparison Shopping for Health Plans?” The piece, by Paula Span, quoting a Kaiser study, reported that 71 percent of recipients did not shop around for Medicare Advantage and Part D drug plans, even though they might have saved money. The author added: “Some of that inertia may reflect people’s satisfaction with their coverage; it might also indicate an overwhelming amount of choice. For 2022, beneficiaries face an average of 33 Medicare Advantage plans to select from (but 56 in Philadelphia and 63 in Cincinnati) and 30 stand-alone Part D plans.”

Rather than including even a paragraph on how our absurd system got this way, she concluded by urging people to shop around: “[I]t’s open enrollment season. SHIP programs in every state, with 12,500 trained team members, represent the best source of unbiased information and work with more than 2.5 million people each year.”

What the piece did not point out is that the private insurance industry uses a trusted public brand, Medicare, to market for-profit products, offering bewildering “choices” precisely to confuse and manipulate subscribers; and that the idea of shopping around for drug benefits is preposterous on its face. Far superior would be universal drug benefits under public Medicare; or even better, under national health insurance, with prices negotiated by the system.

Still more efficient would be a socialized drug industry with no profit motive at all.

But all of this is precluded by the sheer political power of the insurance and drug NOV/DEC 2021 THE AMERICAN PROSPECT 43

industries, which have corrupted Democrats and Republicans alike. The assumptions that this is how the system has to work are so deeply engrained that our most serious newspaper, rather than explaining the real choices that ought to be on the table, provides anodyne advice on how to shop around within a rigged system.

Look around the entire economy, and you find case after case where the sheer power of capital is precluding more social approaches that are not only more decent and fair, but far more efficient and streamlined, and less costly to citizens and the economy.

The for-profit sector keeps crowding out public and not-for-profit alternatives. And because they need to swim in a market pool defined by profit-maximizing corporations, large not-for-profits are increasingly indistinguishable from their for-profit cousins. (“The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but already it was impossible to say which was which.” —George Orwell, Animal Farm) The Massachusetts General Hospital, nominally one of the great nonprofits, plays exactly the same games as the commercial for-profits: buying up referral networks, gaming insurance reimbursements, investing in more profitable specialties, and maximizing market share. Back in the day, when the entire health system was less commercialized, when did community hospitals worry about market share? When did they buy up medical practices? It isn’t just that market institutions crowd out non-market ones. It’s that market norms crowd out other norms and other values. As someone once said, all that is solid melts into air.

That, of course, was Marx. I never went through a Marxian phase. In the 1960s, at the peak of the postwar boom when I was in college and graduate school, the concepts and language of Marxism seemed quaint and silly. The proletariat, rather than rising up against the bourgeoisie, had joined the middle class via effective trade unions.

The middle class, far from being immiserated, was content and growing. Nations that invoked Marx were economic failures. They were not dictatorships of the proletariat but plain old corrupt dictatorships. The reserve army of the unemployed had not materialized, nor had the law of the falling rate of profits, nor the hegemony of capitalist ideas.

In Europe, social democracy was alive and 44 PROSPECT.ORG NOV/DEC 2021

well. Thanks to countervailing power, the state was far from Marx’s executive committee of the working class. It was the instrument of workers and citizens working to tame capitalism in the public interest.

Well, gentle reader, that era turned out to be a blip—the consequence of historically anomalous constraints on the economic and political power of capital in a capitalist economy. In the intervening years, I haven’t become more Marxian. The world has become more Marxian.

The era of social democracy and managed capitalism lasted barely a generation before capitalists recovered their normal immense power in economies whose ownership remained fundamentally capitalist. With hyper-globalization, a worldwide reserve army of the unemployed does batter down wages and marginalizes the political power of labor in the democracies. A lumpenproletariat of the homeless and stateless migrants rends the social fabric.

Even elite professions are becoming proletarianized. It is no longer risible to use “capital,” Marx-style, as a collective noun.

Far too much of society is indeed becoming commodified. The idea that things have to be this way, perhaps with social buffers around the edges, is close to hegemonic.

But while Marxism provides some useful insights, I would not call myself a Marxist.

The Marxian characterization of historical laws is far too mechanistic. Marx neglected to attend to how democracy would actually work, if socialism ever arrived. And he got the most important thing of all dead wrong.

Marx thought that when the crisis finally came, workers of all countries would unite in their collective interest. But as the history of the past century proves again and again, when market forces overwhelm the security and livelihoods of working people, they are far more likely to turn to ultranationalism and fascism.

The great prophetic critic of that dynamic is not Karl Marx but Karl Polanyi. Like Marx, Polanyi astutely explained the tendency of capitalism to commodify things that needed to operate by other norms and values, such as human society and human labor. Unlike Marx, Polanyi appreciated the risks of fascism. Most importantly, Polanyi saw tendencies rather than iron laws. He left room for human agency and diverse experimentation.

Polanyi came of age as a journalist and public intellectual in the 1920s, in what

I haven’t become more Marxian. The world has become more Marxian. was then known as Red Vienna. The city of Vienna had socialist municipal governments from 1919 until 1934. During this remarkable period, the city government created social housing for the middle class as well as the working class, a model to this day. Vienna levied taxes on employers of private servants as well as taxes on cars, horse racing, and other luxuries, to help finance an array of services, including family allowances for parents, preschools, and unemployment insurance run through the trade unions. Electricity, gas, and water were socially owned. None of this undermined Austria’s private economy, which was far more endangered by the austerity policies criticized by Polanyi. In his theoretical work, Polanyi viewed democratic socialism as the system to carry out the political liberalism of the Enlightenment, and economic liberalism (laissez-faire) as corrosive of political liberalism.

Polanyi published his epic book on capitalism, The Great Transformation, in 1944.

He lived another 20 years, long enough to see some evidence that the democracies were taking history’s lessons to heart and constraining capitalism’s destructive tendencies, and to hope that we would go beyond social democracy to democratic socialism.

He did not live long enough to see it all reversed, confirming his darker insights.

One of Polanyi’s most powerful concepts is what he called the “double movement.”

Capitalism overwhelms other social institutions on which ordinary life and economic security depend. Eventually, the common people revolt and are willing to sacrifice democracy for a measure of security and respect. Thus does capitalism destroy democracy in a bank shot. Capitalism also destroys democracy directly, by substituting money and power for citizenship, precluding reformist remedies, and signaling the common people that they are fools to think that voting could make a difference.

Polanyi’s double movement uncannily describes our own era. Ordinary people are

In the 1920s, Karl Polanyi’s Red Vienna featured socially owned housing, water, and electricity, and used taxes on the rich to finance child allowances, preschools, and other social services. disaffected from the dislocations and excesses of capitalism but unsure whom to blame or whom to trust. Ever since Carter, much of the Democratic Party has been so compromised and bedded down with Wall Street that displaced middle- and working-class people are skeptical that Democrats and liberal remedies can make much of a difference in their lives. The cumulative result is Trumpism, a weird combination of racist nationalism and redoubled corporate rule. Libertarians like to teach that liberal democracy and free markets are handmaidens. But autocrats from Trump to Hitler to Xi demonstrate that dictatorship and market modes of production and employment can coexist all too well. The signal disgrace of our era is the ease with which the corporate center-right has gone along with Trump and the Republican efforts to destroy what remains of democracy. If it’s possible to oust unions, cut taxes, and gut regulation, losing democracy is a price worth paying, if it’s a price at all.

Yet Polanyi’s sensibility gives me some hope. Looking at the tendency of capitalism to crush efforts to build decent human economies, you can become a defeatist and a cynic; or you can keep at it, appreciating that sometimes solidarity produces results and that nothing lasts forever. The 15 years of Polanyi’s Red Vienna stand as a model. Likewise the 40 years between the 1930s and the 1970s when the New Deal system contoured America. Swedish social democracy has been

around for almost a century. While global capitalism keeps chipping away at the Swedish model, that model continues to provide decent lives for most Swedes. As capitalism goes, a century of decency is pretty good.

When we had a 30th anniversary testimonial dinner for the Prospect in October 2019, I gave a talk invoking Camus’s celebrated essay The Myth of Sisyphus. As you will recall, Sisyphus is condemned to push a rock up a hill, only to have it roll back down. His every effort is futile. Yet Camus ends his essay with the words “One must imagine Sisyphus happy.” When I first read that, it seemed preposterous. Happy?

Then I appreciated the insight that the joy is in the struggle. And then, I finally got the larger point. The rock, ultimately, is death.

In the end, it crushes us all. But along the way, we build the best life and the best society that we can, recognizing that nothing lasts forever.

So with that credo, Sisyphus Happy, what is to be done? For if we can’t even produce reformed capitalism, how on earth do we move toward democratic socialism?

One thing that needs to be done is to keep pushing outward the boundaries of the possible. In a seeming paradox, the more socialistic elements of Biden’s full $3.5 trillion program are the most popular—the paid family leave, the child allowance, the social provision of child care, the free

tuition for community college, the social enhancements to health care. Revealed preference. Yet the press, in its myopia, concluded that the Democrats had a rough election in November because Biden’s program was too left-wing. Sorting out the Democrats’ election defeat, The New York Times, channeling Fox, published a monumentally stupid editorial titled “Face Reality, Democrats.” It claimed, “Tuesday’s results are a sign that significant parts of the electorate are feeling leery of a sharp leftward push …”

In fact, the Democrats were repudiated because they and Biden couldn’t get their act together and looked like a party that couldn’t govern. And the reason they couldn’t reach agreement on a budget reflected the perverse influence not of “moderates,” as the press keeps calling them, but of corporate Democrats. Most of Rep. Josh Gottheimer’s gang of obstructionists in the House represent districts whose constituents support Biden’s program. The Gottheimer naysayers oppose it not because that’s what it takes to get elected, but because of their corporate debts and alliances.

In individualistic America, the citizenry supposedly mistrusts government. But once socialistic programs are enacted, they are immensely popular. Chattanooga has the country’s cheapest and fastest broadband provided by the local public power company—pure socialism. Ask the citizens if they want to return to slower, more costly, and less reliable private broadband. Our most popular programs are the most socialistic— Social Security and Medicare. Revealed preference again.

That same Times editorial quotes Rep. Abigail Spanberger, a centrist Virginia Democrat, saying, “Nobody elected him [Biden] to be F.D.R.” Maybe not, but last spring when the pandemic emergency, the recession, and the progressive movement impelled Biden to govern in the spirit of FDR, the citizenry liked what they saw. It was only when the momentum was stalled

by Republicans and corporate Democrats that Biden started looking feckless.

Given the immense corporate undertow in American politics, Biden’s program, even if fully enacted, would be necessary but not sufficient. He has made a good beginning with his regulatory appointments aimed at breaking up extreme corporate concentration. He needs to go a lot further by getting rid of the dark financial pools of private NOV/DEC 2021 THE AMERICAN PROSPECT 45

equity and hedge funds, and by constraining private capital generally.

46 PROSPECT.ORG NOV/DEC 2021

Bernie Sanders has been a champion of social ownership going back to land trusts during his mayoralty in Burlington. air. Public radio, despite the annoyance of encroaching quasi-commercials, is still light years away from commercial broadcasting in its basic ethic. We need more such institutional oases of non-market norms.

Housing is an emblematic area where America’s attempts to graft some social objectives onto a for-profit system controlled by developers and financiers are inefficient and pitiful. Our subsidies to create affordable housing include a low-income tax credit that is complex and bureaucratic for community housing developers to use, and that delivers much of the subsidy to financial operators who syndicate the tax shelter to other rich people. A second instrument, housing vouchers, does not meet the need and bids up prices and profits to landlords.

A third gimmick, requiring developers of luxury housing to set aside some affordable units, is woefully inadequate. Far better would be the creation of a large, genuinely social housing sector that need not be traditional public housing. We have a model for this in the form of housing land trusts that create diverse forms of social housing permanently protected from market pressures—pioneered in Bernie Sanders’s Burlington and in Karl Polanyi’s Red Vienna.

We also need to resist and reverse privatization. Institutions that should be public have been increasingly privatized, with

results that provide windfall gains to private capital. For everyone else, the flip side is added costs, debased public values, and degraded services to ordinary citizens.

These include privatized prisons, privatized Medicaid and Medicare, privatized voucher schools, privatized highways and parking meters, privatized management of publictransit systems, and a great deal more.

Regulation itself has been increasingly privatized, as public agencies have delegated their authority to “self-regulatory agencies” that are thinly disguised trade associations.

A comprehensive and depressing guide to this is the superb new book The Privatiza­ tion of Everything, by Donald Cohen and Allen Mikaelian. Here again, it’s important to appreciate that this tendency is not just “privatization,” a neutral-sounding term that suggests well-intentioned policy strategies that sometimes went awry. What’s at work here is yet another realm of the relentless encroachment of capitalism as a system.

It would be good to get more creative in devising new forms of social ownership.

Peter Barnes’s latest book, Ours: The Case for Universal Property, provides some ingenious ways to think about this goal. It was Barnes who first pointed to the Alaska Permanent Fund as a more general model.

When oil was discovered on Alaska’s North Slope in the 1970s, the governor, a renegade

J. SCOT T APPLEWHITE / AP PHOTO

One basic strategy, I think, is to keep creating islands of social ownership and to limit capitalist ones. Our colleague Ganesh Sitaraman calls these “public options.” Ideas like postal banking and other forms of public banking, such as establishing individual accounts directly at the Federal Reserve or a green development bank, can do that. Likewise public power and public broadband.

Or the original public option of socialized health care. Or direct public development and distribution of patent-free drugs. Social institutions like these demonstrate the superior equity and efficiency of socially owned alternatives; they also weaken competing private ones and thus the political power of capital. As Chattanooga suggests, this can be done at the municipal level, as well as by states and the national government.

Social ownership doesn’t mean just government institutions, but incudes others that are noncapitalist in their logic and ownership structure. Once, such institutions were plentiful in America. The New Deal created islands of public ownership, such as public power, public housing, and public financial institutions like the original Fannie Mae and a much enlarged Reconstruction Finance Corporation. But the first half of the 20th century was also an era of noncapitalist mutual and nonprofit institutions.

Most savings and loans were nonprofits; most insurance companies were mutually owned. The first wave of prepaid group health plans were co-ops. These embodied values other than capitalist ones; they promoted direct democratic governance in ways that bureaucracies don’t; and they stood as bulwarks against the relentless incursion of capitalist institutions. In recent decades, however, financial capital viewed these institutions as pools of money they wished to appropriate. The stewards of these institutions saw a chance to cash in and enrich themselves. Congress obliged by making such conversions legal. Most mutual financial institutions have become conventional for-profits. Most nonprofit health plans were converted to for-profit HMOs. This sector needs to be reclaimed.

I happen to love public libraries, not just because I love books, but because when you enter a library nobody is trying to sell you anything. It is free and the ethic is noncommercial. It is like breathing different

Not only is liberalism too weak to resist the predations of metastatic capitalism; so is social democracy.

Republican named Jay Hammond, rather than hand all the profits to the oil companies, sponsored a public fund that would pay all Alaskans annual dividends in equal amounts. Barnes calls for collective sources of wealth (such as sunlight) that are privately exploited to generate dividends and trust funds for all. Thomas Piketty, in his new book, Time for Socialism, calls for a “universal capital endowment” of about $150,000, to be paid to every adult at age 25, financed by taxes on extreme wealth.

These ideas are ingenious technical policy solutions. But to gain political traction, they require a movement built on a coherent understanding of capitalism as a system.

The labor movement is one such movement and, just between us, much of it is socialist.

A weakness of the American liberal tradition, even at its apex under FDR, was that it was disconnected from a comprehensive critique of capitalism as a system. As Albert Hirschman pointed out, FDR sold his reforms as merely pragmatic. Writing in the 1980s, as Reagan was reversing the New Deal, Hirschman observed, “Today, of course, we can appreciate the high cost of Roosevelt’s maneuver. The New Deal reforms … were never truly consolidated as an integral part of a new economic order or ideology.”

More than 20 years ago, Paul Starr and I had an exchange in the Prospect on the relationship between liberalism, social democracy, and socialism. Both pieces are well worth rereading in light of subsequent events. Paul, in a piece titled “Liberalism After Socialism,” was writing not that long after the collapse of communism. His basic argument was that liberalism and socialism come out of entirely different traditions; that it’s a categorical and political mistake to blur them with something called social democracy; and that the liberal tradition is

capacious enough to include all the reform that we need. He concluded his Prospect essay with these words: “While the house of liberalism in America has many rooms, it should not be allowed to become the last refuge of a defeated and disappointed socialism. When socialism was young and full of fervor, some liberals were understandably infatuated and thought of marrying their political values to socialist economics. But the romance should be over once and for all.”

In my own piece, I wrote that social democracy is a more robust heir to the aspirations of liberalism. “Europe’s social democrats, developing a welfare state and a Keynesian strategy of economic stabilization roughly in parallel with American liberals, nonetheless had a somewhat different understanding of what they were about. As part socialist and part liberal, they understood the enterprise not just as spreading social benefits or fighting unemployment, but as taming capitalism and as building a durable political constituency to make that enterprise electorally possible … I am sympathetic to social democracy, not as a bridge to socialism, but as a bridge to a more durable liberalism.”

Two decades after that exchange, events have not been kind to either essay. Not only is liberalism too weak to resist the predations of metastatic capitalism; so is social democracy. Paul wrote, “Western European countries that have had Socialist and Labour parties in power have drifted progressively further away from a commitment to socialism … indeed, some nominally Socialist governments have been actively privatizing public enterprises.” This is pre-

Further Reading

Kate Aronoff, Peter Dreier, and Michael Kazin, eds., We Own the Future Peter Barnes, Ours: The Case for Universal Property Donald Cohen and Allen Mikaelian, The Privatization of Everything Michael Harrington, Socialism: Past and Future John Judis, The Socialist Awakening Robert Kuttner, Can Democracy Survive Global Capitalism?

Thomas Piketty, Time for Socialism Ganesh Sitaraman and Anne L. Alstott, The Public Option

cisely the problem. The great destroyer of liberal values that Paul and I both hold dear has been rampant capitalism.

In a recent Prospect piece, “The Agony of Social Democratic Europe,” I concluded that the cause of the social democratic near collapse was the pervasive spread of neoliberalism as embraced by watered-down “center-left” parties as well as by conservative ones. As the lives of ordinary people became more and more precarious thanks to ultracapitalism spread by globalism, they had no good reason to vote for social democrats.

In the 1980s, when Swedish social democracy was coming under threat by the general turn to the right and the deregulation of global financial markets, two of the smartest Swedish economists, Rudolf Meidner and Gösta Rehn, realized that to defend social democracy you needed something more like socialism. But as Swedes, they did not want statism. Meidner and Rehn both came out of the trade union movement, the central pillar of the Swedish model. Their idea was to build socialism on what they called “wage-earner funds.” Every year, a set percentage of all profits of Swedish corporations would be directed to funds collectively owned by workers. These would not only enhance pensions. More fundamentally, in less than a generation, they would lead to collective worker ownership of Swedish industry, but without undermining Swedish entrepreneurship. On the contrary, as a source of patient capital they would be far better than private financial markets impatient for quick returns. But by the 1980s, the Swedish Social Democrats were already becoming more neoliberal, and the social democratic leadership killed the plan.

The difference between democratic socialism and social democracy is that the former grasps the need for substantial social ownership to supplant capitalism as a system. The latter tends to deteriorate into welfare capitalism, which becomes an impossible straddle fiscally and vulnerable politically, and gets eroded over time.

In 1972, a young Christopher Jencks, who later became a frequent contributor to these pages, wrote an influential book called Ine­ quality. He closed by delicately calling for “what other countries call socialism.” It’s time for Americans to call socialism by its name.

Like Sisyphus, the best we can expect is that the rock may stay where we’ve put it for a long while, sometimes for entire generations of decency, as the struggle continues. n NOV/DEC 2021 THE AMERICAN PROSPECT 47

DA R K DARK MONE Y MONEY THE DEMOCRATIC DILEMMA ON

Liberal electoral groups are now spending more from undisclosed donors than Republicans.

Campaigners don’t readily give up winning strategies.

By Rachel M. Cohen

Eleven years ago, in response to the landmark Supreme Court decision in Citizens United, Democrats rallied around a bill they hoped could prevent a new flood of money into elections. The DISCLOSE Act (short for “Democracy Is Strengthened by Casting Light on Spending in Elections”) would have required new reporting prior to Election Day of top donors to political ads sponsored by corporations, unions, and advocacy groups, with the top five donors disclosed in the ads themselves. “We do not want to chill speech,” New York Sen. Chuck Schumer stressed at the time. “We merely want the American public to have details about who is speaking.”

At the time, in advance of the 2010 midterms, dozens of groups were seizing on the new opportunities presented by Cit­ izens United, which loosened campaign finance restrictions and made it far easier for donors to contribute money anonymously. New “super PACs”—which allow for

48 PROSPECT.ORG NOV/DEC 2021

unlimited spending by corporations and special interests—began registering, and more money started to flow into nonprofit “social welfare groups,” which are not supposed to focus primarily on politics and do not need to reveal their donors. A new era of so-called “dark money” had arrived.

Democrats passed the DISCLOSE Act through the House in June 2010, but fell one vote short of breaking a Republican filibuster in the Senate. Democrats were united in their outrage, and even President Obama condemned the GOP, unequivocally stating: “A vote to oppose these reforms is nothing less than a vote to allow corporate and special-interest takeovers of our elections.”

Obama was correct. A decade later, more than $1 billion in undisclosed spending poured into the 2020 federal election cycle. But the majority of it, around $514 million, went toward electing Democrats, according to an analysis by the watchdog group OpenSecrets, compared to roughly $200 million that helped Republicans. Joe Biden’s presidential bid alone attracted $174 million in anonymous contributions, more than six times as much as Donald’s Trump’s $25 million.

The DISCLOSE Act is now included in H.R. 1, the For the People Act, the Democratic Party’s comprehensive ethics, voting rights, and campaign finance package, which also stands little chance of passage without scrapping the filibuster. But today, Democrats find themselves in a more delicate spot, both backing federal legislation

NOV/DEC 2021 THE AMERICAN PROSPECT 49

ld will admit y is just not a ty anymore.

that would restrict the flow of undisclosed spending, while also becoming increasingly dependent on it and the donors who demand it.

To manage this tension, Democratic campaign officials, consultants, and donor groups consistently rely on a go-to phrase: unilateral disarmament. They claim to agree that money in politics can be detrimental to democracy, but they cannot afford to let all the benefits of super PAC spending flow to Republicans. They have to play the game as it’s played, distasteful though it may be.

But more quietly, leaders in the progressive fundraising world will admit that transparency is just not a serious priority anymore. With imminent threats to democracy, including Republicans clinging to false theories about a stolen 2020 election and the possibility that election officials will simply reject the will of the voters in the future, liberal donors say there are just higher-order matters to focus on. “They’re understandably scared shitless about Trump getting another term, and [they] act accordingly,” said Gara LaMarche, the former president of the Democracy Alliance, a network of progressive mega-donors.

While the liberal argument to win now and focus on reform later makes some sense—the stakes are certainly high—a focus on winning at all costs comes, well,

50 PROSPECT.ORG NOV/DEC 2021

with a cost. Campaigners don’t readily give up winning strategies, and the assumption that all will be stowed back safely away if and when Democrats achieve sufficient electoral majorities starts to look fairly naïve. And all the while, the grip of the rich grows tighter on a party desperate to compete financially, hobbling options for policy that might pinch their elite class. As these happen to be among the most popular ideas with the broader electorate, furious with soaring inequality, the chase for dark money extracts a political cost that may corrode the party as much as it helps it.

With union membership rapidly declining, progressives struggle to counteract the massive power and influence of the corporate lobby. To fill the gap, they turned to tax-exempt nonprofit organizations, of which there are two main kinds, both named for the section of the federal tax code under which they are regulated. 501(c) (3)s, also known as public charities, range from symphonies to the Boy Scouts to (full disclosure) The American Prospect. They can engage only in limited amounts of lobbying, and cannot donate to political campaigns. Financial contributions to c3s also yield donors a tax deduction. 501(c) (4)s—the social welfare groups—provide no tax deduction for contributions, but they can endorse candidates and engage in unlimited lobbying, so long as this doesn’t

comprise the majority of their activities. Importantly, they need not disclose their donors.

The dark-money era brought changes to this model. As Columbia law professor David Pozen has observed, many progressive groups that formed in the wake of Trump’s ascent, like Indivisible and Women’s March, launched off the bat as c4s, and long-standing organizations like the American Civil Liberties Union, which had both c3 and c4 arms, began investing much more heavily in their c4 operations. The NAACP, after 108 years of existence, in 2017 decided to transition entirely to a c4 from a c3, precisely to engage in more lobbying.

“An increasing number of people understand that if they pool resources, they can make a difference on poverty or the environment in a way that you can’t with a standard c3,” says Aaron Dorfman, the president of the National Committee for Responsive Philanthropy. “[Donors] realize if you actually want to make a difference, you need to support movements that contest power and are dedicated to changing systems. That’s not a bad thing.”

Citizens United’s loosening of spending rules created easier opportunities to use c4s for undisclosed campaign spending.

This has been particularly advantageous for the ultra-wealthy, who can avoid capital gains tax on the donation of an appreciated property, a far more valuable tax benefit than the standard charitable deduction they’d take for a c3. While liberals worried about corporate-spending floodgates opening with the Citizens United decision, OpenSecrets found the biggest political actors to take advantage thus far have actually been individual wealthy donors.

Social welfare groups aren’t the only vehicles used to inf luence politics and shield donor data. There also exist socalled “gray-money groups,” which have donations traceable only back to other PACs. The Center for Responsive Politics says such partially disclosing political entities were “practically nonexistent” before 2010, whereas now the landscape is littered with shell groups that make tracing the origins of funds even more difficult.

A bevy of low-profile and well-heeled “venture philanthropy” funds, like the Sixteen Thirty Fund, New Venture Fund, and Tides Advocacy, have also distributed hundreds of millions of dollars to liberal organizations over the last few years. It wasn’t until a year after the 2018 midterms that a pair of journalists learned that the Sixteen Thirty Fund alone had contributed $141 million in dark money to left-leaning groups that cycle, including one (anonymous) $52 million donation. These funds identify as “fiscal sponsors” and boast of their ability to deploy collective resources strategically and quickly.

Even the most left-wing groups cannot resist the dark-money temptation. When Cori Bush and Jamaal Bowman mounted primary bids in 2020, the progressive campaign organization Justice Democrats spent $150,000 and $620,000, respectively, on their behalf in independent expenditures, which are outside spending efforts that can raise unlimited sums of undisclosed money. Bush and Bowman won their races. It was a tactic Justice Dems hadn’t used months earlier in support of Jessica Cisneros, who lost her progressive challenge to Rep. Henry Cuellar, one of the most conservative Democrats in Congress, by just 3,000 votes.

Waleed Shahid, spokesperson for Justice Dems, said they had little choice if they wanted to win. “[Former Rep.] Joe Crowley did not have an independent expenditure supporting him,” he said, referring to Justice Dems’ early triumph with Rep. Alexandria Ocasio-Cortez (D-NY). “But every single one of our opponents after AOC’s victory just fought us on the coordinated and uncoordinated side with all they have.

Part of our strategy that time around was that we could not afford to get outgunned.”

One doesn’t have to squint to see why dark-money groups are attractive to the rich. The vehicles allow them to donate and avoid the negative attention that might come with disclosing their identities, like protests outside their home or bad press.

Anonymity also helps them avoid threats of violence or actual harm, defenders of the status quo like to say. The Philanthropy Roundtable, a conservative advocacy group for charitable giving, says shielding donors from public scrutiny is necessary for “philanthropic freedom.”

While some issues—particularly abor-

tion access—have a real record of harm for supporters, most advocacy groups hide today behind harassment of abortion activists to rationalize their own lack of transparency. Other groups cynically cite a Supreme Court decision from six decades ago that unanimously ordered Alabama to stop accessing the NAACP’s membership list, concluding that doing so interfered with members’ right to freely associate. However, a billionaire donating to a political nonprofit to run anonymous ads against Medicare expansion should not be likened to the legitimate threats Black Americans faced in the South during the civil rights movement.

Sen. Sheldon Whitehouse (D-RI), the lead sponsor of the DISCLOSE Act, says he has no problem with rich donors who want to, say, give discreetly to their alma mater.

“There are some good reasons for anonymity, maybe you want to give a big donation to your university and want to avoid other people coming to ask you for money—there’s nothing really wrong with that,” Whitehouse said. “But it’s different when you’re trying to exert political pressure over others and refuse to stand up for your views.”

Does it really matter if liberal political advocacy groups and campaigns disclose their donors, if the house is on fire?

Dorfman thinks that transparency is “helpful to the cause” and that groups should disclose “a great deal of information,” but acknowledged that sometimes donors just don’t want to do that. “I think each organization in the progressive space needs to make that call, on their own within the limits of the law,” he said.

One challenge of hiding donors is that it makes it more difficult for the public to assess which organizations authentically speak for the communities they purport to, and which are just pet projects of the rich or schemes by companies.

Beginning in 2017, tens of millions of dollars were poured into a generic-sounding social welfare group called Generation Now, which funded TV ads, mailers, and flyers in Ohio to pass a bill that would subsidize an energy company’s power plants. It was only after an FBI wiretap and federal indictment of state lawmakers for bribery and corruption that the public learned the ads had been funded by affiliates of the energy company itself. Or take Patients

for Affordable Drugs, which sounds grassroots, but is really a highly controlled lobbying entity backed by millions from the Laura and John Arnold Foundation.

Elyssa Feder, co-founder of Rising Organizers, a community organizing training program, notes that power dynamics between organizational leaders and donors will always be skewed. “If people’s jobs are on the line and a major donor says my $50,000 check is predicated on you funding a new project—even if that new project isn’t the best use of your time and resources—it’s hard to say no to that when that donation would be able to pay someone’s salary,” she said.

These advocacy groups, and their donors in turn, exert real influence on the priorities of politicians, leading them too often in less populist directions. This isn’t new, and the Democratic Party in particular has been making itself more easily swayed by the whims of the wealthy ever since the early 1980s, when Rep. Tony Coelho took over the Democratic Congressional Campaign Committee and established new direct lines of communication between corporate donors and members of Congress. He billed himself as a pragmatist, one simply playing by the rules of the game, and he’d later go on to fight for legislative loopholes on behalf of the wealthy donors he cultivated. The Washington Post would call him “the most influential young congressman of his generation.” Prospect editor Bob Kuttner referred to him in The New Republic in 1985 as “the Democrats’ Dr. Faustus.”

Coelho himself helped push to defeat a campaign finance reform measure that would have required greater donor disclosure, which might serve as a cautionary tale for Democratic leaders today.

Indeed, just recently Sampriti Ganguli, CEO of Arabella Advisors, which helps consult for leading liberal dark-money groups, remarked that she sees “a low likelihood that the laws will actually change” regarding disclosure. “Our laws protect individuals and their privacy around causes they believe in,” she said.

The Democracy Alliance, a club of top liberal donors founded in 2005 to act as a counterweight to the conservative Koch network, is a top fundraising target for center-left and progressive groups. Political scientists Alexander Hertel-Fernandez and Theda

NOV/DEC 2021 THE AMERICAN PROSPECT 51

Skocpol have noted that the structure of these elite donor consortia have potential to influence politics in uniquely powerful ways, even beyond similar partisan super PACs and single-issue advocacy groups.

While most donors in the Democracy Alliance would say their philanthropic spending should not be compared to conservatives’, because unlike Republicans they back causes that would not necessarily be in their economic self-interest, it remains true that regardless of partisanship, wealthy Americans generally hold different values and preferences from the rest of the country. For example, while having funded many center-left organizations, the Democracy Alliance never prioritized advocacy for Medicaid expansion, even when it became clear no alternative liberal group could meaningfully take that up.

“Medicaid expansion just never seemed to capture a lot of liberal donor imagination,” Hertel-Fernandez and Skocpol concluded. (The Democracy Alliance declined to make their new president, Pamela Shifman, available for an interview.)

The suggestion that wealthy donors on the left never advocate for their economic self-interest doesn’t hold much water, either. The rapid demise of the ambitious and extremely popular redistributive tax proposals in the Democrats’ Build Back Better Act suggests who still has the ear of those in power.

“This stuff is so opaque and no one is holding anyone accountable,” said one staffer whose employer works with the venture philanthropy funds. “The organizational landscape of civic and political organizations is just totally being transformed as inequality grows and rich people get uber rich and we are finding more creative ways to distribute their money.”

The staffer, who works in progressive movement building, says the landscape is becoming “extremely donor-centric” in a way that no longer even resembles the industrial-titan philanthropic milieu they once knew. “We’re entering this new era of capitalism dominated by finance, tech, and insurance. The money is different,” they said. “We’ve linked our fates here to new powers within capitalism, and [how] that money is moved, aggregated, pooled, and filters down is really different than even several years ago, and it scares me a little bit.”

52 PROSPECT.ORG NOV/DEC 2021

As progressive groups grow more dependent on rich donors who’d like to keep their contributions private, liberals find themselves contorting into awkward positions to justify the status quo, insisting groups that are clearly affiliated with the Democratic Party are not, in fact, partisan.

Political nonprofits tend to insist they’re independent and simply “issue oriented”— a framing that’s practically dubious but legally necessary to keep their nonprofit status.

This strained logic was on display this past year when The New York Times profiled obscure Swiss billionaire Hansjörg Wyss, who has become one of the top funders of left-leaning organizations, donating hundreds of millions of dollars since 2016 both to entities that distribute funds to other progressive political advocacy groups, and directly to organizations like the Center for American Progress, a liberal think tank where Wyss sits on the board. While Wyss does not donate directly to candidates or PACs, the groups benefiting from Wyss’s contributions work to help Democrats and defeat Republicans.

Representatives for the billionaire insisted to the Times that his money was not “spent on political campaigning” and was merely “bolster[ing] social welfare programs in the United States.”

With a heavily weakened and embattled IRS, partisan c4s are so confident today that they will face no punishment for engaging too much in political activity that even Majority Forward, a c4 founded in 2015 and affiliated with Senate Democrats, told the Federal Election Commission that it did not receive contributions in 2018 earmarked for political purposes and thus refused to disclose its donors, despite spending more than $45 million that cycle boosting Democrats.

While congressional Democrats remain at least nominally behind political-transparency reforms, not all their donors are so keen. And publicly, the American Civil Liberties Union has been leading an effort to lobby against the c4 transparency requirements included in the DISCLOSE Act. While the overwhelming majority of Americans do not donate anywhere near the $10,000 minimum that would trigger disclosure, in a letter sent to the House of Representatives, the ACLU claimed such rules would nonetheless “chill the speech of issue advo-

cacy groups and non-profits such as the ACLU, Planned Parenthood, or the NRA.” Back in 2010, the ACLU also opposed the DISCLOSE Act on First Amendment grounds, and the group even sided with the plaintiffs in Citizens United. (This was not without internal criticism; in 2012, a former longtime ACLU lawyer outlined why he and others saw the group’s position as constitutionally misguided.) But the ACLU’s rhetoric to justify its opposition to transparency reform has also evolved over the last decade, in ways that suggest they’re struggling to convince the public, and perhaps themselves, that they’re not simply providing cover for the rich to unduly influence elections.

Like the Wyss Foundation and Majority Forward, the ACLU seeks to draw lines between ads that explicitly endorse or oppose candidates and all other political communications, like ads focused on bills or policies. The latter, they claim, should not trigger disclosure rules, and disclosure would in fact “do little, if anything, to serve the public’s interest in knowing.”

Kate Ruane, the senior legislative counsel at the ACLU who has been leading the organization’s opposition, insisted to me that “we cannot lose sight” of how disclosure laws “can be used to suppress marginalized voices” and deter speech. She pointed to Black Lives Matter protests following George Floyd’s death and noted that some opponents tried to figure out who was allegedly funding them. “Presumably that was intended to direct a certain amount of harassment and violence toward the people who were supporting those movements,” she said. “My concern is that H.R. 1 could hurt especially smaller organizations that are just beginning to build their political advocacy, and we want to make sure we are supporting them.”

But what about TV ads run by groups that purport to be environmentalists yet are secretly funded by fossil fuel companies? Or groups that are affiliated with the Democratic Party but go by vague names like Floridians for a Fair Shake?

Shouldn’t the public have a right to know who is behind those political statements, even if they’re not discussing candidates specifically? “There is a certain amount of balancing happening here,” Ruane said.

“I think the ACLU is just wrong on this,” Sen. Whitehouse told me. “While there are very, very rare circumstances like when

Campai are tu sure rule

NAACP members needed protection from Jim Crow state-sponsored violence, when there’s not a record of a specific threat, democracy is better served and citizens are better served by knowing who is behind political messages.”

Meanwhile, the Supreme Court and conservative activists are hard at work to dismantle what’s even left of financialdisclosure law, dropping unsubtle hints that the privacy of donors to spend as they please should trump public accountability.

At the rate things are going, it’s not even clear the DISCLOSE Act would pass judicial review, leaving average Americans who are already fast losing trust in their political system with little reassurance.

For the last 45 years, the courts have said financial transparency is the one campaign finance safeguard least likely to pose a First Amendment concern. “In most applications [disclosure requirements] appear to be the least restrictive means of curbing the evils of campaign ignorance and corruption,” the U.S. Supreme Court reasoned in its 1976 Buckley v. Valeo decision. In Citizens United, while the Court ruled that restrictions on election messages were unconstitutional, it also said “disclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way” and that transparency “enables the electorate to make informed decisions and give proper weight to different speakers and messages.”

Yet now deregulation advocates are turning their sights on disclosure rules, with increasing success. This past summer, the Supreme Court ruled along party lines in favor of conservative plaintiffs challenging a California law that required charitable groups to disclose the names and addresses of their major donors. The petitioners—conservative dark-money legal groups Thomas More Law Center and Americans for Prosperity—argued such rules could have a chilling effect on donors’ First Amendment rights. The ruling, as Whitehouse quipped, created “a new constitutional right to dark money.” But some liberal groups, including the ACLU, the Human Rights Campaign, NAACP Legal Defense Fund, and the Southern

Poverty Law Center, allied themselves with the conservative plaintiffs.

Liberal justices highlighted the dangerous implications the decision holds for political elections. “How is this different from campaign finance laws, where there is an even stronger interest in donating anonymously?” asked Stephen Breyer during oral arguments.

“It’s open season on a lot of things we thought were settled,” says Roger Colinvaux, a professor at Catholic University who specializes in nonprofit tax law. He thinks the next major constitutional challenge will be against public disclosure to the IRS. “One of the things I’m worried about is what this will mean for 990 tax forms [the annual disclosures nonprofits must file]. We’ve been filing 990s and disclosing all this information for 50 years and nobody ever said that affects my First Amendment right to associate.”

Why not voluntarily disclose donors? There have been other instances when Democrats voluntarily committed to things that were not technically required, like avoiding corporate PAC money or returning donations from fossil fuel executives. Even if one accepts the argument that one side of the aisle should not unilaterally disarm when it comes to fundraising, why not just stipulate that funds voluntarily donated to a progressive group or campaign, at least when

ign deregulation advocates urning their sights on discloes, with increasing success.

they reach a certain threshold, must be publicly disclosed? Legally, a group doesn’t have to, but why not make that a model practice anyway?

The Prospect reached out to several leading progressive groups to ask if they would consider making their c4 contributions public, even if it wasn’t legally required. Sunrise Movement, which publishes its 990s on its website and says it’s “committed to financial transparency and accountability,” did not return multiple requests for comment.

“When progressives play by a more stringent set of rules, we reduce the incentives for comprehensive reform,” said Data for Progress executive director Sean McElwee. “As we’ve seen with gerrymandering, when progressives embrace one rulebook and fascists embrace another, we only set our cause back.

There is nothing progressive about losing.”

Justice Democrats’ Shahid said they hadn’t really thought about the idea before but probably would not since most of their PAC work is already required to be disclosed. “We 100 percent support the transparency reforms in H.R. 1,” he said.

Leah Hunt-Hendrix, the co-founder of Way to Win—which tries to mobilize Democratic donors—said she accepts the tensions that come with using dark money.

“I don’t think we can unilaterally disarm, and I think we should use all the money we possibly can raise for movements that

NOV/DEC 2021 THE AMERICAN PROSPECT 53

nstitutionalssoglia with sive Politics.

can fight for the working class,” she said.

“I feel OK about funding through a super PAC because we’re doing it in total alignment with organizations for whom their mission is to redistribute wealth, to fight corporate power.”

While Hunt-Hendrix acknowledges that disclosure has not been a top priority for Way to Win, she thinks if the laws were changed, their focus would shift toward transparency. “There are funders who wouldn’t necessarily want their names out there, and don’t want to open themselves up to attacks, but funding is political work and should ultimately be a public act,” said Hunt-Hendrix. “There may be some donors who feel they can’t make that sacrifice, who feel they’d be putting the rest of their family at risk, and so there are major donors we might lose. I think that’s OK though.”

Others agreed that the desire for privacy was partly a function of habit, and most donors would adjust if they could no longer be anonymous. Disclosure, said Shahid, would help Democrats and progressives far more than it would help Republicans.

The limits of voluntary measures were revealed in the 2020 primary, when leading Democratic candidates one after another swore off super PAC contributions to signal their commitment to getting big money out of politics. Yet those self-imposed bans

54 PROSPECT.ORG NOV/DEC 2021

disappeared as soon as the going got tough.

Joe Biden, who struggled early with fund­ raising, walked back his pledge just six months into his campaign. Elizabeth Warren, who sharply criticized her competitors for months about their fundraising tactics, ended up with a super PAC of her own in the final days of her campaign. (Nearly all of the funding for Warren’s Persist PAC came from a single California donor.)

Progressive advocacy organizations are similarly conflicted. “I think Bernie Sanders is an interesting case in that in the 2016 race he elevated small-dollar donations [and] I do think for progressives that’s the funding mechanism most aligned with our values, but it’s hard for grassroots groups to collect enough to meet their budgets, especially if you want a strong organizing and digital team,” said Lia Weintraub, a progressive strategist. “Foundation dollars still remain the easier way to get money. You can write a proposal and get millions of dollars.”

Dark-money groups are already pouring funds into the federal midterm elections. Fringe candidates who stand little chance of winning are finding they can now raise massive amounts of money quickly, earning them national recognition and post-campaign opportunities.

Dark-money groups and their consultants are also exploiting this fundraising land-

scape, realizing that Democrats too often prioritize fundraising even at the expense of campaigning. “There’s a real danger of dark money becoming institutionalized,” says Anna Massoglia, an investigative researcher with the Center for Responsive Politics. Indeed, the entities that shield donor information aren’t just popular during campaign seasons. Presidential administrations now have their own darkmoney entities to support their agendas: Donald Trump had America First Policies, and Joe Biden has Building Back Together.

Embracing the idea of winning at all costs, some advocates suspect, is not an approach that’s so easy to turn away from, especially after years of defending and shrugging off practices that were once more taboo.

“I think there’s a real disconnect between the political operatives in this town who want to win, win, win, and everyone else,” says Sheila Krumholz, executive director of the Center for Responsive Politics.

“There’s this loss of faith in our political and campaign systems and that ultimately has a damaging effect on democracy.

How do you rebuild it? By being absolutely forthright, candid, and transparent.”

When asked about the massive influx of dark-money spending on the Democratic side of the aisle, Rep. John Sarbanes, the lead sponsor of H.R. 1, insisted he doesn’t believe that means dark money has been normalized. “I think there are lawmakers who are uncomfortable with the increasing influence that money has,” he said. Sarbanes also argued that campaign finance reform is useful in its ability to motivate an increasingly “cynical and disillusioned” public. “If we can diminish the influence of money and special interests at the same time that we lift up the voices of everyday Americans,” he said, “that’s how a democracy ought to operate.” n Rachel M. Cohen is a freelance journalist based in Washington, D.C., and a former American Prospect writing fellow.

CULTURE The Ethiopian Airlines Flight 302 crash killed all 154 on board. It was the second Boeing 737 MAX crash in 132 days.

Built to Lie A new book about the Boeing 737 MAX disaster exposes the company’s allergy to the truth.

By Maureen Tkacik

MULUGETA AYENE / AP PHOTO

Flying Blind: The 737 MAX Tragedy and the Fall of Boeing

By Peter Robison Doubleday Every few years, a photo makes the Reddit rounds of three Soviet apparatchiks in hats and double-breasted military jackets frowning intensely at an open coffin. The clumpy black mass inside is what remains of the cosmonaut Vladimir Komarov, who in April 1967 went along with a doomed plan to commemoBooks rate the 50th anniversary of the revolution by launching a new space capsule that wasn’t ready for prime time, on

the condition that if he died, he be eulogized in an open casket.

For some reason, the Russians not only honored this request, but allowed a photographer to immortalize it, giving space nerds rare documentary evidence that once upon a time, a clique of high-ranking cowards were forced to confront the hideous wreckage of their own venality. What happens in real life is usually the opposite, as Peter Robison’s new book Flying Blind about the murderous Boeing 737 MAX explores in soul-deadening detail.

Boeing’s self-hijacking plane took its first 189 lives on October 29, 2018, just over two months after it had been delivered to the Jakarta Airport terminal of Indonesia’s reigning discount carrier Lion

Air. Fishermen described the fuselage plunging nose-f irst, directly perpendicular to the Java Sea, at speeds many times that of Komarov’s four-and-a-half mile descent from the half-baked Soyuz 1, with its malfunctioning parachutes. A 48-year-old diver dispatched to plumb the deep sea f loor for body parts and the elusive cockpit voice recorder became the 190th fatality. As with the Soyuz, in which the famous cosmonaut Yuri Gagarin was said to have detailed 200 outstanding manufacturing defects in a memo to superiors, the 737 MAX had been the subject of numerous ignored whistleblower reports, tormented confessions, and abrupt career changes; the general manager of the plane’s final assembly line NOV/DEC 2021 THE AMERICAN PROSPECT 55

CULTURE outside Seattle had resigned in despair the week Lion Air took delivery.

But three years later, nothing has surfaced to suggest that any senior official at Boeing took so much as a passing glance at the corpse stew its greed chucked into the Java Sea, much less any semblance of responsibility.

Instead, a crisis center teeming with “loosely identified, official-looking people” mobilized in a Jakarta hotel before the first black box even surfaced. Lion Air flew families in free of charge to sign documents in exchange for immediate cash payouts. An engineer counted a list of 400 entities she was expected to release from liability in exchange for roughly $92,000 for each of the two immediate family members she’d lost, marveling that the cheapskate airline whose safety record was then being frantically picked over by journalists had so quickly pulled off such a lavish response effort. The organizer turned out to be an insurance company owned by Warren Buffett whose biggest client was actually Boeing.

“Oh my god, this is insane,” one victim’s relative texted a WhatsApp group of mourners, likening the release form shakedowns to a CIA interrogation. No one was permitted to take the documents back to their hotel rooms before signing them, or even bring anyone other than themselves into the room while they signed the release forms, in some cases while being videotaped. The victims’ attorney told The New York Times that he had never seen anything like the releases, and the releases themselves arguably violated Indonesian aviation law. But as Robison explains, the liability shield boiler room disguised as a grief counseling center had actually become a fixture in the aftermath of Boeing and other corporate-sponsored mass fatality events, of the sort that have made Ken Feinberg—has Travis Scott hired him yet?—such a wealthy and ubiquitous media presence.

Boeing had killed their loved ones, Boeing knew it, and Boeing would kill again.

Just four months after opening the crisis center, Boeing would be responding to the death of another 154 humans at the hands of its defective MAX plane, with the same zero-shits-givenness on display. In an awkward elevator ride, a victim’s father tells Feinberg his late daughter actually met him once at her college, when he spoke about his creepy memoir about the art of assigning dollar values to the lives of September 11 victims. Feinberg asks robotically, “Oh yeah, 56 PROSPECT.ORG NOV/DEC 2021

I remember that speech, how’s your daughter doing?” (“Fifty feet under the ground in Addis Ababa” is the answer.) Later on, in 2020, Boeing’s then-chief of government relations rejected a request from victims’ families that its executives stay away from a memorial service with the unthinkable retort, “If we’re paying for it, we’ll be there.”

Throughout the MAX crisis, Boeing has remained consistently and unrepentantly addicted to lying, about big stuff and small.

Its lies show incredible range and scope, from convenient omissions to epic, elaborate frauds to inexplicable technical fibs about irrelevant details that make the company look, implausibly, even worse than the truth would have; its executives have lied aggressively and stubbornly under penalty of perjury, as congressional investigators noted in a report they published last fall on the disasters: “The responses [of] senior Boeing officials has been disturbing … because of the clear resistance to acknowledge any technical gaffes or managerial miscalculations on the part of Boeing that now seem blatantly obvious and abundantly clear to anyone that looks.”

This makes the experience of trying to invest oneself in the institution’s saga something like trying to fall asleep in coach on an endless nonstop flight to nowhere: painful, endless, boring, with occasional fleeting intervals between consciousness and sleep when the company’s comparably honorable past comes vividly alive and the world makes sense again.

Komarov was the fourth astronaut to die in the space race in 1967. The first three had been Americans, who slowly asphyxiated in thousand-degree heat wearing dangerously flammable space suits during a fire that broke out at a January pre-launch test of the Apollo program’s command module, which turned out to have a faulty escape hatch.

NASA responded by effectively outsourcing the entire leadership and management of the Apollo program to Boeing, which had forged a reputation for being something of an anomaly within the military-industrial complex: an elite capitalist enterprise driven by anachronistically communitarian values.

Beneath the highest executive ranks, the engineering jobs were all union positions, with a transparent pay scale and a minimum of status-clawing. People worked at Boeing because they loved other people who worked at Boeing, and because working in teams of hundreds of engineers to put together

Throughout the MAX crisis, Boeing has remained consistently and unrepentantly addicted to lying.

products with a million discrete parts felt like contributing to the advancement of human civilization. The corporate culture was so comically honest that one airline CEO used to joke about his surprise at receiving a random $275,000 check one day from the manufacturer, in honor of an agreement it had made years earlier to compensate its loyal customer in the case that a rival airline negotiated a cheaper price on a plane.

Two years after Boeing assumed the reins of the Apollo project, Neil Armstrong was on the moon; two years after that, astronauts David Scott and James Irwin returned to place a commemorative plaque with the names of 14 fallen astronauts, Komarov among them, in the lunar soil. Even the deepest lows feel in hindsight like triumphs at Boeing of yore, as Robison addresses in a passage on Boeing’s culpability in the deadliest single-plane accident in human history, the 1985 crash of Japan Airlines Flight 123, which stemmed from a very slightly half-assed repair one of its technicians had performed seven years earlier. Boeing took full responsibility for the crash with such alacrity that many Japanese officials assumed the company was covering up for an important customer.

Boeing’s Boy Scout era ended abruptly and conclusively in 1997, when it “merged with” (but was in fact definitively conquered by) the insolvent defense contractor McDonnell Douglas. Since then, it has been run the way every other titular “old economy” company in America is run, as a vehicle for legalized looting.

The whole premise of the 737 MAX, much like that of its predecessor the 787, was a lie.

The CEO of American Airlines told his Boeing counterpart he was placing a big order for a new, extra-fuel-efficient, single-aisle Airbus, and the Boeing CEO pretended he had a comparable version of the ubiquitous 737 in the works.

What might have been a harmless bluff

impression the memo had been sent, no one at Boeing ever hit “send.”

The Lion Air crash sent the lie machine into overdrive. Boeing goaded the Federal Aviation Administration into issuing an “airworthiness directive,” coolly “reminding” pilots of the checklist for responding to “uncommanded nose-down trim” caused by “erroneously high single AOA sensor input”; it later emerged that the agency at the very last minute had deleted a line from the directive explaining MCAS. The Wall Street Journal published a story the following week detailing the software’s existence and the company’s strange decision to omit references to it from training The charred body of Vladimir Komarov, lying in an open casket in front of Soviet officials in 1967, materials, and then-CEO Dennis in a rare moment of accountability for airborne disaster Muilenburg hosted a non-mangrew steadily more sinister. Engineers tested which is what happened—and because it datory conference call with board members a toy-sized miniaturization of the plane in would have been so unbelievably easy to pro- to make the case that, as he expressed in an a wind tunnel and realized it flew weird. gram the software to cross-check the plane’s email, “the only engineering and PR problem The massive new engines hadn’t fit properly angle with a second sensor on the other side we have is the pseudo problem fabricated by underneath the 737 wings, so they’d perched of the nose before embarking upon a suicide the WSJ!” The FAA ran an internal “risk assessment” them up toward the front of the wings, where mission. Engineers worried, though, that they threw off the plane’s center of gravity. if the two sensors conflicted, some cockpit on the threat the unmodified MCAS posed to This might not have been a big deal but for a alert would need to ask the pilot to reconcile the flying public and forecast it would likely new lie the Boeing sales team was telling, that between them, which would in turn tip off produce a fatal crash every two to three no simulator training would be required for pilots (and regulators) to the existence of the years, but an MIT statistician determined certified 737 pilots to fly the new MAX. (This software they were trying to conceal. that the agency failed to count any of the 52 “So, what happens when the sensor is planes per month Boeing was at that point lie would soon be expanded into a promise that training would be no more intensive faulty?” an anonymous Boeing engineer delivering to airlines, and understated the than Level B training, which consisted of asked a colleague two years before the crash. probability of a crash by a factor of at least “If [it is] faulty then MCAS shuts down 24, suggesting that another MCAS crash was a 56-minute iPad class.) Boeing developed a software called MCAS to mask the differ- immediately,” the anonymous colleague likely to occur within a couple of months.

This was off by just a bit; the Ethiopian Airences between the old and new 737s—a white replied. lie—and then, for good measure, hatched a This turned out to be two lies in one. lines crash happened 132 days later. conspiracy to get all mentions of MCAS strick- Not only did a single malfunctioning senThe Boeing on display in Flying Blind en from the training materials and flight sor on Lion Air’s two-month-old MAX acti- will remind Prospect readers of all the other manuals, to rule out the possibility that some vate MCAS into committing mass murder, unimaginatively despicable 21st-century regulator somewhere would notice the new but there was also no way for Lion Air’s deep-state greed monsters. The psychoacronym and mandate simulator training. repair unit—whose chief was fired under pathic refusal to concede even the tiniest Lie number five came after the first planes orders of the Indonesian government the error in judgment seems suspiciously plawere manufactured, when test pilots real- day after the crash—to even know the AOA giarized from Richard Sackler. ized the handling was still off, and someone vane wasn’t working. Another software malAs Sackler blamed the “reckless crimidecided to solve the problem by substantially function Boeing learned about in mid-2017 nals” and “scum of the earth” who became tweaking MCAS and not telling anyone about had disabled on 80 percent of the MAX fleet addicted to OxyContin for his own (drastiit. The new software would cause the plane a cockpit light that should have lit up dur- cally insufficient) legal woes, Boeing has to turn abruptly down if a small “angle of ing the preceding flight to alert pilots of a worked overtime to promulgate a narrative attack” (AOA) vane on the exterior of its nose conflict between the readings of the two that blamed the “foreign pilots … too dumb sensed that it was approaching a danger- sensors. Although someone at Boeing had to spell 737” for the crashes, in a desperate ous stall: a kind of engineering blasphemy, drafted a memo to airlines informing them attempt to fight off its own culpability.

Robison mentions only one example of an because it meant a single faulty sensor could of the cockpit light malfunction, and somesend the plane nosediving into the Earth— one else at Boeing had given a supplier the American pilot who “survived” an erroneous NOV/DEC 2021 THE AMERICAN PROSPECT 57

CULTURE MCAS activation in a flight simulator on the first try, a trained FAA pilot who had been coached by Boeing officials prior to the test.

The rest took anywhere between six and 60 seconds too long. And yet the mendacious insult to the dead lives on, most radiantly in a jaw-dropping interview Boeing’s new CEO David Calhoun gave to The New York Times in March 2020, during which he claimed pilots who “don’t have anywhere near the experience that they have here in the U.S.” deserved to share blame for the crashes. When asked to clarify whether he was implying that American pilots could have saved the planes, Calhoun asked to go off the record, adding, when reporters demurred, “You can guess the answer.”

The Soyuz survived the gruesome descents of both Komarov and the Berlin Wall to become an unlikely commercial success during the Obama administration, when NASA decommissioned its space shuttle. The agency’s inspector general last year said it had since 2006 spent $3.9 billion paying the Russians as much as $86 million a ride to ferry American astronauts to the International Space Station in the capsule. NASA had awarded Boeing a $4.2 billion contract to produce a domestic space capsule by 2016, but an uncrewed test flight in 2019 failed so spectacularly that the agency drew up a list of 80 corrective actions it would need to take before a second attempt, which was just recently postponed indefinitely for the umpteenth time, following unspecified problems with the propulsion system. (Boeing has offset some of its losses on the program by selling five of its own Soyuz seats to NASA for $373 million in 2017.)

This pattern is replicated across literally every Boeing product line. The 787 Dreamliner produces seemingly more whistleblower lawsuits than planes; the KC-46 aerial refueling tanker, from which the MAX program cribbed the MCAS idea, has never successfully refueled a fighter jet in the dark; the latest version of the 777 experienced an “uncommanded pitch event”; more than a hundred 737 MAX jets were recently regrounded just months after the FAA lifted the original grounding due to as-yet-unexplored electrical problems referenced in numerous whistleblower reports.

Incredibly, the Justice Department earlier this year shut down its probe of Boeing’s MAX murders in exchange for a no-strings cash settlement, resisting calls to appoint 58 PROSPECT.ORG NOV/DEC 2021

the customary “independent compliance monitor” on the basis that—get this—“the misconduct was neither pervasive across the organization, nor undertaken by a large number of employees, nor facilitated by senior management.”

What downed the two MAXes, the DOJ instead concluded, was what Calhoun has dismissed as a toxic “micro-culture” embodied by a middle-aged former Boeing employee named Mark Forkner, whose wardrobe consists largely of Seattle Seahawks jerseys.

Forkner is the real-life Komarov figure of Flying Blind.

As the chief technical pilot on the 737 MAX, a job Robison says put the Air Force veteran “about dead last [in the] pecking order” among Boeing pilots, Forkner was charged with closing the deal on getting the 737 certified with the ultra-perfunctory “Level B” pilot training. He traveled the world convincing regulators to accept Boeing’s inadequate training regimens; he casually emailed the FAA requesting that MCAS be expunged from the flight manual; and he sent a colleague a candid text message upon his discovery in a simulator in 2016 that something “craxy” was afoot on the MAX. “So I basically lied to the regulators (unknowingly),” Forkner concedes, and even though his colleague responds, “It wasn’t a lie, no one told us that was the case,” he’s now alone among Boeing employees in facing several decades in prison for the crime of being a convenient patsy.

By the time Forkner realized that MCAS was wildly different from what he’d been led to believe, the lies had already been told, and the plane was months away from certification. What was he realistically supposed to do? He had been toiling anonymously in the trenches of Boeing and its titular regulator for long enough to know what happened to whistleblowers. Furthermore, as the selfprofessed least likely to be kept in the loop among Boeing pilots, who was Mark Fork­ ner to blow the whistle? In one of his other widely misquoted emails, Forkner described feeling like “dogs watching TV” while listening to an engineering presentation.

In an almost poetic passage of Flying Blind, Forkner corners Seahawks center Ethan Pocic at the airport and tells him, “You have one job, and that is to protect Russell Wilson, understand?” He clearly saw himself in a similar role at Boeing, even if his bosses struck him as more like the corporate equivalent of Johnny Manziel.

The Boeing on display in Flying Blind will remind Prospect readers of all the other unimaginatively despicable 21stcentury deep-state greed monsters.

Forkner’s texts first surfaced after the Lion Air crash, when the DOJ launched a criminal fraud investigation into the campaign of concealment detailed in The Wall Street Journal. The book describes Boeing’s then–general counsel J. Michael Luttig, a former groomsman of John Roberts and mentor to FBI chief Chris Wray and Trump AG Michael Barr, compiling all of Forkner’s correspondence in a kind of dossier for prosecutors in an apparent effort to cast him as the designated “fall guy.” After the second crash, Robison writes, Boeing set up Forkner with a highly regarded lawyer named David Gerger, who quietly convinced the DOJ to move the investigation to Texas, where it ultimately produced a settlement Columbia Law professor John Coffee termed “one of the worst deferred prosecution agreements I have seen.”

It’s not all bad news in the skies: Elon Musk’s SpaceX is now ferrying our astronauts to the ISS and back far more cheaply than the Soyuz, thanks to a stockpile of adult diapers and a workforce chock-full of Boeing defectors mostly content to humor his narcissism for 16-hour days on end because he at least seems to think rockets and jet engines are cool. MCAS, if nothing else, is fixed. But it is hard to swallow this account of the past three years in American aviation and aerospace without fixating on the 1975 exhortation of former Airbus CEO Bernard Lathiere, who told his engineers that “if we don’t have a place in high technology in Europe, then we should just be slaves to the Americans and our children will be slaves.”

“We are fighting,” he said, “for our children.” n Maureen Tkacik is a senior fellow at the American Economic Liberties Project.

The Myth of Artificial Intelligence

The Age of AI advances a larger political and corporate agenda.

A Marine Corps unmanned aerial system, used as an intelligence-gathering asset

By Meredith Whittaker and Lucy Suchman

DEPARTMENT OF DEFENSE

The Age of AI: And Our Human Future

By Henry A. Kissinger, Eric Schmidt, and Daniel Huttenlocher Little, Brown The term “artificial intelligence” is widely recognized by researchers as less a technically precise descriptor than an aspirational project that comprises a growing collection of data-centric technologies. The recent AI trend kicked off around 2010, when a combination of increased computing power and massive troves of web data reanimated interest in decades-old techniques. It wasn’t the algorithms that were new as much as the concentrated Books resources and the surveillance business models capable of collecting, storing, and processing previously unfathomable amounts of data.

In other words, so-called “advances” in AI celebrated over the last decade are

primarily the product of significantly concentrated data and computing resources that reside in the hands of a few large tech corporations like Amazon, Facebook, and Google. At the same time, AI technologies are increasingly shown to be brittle, systemically biased, and applied in ways that exacerbate racialized inequality.

The Age of AI works to take the debate about artificial intelligence off the table by obscuring the relevant technologies and the political economy behind them. Its title alone—The Age of AI: And Our Human Future—declares an epoch and aspires to speak on behalf of everyone. It presents AI as an entity, as superhuman, and as inevitable—while erasing a history of scholarship and critique of AI technologies that demonstrates their limits and inherent risks, the irreducible labor required to sustain them, and the financial incentives of tech companies that produce and profit from them.

While the book’s intellectual contribution is marginal, the political agenda of its authors merits careful consideration.

Henry Kissinger needs no introduction.

Even at 98 years old, he remains an influential voice in foreign policy despite his sustained commitment to U.S. exceptionalism, military dominance, and entrenching the military-industrial complex.

Eric Schmidt is the former chief executive of Google and former executive chairman of its parent company Alphabet. He has worked over the last decade to encourage investments by the military and intelligence establishments in Big Tech infrastructures and to market their products, including Google’s AI technologies, as indispensable to U.S. military prowess. He’s also a billionaire and a philanthropist, whose Schmidt Futures underwrites positions throughout the federal government, and many tech-related civil society organizations and initiatives.

Over the last several years, he chaired the National Security Commission on Artificial Intelligence (NSCAI), an advisory board to Congress and the Pentagon comprising Big Tech executives, military and intelligence professionals, and academic elites.

NOV/DEC 2021 THE AMERICAN PROSPECT 59

CULTURE Daniel Huttenlocher is the dean of MIT’s Schwarzman College of Computing, an AIfocused mega-lab that was launched thanks to a $350 million gift from foreclosure profiteer and longtime Trump supporter Stephen Schwarzman, the co-founder of the investment group Blackstone. Huttenlocher is also board chair of the MacArthur Foundation, which funds progressive nonprofits and initiatives focused on tech accountability.

This book provides Eric Schmidt and his co-authors a new occasion for a well-funded PR campaign, during which they will be given opportunities to present their views to large audiences, and likely to brief policymakers and other political actors.

In this way, The Age of AI should be understood as a companion to the work that the NSCAI has already done under Schmidt’s leadership. In March, the NSCAI issued a report that echoed Cold War rhetoric to recommend $40 billion in federal investments in AI, warning that the U.S. must maintain AI supremacy or risk being eclipsed

by China. The NSCAI report and The Age of AI serve Big Tech’s agenda through three rhetorical strategies.

First, they position Big Tech’s AI and computing power as critical national infrastructure, across research and development environments, and military and government operations. Second, they propose “solutions” that serve to vastly enrich tech companies, helping them to meet their profit and growth projections, while also funding AI-focused research programs at top-tier universities. This serves to bring Big Tech and academia closer together, further merging their interests and deterring meaningful dissent by a new wave of researchers critical of Silicon Valley. Third, and most importantly, by providing arguments against curbing the power of Big Tech companies, the book frames these companies as too important to the American national interest to regulate or to break up. Those arguments could be read against the antitrust advocates and tech critics within the Biden administration who have committed to checking the concentrated power of Silicon Valley.

Over the last five years, a chorus of researchers, policy advocates, and tech workers have pushed a rejection of Big Tech into the mainstream. Movements calling for bans on facial recognition, worker surveillance 60 PROSPECT.ORG NOV/DEC 2021

Primitive AI robots set the stage for a regime of near-constant surveillance. and control, surveillance advertising, algorithmic content amplification, and other harmful applications of artificial intelligence have increased. Significant battles have been won in the process.

A complementary turn to tech antitrust and a growing willingness signaled by the Federal Trade Commission to crack down on concentrated power and deceptive practices is also opening questions about the future of ubiquitous AI deployment, and the surveillance business models and concentrated resources on which it relies.

This background is important to understanding why The Age of AI has as a central theme establishing artificial intelligence’s inevitability. Throughout, this refrain is relentless: AI is “already ubiquitous,” “undeniably, inevitably” set to “change both humans and the environments in which we live.” AI “may soon prove indispensable” and cannot be “uninvented.”

This recitation is necessary because AI is not inevitable. In fact, the public is recognizing that it has a choice in whether AI is developed and widely adopted, and this poses a threat to the Big Tech interests whose funding, revenue, and growth projections depend on ubiquitous AI. Just as The Age of AI goes to great lengths to emphasize AI’s inevitability, it also warns of the dangers—even cowardice—of AI refusal. The authors assert that “[a]ttempts to halt its development will merely cede the future to the element of humanity courageous enough to face the implications of its own inventive-

ness,” while tech whistleblowers are “leakers and saboteurs.” Adopting AI is a moral imperative, such that “[o]nce AI’s performance outstrips that of humans for a given task, failing to apply that AI—at least as an adjunct to humans—may appear increasingly decadent, perverse, or even negligent.”

With all of its superlatives, this book describes something bordering on the divine, which bears no resemblance to the automated decision systems or even the large language models and other so-called cutting-edge approaches that are currently developed by AI companies. The reader is offered a false portrait of AI, described as a fundamental break in human history, one auguring a new epoch involving “the alteration of human identity and the human experience of reality at a level not experienced since the dawn of the modern age.” We are told that AI’s “functioning portends progress toward the essence of things—progress that philosophers, theologians, and scientists have sought for millennia.”

At the same time, The Age of AI sidesteps the vested interests responsible for AI, in the process eliding Big Tech’s monopoly over data and infrastructural resources. For the authors, Big Tech companies, as “network platform operators,” are providing a public service “on a scale that represents a civilizational event.” In contrast, government is painted as ill-equipped to regulate and oversee these companies. The message of the authors is clear: Regulation is danger-

The public is recognizing that it has a choice in whether AI is developed and widely adopted. ous, especially regulation that would hamper AI’s development.

The Age of AI is also, quite explicitly, offering product placement for Google’s AI products and capabilities. Of the examples presented, most are produced either by Google, its parent company, or companies that it has purchased: AlphaZero (an AI model developed by DeepMind, famous for its prowess at the games of chess and Go), BERT (a significant large language model developed at Google), Google Assistant, Google Translate, Google Search, AlphaFold (an AI model that predicts protein structures), DeepMind’s data center energy reduction accomplished using machine learning, and MuZero (derived from AlphaZero). AI efforts from Amazon, Apple, Microsoft, and Facebook get shout-outs, but in Facebook and Microsoft’s case the examples named are not particularly flattering: flawed content moderation AI in Facebook’s case, and the racist chatbot Tay in Microsoft’s.

To claim, as The Age of AI does, that this book fills a “gap” in “basic vocabulary and concepts for an informed debate about this technology” requires erasure of an extensive journalistic and academic literature.

Acknowledging these writings would undermine the authors’ grand prognostications, the hazy image of AI as all-powerful and (largely) beneficial, and the Big Tech–friendly political agenda this book is working to bolster.

Selling this agenda, in other words, requires some willful ignorance. References to race, gender, and labor are largely absent even as the co-authors explore historical terrain where racism, patriarchal power, and colonialism are central. For example, the authors celebrate the Dutch East India company and the stock exchange where its shares were traded as an example of a positive network effect, without remarking on its genocidal colonial practices, or its role in the Dutch slave trade.

The book’s erasure of white supremacy, colonialism, and slavery from its historical

overview is mirrored in the minimal engagement with the extensive research that has exposed how AI replicates and amplifies racialized, gendered, and other forms of inequality. There’s no mention of the AIpowered wall at the United States’ southern border, or police and law enforcement use of AI to hunt and track protesters, or the exploitative use of AI to control workers by companies like Uber and Amazon, even though these harmful and oppressive applications of AI are by now well documented.

The book also fails to mention climate change, or the significant climate costs of large-scale AI systems. To acknowledge climate would tear a hole in its narrative, suggesting an existential threat not coming from China and the mythical specter of Chinese dominance.

Eric Schmidt’s latest endeavor, the Special Competitive Studies Project (SCSP), launched in early October 2021, just in time to be central to a press tour arranged around the book. Described in quasi-governmental language and with a “bipartisan board of national security leaders,” SCSP is, in fact, a self-funded, shadow lobbying organization created to advance the interests of the tech industry. By filling the project’s board and leadership positions with many of the same cast that constituted the National Security Commission on Artificial Intelligence, this initiative inherits the patina of an official government endeavor whose work deserves serious consideration.

Schmidt says that the project is modeled on the Rockefeller Special Studies Project (SSP), which Henry Kissinger led in the 1950s and used to advocate for the vast expansion in U.S. military spending. SSP was also privately funded by one of the most powerful men in the world, Nelson Rockefeller. That program advocated for a resource-intensive Cold War arms race, based on the premise that the alternative was apocalypse at the hands of the Soviet Union.

Schmidt and his associates could be read as trying for a repeat of the SSP, drawing on the version of AI presented in The Age of AI and reheated Cold War urgency that focuses on China as the looming threat. This time, however, we need to call the bluff, rejecting the mystified portrait of AI that is central to this agenda, and naming related influence campaigns for what they are.

A more rigorous treatment of AI that included problems of discrimination and the

climate and labor costs of producing AI would suggest very different trade-offs. It would suggest, as well, answers to questions of security that look more like international solidarity and equitable resource distribution, and less like technological brinkmanship and a mindset premised on a new Cold War. n Meredith Whittaker is the Minderoo Research Professor at New York University and faculty director of the AI Now Institute.

Lucy Suchman is professor emerita of the anthropology of science and technology at Lancaster University in the United Kingdom.

2021 STATEMENT OF OWNERSHIP, MANAGEMENT AND CIRCULATION (REQUIRED BY 39 USC 3685): Publication Title: The American Prospect.

Publication #1049-7285. Filing date: Sept 29, 2021.

Issue Frequency: Bimonthly. No. of Issues Annually: Six. Annual subscription price: $60. Complete mailing address of general business offices: 1225 Eye St. NW, Suite 600, Washington, DC 20005. Publisher: Ellen Meany. Editor: David Dayen. Managing Editor: Jonathan Guyer. Owner: The American Prospect Inc. Known Bondholders: None. Tax Status Has Not Changed. Most recent single issue date for circulation data: Sept-Oct 2021. Extent and Nature of Circulation: Net press run: Average no. copies each issue during preceding 12 months: 5881. Actual no. copies of most recent single issue: 4988. Paid Circulation: Mailed paid subscriptions: Average no. copies each issue: 3775; Actual no. copies of most recent single issue: 3061. Paid distribution outside the mails and USPS: Average no. copies each issue: 0. Actual no. copies of most recent single issue: 0. Total paid distribution: Average no. copies each issue: 3775. Actual no. copies of most recent single issue: 3061. Free or Nominal Rate Distribution: Average no. copies each issue: 1258. Actual no. copies of most recent single issue: 1248. Mailed at other classes: Average no. copies each issue: 0. Actual no. copies of most recent single issue: 0. Outside the mail: Average no. copies each issue: 605. Actual no. copies of most recent single issue: 579. Total free or nominal rate distribution: Average no. copies each issue: 1863. Actual no. copies of most recent single issue: 1827. Total distribution: Average no. copies each issue: 5638. Actual no. copies of most recent single issue: 4888. Copies not distributed: Average no. copies each issue: 243. Actual no. copies of most recent single issue: 100. Total: Average no. copies each issue: 5638. Actual no. copies of most recent single issue: 4888. Percent paid: Average each issue: 67%. Actual most recent single issue: 63%. Electronic Copy Certification: N/A. I certify that 50% of all my distributed copies are paid above nominal price. I certify that all information furnished on this form is true and complete. Publisher, Ellen Meany. November 30, 2021.

NOV/DEC 2021 THE AMERICAN PROSPECT 61

CULTURE

nic pride becomes melting-pot patriotism.

As critics and academics observed, it was a show about how Italians became white.

Which leads us to the million-dollar question: Does The Many Saints of Newark have anything to say about Black people?

strangely caught in narcissistic nostalgia it turns out to be.

The structural problem is simple, and many have pointed it out: The movie tries, in only two hours, to tell two very different and difficult stories at once, but because it lacks the time to let either plot breathe or develop, it fails at both. On the one hand, this is a movie about the insulated white community of the show, telling the story of Tony’s family before they fled to the suburbs. On the other hand, it’s a movie about the Black people that they fled from, about the rise of a Black gangster who would take over the inner-city spaces that whites were fleeing.

But while it would be a tall order to tell a coherent story across the American color line at one of the moments of its most

After all, this movie wasn’t just made in a different time than The Sopranos was, it has been released during a very particular moment of historical resonance. Though filmed in 2019, we’re watching it a year after the historic protests against the murder of George Floyd. The Sopranos was unmistakably of its dot-com-bubble, Y2K, and 9/11 moment, but the timeliness of this movie is inescapable.

It’s almost shocking, then, to discover how little this movie has to say about the historical material it plays with, how careless it is with its Black characters, and how

heightened tension, the movie’s inability to integrate these two worlds is more than just a screenwriting failure, or something that you could have fixed by expanding it to miniseries length. It’s a refusal to look closely at how integrated these worlds once were, and how increasingly segregated this country became after the civil rights era.

In the film, Black people are a spectacle, a useful red herring to cover up crimes.

Dickie Moltisanti burns his father’s body in his car dealership as the city is in flames, holding the rioters responsible. Junior’s killing of Dickie presumably goes unre-

The Many Feints of The Sopranos

Inside David Chase’s failed prequel is a better movie straining to get out.

By Aaron Bady When it was announced that The Many Saints of Newark, David Chase’s return to The Sopranos, would be set during the 1967 Newark riots, and would feature prominent

Leslie Odom Jr. and Germar Terrell Gardner in The Many Saints of Newark Black actors (most notably Leslie Odom Jr.), I was intrigued, but a little bit nervous. No one had asked David Chase to take on race.

No one had said, “Do you know what television show can really speak to the Black Lives Matter moment? The Sopranos!”

This is not to deny that The Sopranos was always about race. When the focus wasn’t on violence Movies and crime—or on large stupid men eating salted meats and stewing in their pettiness—the show explored what happens when “a certain Italian American subculture” moves to the suburbs, when eth62 PROSPECT.ORG NOV/DEC 2021

Michael Gandolfini and Alessandro Nivola

marked because everyone assumes Harold had him whacked. Paulie and Pussy steal a TV because they know it will be blamed on “the Harlem Globetrotters,” as Paulie puts it. Black Newark is a place you stay out of, and flee from, as when Dickie accidentally finds himself in a riot or when the family flees to the suburbs because a Black doctor bought a house. Black people are the orange sky they stare mutely up at, a baffling reflection of riots whose causes and meaning they find utterly mysterious.

We see Harold McBrayer (played by the aforementioned Leslie Odom, Jr.) reflect on his exploitation by his white colleagues, listen to Black Power poetry, turn against his onetime high school football buddy Dickie, and begin to build an empire. Unlike virtually every character in The Sopranos, he seems like a real hero. He is capable, thoughtful, cautious, and his grievances are real. More than just handsome, he’s exactly the kind of man Tony Soprano would claim to revere, “the strong silent type.” He is, in short, one of the least Sopranos characters David Chase has ever written. He should be incompetent, unattractive, and shortsighted. He should harbor bizarre delusions of grandeur and an unfounded persecution complex. He should spontaneously make narcissistic choices that ultimately ruin him. The point of his character should be his self-deceptions and pettiness.

But Harold doesn’t just come from a different part of Newark; he comes from a different show. And if the great thing about The Sopranos was that it demystified the mafia, showing them to be lazy, violent

In the film, Black people are a spectacle, a useful red herring to cover up crimes. slobs, the strange thing about The Many Saints of Newark is that it seems to be doing the opposite in Harold’s world, not a deconstruction of the gangster’s self-image, but a glorification of it.

The missed opportunity was for the movie to connect these two story lines.

Dickie Moltisanti should have been that point of connection, and that should have been what made his death meaningful. But we see no indication that Tony knows or cares that Harold was supposed to have been who killed his uncle; Dickie’s death is not made meaningful to him in racial terms.

The Sopranos was about Italian whiteness, but what if Many Saints had been about Italian non-whiteness? The history embedded in a slur like “guinea,” as in the Guinea coast of West Africa—directly asserting that Italians are Black—is strangely absent from this story. And while there is some playful banter in the movie about how Sicilians have “Black blood”—to which one Sicilian takes great offense—imagine a version of this movie in which Dickie’s mother-in-law was explicitly coded as having North African heritage. Sicily is a lot closer to Tunisia than Rome, after all, a geographical fact that could have been made into a thematic

one. What if the movie explored a lost interracial desire and solidarity, instead of simply white flight? (Instead, she’s from Ariano, a short drive from Tony’s own Avellino.)

I’m not just asking David Chase to have made a different movie than the one he did. This much better movie he didn’t make is implied throughout. The orange skies above Newark are picturesque, as the flames of downtown looting reflect across the city to where a young Tony Soprano (and a young David Chase) could see them.

But those riots turn out to be as inconsequential as Harold is to the story, just a means of camouflaging a murder that no one seems to care about anyway.

The movie is just as disinterested in the era of re-segregation that followed the ’60s, as white families not only fled the prospect of living beside Black people, but erected new structures of discrimination to keep them from following. After the credits, we see a strangely triumphal scene of “integration,” as Harold cheerfully greets a (hostile) white neighbor, and then turns to making some kind of criminal payoff. He has won, the movie implies; the city is his. Is this a triumph? That would be a strange takeaway for a movie about the world we live in, where we are more segregated now than we’ve been in decades.

The movie that we’re left with tells a story about the civil rights struggle in Newark, Black Power, and white flight that rhymes strangely well with what white people often tell themselves about where racial strife comes from: Black people. After all, the story of civil rights is of Black people demanding social integration, equality, and an end to racial segregation; white flight is a story of whites abandoning their cities rather than allow all of that. But if the mob story in The Many Saints of Newark is a microcosm of racial history, it’s striking that Harold turns out to be the source of that division, with Dickie its victim. It’s superficially easy to understand Dickie’s confusion when Harold turns against him, after having treated him quite well—almost a brother!—in every scene we see of the two together. How, after all, could he ever understand what drove Harold, or what it’s like to be Black in Newark? All of that happened in a completely different movie. n Aaron Bady is a writer in Oakland, Cali­ fornia. A fuller version of this review can be found at prospect.org/sopranos.

NOV/DEC 2021 THE AMERICAN PROSPECT 63

PARTINGSHOT

Greetings From Meta

By Francesca Fiorentini Hello, reader. It’s Meta. The artist formerly known as Facebook. (Prince had the love symbol, Mark has a melted infinity loop. Same deal.) You might be wondering, “Why is a $917 billion conglomerate buying the back page of a lefty rag?” It’s because we’ve changed. We care about the prynted werd™. And informaytion™. And facks™. Also, we will in all likelihood buy this publication in the nottoo-distant future. Though “buy” is a strong word for Mark winning it in a hand of poker along with a million hectares of Paraguay.

But mainly, we know you’re upset with us. And we’ve listened.

We know that we enabled wouldbe dictators to censor reality or create thousands of phony accounts propping up takeovers of their government, in exchange for exclusive control over internet services. Our bad. We know that we accidentally gave your name, address, email, work history, a list of everything you’ve eaten in the last six months, and all pictures of you and your ex-boyfriend to a gaming app about ducks. We goofed. We know that you put your credit card information in for a $4.95 bottle of the face cream Angelina Jolie “uses” and that it was in fact a $98-a-month subscription that took you three months to cancel so it ended up being a $298.95 bottle. But that’s not the point.

The point is, we’ve heard you.

We’ve cleansed clutter from the Timeline, and the Rohingya from Thailand. We tweaked the algorithm like the dial on an electric chair, and you stayed seated. We gave you more of your friend’s baby photos, and then fewer of your friend’s baby photos, and then five times as many of the same photos, and then photos on every second Thursday of the month.

64 PROSPECT.ORG NOV/DEC 2021

And we never once showed that baby being breastfed. Gross.

But maybe we lost our way. Maybe it was when we purchased that skinny chicks app (you know it as Instagram). Addicts say you

need to hit rock bottom before you can start recovery. But for us, the rock isn’t necessarily the bottom. You can always break through that rock and find oil!

We’ve had our share of setbacks: whistleblowers, leaked internal documents, and congressional hearings, where senators asked our

half-puppet, half-boy CEO some tough questions, like “How do I get the printer to work?” and “What is the password to my email?”

All this talk of “regulating Big Tech” has left us wondering: If we can’t regulate ourselves, do we even deserve to be regulated by others? So we looked inward. And like Michael Jackson, we started with the man in the mirror and asked him to change his ways. We also looked into faking our own deaths and living on an undisclosed Caribbean island for the rest of our lives with M.J., but he said that with his underground Foreva Eva Land there wasn’t enough room.

So we pivoted. We’re going …

Meta. (Which is much better than our runner-up name, Squoob. Real close to being Squoob.) Meta is for the Metaverse. And if you don’t know what the Metaverse is, it’s like the Spider-Verse, only it’s a threehour all-hands meeting with 1998level graphics. And without any brown characters. Meta means multitudes. Like the ones that stormed the Capitol on January 6th. Meta exists in the future and the past.

Like how we did and will again help elect Donald Trump. Meta is for the metadata we mine from your thirsty private messages to internet celebrities. Yes, they were dick pics. Yes, we looked. And we said, “Shoot your shot, king!”

Meta is the world’s first self-regulating social media platform that will utterly disrupt the Corporate Accountability Industrial Complex.

And at the helm will, of course, be our Mark. Not a marionette, not yet a boy.

Buckle up, Earth. Where we’re going, we don’t need books. Or faces. n Francesca Fiorentini is a comedian, cor­ respondent, and host of The Bitchuation Room podcast.

GREG HOUSTON

The born-again tech giant would like a word.

advertisement

Back to School for All: Working people are Return, Recover and Reimagine

stronger together

By Randi Weingarten, President AMERICAN FEDERATION OF TEACHERS

By Randi Weingarten, President

S T

AMERICAN FEDERATION OF TEACHERS chools must open this fall. In person.

Five days a week. With the space and health safeguards to do so. Andworld my “We can bring to birth a new union, the American Federation of from the ashes of the old.”

Teachers, is committed to making it happen.

School is where children learncentury-old best, wherelabor they play hat line, from the together, form and learnForever,” resilience.feels It’s unionrelationships anthem “Solidarity where many childrenapt who mightAren’t go hungry especially in otherwise this moment. eat breakfast andyearning lunch. Parents schools not we all to liverely in aon “new world” only to educate their kids but so they cansorrow work. An without the anxiety, disruptions and astounding million mothers dropped out of itthe caused by 3the COVID-19 pandemic?

Isn’t well workforce the pandemic. past timeduring to sweep discrimination and violence based on race, religion, gender and other factors The United States will not be fully back until we are into the “ashes of the old”? Can’t the United fully back in school. And my union is all-in. I recently States—the richest country in the world, yet home gave a speech detailing the steps necessary to return to 37 million people living in poverty—“bring to safely to full in-person learning, including building the birth” a world in which every person has a decent support systems to help students recover socially, standard of living and opportunities to get ahead? emotionally and academically, and overcoming the concerns and fears some have polarizing about sending Much has been made of parents the divisions their children but backAmericans to school.are united by a powerful our country, bond: our desire for a better life for ourselves and our

We must address those fears. The AFT, with the families. People are anxious about rising prices for NAACP and others, recently polled parents of public food, gas and other essentials. They are frustrated that school students. Only 73 percent of parents—and life isn’t snapping back from the pandemic as quickly only 59 percent of Black parents—said they are as they’d like. And they want fair wages and benefits, comfortable with in-person learning for their child this good working conditions and a voice on the job. fall. But if the safety and education measures the AFT isNew calling for have are inemerged place, the jumps terms to comfort describelevel the state of to 94 percent workers—like of parents, including 87 percent of Black American the “Great Resignation,” parents.

It’s clear that mitigation measures to prevent the “Great Exhaustion” and the “Great Frustration.” the spread the coronavirus trust, as does I hear this of sentiment from my create members, most of whom collaboration between and professions families. COVID-19 work in education andschools healthcare, under vaccines have been real game-changers, it’sagreat enormous strain during the pandemic. Weand have news that theunion: Pfizer Together vaccine has approved for that saying in my we been can achieve things 12to 15-year-olds. would be impossible on our own. Collective bargaining

Here are 10 ideas to move us toward those goals: 1.

Launch the AFT’s “Back to School for Everyone”

But there must be good faith on both sides of national campaign to underscore the importance the bargaining table. Warrior Met Coal is riding of in-school learning. high on record coal prices but has kept its 2. Form school-based committees of staff, parents employees on strike for nearly eight months—after and, where appropriate, students to plan for and workers made concessions in pay and benefits respond to safety issues and to conduct safety to help the company emerge from bankruptcy. “walk-throughs” in school buildings.

Workers at Kellogg, which racked up $307 3. Align health and pedagogical best practices by million in profits last quarter, are on a prolonged reducing class sizes to reflect the Centers for strike. The union representing employees at the Disease Control and Prevention’s 3-feet social Wirecutter, the New York Times’ popular and distancing guidance. Eliminate simultaneous profitable product review site, planned to strike in-person and remote instruction. from Black Friday through Cyber Monday, to 4. Offer “office hours” and clinics for AFT protest the Times’ management’s wage proposals affiliates and others to discuss ideas and get that would severely underpay its staff.

technical support.

5.Nurses Roll and out camps summer programs healthand professionals at Kaiserthat provide academic helpand students get back Permanente facilitiessupport, in Oregon Washington into3,400 routines and encourage kids toofhave fun. state, of whom are members my union, 6.are Promote community schools build trust and exhausted, traumatized andtoshort-staffed after remove obstacles to getting kidsofand the nearly two years on the frontlines thefamilies pandemic. support services they need.

Kaiser had aand higher profit rate than Amazon last year, yet it demanded a two-tier wage scale to pay new nurses less and failed to address staffing

7.

Increase the emphasis on civics, science and

project-based learning, nurture critical thinking shortages.

Two days beforetothousands of Kaiser and bring to life.the parties negotiated an workers werelearning set to strike, 8.agreement Use funds from the American Rescue Planstaffing to fill that makes big inroads on safe shortages of teachers, counselors, psychologists levels and provides decent wages and benefits.

and nurses. lecturers at the University of California, 9.AFT-member Launch a federal task force to rethink accountwho teach 30 percent of the courses at the ability—how we assess student learning and university, recently negotiated landmark job security how to measure what really counts. protections, paid family leave and double-digit 10.

Engage stakeholders—families, educators and pay increases—just hours before they were set to community partners—to ensure funds in the strike. Lecturers now won’t have to worry from one American Rescue Plan and other federal funds for semester to the next whether they will have a job. schools are spent equitably and effectively.

Strikes are always a last resort. That’s especially We are all yearning to move forward after this difficult true in education and healthcare because of year.

For our young people, that means being back in our responsibilities to our students and patients. school, with their peers and caring adults, with all the But they can’t always be averted. Teachers and supports they need. paraprofessionals in Scranton, Pa., where public

Despite the divisions in our country, is a schoolsallhave been shortchanged $39there million consensus importancestrike of strong annually, around waged the a weeks-long withpublic strong schools. is especially vitalthe now, when we Instead need our supportThat from parents and community. schools to provide access to a great, well-rounded of getting the state funding the district needs, it is education to spark kids’ passion for learning and has help under a state-controlled “recovery” plan that them sociallyThe anddistrict emotionally. donerecover great harm. has closed school libraries; eliminated prekindergarten, art and music;

We have a rare chance to seed a renaissance in and cut other supports that help children thrive.

American public education. It’s a once-in-a-lifetime Educators have sacrificed as well, working five years opportunity not only to reopen and recover, but to under an expired contract with no pay increases. reimagine our schools in a way that makes every public school a place where parents want understand to send In these uneasy times, working people their educatorstogether. and support staff want to thatchildren, we are stronger Collective bargaining work and students can channel angerthrive. and frustration into action to achieve economic fairness, gain voice and agency on the job, and help Americans achieve their dreams.

The United States will not be fully back Americans our until we areare fullyunited back by in school. desire for a better life.

allows workers not just to ask for things from those

But must dohas more thanaphysically Thewe pandemic shone new lightreturn on theto schools, asimportance important as is tovoice. create theaffiliates normalcy we of that worker Our crave.

Wethemust also put in placehealth the supports to help across country negotiated and safety students recover—socially, emotionally protocols to reopen schools and keep and them academically.

And welearning must reimagine teaching and open for in-person during the pandemic. learning to focus onlike what students’ passion, And some unions, thesparks Detroit Federation of builds confidence, nurtures criticalprograms thinking and Teachers, negotiated innovative like brings the learning to life—so all children have access to the DFT’s home visit program to combat low student opportunities that give them to thrive. attendance exacerbated by the the freedom pandemic.

Photo: Brett Sherman Photo: Brett Sherman

My union is all-in. We are pressing for those safety in power but to have some power of their own. and education measures in schools across the country.

And we Americans are dedicating million to a to “Back Today, are $5 twice as likely havetoaSchool for Everyone” national to connect not just Costco card as to havecampaign a union card.

Yet two-thirds with teachers and schoolofstaff also with of Americans approve laborbutunions, the families highest and communities, build1965. trust And and nearly confidence in level of approvalto since half of children returning to school, particularly those who nonunion workers polled said they would join a have been learning remotely. union in their workplace if they got the chance.

Weingarten speaking at AFT headquarters in Washington, D.C., May 13.

Weingarten addressing striking in twitter.com/RWeingarten Scranton, Pa., on Nov. 4.

Follow AFT President educators Randi Weingarten: aft.org/renaissance Follow AFT PresidentRead RandiWeingarten’s Weingarten:speech: twitter.com/RWeingarten

GIVE THE GIFT OF TAP

Every Gift Supports Our Journalism ~ FULL MEMBERSHIPS ~

prospect.org/membership Choose your level — Ideas, Politics or Power — and click “Give this as a gift” to complete your purchase.

~ PRINT DELIVERY ~

prospect.org/give-print Introduce your friends and family to great progressive journalism with six issues for 2022.

Auto renew for 2023 if desired!

~ PROSPECT MERCHANDISE ~

prospect.org/shop Choose from a baseball cap, t-shirts, the TAP tote, or the Ideas-Politics-Power mug, shipped from our shop in Boston.

Thank you! We can’t do it without you!

34 WWW.PROSPECT.ORG SEP/OCT 2020