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VOLUME 30, NUMBER 2 SPRING 2019

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COLUMNS 4 PROSPECTS THE 2020 ELECTION AND THE DEMOCRATS’ THEORY OF CHANGE BY PAUL STARR

NOTEBOOK 7 GETTING SERIOUS ABOUT POWER BY CAROLINE FREDRICKSON 9 ON TRUMP’S TAXES, RICHIE NEAL HAS THE SLOWS BY JEFF HAUSER AND ELEANOR EAGAN 11 WILL IMMIGRANTS FIND THEMSELVES IN THE DRIVER’S SEAT? BY MANUEL MADRID 13 COULD CALIFORNIA END CHILDHOOD POVERTY? BY KALENA THOMHAVE

FEATURES 16 TRUMP AND CHINA: THE ART OF THE DESPERATE DEAL BY ROBERT KUTTNER 24 CONGRESS’S NEW PROGRESSIVES TAKE ON THE BANKS BY DAVID DAYEN 32 BETO VERSUS THE BARRIO BY CHRISTOPHER HOOKS 40 NEEDED: A U.S. POLICY ON SAUDI ARABIA BY JONATHAN GUYER 46 THE MIGRATION CRISIS AND THE FUTURE OF EUROPE BY GEORG DIEZ 52 NOT SO SUPREME? BY IAN MILLHISER 57 DO ALL ROADS LEAD TO CONGESTION PRICING? BY GABRIELLE GURLEY 62 AMLO’S GAMBLE BY JEFF FAUX 66 HOW TO REBUILD THE LABOR MOVEMENT, STATE BY STATE BY ALEXANDER HERTEL-FERNANDEZ

CULTURE 71 IS THERE SUCH A THING AS PROGRESSIVE NATIONALISM? BY E.J. DIONNE JR. 74 THE COURAGE TO DEFY BRUTALITY BY RANDALL KENNEDY 78 PROSECUTORS AGAINST MASS INCARCERATION? BY DAVID GARLAND 81 THE CRISIS LAST TIME BY SIMON JOHNSON 83 THE TROUBLE WITH TECH BY MICAH L. SIFRY 86 THE UNKEPT PROMISES OF HIGHER EDUCATION BY DAVID KIRP 88 PARTING SHOT BUYBAX! BY HAROLD MEYERSON Cover photo by Andrew Harnik / AP Images

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from the Editors

W

e have several wonderful changes at the Prospect to announce, and more to come. As of June 1, DAVID DAYEN will become our executive editor. As readers of the Prospect will recognize, David has been one of our most prolific and incisive writers and has also found time to contribute major articles to The New Republic, The Nation, In These Times, The Intercept, and many more.

His 2016 book, Chain of Title, was widely recognized as the authoritative book on the bank frauds that led millions of people to lose their homes in the subprime scandal. His new book on corporate concentration will be published next year.

When David becomes executive editor, HAROLD MEYERSON will return to his old job as editor-at-large, continuing to write and edit.

ROBERT KUTTNER and PAUL STARR will continue contributing to the Prospect, as founding co-editors.

Our new publisher, ELLEN MEANY, joined us December 1. She was formerly the longtime creative director of the successful Madison, Wisconsin, weekly Isthmus. Ellen also worked as a senior publishing Dayen executive for a family-owned chain of newspapers, giving new life to their digital operations. Ellen brings with her extensive expertise in both print and digital publishing, as well as business acumen.

David and Ellen will be working on an upgrade of our daily web magazine, prospect.org, technically, visually, and in terms of content.

The site will be easier to navigate and will have more offerings. We will also make improvements to the print magazine.

And there’s more: We are delighted to announce our new managMeany ing editor, JONATHAN GUYER , who will join us in April. In addition to his talent as a writer, editor, and manager, Jonathan brings to the Prospect a wealth of foreign-policy experience. Jonathan is finishing his first book, on the role of political cartooning in defining the limits of permissible dissent in Egypt. He has written articles for Foreign Policy, The New Yorker, Harper’s, The New York Review of Books, and Le Monde diplomatique. Jonathan’s feature piece in this issue is on U.S. policy toward Saudi Arabia.

And we welcome our longtime proofreader, SUSANNA BEISER , as Guyer staff copy editor. Susanna has freelanced as copy editor or proofreader for a number of publications, including World Affairs and the Bulletin of the Atomic Scientists.

The Prospect was launched in 1989, after several lurches to the right in the United States. Our project has been about defining, promoting, and reporting on the quest for a decent, democratic America. We have been a community of politically serious intellectuals, journalists, and activists, and our work has helped to expand that community.

Beiser As we celebrate our 30th year of publication, these new staffers mark a generational transition. With a sense of accomplishment and continuity, the founders of the magazine welcome new leadership as the Prospect helps usher our country into America’s next great progressive era.

American democracy has been through some terrible times during these three decades, but it has endured. Now it needs to be strengthened. America’s new progressive energy has been worth waiting for. The American Prospect will continue to be at the forefront of the quest for strong, decent, and just democracy.

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CO-EDITORS ROBERT KUTTNER AND PAUL STARR CO-FOUNDER ROBERT B. REICH EXECUTIVE EDITOR HAROLD MEYERSON DEPUTY EDITOR GABRIELLE GURLEY ART DIRECTOR MARY PARSONS MANAGING EDITOR JONATHAN GUYER ASSOCIATE EDITOR SAM ROSS-BROWN WRITING FELLOWS MANUEL MADRID, KALENA THOMHAVE COPY EDITOR SUSANNA BEISER EDITORIAL INTERNS SAMUEL BRESLOW, DANIEL KAUFMAN, KATIE MALONE, IVEY NOOJIN CONTRIBUTING EDITORS MARCIA ANGELL, GABRIEL ARANA, DAVID BACON, JAMELLE BOUIE, HEATHER BOUSHEY, ALAN BRINKLEY, JONATHAN COHN, ANN CRITTENDEN, DAVID DAYEN, 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 COMPTROLLER ANNE BEECH BUSINESS COMMUNICATIONS SPECIALIST STEPHEN WHITESIDE BOARD OF DIRECTORS MICHAEL STERN (CHAIR), CHUCK COLLINS, SHANTI FRY, STANLEY B. GREENBERG, JACOB S. HACKER, ROBERT KUTTNER, RONALD B. MINCY, MILES RAPOPORT, JANET SHENK, ADELE SIMMONS, GANESH SITARAMAN, WILLIAM SPRIGGS, PAUL STARR SUBSCRIPTION CUSTOMER SERVICE 1-888-MUST-READ (1-888-687-8732) SUBSCRIPTION RATES $19.95 (U.S.), $29.95 (CANADA), AND $34.95 (OTHER INTERNATIONAL) REPRINTS INFO@PROSPECT.ORG

Prospects

The 2020 Election and the Democrats’ Theory of Change

BY PAUL STARR

A

s Democrats prepare for 2020, they face a fundamental quandary.

The theories of change offered by their most recent president, Barack Obama, and previous presidential candidate, Hillary Clinton, have been shot to hell.

I borrow the phrase “theory of change” from an article that Mark Schmitt wrote for the Prospect in December 2007 about the candidates who were vying for the 2008 Democratic presidential nomination. Rather than being about ideology or electability, Schmitt wrote, the nomination fight that year was about differing assumptions about politics and how to use the “levers of power” to get things done. Schmitt suggested that Obama wasn’t so naïve as to believe in “hope” and “bipartisanship” but was instead using those aspirations as a “tactic” to subvert conservative power. By claiming “the mantle of bipartisanship and national unity,” Obama would seize the high ground, and “Republicans would defect from that position at their own risk.”

Even cleverly interpreted, however, the theory of change that Obama espoused as a candidate in 2008 has long ceased to be tenable. He did get important things done, notably the Recovery Act in the depths of the Great Recession, the Affordable Care Act, and financial reform—but none of them thanks to bipartisanship.

Republicans refused to be partners

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in governing even in the midst of the greatest economic crisis since the Depression. The only reason Obama had significant legislative achievements is that for his first two years Democrats had control of Congress, including a filibusterproof Senate majority for about six months, which is what enabled the ACA to pass.

As a candidate for the Democratic nomination in 2008 and as the party’s candidate for president in 2016, Hillary Clinton’s theory of change relied on detailed preparation of serious and practical policy ideas. Her standard speech in the 2008 campaign, Schmitt pointed out, made use of a three-way contrast. One candidate, Clinton said, was relying on “hope” for change (that was Obama), while a second thought you could just “demand” change (that was John Edwards), but she insisted you have to “work for it.” The title of Clinton’s 2014 book Hard Choices expressed the same spirit, and her 2016 campaign site offered policy prescriptions in more than 30 different areas. From her long experience she could give a coherent response to the full gamut of international and domestic challenges, a quality that Americans once valued in a president.

In campaigns, however, more can sometimes be less. Clinton’s many rational and sensible policies could not compete successfully for the voters’ attention with the few simple things that Donald Trump used to stir outrage and

appeal to raw emotion. Of course, Clinton wasn’t helped by the media’s preoccupation with her emails, the disinformation efforts during the campaign, and much else—and she did win nearly three million more votes than Trump.

But there is a lesson nonetheless in her inability to convey a clear and strong message about what she would change as president and how she would do it.

IN LIGHT OF THIS RECENT history, it’s easy to understand why Democrats are fed up with bipartisan compromise and sensible pragmatism. There is no point in calling for bipartisanship if the other side is unwilling to compromise and sees no reason to do so because it has gotten away with being intransigent. In what may be the single most important development in American politics in the last half-century, the liberal and moderate Republicans who once were open to compromise have nearly vanished from the national stage. This is not as common in state government, where Democrats and Republicans sometimes do work together. As a result, some Democratic presidential candidates with state-level experience—Colorado’s governor John Hickenlooper is the current example—claim they can bring cooperation back to Washington. But in national politics these days, the advocates of bipartisanship are the true utopians.

So Democrats will almost

certainly need to rely entirely on members of their own party to govern, but that won’t resolve the problem of how to bring about change. The Democratic Party itself is a coalition, and that coalition now includes people who used to be Republican moderates or independents, especially in the suburban areas where Democratic victories in 2018 gave them control of the House. If Democrats ignore that side of the party, they will not only lose the presidency in 2020—they’ll lose the House too.

Democrats now hold 31 districts won by Trump in 2016, while Republicans hold only three won

by Clinton. The extreme clustering of liberal and progressive voters in cities puts Democrats at a structural disadvantage that they can overcome only by extending their support into traditionally Republican suburbs. The need to win those relatively affluent districts, however, constrains how far to the left the party can move. No credible theory of progressive change today can ignore this reality.

The challenge for Democrats, furthermore, isn’t just to gain power but to keep it. The big changes that Democrats want to bring about will take a long time to see through. The last two Democratic presidents both lost control of Congress at the first midterm election. To break that pattern, Democrats need a strategy that can maintain and even expand their coalition instead of undercutting it.

Prospects

There are legitimate disagreements about how to do that. Here’s my view.

To avoid the problems Clinton faced in 2016 in conveying a message about change, the Democrats need to focus on a few big ideas that embrace many of the specific policies they will be promising to pursue. Fortunately, they have already begun to develop those themes, though it will be critical how their presidential candidate in 2020 defines and explains them.

The first big theme brings together the most historically urgent issue of our time, climate change, with practical economic concerns about jobs and fairness. That’s the idea of a Green New Deal. Time is of the essence in climate reform. The longer the United States and other countries delay measures to reduce greenhouse gases, the steeper the reductions need to be and the greater the risk of hitting irreversible tipping points and triggering truly catastrophic levels of warming and sea-level rise. This is one reason why a Trump presidency lasting until the mid-2020s would be so dangerous.

But a narrowly tailored climate policy—built, for example, around a carbon tax—will not work. To succeed politically, a program has to provide voters with immediate and tangible benefits, and the way to do that is to frame climate reform as a program for rebuilding America, which, in fact, it necessarily must be. Trump promised an infrastructure program but has failed to deliver it; the Green New Deal can be that program, except now aimed at meeting both economic and urgent environmental goals. This shouldn’t be a Christmas tree hung with every progressive ornament, but it has to be socially inclusive, deliver increased earnings (for example, through a higher minimum wage), and attend to the legitimate worries of workers and communities, especially those threatened at least initially by the coming energy transition. Borrowing is

a proper way to finance public investments that bring a future return, and that is principally what Democrats should rely on, without being intimidated by deficit scolds as they were in recent Democratic administrations.

A second big theme is family security, which could embrace a variety of specific ideas that Democrats are supporting. Several presidential candidates have endorsed a bill now in Congress, the American Family Act, which proposes what in other countries are known as “child allowances.”

The allowances would consist of refundable tax credits of $300 per month for children up to age five and $250 for children ages six to sixteen. An expansion of the existing Child Tax Credit (which does not, however, benefit the poor), the

the short term. Second, both the programs and the financing for them will express a sense of fairness and justice that Americans are asking for, without demanding higher taxes from those middleclass suburbanites who have just started voting Democratic.

Democrats will necessarily have to spell out positions on many other issues, such as immigration and trade, where the election is likely to be a referendum on Trump. At the same time, they need to stay away from some other causes that could undermine their chances to win in 2020 or to govern effectively thereafter. I have two things particularly in mind.

The first is reparations for the descendants of slaves, an issue that has had a flurry of publicity after some of the Democrats

single-payer poses a host of difficulties: It would take away people’s existing insurance, arouse the all-out resistance of the entire health-care industry, and require tax increases of a magnitude with no precedent in U.S. history.

Current single-payer proposals imply raising taxes to pay for all the costs now covered through private insurance premiums and outof-pocket spending. In 2017, those came to $1.6 trillion, just about the same total as the government raised through the personal income tax. Even if single-payer had big savings, the necessary tax increases are implausible and would likely sink the rest of the Democrats’ agenda. The rest of what Democrats hope to accomplish is simply too important to put at risk. On health care, their

The challenge for Democrats isn’t just to gain power but to keep it.The big changes that they want will take a long time to see through. new system would cut child poverty by a third and bolster middle-income families, while being phased out at higher incomes.

Proposals for paid family leave and universal child care would also fit into what could be conceived of as a broader Family Security Act, aimed at helping young families get a start and providing a secure foundation for their—that is, for America’s—children. Democrats ought to finance these programs not only by repealing most of the unpopular 2017 Republican tax legislation but also through higher taxes on the superrich, as in Elizabeth Warren’s proposed tax on households with net assets of more than $50 million.

THE GREEN NEW DEAL and a fam-

ily security program have two things in common. First, they are about securing the future, though each provides concrete benefits that voters will be able to see in

running for president said they were open to the idea. I have long believed there is justice in the idea of reparations; in a 1992 article I proposed reparations in the form of an “Endowment for Black America.” But it is one thing for writers to suggest ideas, another thing for candidates and parties to adopt them in a campaign.

When an idea is not ripe—when, as in the case of reparations, an overwhelming majority of voters continue to reject it—political leaders need to say no. They are not obliged by their ideals to make a gift of an election to the opposition.

Medicare for All, particularly in its single-payer version, would also be a political albatross. Again, I understand the abstract argument; I’ve proposed an alternative that I call “Midlife Medicare” for making Medicare available at 50 for individuals not otherwise insured. But

immediate aim should be to provide for early eligibility for Medicare, reforms of the ACA, and measures to reduce pharmaceutical and medical prices.

Large-scale institutional change is extraordinarily difficult in the United States. Our political institutions are set up to make it difficult, and the entrenched power of concentrated wealth makes it even harder. There has been no period in American history, not even the New Deal, when reformers did not make concessions to achieve the big changes that were consistent with sustained political power. If Democrats can carry out a Green New Deal and a family security program, it will be momentous, and it will build the support for other things as well. But if they cannot adjust their program and how they talk about it to fit the political coalition they have, they will get nowhere.

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... a world where the United States is leading the effort to build a greener planet ... an America where an unimpeachable right to health care is signed into law ... a time when all lawmakers work harder to expand the rights of citizens to vote than to block their voting ... a place where equal justice and opportunity are both law and fact

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Lewis Franklin Powell Jr., conservative mastermind and Supreme Court justice, in 1972

Getting Serious About Power Can we learn something about the right’s strategic coherence without emulating either their ideas or their contempt for democracy?

BY C A R O L I N E F REDRICKSON

ap images

I

t was 1971 and Lewis Powell, a corporate lawyer in Richmond, Virginia, who had been president of the American Bar Association and a member of the board of the giant tobacco company Philip Morris, had come to believe that American capitalism was facing a dire threat. Americans were angry about corporate abuse and corporate pollution; President Richard M. Nixon had responded by signing the National Environmental Policy Act and creating the Environmental Protection Agency through executive order. Across the country, activists marched for Earth Day, and Congress passed the first air pollution standards.

Ralph Nader and other consumer advocates had successfully fought

for safer cars and other products.

Powell believed that corporate America needed a decisive response to this perceived threat to the free-enterprise system. In a lengthy memo, the soon-to-be Supreme Court justice laid out his concerns and proposed responses to the Chamber of Commerce, where he served as chairman of the education committee.

The document he penned, now known as the Powell Memo, has been described as the road map for conservative dominance of public policymaking. For any such plan to be successful, Powell understood, conservatives would have to fund a broad array of institutions that would exert control over the levers of power,

including the courts, the legislature, and the media. Importantly, the tobacco lawyer insisted, it would require “careful long-range planning and implementation, in consistency of action over an indefinite period of years, in the scale of financing available only through joint effort, and in the political power available only through united action and national organizations.” What Powell grasped is that policy victories come after gaining control of the levers of power—and not before.

The impact has been devastating. And yet the progressive response, though energized, has been diffuse. There is no central committee of the American left, nor should there be. In the

absence of a coherent plan, progressive leaders aggressively promote multiple ideas rather than focused strategies and tactics.

Major funders support an array of advocacy groups, many without mass memberships or a focus on mobilization, that sometimes work at cross-purposes and in competition.

The Democracy Alliance, created in 2005, attempted to remedy that anarchy, with mixed success.

It was launched with a smart PowerPoint elaborating on how the left should respond. But, as current Democracy Alliance president Gara LaMarche admits, “liberal values aren’t command and control. It’s a steep climb to get donors to consider collective aims. The right believes in long-term funding and general operating support while the left requires groups to perform against metrics in project grants and cuts them off after a short time to fund something new.”

Progressives are unlikely to adopt the hierarchical approach that works on the right, but we do need something like a Powell Memo of our own, an overarching strategy that focuses on winning and maintaining power, not just on issues; one that recognizes the need for large-scale and longterm investment in progressive infrastructure—think tanks to generate ideas, media to disseminate them, lawmakers to enact them, and judges to uphold them. Right-wing foundations are indeed famous for long-term funding of core institutions. Liberal foundations tend to have short attention spans. For our ideas to take hold and remain strong, we need to understand that long-term victories will require locking in democracy with a small d: nonpartisan districts, broad access to the voting booth, and fair-minded judges.

But in order to get there, we need to win elections. This requires two different, mutually reinforcing instruments. First, we

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need to support a set of policies that galvanize voters. We’ve seen the beginning of this, as progressive leaders embrace bold policies that were written off as fringe but that turn out to enjoy broad support. Second, we need to take back our democracy so that political preferences can translate into election wins—and real power.

That means broadening and deepening the right to vote for minorities, women, young people, urban voters, as well as making sure that they and their votes are counted. Mitch Mc­Connell paid progressives a backhanded compliment when he described H.R. 1, the For the People Act, as the “Democrat Politician Protection Act.” He was admitting that if democracy reform ever assured the right to vote, Democrats would be the majority.

In blue states, we need an aggressive campaign to pass legislation to expand early voting and automatic voter registration; in red states, well-funded litigation will be necessary to attack each and every law that threatens the right to vote, as well as a political strategy to target the legislators behind those bills. And that will require progressives not to shy away from bare-knuckle tactics. Right-wing lawmakers have to feel some pain, whether that entails losing voter support or having

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to defend their actions in public from a vigorous attack.

Several states already have stronger protections for the right to vote in their constitutions, which has allowed progressives to challenge some voter suppression efforts successfully, such as the Pennsylvania voter ID law that was found unconstitutional in 2014.

In other states, like Michigan, progressives are trying to emulate Pennsylvania by passing a constitutional amendment to protect the right to vote, including early voting, no-excuse absentee ballots, and straight-ticket voting. Funders and leaders need to coalesce around a group of states where existing constitutional provisions can support a litigation strategy and those where a ballot initiative might be the first step.

Similarly, of immediate importance, progressive donors and activists need to fight for Democratic control of statehouses before the 2020 census, which precedes redistricting.

Part of this effort will be constitutional challenges to the districts that were heavily gerrymandered in favor of the GOP after the 2010 census. These lawsuits are beginning to find some success, with some lawsuits focusing on state constitutional provisions, others on federal. This approach perfectly

House Democrats were able to pass their ambitious H.R. 1, “For the People Act,” which aims to expand voting rights, limit partisan gerrymandering, strengthen ethics rules, and limit the influence of private-donor money in politics. But until Democrats regain control of the Senate, the bill will go nowhere.

melds our strategic imperative with progressive values. But fair maps are only step one. Without powerful recruitment and support for Democratic candidates for state offices, Republicans will retain control.

And of course, we can fix all the election rules in the world, but if people don’t vote, we won’t win. So that’s where changes like voting by mail and same-day registration come in. We need to make it easy to vote.

And donors and the Democratic Party need to invest in a ground game that reaches out to low-propensity voters— minorities and young people—over a period of time. It can’t just be the day before the election, but needs to be a continuous engagement over time that gets them invested in the outcome.

In an analysis of Obama voters who stayed home in 2016, a group of political scientists found that these voters have strong progressive values and “four out of every five … identify as Democrats, and 83 percent reported they would have voted for a Democrat down-ballot. A similar share of Obama-to-nonvoters said that they would have voted for Mrs. Clinton had they turned out to vote. In short, while reclaiming some Obama-toTrump voters would be a big help to Democratic prospects, re-energizing 2012 Obama voters who stayed home is a more plausible path for the party going forward.” But that takes money and a strategy that can’t be cooked up right before the election.

None of this is easy. Lewis Powell himself did not see his plan come together all at once, but on the right, there was quick recognition that he had correctly analyzed the problem, and conservatives were serious about a solution. Like the right, we must be ruthless in thinking through which procedures and rules will make it easier for us to win electoral, legal, and legislative victories. We can pursue all this with a clear conscience—because unlike the right, in a fair election we win.

Caroline Fredrickson is the president of the American Constitution Society and author of a forthcoming book, The Democracy Fix: How to Win the Fight for Fair Rules, Fair Courts, and Fair Elections.

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On Trump’s Taxes, Richie Neal Has the Slows The costs of having a corporate Democrat chair the House Ways and Means Committee

BY J E F F H A U S E R A N D E L E A N O R E A G A N

A

s most House Democrats enthusiastically jump on the long-­dormant congressional oversight train, one senior lawmaker has conspicuously chosen to stay on the platform. Under the leadership of Representative Richard Neal, the House Committee on Ways and Means has shown none of the zeal for oversight exhibited by its counterparts.

The announcement two weeks ago that Neal would finally request Trump’s tax returns, after a good deal of pressure from the Democratic Caucus, might have appeared to be a welcome reversal. But look at the fine print and you’ll see that the committee’s strategy is basically a continuation of Neal’s obstinate refusal to deliver on Democrats’ 2018 campaign promises.

Not only is Neal’s request still set for some uncertain time in the near-ish future (approximately three months too late), but the request he is contemplating is wildly inadequate.

That is because Neal plans to disregard tax law experts and request only the President’s personal returns.

Neal’s lame excuse is that he wanted to wait for Special Counsel Robert Mueller’s report, and that the business returns for Trump’s over 500 limited liability corporations (LLCs) are too complex. Neal is right that understanding Trump’s finances will be unjustifiably arduous, but as one of the few people in the country with the power to gather the resources and expertise to conquer this task, surrender in the face of this complexity is a cowardly dereliction of duty.

Trump’s personal tax returns will show how much money he is earning from each of his LLCs, but not how the LLCs came to possess that money or what machinations the funds may have gone through before reaching the president. Without this information, we will make little headway in learning specifics about Trump’s

conflicts of interest, including international entanglements and alleged tax evasion.

Failing to request the business returns compromises not only congressional investigations into this president, but also the committee’s potential oversight of society’s wealthiest tax cheats. Neal reportedly likes to boast of his committee’s historical significance, and yet he is failing to seize his opportunity to be a part of that vaunted history by reforming the corrupt system that created the likes of Donald Trump and those surrounding him.

Looking back over Neal’s 30 unremarkable years in Congress, it appears that he has long been more concerned with rising through the ranks than actually accomplishing anything. For three decades, Neal has quietly waited his turn, neither making waves nor attracting national scrutiny. Unfortunately, Democrats’ deference to seniority in committee chair assignments can allow a lowenergy, risk-averse politician to rise to power, even as it can also yield activist chairs like Representative Maxine Waters (D-CA) of the House Financial Services Committee.

Neal has faced very few real challenges throughout his career. In the last four elections, since Massachusetts lost a congressional district and Neal began representing the state’s First Congressional District in the very liberal far western slice of the state, Neal has faced a primary challenger twice and faced an opponent in the general election only once.

Last year, he faced a primary opponent, Tahirah Amatul-Wadud, who had little funding and had never run for office. She managed to get 29 percent of the vote. Next time, Neal is likely to face a serious primary challenge.

He handily outraised both primary challengers by a factor of 6 to 1 in 2012 and 24 to 1 in 2018, thanks to big hauls

Neal is failing to seize his opportunity to reform the corrupt system that created the likes of Donald Trump and those surrounding him.

from PACs. Although he represents a progressive district, Neal’s fund­ raising relies to a remarkable degree on corporate PAC contributions. Neal was one of the top eight corporate PAC recipients in either party in the House for the 2018 election cycle. Only a fraction of his contributions (2.1 percent in 2012 and 0.73 percent in 2018) came from small-dollar donors.

This paints a picture not of a deeply popular politician with a committed base, but of one whose corporate fundraising prowess successfully suppresses challengers. This is a shame, because Trump’s tax practices cry out for a serious investigation.

While it is cheap and easy to set up an LLC, the services of those that can help you use it add up quickly, meaning that the parallel world of accounting tricks and loopholes is only available to those who can pay the price. Many of the country’s wealthiest individuals pay millions of dollars for expert advice on how to escape tens or hundreds of millions of dollars in obligations.

The authorities charged with punishing those that cross the line from “aggressive tax planning” to tax evasion simply cannot keep up. The IRS, for instance, has decreased the rate at which it audits the country’s wealthiest individuals by almost threequarters over the last decade. Due to the complexity of these individuals’ finances, these audits require a tremendous outlay of time, resources, and expertise. And yet decades of effective lobbying by some of the richest and most shameless people and corporations have ensured that the IRS budget is paltry compared to its needs.

Meanwhile, that “aggressive tax planning” goes almost entirely unscrutinized. While these tactics are currently legal, it is not clear that they are fair, nor that they should continue to be permissible. Consider, for instance, last year’s New York Times report about the Trump family’s extensive efforts to avoid inheritance taxes. While those tactics might have seemed shocking to you or me, tax law professor Lee-Ford Tritt told Vox that between 80 percent and 85 percent of those maneuvers would have been “a yawn for the uberwealthy estate planners.”

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House Ways and Means Committee Chairman Richard Neal

That this type of behavior is routine for a select few, however, should not distract from the severe consequences that it has for the rest of our society.

Between 2008 and 2010 (the last years for which it released figures), the IRS estimated that it lost $458 billion annually to tax evasion. It does not release estimates for how much revenue is lost to legal, but questionable, maneuvers like many of those described in the New York Times report. Based on the fact, however, that the Trump heirs alone avoided (through mostly legal but probably also some illegal tactics) $500 million in taxes in 1996 dollars (just over $800 million today), it is likely a significant sum.

This is exactly the sort of injustice that Democrats should be interrogating through aggressive oversight. Democrats’ win in 2018 was a repudiation of Trump, but it was also a rejection of the system that created him. That system aggressively pursues people who dare to claim the Earned Income Tax Credit, while turning the other cheek as the ultra-wealthy spirit millions of dollars out of the government’s reach.

If House Democrats are serious about fixing the system that produced Donald Trump, they will need to understand its architecture, which means they cannot throw up their hands in the face of its complexity.

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Instead, Ways and Means should gather the tools necessary for the task. That starts with hiring enough staff, including experts who have the specialized knowledge needed to decode Trump’s tax returns.

Other committees have boasted of expert hires in areas such as ethics (Norm Eisen), banking misconduct (Bob Roach), and antitrust (Lina Khan), while Ways and Means has announced no such oversight-targeted employment decisions.

March is the month when committee chairs go before the House Administration committee to make the case for their budget requests for the coming two years. Rather than bemoaning the complexity of oversight, Neal must recognize that current resources are adequate for investigating Trump’s returns, but not for the breadth of issues his committee should be overseeing. Neal should take this opportunity to obtain the funds that his committee will need to do its broader job, because the oversight that the American people demands starts, but does not end, with the president’s tax returns.

The committee also has jurisdiction over trade policy, as well as Medicare and Social Security.

Viewing Trump’s financial records will inevitably raise other questions for which Ways and Means should also seek

The oversight that the American people demands starts, but does not end, with the president’s tax returns.

answers and begin developing remedies.

For example, if President Trump is guilty of tax evasion on the scale that is alleged, why was he not caught sooner? Who else has benefited from this weak enforcement? Minoritybound Democratic senators on the Banking Committee have already been seeking answers to precisely these questions, but lacking subpoena power, are unable to do more than send a letter to the IRS questioning enforcement priorities. In contrast, Ways and Means can and should force executive branch officials to furnish answers to these important questions.

By shining a light on uneven enforcement and chronic understaffing, Ways and Means could build support for increasing the agency’s budget. Not only would this be one of the most effective ways to increase revenue (for each dollar in additional funding that the IRS receives, it regains between $6 and $9), it would also likely enjoy bipartisan support, if not among lawmakers than among the general populace, a majority of whom view the agency favorably.

Fixing enforcement, however, will only be the start. A thorough investigation of Trump’s tax returns will also certainly make clear that there are structural deficiencies in our laws that allow the wealthy to consistently achieve better outcomes. Why, for example, should income from LLCs receive a 20 percent deduction? Why should individuals be able to hide their identity behind anonymous shell companies, allowing them to violate the law without consequences?

The Ways and Means Committee must investigate Trump not only because he is a corrupt president, but because Trump’s celebrity makes him a worthy vehicle for highlighting the unjust and corrupt system that created him. Failure to request the business returns demonstrates a lack of seriousness about understanding and dismantling this rigged system. It is not only Trump but every rich tax evader in America who is breathing easier with Richard Neal as chairman.

Jeff Hauser and Eleanor Eagan work at the Revolving Door Project, where Hauser is the founder and director.

tom williams / roll call via ap images

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Will Immigrants Find Themselves in the Driver’s Seat?

Trump’s ICE crackdown is increasing support for access to driver’s licenses.

BY M A N U E L M A D R I D

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decades-old political debate over whether undocumented people should be allowed to drive has gained new relevance under the Trump administration, as state legislators and advocates work to push back against increased immigration enforcement by the federal government.

Democrats in New York, New Jersey, Minnesota, Massachusetts, Rhode Island, and Oregon have introduced legislation that would grant residents the ability to obtain driver’s licenses regardless of immigration status (a similar bill was put forward in Virginia, but failed). Licenses granted to immigrants under these proposals would be reserved for driving and would not be compliant with the Real ID Act, the federal standard for identification used to board domestic flights and enter government buildings.

Lawmakers and advocates believe expanding access to licenses will benefit local economies, make roads safer, and, critically, put an additional barrier between Immigration and Customs Enforcement and immigrants guilty of little more than a traffic violation.

An analysis of the 44,000-some immigrants in ICE custody last summer found that a full 80 percent of detainees had only committed a minor offense such as a traffic violation or had no prior convictions at all, according to a report by Syracuse University’s Transactional Records Access Clearinghouse. According to the agency’s own numbers for the last fiscal year, ICE charged or convicted roughly 75,000 immigrants for simple traffic violations (DUIs were not included).

Crispin Hernandez is tired of living in fear of immigration agents. Hernandez, an organizer with the Workers’ Center of Central New York and a former upstate dairy worker, says that he’s seen too many families in his community separated. “They’ll take

a father or a mother from their family and the kids are the ones left to suffer,” Hernandez says.

If ICE wasn’t enough, undocumented immigrants in upstate New York must also contend with Border Patrol, which is allowed to conduct searches within 100 miles of the border under federal law. Both agencies have proven emboldened under the Trump administration, targeting bus stations and workplaces for raids.

“The need for driver’s licenses [for undocumented immigrants] has always been there, but in many ways it became more urgent when Trump became president. It woke up a lot of people,” says Hernandez, who is also at the center of a lawsuit against the state of New York to allow farmworkers to unionize. “Farm owners have a lot of power over their [undocumented] employees. With driver’s licenses, we would have more freedom.”

Although the majority of undocumented immigrants in the United States reside in big cities, the most vocal calls for expanding driving privileges come from rural towns where a growing number of undocumented workers have found work on farms and in meat-processing plants.

It’s in these areas, underserviced or not serviced at all by state public transport, largely ignored by Uber and Lyft, and increasingly dependent on migrant work for their economic stability, where the need for licenses is greatest.

“Driving is an absolute necessity.

Every day, it’s a 30-mile drive to work and a 30-mile drive back home,” says Iván Hernández, communications manager for Oregon-based immigrant rights group Causa Oregon.

Hernández, who has been a U.S. citizen for a little over a year, grew up undocumented in Umatilla, a rural Oregon town with a population of approximately 5,000 (7,300 if you

MOBILITY Most of America can’t function without a driver’s license.

Immigrants will drive, with or without one.

Expanding access will protect immigrants from summary arrest and deportation.

count an estimated 1,800 inmates at a nearby state prison). From a young age, Hernández would use his school breaks to help his parents with farmwork. First, yanking weeds from fields to clear the way for harvesting combines and then, once he was older, driving the combines himself.

“That fear is always present in your mind when you’re driving or sitting in the car,” says Hernández. “What if my dad is pulled over? Is this going to be the last time I see my mom? Will I be taken and deported to a country I don’t know?”

Supporters of the policy say that expanding access to driver’s licenses would also make roads safer. Whether or not licenses are available, families like Hernández’s are going to drive, be it to work, the grocery store, school, or to the hospital in case of an emergency.

Wouldn’t it be smarter to certify that they are capable of driving and insured?

Recent research appears to validate this intuition. A 2017 Stanford study found that California’s decision to provide licenses to more than 800,000 undocumented immigrants resulted in an average decrease of 7 percent in the rate of hit-and-run accidents in the state, with no significant change in the rate of total accidents or fatal accidents. The researchers estimated that California drivers saved $3.5 million in out-of-pocket damage costs because of the drop in hit-and-run accidents.

Providing undocumented people with licenses could also be a boon for state public transportation and residents already paying for car insurance. In New York, for instance, annual government revenues from car registration and licensing fees, sales tax, and gas tax would increase by $57 million if the state were to expand access, according to an analysis by the Fiscal Policy Institute. That revenue jump would come from an estimated 265,000 newly certified undocumented drivers in the Empire State. A recent study on the effect expanding access could have in New Jersey also projected significant revenue gains.

Advocates and lawmakers make a point of drawing attention to the policy benefits that would come with allowing undocumented residents to legally drive, which they view as a

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bipartisan win-win. But there’s also an entire history of politics at play here, national and local.

AN IMPORTANT BIT of context around the battle over permitting undocumented immigrants to drive is that there really wasn’t one until after the turn of the century. Before the 2000s, most states either allowed people without legal status to drive or didn’t explicitly require a Social Security number to obtain a license. It was only in the months and years following the terrorist attacks on September 11, 2001, that state officials began stripping access in the interest of national security.

Movements to restore driving privileges formed, encountering as much success as failure for the remainder of the decade: Tennessee passed a license law, amended it, and then repealed it years later. Utah, oddly, became and remains a model for bipartisan agreement after passing its own legislation allowing for undocumented drivers in 2005. New Mexico passed its own law in 2003 and kept it. Efforts to move forward on licenses in New York in 2007 were shot down, with help from vocal opponents like then-Congresswoman Kirsten Gillibrand.

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Advocates would come to learn that when it came to immigration, many state Democrats preferred to delegate authority to Congress, while many other Democrats turned out to be as conservative as Republicans on the issue.

Then there was the issue of coalition building and public outreach. In New York, the push for license access beginning around 2007 was coming primarily out of New York City, according to Emma Kreyche, a senior worker rights advocate at the Worker Justice Center of New York. “They didn’t have the same organizational landscape in rural communities that exists now,” says Kreyche.

“We learned in Tennessee that you can’t sneak this kind of issue through,” says Stephen Fotopulos, former executive director of the Tennessee Immigrant & Refugee Rights Coalition. “If you haven’t built the political base and political power on the merits of the issue, you can pass whatever bill you like, but you won’t be able to defend it or keep it in the long run.”

It wasn’t until 2013 that a breakthrough came. By then, the DREAM Act was dead and remaining conversations in Congress over comprehensive immigration reform were

The immigrant rights group Causa Oregon has been pushing for driver’s licenses for the undocumented for years.

collapsing. Immigrant advocacy groups and state lawmakers had run out of patience with the federal government. That year, seven states, Puerto Rico, and Washington, D.C., signed legislation allowing driver’s licenses and cards to be issued to residents without legal status.

“States took action as a matter of necessity, as a response to federal inaction,” says Jackie Vimo, a policy analyst at the National Immigration Law Center, which has provided technical support to state-led campaigns, including Causa in Oregon.

“State policy is ultimately where the rubber hits the road for many immigration issues.”

Advocates and legislators looking to adopt license laws have taken lessons from states like Vermont and Washington state, where immigrant communities were rocked by recent revelations of DMV employees sharing drivers’ personal information, including legal status or lack thereof, with ICE agents. As a result, new bills like the ones proposed in New York include language explicitly limiting the information that DMVs can collect and store, as well as any information sharing with federal agencies.

While immigrant interests continue to grow as a key influence on the Democratic platform, a web of state, local, and national groups supporting license legislation has grown in both rural and metropolitan areas. Moreover, Democrats have strengthened their support in key states.

Following the 2018 elections, Democrats kept or took control of all three branches of government in New York, Colorado, Illinois, Maine, New Mexico, and Nevada. These six new Democratic “trifectas” joined eight other states, including New Jersey, Rhode Island, and Oregon, where the party dominates the governor’s office and both legislative chambers.

Nine of the 12 states that currently allow undocumented people to drive are states where Democrats control all three branches of state government (Utah, Vermont, and Maryland being the exceptions). In other words, of these 14 Democratic trifectas, only New York, New Jersey, Maine, Oregon, and Rhode Island do not

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currently allow undocumented people behind the wheel.

Indeed, Democrats holding all the power in a state doesn’t mean much without sufficient political will and voter outreach. Take the case of Oregon and Rhode Island, which have both been Democratic trifectas since 2013.

“Should this become a litmus for Democrats? I think it should be, and we’re definitely going to do what we can to make that the case,” says Johanna Calle, director of the New Jersey Alliance for Immigrant Justice.

Calle can speak to the importance of keeping pressure on politicians, trifecta or no trifecta, as reports continue to surface of New Jersey lawmakers getting cold feet on expanding access to driver’s licenses. Now it’s said that Democrats in the state might opt to wait until after elections next November to move.

“There’s this worry among Democrats [in New Jersey] of ‘How do we win an election knowing Republicans will make this their number one issue during the campaign?’” says Calle. “New Jersey is not a red state. Trump didn’t win in New Jersey … They’re too nervous about being accused of being for open borders. In the age of families in cages, that timidity needs to go away.”

If there’s any silver lining to be found in the cloud of dread cast over immigrant communities by Trump’s deportation machine, it’s that the country has been forced to consider the role of states and localities in the national immigration debate.

His polarizing presence has not only forced Democrats further to the left, it’s also pushed the general public in that same direction. In making the need for driver’s licenses for immigrants more urgent through jackbooted immigration enforcement, he also improved its political prospects.

“For better or for worse, Trump has focused the nation’s attention on immigration issues in a way that hasn’t been seen for a long time. People are tuned in,” says Emma Kreyche.

“We’ve seen a lot more momentum among concerned people with no previous exposure to immigration issues, everyday folks generally appalled by what they’re seeing from federal immigration enforcement.”

Could California End Childhood Poverty?

America’s most liberal state government has a far-reaching plan to do just that. But does it have the will to enact it?

BY K A L E N A T H O M H AV E

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f there’s one state we can call the progressive homeland, it’s most likely California. The state is overwhelmingly Democratic and disproportionately liberal. Democrats hold more than three-quarters of the seats in the legislature, while Governor Gavin Newsom has already demonstrated he’s clearly to the left of his predecessor, Jerry Brown.

Sacramento is abuzz with progressive proposals from both Newsom and the legislators. The governor wants to have Medi-Cal (the state’s Medicaid program, which serves 14 million Californians) bargain directly with drug companies over prices. He also wants the state to fund universal pre-K for four-year-olds. Legislators are mulling over proposals to invest major sums in affordable housing.

Perhaps the most far-reaching set of proposals to come before legislators is that developed by a task force the legislature established two years ago.

If enacted in their entirety, the proposals could do something that’s never before happened in the United States: eliminate childhood deep poverty.

Many of those proposals have been included in the budget that Newsom has presented to the legislature.

FOR ALL THE STATE’S progressive bona

fides, child poverty in California is deep and widespread. According to the supplemental poverty measure, which unlike the official census measure takes costs of living and social benefits into account, California has the highest rate of poverty in the country. Researchers from the Public Policy Institute of California and the Stanford Center on Poverty and Inequality (SCPI) took this measure one step further, creating the California Poverty Measure (CPM), which provides an even more complete picture of the state’s poverty. According to the CPM, more than one in five children in California—1.9 million—live in

poverty, while 450,000 of those children live in deep poverty, or below half the federal poverty level ($12,875 for a family of four).

Housing costs in both large urban centers and rural areas help account for this—nearly half of California families spend more than 30 percent of their incomes on housing. The large immigrant population is also a factor, as immigrants are much more likely to live in poverty than the native-born, in part because many are ineligible for social safety net programs. Most Californians in poverty work, but one in three California workers is employed in low-wage work. All of these burdens are disproportionately felt by the state’s people of color: About one-third of Hispanic children and more than one-quarter of black children live in poverty, compared to 12 percent of white children.

Tens of thousands live in extreme poverty, which has grown considerably since 1996’s welfare reform. Nationally, about one million more people have been plunged into deep poverty since then—people who in effect live on $2.00 a Day, as researchers Kathryn Edin and Luke Shaefer documented in their book with that title.

California’s campaign to end child poverty began several years ago, spearheaded by the anti-poverty, faithbased organization Gather, Respect, Advocate, Change, Engage (GRACE), a project of the Daughters of Charity.

GRACE tried different strategies to get the state to take on child poverty. They weren’t successful, says GRACE President and CEO Conway Collis, because the state itself had not been part of the conversation. So the campaign turned to the legislature, and crafted a bill to call on the California Department of Social Services (DSS) to convene a task force to develop a new plan.

The sponsor of the bill, Los Angeles Assemblymember Autumn Burke, says Collis, is a “moderate Democrat,

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concerned with cost-effectiveness of policy, [which] made her a good author for something that was going to be transformative.” Burke highlighted not only the moral reasoning to end child poverty, but also the economic reasons, given what poverty costs the state. Her bill passed with unanimous support, and last November, the DSS’s task force delivered its plan.

TO SYSTEMATICALLY ATTACK the roots of child poverty, the plan focuses on seven main areas of policy: health care, housing, workforce/education, early childhood, special populations (like foster children), the general public-assistance system, and coordinating anti-poverty services.

Perhaps most impactful of these policies—and most innovative—is a refundable, targeted child tax credit (TCTC) that would, each month, directly transfer cash into the pockets of families with children in deep poverty. (The design also takes costs of living in different areas of the state into account and supports parents’ working efforts by, for example, disregarding some earned income.) Essentially, the TCTC is a guaranteed income for extremely poor families with children.

One of the researchers on the task force was David Grusky, director of SCPI. The researchers’ job was to run statistical analyses to evaluate proposals based on their ability to end child poverty. What they found, he says, was “disturbing.”

“When we ramped up existing programs,” Grusky says, “we could not meet our charge in ending deep child poverty. We could make some headway, but we couldn’t end it.”

Enter the TCTC, which would be an aggressive supplement to the already existing federal child tax credit.

The TCTC, says Grusky, would be “a foundational intervention that positions children to participate in the economy when they grow up that perhaps no other intervention could do.”

The evidence supporting the long-term benefits of such a cash transfer is relatively recent—but persuasive. Poverty has enduring health and future implications for children, and what works to rectify this can be very simple: more income. It may seem too obvious or

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Child poverty in California is deep and widespread.

High housing costs in both large urban centers and rural areas help account for the fact that the state has the highest rate of poverty in the country.

even tautological in its simplicity, but just giving money to low-income people is a surefire way to reduce their poverty and its consequences by allowing them to make their own decisions about how to improve their lives. That translates into better educational, employment, and earnings outcomes for kids as they grow up. Grusky also notes that the credit is cost-effective—as proposed, the TCTC phases in over ten years, eventually costing $2.8 billion annually to eliminate deep child poverty, and its own immeasurable costs, in the state.

In February, another report came out on how to address child poverty, and this one was a behemoth. The National Academies of Sciences, Engineering, and Medicine published a $1.25 million, 600-page study detailing proposals to alleviate child poverty. While the evidence from both reports is similar in many ways—living with low income in childhood affects children long-term, and cash benefits significantly reduce poverty in the U.S.—Grusky does note one serious difference. The NAS report, he says, was “powerful and compelling,” but “if you compare how [the California] task force played out as against the NAS task force, the difference is that we came up with an approach that would actually allow us to end deep child poverty. By contrast, the NAS panel limited themselves to existing, more conventional proposals.”

Instead of a TCTC, the NAS task force recommends smaller child allowances than the TCTC ’s, which would cut deep child poverty in half, but not eliminate it. “They fulfilled their charge,” says Grusky. “But we took the next step and said ‘OK, we can actually get this done if we’re willing to be a bit more aggressive.’”

Congressional Democrats are currently proposing income policies similar to the NAS recommendations that cover more families higher up the income scale than the California task force’s proposal. They’ve put forth an expanded child tax credit—basically, a child allowance on par with those of other wealthy countries. It would both cover a greater number of families (with the credit beginning to phase out at $130,000 annual income for a single parent in the current Senate version) and provide

a smaller allowance than the TCTC— going broad instead of deep.

The California task force didn’t rely on the TCTC alone. It also called for changes to the existing public-assistance system in California—because these programs work. Without such programs, estimates suggest more than a third of all California kids would live in poverty, rather than the current level of one-fifth.

Specifically, the report calls for increasing California’s cash welfare, Temporary Assistance for Needy Families program (CalWORK s) grants, expanding the Earned Income Tax Credit, and expanding child care and early-childhood education for all children living in poverty until age eight. The list goes on: rental subsidies, voluntary home-visiting programs, expanded health care, implementing rent control, expanding Promise Neighborhoods (a federal initiative that provides extensive community services to children and their families), and many other smaller policy tweaks that would have substantial effects on children and families living in poverty—like expanding opportunities for children visiting parents at local jails, providing state funding for low-income tenant legal representation in housing court, and easing bureaucracy to streamline benefit application processes. Faye Wilson Kennedy of the Northern California Poor People’s Campaign notes that it is essential that people in poverty give their input on the policies that will ultimately affect them; some of the task force recommendations came from low-income people themselves— among them, investing in affordable housing, particularly for the homeless.

“This isn’t pie in the sky,” says Collis, who co-chaired the task force alongside the then-director of DSS. Indeed the report is housed on DSS’s website—with the .gov site address implicitly giving the report the imprimatur of state authority.

California is already far ahead of most states when it comes to the extent of its social safety net. While on average states spend less than a quarter of their TANF funds on cash assistance, California spends about 38 percent. Campaigns in the past

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several years have succeeded in removing the state’s family cap (which denies cash benefits to children born while a family is receiving assistance), repealing the maximum family grant, and increasing the amount of the CalWORK s grant.

marcio jose sanchez / ap images

WHILE ONE MAY IMAGINE

that the roughly $14 billion annual price tag of reforms (phased in over ten years) would leave many legislators shuddering, that does not seem to be the case—at least, not yet. Advocates argue that that $14 billion would be a very costeffective investment. The NAS study estimates that child poverty costs the U.S. between $800 billion and $1.1 trillion each year due to, for example, lost workforce potential and increased health services due to the consequences of poverty. A 2007 Urban Institute report found that poverty costs the U.S. 4 percent in economic output each year, which would translate to $100 billion each year for California. If the task force plan is fully implemented—which would perhaps mean challenging Proposition 13, which caps property tax increases in the state— the report concludes that California would, over the long term, benefit much more than $14 billion each year as poverty falls. That is a substantial return on investment, which could, Grusky hopes, persuade even “a wholly dispassionate observer.”

There’s no question that the state’s lawmakers are inclined to confront California’s high levels of poverty.

Before his victory in November’s election, Newsom said in an interview that child poverty “is a matter of political will. We’ve allowed these conditions to persist. And child poverty is the ultimate manifestation of our failure.” He said he had “made child poverty my North Star.”

Newsom’s administration has given weight to his words through the policies proposed in his budget. Newsom’s chief of staff, Ann O’Leary, told advocates their plan “informed the work

This toddler’s family was forced to live in an RV when their landlord hiked the rent on their apartment beyond what they could afford.

About a third of California’s Hispanic children and more than a quarter of black children live in poverty, compared to 12 percent of white children.

that we were doing,” during the transition, and that “You will see a lot of your work reflected in our budget.”

Among the many policies highlighted in the task force report that made it into Newsom’s budget are increases to CalWORK s grants to end deep poverty for families who receive those benefits, paid family leave, increases to the state EITC, investments in affordable housing, and expanded access to early-childhood education.

However, the targeted child tax credit is conspicuously absent from the governor’s budget. It may be that there’s so much on Newsom’s wish list now that the TCTC is still a bridge too far. It may also be that because the TCTC requires an entirely new design, there are still technical issues to work out regarding how exactly the credit will work and how California’s data infrastructure can be updated to, for example, calculate the cost of housing in different regions throughout the state. Until such matters are clarified and costed out, the governor, no matter his preferences, probably can’t take a position on the tax credit.

However, Collis tells the Prospect, the governor’s staff is working through the details of the tax credit and examining what would be needed to implement it, including how to incorporate its cost.

Even if the TCTC makes it into the governor’s final budget proposal (what is known in Sacramento as the “May

Revise”), of course, the legislature still would have to decide whether to enact it. Burke, who is chair of the Assembly Committee on Revenue and Taxation, has sponsored legislation to pass the tax credit proposal. At least 17 other bills have so far been introduced that would implement most of the rest of the provisions.

While the goal is to pass the entire comprehensive plan, advocates are currently focusing their energy on the pieces of the report that might need the biggest pushes to pass, for example, implementing the TCTC and expanding paid family leave. But Collis says, “I don’t think it’s a situation where [these proposals] are facing opposition as much as [it’s that] we have to work through the details of implementation.”

There’s clear political logic in focusing anti-poverty programs on children—they are an extremely sympathetic population in the national consciousness. The tired, venerable individual responsibility narrative that’s so popular in the U.S. makes it easy for conservatives to blame adults in poverty, but it’s virtually impossible to blame the children (not that some haven’t tried).

If California does declare a real war on poverty, would other states follow?

The Golden State enjoys a very different political climate than the rest of the country, with its Democratic supermajorities across the branches of government and its pools of great wealth. It already provides better social assistance—within the paltry U.S. system, of course—than many other states. But even if other states lack the resources and will to go where California may go, the state could yet provide a model for Democrats at the federal level should they win the White House and Senate in 2020.

Jessica Bartholow, a policy advocate at the Western Center on Law and Poverty and a key member of the state’s task force, has long argued that ending poverty is a political decision. But, she says, “I feel like any time I said that before [we created this plan] it was just political rhetoric. Because someone could have said to me, ‘OK, what’s the plan?’ and I wouldn’t have been prepared to answer that question.

“But now we have a plan.”

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TRUMP AND CHINA:

The Art of the Desperate Deal Will Robert Lighthizer restrain Donald Trump’s impulse to take a headline-grabbing and self-defeating China deal?

B Y R OB ERT K UTT NER

U.S. Trade Representative Robert Lighthizer and other Trump administration officials meet with their Chinese counterparts at the start of U.S.-China trade talks in Washington in January.

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E

ver since China was admitted to the World Trade Organization in 2001, the trade imbalance between the United States and China has become ever more lopsided. In 2001, the deficit stood at $83 billion. In 2017, it reached $375 billion. Rather than moving toward a more open economy, as enthusiasts of WTO membership predicted, China has intensified its policies of state-led capitalism and protectionism. Combined with its outright technology theft, these policies have enabled China to achieve domination in industry after industry, with grave economic and geopolitical consequences for the U.S. Robert Lighthizer, the U.S. trade representative, aims to change that. He is dead serious about using America’s economic and political leverage to reset the U.S.-China relationship. An anomaly among Trump’s appointees, Lighthizer is deeply knowledgeable about his subject, strategically clear about his goals, and tactically astute as a negotiator.

And unlike his last four predecessors as USTR , Lighthizer unabashedly embraces a salutary brand of nationalism. To use a very old-fashioned word, Lighthizer is a patriot, someone who truly cares about whether U.S. industry endures— and a far more serious man than his boss.

There’s only one person who can undermine what Light­ hizer is trying to achieve. That would be Donald Trump.

Why? Because Trump is looking for a quick deal that gives him bragging rights, while Lighthizer is playing a long game for systemic change.

After Trump waived his own March 1 deadline for a major increase in tariffs on Chinese goods absent a major agreement, he sounded more and more bullish about the prospects of an imminent deal, issuing tweets on the great progress that has been made. On February 25, Trump crowed to a White House gathering of the nation’s governors that “we’re going to have another summit, we’re going to have a signing summit, which is even better, so hopefully we can get that completed, but we’re getting very, very close.”

The more Trump trumpeted success before progress had been agreed to, the more he invited the Chinese to harden their line, and the more he undercut his own negotiators. In reality, the deal that was on the table in early March, when Beijing insisted on delaying the signing ceremony several weeks pending further talks, was far from adequate. China had sought to sucker-punch Trump by offering to purchase a lot more stuff—soybeans, beef, chickens, natural gas, semiconductors—but not to make changes in China’s mercantilist system of state support for its own industries.

You can understand the appeal of a deal. If Trump and China’s President Xi Jinping can announce an agreement consisting of specific commitments to purchase lots more U.S. products, plus some vague, easily evaded promises to reduce aspects of Chinese mercantilism, it will produce

several tactical wins for the president. First, it will divert attention from Trump’s other woes. Second, there will be favorable headlines that Trump has come to his senses on tariffs and avoided a “trade war” with China. Going into an election year, the farm lobby and farm-belt voters will be relieved and grateful. So will the large segment of American corporations and banks that profit from the status quo.

The Dow will jump several hundred points, reflecting both general approval and the prospect of increased exports and profits. Best of all, the deal will be announced at Mar-aLago, with a smiling Xi at Trump’s side.

And China’s system will not change at all.

Should all that happen, it will be a stunning defeat for the man who is probably Trump’s most competent and conscientious appointee. To date, says China journalist and scholar James Mann, “Lighthizer has been the driving force in persuading Trump not to take deals that would generate headlines but not alter China’s system.” Given China’s hard line and Trump’s eagerness for a deal, it will take something close to a miracle for Lighthizer to prevail.

ROBERT LIGHTHIZER WAS BORN in 1947, in Ashtabula,

Ohio, where he watched the steel industry slowly vanish from the American Midwest of his boyhood. He attended college and law school at Georgetown, practiced law at the blue-chip firm Covington and Burling, and then served as trade counsel and later chief of staff to the Senate Finance Committee under the chairmanship of Kansas Republican Robert Dole. In 1983, President Reagan appointed Lighthizer to be deputy U.S. trade representative, where he became one of the administration’s two notable trade hawks, along with Clyde Prestowitz, whose title was counselor to the Secretary of Commerce.

In those years, the main Asian mercantilist threat to U.S. industry came from Japan (whose model China was to adapt and intensify). At first, Reagan’s negotiators attempted to persuade the Japanese to operate their economy more in the U.S. image, with transparent prices and open markets. With great fanfare, negotiators announced an initiative called the MOSS Talks, for Market-Oriented Sector-Selective. It soon became evident that the Japanese were masters of evasion and indirection. The joke became that MOSS stood for More Of the Same Stuff. As it became clear that Japan was not about to open its markets, Lighthizer and Prestowitz reluctantly settled for a series of second-bests. These included ad hoc deals for “voluntary restraint” of Japanese exports such as steel, autos, and semiconductors, as well as some selective reduction of Japan’s barriers to imports. If anything, what Lighthizer achieved with Japan is a lot better than the deal that’s on the table with China.

“Bob helped author the approach of negotiating resultsoriented trade agreements that set specific metrics on

The more that Trump boasts that a deal is imminent, the more he undercuts his own negotiators.

SPRING 2019 THE AMERICAN PROSPECT 17

U.S. Trade Representative Robert Lighthizer with China’s vice premier and lead trade negotiator Liu He and Treasury Secretary Steven Mnuchin at the opening session of trade negotiations in Beijing

consciousness, and was good preparation for his role today as America’s lead China negotiator.

Japan, moreover, was and is a democracy, with no global hegemonic ambitions. For much of the past quarter-century, Japan’s economy has been bogged down in a deflationary spiral, though its manufacturing export sector is as strong as ever. China is a whole other story. And, as Prestowitz observes, Japan was also a national-security client of the U.S., providing the U.S. with some pressure points. Not so China.

After working for Reagan, Lighthizer returned to private legal practice in 1985, specializing in trade cases, mainly representing U.S. companies whose businesses have been harmed by the protectionist policies of other nations, notably China. In representing scores of companies directly damaged by that nation’s state subsidies, dumping, technology theft, preferential cartels, and other aspects of mercantilism, and filing appeals of those practices to agencies such as the Commerce Department, Lighthizer

18 WWW.PROSPECT.ORG SPRING 2019

gained an up-close look at just how Chinese mercantilism operates—and the limits of the usual U.S. tools to counter it.

That experience has proved invaluable. Prestowitz says: “Think of Cool Hand Luke when you consider Bob Lighthizer in a trade negotiation. He knows the trade laws, the history of the trade organizations, the key trade cases, the major players in virtually all countries, cold. He doesn’t get excited.

Doesn’t lose his temper, but can be impatient with nonsense from his negotiating partner. In short, he’s a pro’s pro.

“Always remember that before China there were Japan and Korea who followed policies similar to those of China today.

Bob knows they and we are not playing the same game. We’re playing tennis and they are playing football. He is bound and determined that we put on some helmets and pads.”

Out of government, Lighthizer was one of the key informed critics of U.S. China policy, regularly testifying, giving speeches, and writing op-eds, as well as litigating on behalf of U.S. companies that bore the brunt of China’s policies. On the eve of the tenth anniversary of China’s accession to the WTO, in 2010, Lighthizer presented encyclopedic testimony to the U.S.-China Commission, detailing every aspect of Chinese mercantilism and American wishful thinking. Lighthizer concluded: “The optimistic promises made at the time Congress approved PNTR [Permanent Normal Trade Relations with China] have not been fulfilled. Years of passivity and drift among U.S. policymakers have allowed the U.S.-China trade deficit to grow to the point where [it] is widely recognized as a major threat to our economy. Going forward, U.S. policymakers should take these problems more seriously, and should take a much more aggressive approach in dealing with China.”

For the past two decades, Lighthizer was a voice in the wilderness. His 2010 report read like an audition piece for some future President Trump. And in Trump, he found an improbable champion. It is a little embarrassing for progressives to credit Donald Trump for doing even one thing right, in this case ostensibly pursuing the serious China policy that has eluded the last several presidents. But the final chapter is yet to be written, and Trump is a long way from success.

Until Trump, U.S. China policy was wishful. Though China repeatedly held down the value of its currency in order to artificially boost exports, since 1994 no president has officially designated China a currency manipulator, which would have triggered retaliation under U.S. trade law. Though the Trade Act of 1974 does include a variety of remedies, including retaliatory tariffs when other countries’ governments subsidize industries and dump their export products at below-market prices, prior administrations mostly refrained from using them, because the U.S. was selling the ideal of liberal trade.

As critics of U.S. trade policy have long argued, drastic changes were needed. Trump, in his intuitive and feral

mark schiefelbein / ap images

whether Japan was abiding by its promises and ensuring that swift and sure retaliation would occur if Japan broke its promises,” says Michael Wessel, one of the Democratic members of the U.S.-China Commission. “That’s the same approach we should be taking with China.” (The independent commission, created by Congress in 2000, has functioned as a kind of loyal opposition to the conventional wisdom about China.) Those Japan deals did produce some gains, but their failure to fundamentally alter Japan’s national system was seared into Lighthizer’s

fashion, grasped the music. It fell to Lighthizer to provide the words. But Trump may yet demonstrate that even on China, what appears to be a propitious convergence of goals is just another fake. To be serious, a revised trade policy would need to be married to a series of industrial policies.

The goal should be not just to improve the trade balance but also to revive American industry and safeguard it from China’s improper grabs of market share via subsidies and dumping. Trump has done nothing on that front.

Lighthizer’s reality-based China policy stands in marked contrast to Trump’s delusional, blowhard, and self-defeating policies nearly everywhere else—from Iran to Syria to Saudi Arabia, and from Russia, Korea, and Germany to Hungary and Poland. Indeed, our China diplomacy is made more difficult because Trump’s ad hoc affronts to the European Union have removed one crucial ally that the U.S. sorely needs in its China policy. If Trump does end up undercutting Lighthizer for a deal that produces cheap headlines and no fundamental changes, it will be of a piece with Trump’s diplomacy elsewhere in the world.

DONALD TRUMP’S ASCENSION to the presidency left Beijing bewildered. Since the Clinton administration, the Chinese government has known exactly how to play Washington: make token concessions while buying off key industries and notables, so that proponents of a harder line would be dismissed as protectionist “China-bashers.” But it was not at all clear to the Chinese what Trump wanted from Beijing, or how to play him. The fact that Trump kept changing his rhetoric and demands created further puzzlement on the part of the Chinese. Did these shifts represent a higher order of deceptive tactical brilliance, or just incoherence?

The Chinese pursued a two-part strategy. First, knowing Trump’s personal corruptibility, they sought ways to buy him, either directly or though members of his family.

Trump got expedited trademark approval for sales in China of Ivanka’s product lines. Chinese officials spent great effort cultivating Jared Kushner, whose family’s company has Chinese real-estate connections. In May 2017, Kushner’s sister, Nicole Meyer, made a pitch to more than 100 prospective Chinese investors at the Ritz-Carlton Hotel in Beijing for $150 million in financing on behalf of the Kushner Companies for a proposed Jersey City housing development known as One Journal Square.

It was only after Lighthizer and national-security officials leaned hard on the president, and additional details of Jared and his family’s China plans were leaked by hardliners to The New York Times, that Trump personally shut down this back channel and kept “Javanka” far away from China diplomacy. A planned second trip by Jared was prudently killed, and the Chinese financing of the Jersey City deal was abandoned.

The other Chinese strategy, as noted, has been to see whether Trump could be induced to relent in exchange for promises to buy ever-increasing amounts of stuff. When Treasury Secretary Steven Mnuchin met with them in May 2017, Chinese officials offered just that sort of deal: more access for exports of U.S. beef and chicken, as well as some credit card services, in exchange for the U.S. abandoning tariffs and other demands. Mnuchin put out the word that the U.S. had an agreement. Lighthizer, national-security officials, and White House economist and trade adviser Peter Navarro strenuously resisted.

For more than a year, Mnuchin and the hard-liners have skirmished over whether to accept a deal that would include no fundamental changes in China’s system. At one fraught meeting, in May 2018, Navarro and Mnuchin got into a screaming and cursing match after Navarro learned that Mnuchin had secretly arranged a private high-level meeting with his Chinese counterpart, excluding other members of the U.S. delegation.

But Trump refused to take the deals promoted by Mnuchin and the Chinese, instead doubling down and increasing the pressure on China. On July 6, 2018, Trump imposed tariffs of 25 percent on 818 categories of goods imported from China, worth $34 billion, as retaliation for Chinese theft of U.S. intellectual property under Sec. 301 of the Trade Act of 1974. It is standard practice for the Chinese government to coerce American companies seeking to do business in China to transfer trade secrets to Chinese “partners.” China also ignores patents and steals technology outright. The stakes were further raised when Trump set a deadline of March 1, 2019, for a broader trade deal, or tariffs would increase from 10 percent to 25 percent on $200 billion worth of Chinese goods.

This grand strategy is largely Lighthizer’s work.

In the 2016 campaign, Trump seized on economic nationalism.

Now he needed someone to define it and carry it out.

THERE IS AN OLD SAYING that even a stopped clock is

right twice a day. Lighthizer marks the rare case of Trump both stumbling into a better policy than that of his predecessors, and hiring the right person to carry it out. In the 2016 campaign, Trump seized on economic nationalism as a theme that tapped into the frustrations of blue-collar workers that good jobs were moving offshore and that Democrats like Hillary Clinton seemed to care more about Davos than Dubuque, and more about the rights of Mexican immigrants than about white Americans. Economic nationalism, as defined by Trump, served both to racialize the campaign and to create a faux-populism that camouflaged the extent to which Trump was actually a gardenvariety corporate Republican on nearly every other issue, from taxes to deregulation to union-bashing.

But having associated himself with economic nationalism in the campaign, Trump in office needed to define

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In the China talks, the U.S. has more cards than it likes to admit, but Trump has played his hand badly.

and execute it. After a few purely symbolic forays at places like the Carrier plant in Indiana, where he used threats and slogans to keep a tiny number of manufacturing jobs from moving south of the border, Trump turned to NAFTA .

This was part of his larger ploy of demonizing Mexico and humiliating Canada for good measure.

The NAFTA negotiations sucked out a huge amount of oxygen and consumed extensive time and energy away from the more existential challenge posed by China. When his negotiators finally brought home a revised NAFTA deal, it included only minimal changes, some of them not for the better. Absent changes on the particulars, this deal is likely to be rejected by the Democratic House.

With his China policy, however, Trump hit pay dirt.

China’s mercantilist system, as well as specific abuses such as cyber theft and the pilfering of trade secrets, really does cry out for a muscular U.S. response. Trump also hit pay dirt when he hired Lighthizer. The two men had not known each other, but to the economic nationalists around Trump, including Dan DiMicco, former president of Nucor Steel and Trump’s trade adviser in the campaign, who knew Lighthizer from several cases protesting China’s dumping of low-cost, state-subsidized steel on the U.S. and world markets, Lighthizer was the natural pick.

James Mann observes, “Trump’s is the first U.S. administration that wants something from China that’s about China itself and its own economic system, not about other things like help with the Cold War or climate change.”

As Mann explains it, under Richard Nixon and Henry Kissinger, the U.S. wanted a closer relationship with China as a counterweight to the USSR . Under Bill Clinton, we assumed that changes in China’s internal economic and political systems would logically follow if we let them into the WTO, so Clinton put aside concerns about humanrights abuses in China. Under George W. Bush, we needed China’s acquiescence in the U.N. Security Council to our Iraq invasion. Under Obama, the main thing we wanted from China was some progress on climate—and our main trade goal for the region, the aborted TPP, did not address China’s own predatory trade practices. China has been brilliant at giving the U.S. some of the things that Washington asks for that do not affect its economic or political system.

EVER SINCE THE U.S. WELCOMED China into the World Trade Organization in 2001, based on Beijing’s vague promises to behave like a normal market economy, China has been taking advantage of America’s naïve belief that more trade would somehow transform China into a liberal and democratic market economy. Naïveté is probably too kind a characterization of the posture of U.S. corporate, financial, and political elites: Willful blindness is more accurate. While some American manufacturing companies

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were mightily upset at being displaced by Chinese firms, many others were content to move operations to China, where wages were low, workers repressed, and billiondollar construction subsidies were on offer for the factories they sought to build. The financial industry was not able to operate freely inside China, but was bought off by being able to make billions brokering deals. So Wall Street was a passionate backer of the status quo, too.

In the 1990s, when China was pressing for admission to the WTO on terms that would still allow it to subsidize and protect its domestic industry as a “developing country,” Beijing was playing a weak diplomatic hand. China was in ill repute from the 1989 massacre at Tiananmen Square.

In its key industries, productivity levels lagged those of the West, and China was far from fully competitive.

In Clinton, China faced an American president who had campaigned on human rights. Clinton took office insisting that China had to improve its human-rights record before being admitted to the WTO. Once in office, however, Clinton succumbed to business pressure to get access to China’s market of 1.2 billion people. Clinton’s story line became that China’s WTO membership would inevitably lead to more liberalization, both politically and economically.

Having secured its coveted WTO membership, China then ignored its vague commitments to liberalize. Instead, Beijing went right on building a toweringly successful mercantilist economy and, under Xi, ratcheting up its dictatorship. Its practices were hidden in plain view. They are spelled out in the voluminous annual reports of the U.S.China Commission, and in the annual reports of the Office of the U.S. Trade Representative, in countless complaints filed by American companies, and in a growing library of books that persuasively challenge the conventional wisdom.

Today, 17 years into China’s WTO membership and commitments to liberalize, all of its major industries are either owned or directed by the government, which is to say the Communist Party. State-owned or -controlled enterprises get cheap or free capital—sometimes outright grants, sometimes loans at below-market or negative interest rates, often both. The state doesn’t care whether these enterprises lose money for a long time so long as they create, borrow, or steal key technologies and gain global market share. China imports only what it needs—mostly food, raw materials, and some advanced capital goods, but not products that would compete with its own domestic producers and grand plan.

China steals technology from the West, either by copying and reverse-engineering it, or by requiring coercive “partnerships” with Western companies that seek to do business in China. In a typical deal, the American company is attracted by subsidies to build plants and by cheap labor.

But in return, the company must agree to produce only for

alex br andon / ap images

export back to the West, and to share its advanced technology with a Chinese partner whose goal is to overtake and displace the Western rival over time. China’s immense trade surpluses with the West are augmented by its practices of currency manipulation, but this is secondary. What’s primary is China’s entire system of state-led mercantilism.

The rise of China is an unmistakable geoeconomic, geopolitical, and ideological threat to the United States.

Yet four presidents, two Republicans and two Democrats, from George H.W. Bush through Barack Obama, indulged Beijing. To American elites, the U.S. is selling the world a system of free-market capitalism. To resort to measures like tariffs, even as leverage against countries that routinely violate the norms and rules of market capitalism, would somehow be “protectionist.” Moreover, markets should dictate the location of global production—never mind that China’s capture of global market share is far from a free-market verdict. Therefore, to care about whether U.S.-based companies produce domestically, except on the narrowest of national-security grounds, is to practice odious economic nationalism, a habit that we are seeking to dissuade other nations from indulging. And just to reinforce this self-annihilating set of syllogisms, scores of former top U.S. trade and diplomatic officials, as well as scholars, have lucrative consulting arrangements with the Chinese, and can be counted upon to lecture on the dangers of protectionism and China-bashing.

The mainstream press also got China completely wrong, and for the most part, it still does. One big mistake was to assume that partial economic opening would inexorably lead to political pluralism. In The New York Times, Nicholas Kristof wrote in 2004 that “after the Chinese could watch Eddie Murphy, wear tight pink dresses and struggle over what to order at Starbucks, the revolution was finished. No middle class is content with more choices of coffees than of candidates on a ballot.”

The more recent mistake of much press coverage has been to confuse tactics with goals. A standard news story might be summarized as, Oh My God, Tariffs! In general, the hard line taken by Lighthizer and Trump has gotten a hostile press.

While establishment China scholars are now in a mood of revise and repent, they continue to resist the kind of aggressive diplomacy that would make a real difference—perhaps because its instigator is Donald Trump.

Last March in Foreign Affairs, the bible of the foreignpolicy elite, Kurt Campbell, assistant secretary of state for East Asian and Pacific Affairs under Obama, wrote a kind of nostra culpa piece with Ely Ratner titled “The China Reckoning,” admitting that “the assumptions driving U.S. China policy look increasingly tenuous.” Yet the piece went on to warn against Trump’s approach, which

risks “being confrontational without being competitive.”

One amusing and instructive misinterpretation occurred when Trump, with Lighthizer by his side, called in the press and the cameras on February 22, to discuss progress on the China negotiations. At one point, with China’s top trade negotiator, Vice Premier Liu He, looking on, Trump directed Lighthizer not to settle for a mere “memorandum of understanding” in any China deal, but to insist on a binding contract. Lighthizer explained to his boss that in trade law, a memorandum of understanding

is a contract. To most of the media, the takeaway was that Trump was an idiot, both for having this conversation in front of both the press and the chief Chinese negotiator and for misunderstanding the terminology. But in Trump’s world of real-estate deals, such memoranda are far from binding and easily evaded. In context, Trump was posturing tough, telling his negotiator not to get rolled. To the extent that Trump really meant it, he had learned well from Lighthizer. With Trump, of course, you never know.

As we go to press, Lighthizer seems to have walked Trump off the ledge yet again. But absent much firmer pressures from the U.S., the Chinese will resist the fundamental changes that make a deal worthwhile, and a signing ceremony for the wrong sort of deal beckons. The U.S. has more cards than it likes to admit, but Trump has played his hand badly.

Beyond the challenge of Chinese mercantilism at U.S. expense, Washington has yet to reckon with Beijing’s increasing power on the world stage. While U.S.-backed

Trump entertained President Xi Jinping and first lady Peng Liyuan at Mar-a-Lago in April 2017.

SPRING 2019 THE AMERICAN PROSPECT 21

At an Oval Office meeting with Liu He in February, Trump and Lighthizer discussed whether a “memorandum of understanding” is in fact a binding contract.

and most of the jobs go to Chinese work crews. Yet the scale of investment dwarfs anything the West is offering, and poor countries find it hard not to take the deal.

Beijing has announced that the second annual One Belt One Road summit, in late April, expects about 40 heads of state to attend.

The U.S. needs a policy that is one part containment and one part modus vivendi with China, as well as one part more serious engagement with developing nations, so that they have other possible geo-economic partners than Beijing. The Obama administration’s defunct Trans-Pacific Partnership was a pitiful response—and on the global front, Trump is offering nothing at all.

NEGOTIATING WITH CHINA recalls the famous seren-

ity prayer of Alcoholics Anonymous: God, grant me the serenity to accept the things that I cannot change, the courage to change the things I can, and the wisdom to know the difference.

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Some aspects of China’s economic system are purely China’s affair. American pressure cannot change these elements, and probably should not try. If China wants to have a system of state-led capitalism, with subsidies and industrial policies, that is China’s business. The system has succeeded in generating rates of economic growth at a scale unmatched in the history of the world, and is responsible for relieving hundreds of millions of people of extreme poverty. The problem comes when those subsidies are used for export to displace other producers in other countries.

If the U.S. disdains industrial policies, while China targets the next generation of advanced technology under its Made in China 2025 program, from artificial intelligence to 5G broadband, China’s resulting dominance will be mainly the result of America’s own stupidity. Real U.S. national (and working- and middle-class) security requires that we define cutting-edge technologies broadly, rather than narrowly in military terms. And we should make sure China does not get an unfair leg up by purchasing American advanced-technology companies, or placing state-controlled companies like ZTE or Huawei in the heart of America’s communications infrastructure.

Alas, Trump’s continued affronts to America’s allies have made them unreceptive to demands that they keep Huawei out of their telecom infrastructure, and Trump himself has hinted that he might go easier on ZTE as part of a grand bargain. It is these mixed signals that undermine Trump’s ability to achieve his stated goals, and play into Beijing’s hands.

China has the right to its own model, but the model becomes problematic when its mercantilism includes theft, commercial espionage, and disdain for intellectual-property rights, and results in the displacement of entire U.S. industries through tactics that are illegal under the WTO, or should be. Former Missouri Senator Jim Talent, one of the Republicans on the U.S.-China Commission, told me, “We thought that by letting them into the world trading system, we would change them. But they’ve changed the system. The WTO tools are inadequate to deal with an economy like China. The WTO presumes that a major actor is not actively trying to subvert the entire system.”

If the WTO is an inadequate venue of redress, then the U.S. is entirely within its rights to pursue unilateral remedies in search of some kind of modus vivendi with Beijing.

Before he rejoined the government, Lighthizer called for unilateral measures to protect American interests, even if they are inconsistent with WTO commitments (which China repeatedly ignores anyway). “WTO commitments are not religious obligations,” he told the U.S.-China Commission, and “do not (and should not be construed to) impinge upon national sovereignty, and are not subject to coercion by some WTO police force.”

m a r t i n h . s i m o n / p i c t u r e - a l l i a n c e / d pa v i a a p i m a g e s

multilateral agencies such as the World Bank and the International Monetary Fund offer development financing and fiscal assistance in exchange for an embrace of neoliberal policies, China is offering a very different sort of devil’s bargain under its One Belt One Road project.

Third World countries can get massive aid for infrastructure projects from Beijing. In exchange, China gets to exploit their mineral resources; and if the project goes bad, the client country is responsible for paying back the loans. The environmental conditions are often deplorable

The U.S. has the power to prevent China from buying strategically important companies, which we have used intermittently through CFIUS, the Committee on Foreign Investment in the United States. We have the power to create our own industrial policies, and to strengthen “buy American” requirements when investments are the fruits of U.S. taxes or public debt. Former Virginia Senator Jim Webb introduced a bill to prohibit American companies from transferring to Chinese “partners” technologies created thanks to government contracts or R&D. The U.S.-China Trade Commission has called for a mandatory reporting system for all technology transferred to China.

Lighthizer has also raised the possibility of using tariffs not just as bargaining counters, but to offset the overall impact of China’s mercantilist system. “At some point, however,” he told the commission, “where goods imports from China exceed $300 billion while U.S. exports to China are below $70 billion—one must ask whether potential retaliation from China really would or could even remotely offset the benefits to the United States of more aggressive trade measures.” Advocating a policy that runs counter to those of every other recent administration, Lighthizer has also called for China to be formally designated as a currency manipulator, which would permit the levying of still other offsetting (“countervailing”) tariffs.

Testifying before the House Ways and Means Committee in late February, Lighthizer walked a tightrope between professing loyalty to Trump and insisting that the China deal was far from done. “Much needs to be done both before an agreement is reached, and more importantly, after it is reached, if it is reached.” In testimony before the Senate Finance Committee on March 7, he took an even harder line, reserving the right to impose tariffs “in situations where there’s violations of the agreement.”

But the agreement itself could be the problem. As a key element, Lighthizer and leaks by the Chinese have described a complex system of multi-tiered consultations to resolve complaints of violations of the deal—on a monthly basis with lower-level officials from both countries, then quarterly with more senior officials, and finally every six months with Lighthizer and China’s vice premier and special envoy on trade, Liu He. Critics dismiss this jerry-built proposal for ad hoc complaint and response as only the latest version of whack-a-mole. In the absence of binding commitments for structural change, this system could easily turn into MOSS—more of the same stuff.

There is also the more subtle problem of a deal that could improve the terms of engagement and profitability for U.S. companies that produce in China (more access, less outright theft of trade secrets by Chinese “partners”), but do little or nothing for U.S.-based producers and their workers looking to export to China. In recent testimony

to the U.S.-China Commission, the China scholar Mary Lovely reported that 46 percent of all Chinese exports are from foreign-owned enterprises, as are 60 percent of all exports to the U.S. In other words, China relies on U.S. capital and U.S. companies (which are mostly prohibited from selling into the domestic Chinese market) to produce for export back to the U.S. The industrial policy expert Harley Shaiken terms this system “industrial tourism”— U.S. capital goes to China, where it underwrites production by very-low-wage workers who make things for sale back in the U.S. Psychotherapists often counsel patients that you can’t change someone else’s behavior, only your own; by doing that, you alter the system. The same might be said of trade diplomacy. With the multilateral WTO next to useless except as a forum for pressure, with Trump at odds with America’s natural allies, and with China resisting making concessions in two-way talks, some unilateral policies make sense in their own right. We are not going to change China’s entire economic model, but that model does not require cyber theft. It does not require coercive terms for Western companies to operate within China. It’s also reasonable for the U.S. to demand a set of trading practices that takes into account and offsets China’s extensive strategies of state subsidies and selling below cost that are counter to norms of liberal trade. The use of tariffs to counterbalance such policies is both reasonable and sensible.

The risk of the wrong sort of deal with China is twofold. First, China’s nominal commitments to revise some mercantilist practices can and will be easily evaded, as they have been ever since China was let into the WTO. The more serious risk is that in exchange for China’s agreements to import more products, the U.S. may swear off the use of unilateral measures that could really make a difference by insulating our economy from China’s predatory practices.

Under Lighthizer’s predecessors, most of whom were lobbyists or investment bankers, USTR reports on China read like exercises in gentle persuasion: We thank China for making some progress. Now, could China please make some more progress? Under Lighthizer, they read like indictments.

With tough and creative diplomacy, it is possible both to allow China its own development model and to prevent China from breaking the rules and thriving at America’s expense. Lighthizer has the wisdom and courage to pursue such policies. Whether his boss does remains to be seen. By denouncing and disrupting America’s previous China policy, Trump, however ineptly and incompletely, has opened the door to a better policy. But its execution will fall to the next administration. In the meantime, Lighthizer’s main challenge is to limit the damage—both from China and from Trump.

If the U.S. disdains industrial policies, while China targets advanced tech, China’s dominance will be the result of American stupidity.

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Congress’s New Progressives Take On the Banks The House Financial Services Committee— long a landing place for pro-bank Democrats— now includes AOC and a flock of leftists.

And Maxine Waters is its new chair.

BY DAV ID DAYE N

art by victor juha sz

T

he day before Valentine’s Day, the House Financial Services Committee convened its first hearing of the 116th Congress. For the prior eight years, when Republicans controlled the House, hearings were typically reserved for the majority’s demands that Wall Street be relieved from the shackles of regulation. Proposed deregulatory changes were deliberately buried under technical jargon impenetrable to the average American so almost nobody outside the financial industry would comprehend the committee’s giveaways.

But that was then. This year, Maxine Waters (D-CA), who assumed the chair after the Democratic midterm triumph, signaled a break with that past with her first hearing topic: homelessness in America. “In the richest country in the world, it is simply unacceptable that we have people living in the streets,” Waters said in her opening statement, noting that over 550,000 Americans are homeless, 160,000 of them children. “This is the very first time the committee has convened a hearing focused entirely on homelessness … it is long overdue.”

The hearing exemplified the expansive footprint of the Financial Services Committee, which has a hand in virtually every corner of the economy, from banking to capital markets to commodity prices to consumer and investor protection to affordable housing to macroeconomic management. Fair lending doesn’t exist absent civil rights, and human rights play a role (or should) in corporate investment. The entire economy flows through Wall Street, and therefore through the House Financial Services Committee.

By making homelessness its initial topic of study, Waters made clear that the committee had changed not just its

partisan balance of power, but also its perspective—and perhaps even its mission. Long a legislative backwater filled by early-career members of Congress seeking Wall Street campaign contributions, the committee has now been altered by the presence of several progressives who have sworn off corporate cash. New members like Alexandria Ocasio-Cortez (D-NY) and Katie Porter (D-CA) reached the committee due to a series of happy accidents from which the financial industry is still reeling.

This metamorphosis shouldn’t be overemphasized. Plenty of corporate-friendly Democrats hold down senior positions, and the committee could still bestow bipartisan gifts on the financial sector. Chairwoman Waters’s delicate task will be to balance the disparate interests of centrist warhorses and progressive firebrands. But early returns have been encouraging: Already, there have been serious moves toward oversight, hearings holding the feet of regulators and industry CEOs to the fire, and strong legislation introduced. Ultimately, the committee must answer the same question before the entire Democratic caucus: whether to produce a bold new vision for legislative action, or succumb to the cramped technocratic model of the past.

The importance of the progressive beachhead on Financial Services may not be felt this year or even this session, but after the next financial crisis. Having progressives willing to carry forward structural responses to financial misconduct could make a huge difference. “In 2008 the public was alerted and alarmed and angry to do something, but there wasn’t the Washington leadership necessary,” says Marcus Stanley of Americans for Financial Reform, a coalition formed to bridge that gap. “It’s unpredictable

SPRING 2019 THE AMERICAN PROSPECT 25

what would happen in another crash, but if there is one, we won’t miss the opportunity again.”

SINCE THE LATE 1970S, the House Financial Services Committee has done Wall Street’s bidding nearly unreservedly, regardless of the party in power. Democratic committee chairs sent deregulatory measures to Republican presidents, and Republican committee chairs sent deregulatory measures to Democratic presidents.

Fernand St. Germain, a Rhode Island Democrat who used his political clout to get cut into lucrative real-estate development deals and secure no-money-down bank loans for his purchase of several International House of Pancakes restaurants, chaired the committee in the 1980s.

Under his leadership, the committee churned out bills that deregulated the savings and loan industry and created the architecture for the catastrophic mortgage-backed securities market; President Reagan signed them into law. Jim Leach, a moderate Republican who took over after the Gingrich revolution in 1994, co-authored Gramm-LeachBliley, which ended the Glass-Steagall separation between commercial and investment banks. Leach’s committee also reported out the Commodity Futures Modernization Act, which barred the regulation of derivatives, another core cause of the 2008 crisis. President Clinton signed those.

In the mid-2000s, Democratic congressional leaders sketched out a more purely political role for Financial Services, which overshadowed and shaped its policy work. “People who got on that committee for the most part were mostly conservative members who wanted to raise money,” says Brad Miller, a Democrat from North Carolina who served on Financial Services from 2003 to 2013, co-authoring the bill that would eventually create the Consumer Financial

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Protection Bureau (CFPB). “They were told, this is a great committee to raise money from, call this list of lobbyists.”

After victorious 2006 and 2008 elections, the Democratic leadership, led by Democratic Congressional Campaign Committee chair Rahm Emanuel, made room on Financial Services for newly elected swing-district centrists— “frontline members” in congressional parlance—thereby giving them access to Wall Street bankers and lobbyists who could fill their campaign war chests for their re-election. This ballooned the size of the committee to the second-largest in Congress. Barney Frank, the committee chair at the time, pleaded with the House leadership in 2008 to cut the membership to a more manageable level, but he was rebuffed: Too many frontline members needed a piece of the action.

After 2008, the newly reconstituted Financial Services Committee transformed from a sleepy panel that slowly chipped away at the regulatory state to the first line of response to the financial crisis. Unprepared for this challenge, committee members got nearly all their information about the crisis from the banks themselves. Miller admits he had to search “credit default swaps” on Wikipedia to understand what was happening. “In computers there’s an interruption of service attack, the site is so overwhelmed it shuts down,” Miller says. “That’s sort of true of members: They’re so overwhelmed with the need to call and talk to lobbyists, there’s no time in the day to learn the substance of the issue.”

This lack of expertise and one-way information flow led to a Dodd-Frank reform law that was far more modest than it could have been. Needless to say, reliance on a powerful industry for campaign cash does not elicit a populist instinct. With Republicans voting as a deregulatory bloc, it took only a handful of Democratic members to tip committee votes, frequently creating a pro-bank majority on

j. scot t applewhite / ap images

House Financial Services Committee Chair Maxine Waters (left) recruited freshman Progressive Caucus members Alexandria OcasioCortez, Ayanna Pressley, and Rashida Tlaib (right) to join her committee.

a panel controlled by Democrats. On several key votes, Frank did not have control of his fellow Democrats. Good legislation was sacrificed for campaign finance.

One such instance arose when the committee considered whether auto dealers should be regulated by the CFPB. Buying a car is one of the largest financial transactions most people make, but Republicans wanted to shield the industry from oversight. The author of the provision providing that shield, Republican John Campbell, was a former Saab dealer from Orange County who still collected rent on some dealerships.

Seats are arranged in the Financial Services Committee by seniority; the higher rows contained senior members.

When Campbell’s auto dealer amendment came to a vote, top-row Democrats all renounced it. But one by one, new members on the bottom two rows voted with Republicans, positioning themselves to win favor from auto dealers in their districts. Once the outcome became clear, even toprow Democrats started changing their votes—if the auto dealers were going to win anyway, they might as well stay on their good side.

“The bill absolutely got better in the Senate,” said Andy Green, who worked for Senator Jeff Merkley (D-OR) at the time and is now with the Center for American Progress.

The Senate isn’t exactly a bastion of populists, but compared to the skittish conservative Democrats driving the process in the Financial Services Committee, senators might as well have all been Robert La Follette.

January town hall in Irvine. “The majority of my incoming freshman colleagues don’t take corporate PAC money,” she explained. “When you don’t take corporate PAC money, the number of people with a burning interest in banks and their money is much smaller.”

This corporate PAC purge was mostly symbolic; most campaign cash comes from wealthy donors rather than PACs. But over 170 federal candidates took the no corporate PAC money pledge, including 36 first-time Democratic House members. PAC donations happen to be a major way that Wall Street firms funnel funds to Financial Services Committee members. That, plus the general toxic reputation of big banks, made swing-district freshmen look elsewhere for their committee assignments.

For progressives, Financial Services has historically not held much appeal. Many have backgrounds in legal aid or unions, and tend to cluster in the Judiciary or Education and Labor committees, which reflect those interests.

Nobody enters politics to make a difference on collateralized loan obligations and trust-preferred securities.

Historically speaking, few progressives enter politics to make a difference on collateralized loan obligations and trust-preferred securities.

AFTER A RESOUNDING VICTORY in 2018, many assumed

that Democrats would return to seating their newly elected frontline members on Financial Services. But the party’s leaders faced two major quandaries. First, the Progressive Caucus, representing about 40 percent of House Democrats, made a strategic effort to capture more power. Nancy Pelosi needed progressive votes to return as Speaker, so caucus co-chairs Mark Pocan (D-WI) and Pramila Jayapal (D-WA) cut a deal for proportional representation on four key “money committees” that carry domestic legislation, including the Financial Services Committee.

Refusing to break with tradition, however, Pelosi declined to give freshmen any slots on three of those money committees: Ways and Means, Energy and Commerce, and Appropriations. That made it hard to reach the quota she’d agreed to. Financial Services had long been a roost for freshmen, but mostly of the swing-district variety. This time around, however, practically nobody wanted to serve on the committee. The party even considered shrinking its size, an unheard-of option.

Why was Financial Services suddenly considered anathema? Katie Porter, a freshman Democratic congresswoman from California, explained it to her constituents at a

Well, nobody except Katie Porter.

A consumer advocate who studied under Elizabeth Warren at Harvard Law (and later co-authored a book with her), Porter went on to teach at the University of California, Irvine. She was one of the first in the country to recognize routine fraud in foreclosure processes; her paper, “Misbehavior and Mistake in Bankruptcy Mortgage Claims,” discovered that lenders lacked evidence to validate the debts they claimed were rightfully theirs in almost half of the cases she studied. Later, as the independent monitor of California’s share of the national foreclosure fraud settlement, Porter transformed a thankless job into an activist position, personally intervening with numerous banks to achieve better outcomes for homeowners.

Last November, Porter won a swing seat in Orange County that had never been occupied by Democrats—in fact, it was the seat once occupied by John Campbell, the onetime car dealer who’d authored the industry’s exemption from CFPB oversight. After she won, members would ask her what committee she wanted to work on. “I wouldn’t waver. I’d say, ‘the House Financial Services Committee, it is my life,’” she says.

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Porter adds that Waters reached out to progressives individually to get them interested, reminding them of the committee’s broad jurisdiction and importance. “If you said to someone, do you want to be on a committee about the SEC, they’d say, ‘uhh ...’” Porter explains. “But if you say, do you want to be on a committee about saving for retirement? If you’re interested in inequality, economic opportunity, this is a committee you want to be part of.”

Many freshmen eventually agreed, including OcasioCortez, who sat down with Waters before the new Congress began. Fellow Justice Democrats Rashida Tlaib of Michigan and Ayanna Pressley of Massachusetts (who defeated Financial Services Committee member Michael Capuano in a Democratic primary) also expressed interest. Crucially, Pelosi needed these progressive members to reach the money-­committee quota she’d agreed to. When the final tallies were announced, 14 of the 34 Democrats on the committee were Progressive Caucus members, about 41 percent.

Nine Progressive Caucus members were newly installed on the committee, including Porter, Tlaib, Pressley, and AOC.

Plenty of corporate-friendly Democrats hold down senior positions, and the committee could still bestow bipartisan gifts on the financial sector.

THE FLIP SIDE, HOWEVER, is that there are 20 Democrats

on Financial Services who are not Progressive Caucus members, including several subcommittee chairs and longtime fixtures. Sixteen are members of the New Democrat Coalition, the bank-friendly alternative to the Progressive Caucus. Last year, the main bipartisan law signed by Donald Trump was a bank deregulation measure; six current committee Democrats voted for it.

The head of the consumer protection subcommittee is Gregory Meeks of New York, a New Democrat who describes himself as a “bridge-builder” between consumer advocates and Wall Street. Jim Himes and Josh Gottheimer represent Wall Street bedroom communities in Connecticut and New Jersey, respectively. Himes is the outgoing chair of the New Democrats; Gottheimer recruited ideological allies to join Financial Services, as a counterweight to the progressives.

In the middle of this ideological split sits Waters, whom Wall Street fought to prevent from becoming the Democratic ranking member after Barney Frank retired. The 15-term progressive has endeared herself to the millennial left with her withering comments about the Trump admin-

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istration, earning the nickname Auntie Maxine. But she joined Financial Services as a freshman member, traveling a long road before finally receiving the gavel 28 years later.

As ranking member, Waters admirably took aim at her own colleagues in the Congressional Black Caucus, like Meeks, when they joined with Republicans to weaken Dodd-Frank. She has introduced legislation to break up Wells Fargo, after the bank’s cascade of consumer scandals.

As incoming chair, she eagerly recruited Progressive Caucus members as reinforcements. “She’s a progressive and would like to get things done but she needed more votes,” says Dennis Kelleher, CEO of Better Markets, an advocacy group for financial reform.

But Waters has also had an open-door policy with big banks during her tenure, and a solid working relationship with her Republican counterpart on the committee, Patrick McHenry (R-NC), with whom she has introduced bipartisan bills. She’s been a vocal supporter of policies like federal flood insurance and the Export-Import Bank, which critics have respectively savaged as a failure to reckon with climate catastrophe and an unnecessary outlay of corporate welfare.

Despite this duality, we don’t have to guess much at Waters’s agenda for this Congress. Alone among committee chairs, she laid out her thinking in a January policy speech at the Center for American Progress. She led with a strong defense of Dodd-Frank, in particular the Consumer Financial Protection Bureau, which the Trump administration has consistently tried to undermine through actions like demoting the Office of Fair Lending and eliminating supervisory exams for lenders to military families. Waters’s bill, the Consumers First Act, would reverse these actions, and she vowed to call in bank regulators to ensure that they keep their hands off other pieces of Dodd-Frank and properly enforce the law.

Waters then highlighted several issues that have already become priorities in the initial months of her leadership.

She promised a bill to fight homelessness that would provide more than $13 billion in new federal funding. She expressed a desire to overhaul the credit reporting industry, which has been stung by data breaches and high error rates. And she vowed to create a new subcommittee on diversity and inclusion, covering representation among employees in the financial services industry. “An AfricanAmerican woman taking the gavel and saying we need to make race and diversity issues important, that’s a powerful statement,” says Andy Green of the Center for American Progress, who helped host the speech.

The chairwoman also made several nods to working across the aisle. She planned to re-introduce a bill with McHenry to limit corporate insider trading. She called for “reauthorization and reform” of flood insurance, the

right art / ap images credit

Ex-Im Bank, and the Terrorism Risk Insurance program, a bailout guarantee for private insurance companies in the event of a 9/11-style attack. I’d also expect another attempt at an expanded JOBS Act, a law passed under Obama that made it easier for companies to raise private capital and eventually go public. The JOBS Act allows companies to present lower-income investors with minimal information about their business and still solicit funds.

It hasn’t done much to increase business startups, but has added the risk of swindling for unsophisticated investors, and the JOBS Act expansion would just deregulate investor protections even more. Waters supported the expanded JOBS Act last year.

Waters also laid out principles for legislation dealing with Fannie Mae and Freddie Mac, the mortgage securitization giants that have been under government conservatorship for over a decade. While she wants to prioritize underserved homeowners and access to affordable housing, advocates have long worried that the Trump administration wants to privatize Fannie and Freddie, transferring a lucrative government guarantee to financial companies while securing a windfall for hedge funds that have bet on privatization by purchasing discounted Fannie and Freddie stock. Waters doesn’t appear to support privatization, but giving oxygen to housing finance reform could empower centrist Democrats to connive with Republicans on a policy far to the right of her goals.

Overall, the speech was strong on defending DoddFrank; we won’t see weakening legislation in this Congress.

But neither did it suggest a bold alternative vision for fixing what’s broken in American finance. Proposals like creating public options for simple banking through the post office or eliminating risky trading instruments were nowhere to be found. Finance was manifestly hazardous before Donald Trump, and restoring the pre-Trump status quo is hardly sufficient.

It’s true that Trump would never sign such bills, and the Senate wouldn’t even take them up. But under the previous chair, the now-retired Jeb Hensarling (R-TX), the Financial Services Committee advanced dozens of bills reflecting their deregulatory priorities, regardless of whether they stood a chance of enactment. This would signal congressional priorities to regulators, who would take their cues accordingly. “They would pass a bill, and even if it didn’t pass into law, it was a powerful tool for the industry,” says Marcus Stanley of Americans for Financial Reform.

That does not appear to be Waters’s legislative strategy. She wants to put bipartisan points on the board while fighting off the worst deregulatory impulses. But the progressives she helped bring onto the committee have bigger ideas—and an innate understanding of how to draw attention.

THE NEW MEMBERS’ PENCHANT for capturing notice was on clear display in a February hearing with the CEOs of the three major credit reporting bureaus, the first major oversight work in the committee this year. With bipartisan criticism of the industry’s oligopoly and lack of quality control, and major legislation from Waters that would give consumers more ability to dispute errors on credit reports and end the use of credit checks in hiring decisions, there’s a real opportunity to curb credit-report abuses.

Senior Democrats were alternately aggressive and accommodating to the CEOs. New Democrat David Scott of Georgia fairly slobbered over Equifax, which is based in Atlanta. “I represent the great state of Georgia and love Georgia very much … you represent a legacy of our great state,” he said, while lauding the steps Equifax has taken in the wake of a data breach affecting 143 million Americans.

Scott has received $28,000 in PAC donations from Equifax since 2004, according to the Center for Responsive Politics.

Then Katie Porter was recognized.

“My question for you is whether you would be willing to share today your Social Security [number], your birthdate and your address at this public hearing,” Porter asked Mark Begor, Equifax’s CEO. He declined, saying it was “sensitive information that I like to protect.” Porter asked what might happen if that information was disclosed, and Begor said he’d be concerned about identity theft, which has happened to him three times in the last ten years.

“So,” Porter continued, “my question then is, if you agree that exposing information like that you have in your credit reports creates harm, therefore you’re unwilling to share it, why are your lawyers arguing in federal court that there was no injury and no harm created by your data breach?”

Indeed, responding to a class action lawsuit from consum-

Representative Katie Porter is a consumer advocate with experience translating hardto-understand concepts into digestible chunks that can bring public awareness to financial-industry schemes.

SPRING 2019 THE AMERICAN PROSPECT 29

er victims, Equifax lawyers claimed that the consumers failed to “sufficiently allege injury” from having their personal information revealed. Porter’s success at getting the CEO to admit harm from data exposure could significantly disrupt Equifax’s long-standing legal strategy.

The hearing clip went viral, and demonstrated not just Porter’s importance, but also how she models the role of an advocate inside the system and can serve as a mentor for younger progressive members. Her experience translating hard-tounderstand concepts into digestible chunks can bring public awareness to financial-industry schemes. “One thing I said during the campaign, nobody likes to get ripped off,” Porter says. “Republicans, Democrats, frequent voters, infrequent voters, no category of American likes being cheated.”

To progressive activists, Porter’s questioning was a breakthrough for a Democratic Party relearning the function of congressional oversight. “The fortuity that led to the House Financial Services Committee getting such highwattage new members offers a possibility of teaching the party that you can do great politics by doing oversight on corporate America,” says Jeff Hauser, who runs the Revolving Door Project at the Center for Economic and Policy Research. “The people they’re going to be questioning are so broadly disliked, it creates a perfect storm for teaching the freshman class that oversight can be fun. You’ll have other members thinking, how can I be like that?”

Porter’s freshman colleagues, while still learning about finance, have had moments to shine as well. Rashida Tlaib asked credit reporting bureau CEOs what credit scores had to do with anyone’s driving history; a constituent had informed Tlaib that her auto insurance rate spiked because of her credit report—an all too rare moment of a lawmaker using a personal story from a constituent to make policy.

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tom williams / roll call via ap images

Representative Alexandria Ocasio-Cortez has proven to be a masterful questioner in hearings, and given her social-media prowess, she can reach millions to shine a light on Wall Street’s nefarious practices.

Tlaib said she planned to introduce legislation to ban credit scores from factoring into auto insurance rates.

Ocasio-Cortez has proven to be a masterful questioner in hearings, and she hasn’t disappointed on Financial Services. In a hearing about providing banking services to legal cannabis-related businesses, which often operate in cash because the drug is still restricted at the federal level and banks are wary of doing business with them, AOC noted that 73 percent of cannabis industry executives in Colorado and Washington are male, and 81 percent are white. “Are we compounding the racial wealth gap right now, based on who is getting the first mover advantage?” she asked.

A single tweet from AOC reaches millions. In an instant, she can shine a spotlight on Wall Street’s nefarious practices. And she has used that power to call attention to disparities in the economy, with an agenda that’s more expansive than Waters’s. AOC has listed as top priorities the student loan crisis and postal banking, neither of which were in Waters’s policy speech. She told local activists in New York that the committee would hold oversight hearings on banks’ investments in private prison corporations that profit off immigrant detention. Shortly thereafter, in early March, JPMorgan said it would terminate these investments.

Progressive House aides see hearings and member statements as opportunities to add kindling to the outside activism for financial reform. When bank CEO s come before the committee, as has been planned, it may offer a chance to build momentum for policies like breaking up large financial institutions, which could squeeze centrist Democrats and even the chair. This wouldn’t automatically lead to passing laws, but it could help compel Democrats to stand for economic justice.

The industry has been f lummoxed about how to approach AOC and the committee’s left flank. They know that her megaphone can damage their interests, and that trying to engage and co-opt her could backfire. “It’s like going in to talk to the FBI, anything you do or say can be used against you,” one lobbyist told Reuters. AOC ’s chief of staff, Saikat Chakrabarti, responded that his boss “is here to hold Wall Street accountable, not be your buddy.”

One area where the progressive left should get buy-in from Waters is on oversight. Waters has been more aggressive than other committee chairs in scheduling hearings with regulators and industry heads. Another planned hearing will cover the Securities and Exchange Commission’s watering-down of the “fiduciary rule,” which was intended to require financial advisers to act in the best interests of their clients.

Waters has also pressured regulators herself. A recent letter she sent to the CFPB sought answers to why recent settlements with financial companies that violated the law did not include restitution to make wronged consumers whole. A second letter invited CFPB employees to contact committee staff if

they witness “waste, fraud, abuse or gross mismanagement.”

While no subpoenas have yet been issued, sources that have consulted with the committee indicate that there’s an appetite to investigate. Financial Services staff has already started calling banks with questions and document requests. Waters told MSNBC ’s Chris Hayes in February that Deutsche Bank was actively cooperating with her staff on investigations about money laundering for Russian oligarchs. Deutsche Bank, of course, was Donald Trump’s main lender. The discussions are part of a multi-committee probe into Trump’s personal finances.

One key hire has raised hopes for deeper oversight.

The committee has brought in Bob Roach, who dug into numerous banking abuses on Carl Levin’s Permanent Subcommittee on Investigations, including Goldman Sachs betting against the housing market before the financial crisis, Swiss bank tax evasion, and HSBC ’s money laundering with terrorists and drug cartels. Roach has a sterling reputation for dogged investigative work, and will presumably be central to the Deutsche Bank probe.

Roach’s presence could also bring much-needed sunlight to many other dark corners of finance: the role of privateequity firms in the demise of the retail sector, the staggering sums of unreported money in offshore tax havens, the potential bias inside algorithms in the lightly regulated financial technology (fintech) sector, and rampant fraud in the sale of home energy improvement loans, to name just a few.

Deep-dive investigations take time and resources, and experts don’t think they would immediately bear fruit.

But just having Roach in the building suggests financial misdeeds will not go unnoticed, just as creating a subcommittee on diversity or kicking off its proceedings with a study of homelessness suggested a broader understanding of the committee’s work. Despite the broad ideological range of its members, the committee has been reoriented, foregrounding vigorous protection of consumers and appropriate skepticism of the industry.

That approach, if it sticks, will pay off down the road.

THE SIX LARGEST WALL STREET banks took home $100

billion in profit in 2018, aided by significant relief from the Trump tax cuts. Overall, industry profits hit a new record high. While no banks failed in 2018 for the first time in over a decade, the huge amounts of money sloshing around the system cannot but help to increase finance’s appetite for more risk. And as the pendulum swings away from regulating banks, as it has under Trump, a bust eventually follows.

We don’t know how or when the next financial crisis will occur, only that it’s inevitable. The relatively modest tweaks in Dodd-Frank hardly fortified all our defenses.

When the crisis struck in 2008, many of the financial regulatory groups now in place in Washington didn’t exist.

They wouldn’t have had many friendly faces (or even just informed ones) in Congress to appeal to, anyway. “The committee with jurisdiction of the financial sector had no idea about the financial sector, and that’s just the way the financial sector wanted it,” says former Congressman Brad Miller.

As a result, Dodd-Frank opted for retaining the basic business model and structure of the industry—and even the more far-reaching provisions of Dodd-Frank have been weakened by a decade of persistent lobbying for changes.

Last year’s bipartisan financial deregulation law removed stricter supervision from 25 of the largest 38 banks in America, which triggered runaway industry consolidation when the banks freed from regulation teamed up to expand.

As was not the case in 2008, however, there’s now a network of advocacy groups with a shelf full of ideas that would truly return finance to its traditional role of supporting the broader economy, rather than towering over it.

The progressive beachhead on the Financial Services Committee could act as a catalyst for that transformative opportunity. Unmoved by the lure of corporate PAC money,

The progressives on the committee could act as a catalyst to return finance to its traditional role of supporting the broader economy, rather than towering over it. these legislators may actually want to legislate. If they do, they could return the committee to its posture in the 1960s and ’70s under populist chairman Wright Patman, when it passed landmark consumer legislation like the Fair Credit Reporting Act, the Equal Credit Opportunity Act, and the Truth in Lending Act. All it might take would be a banking committee that actually looks out for bank customers instead of bank executives—and, yes, some positive election results in 2020.

“It really is the first time where there may be a forum for people to think hard about the big fundamental issues,” says Dennis Kelleher of Better Markets. “There’s a huge unfinished agenda.” The activist leadership is in place, and the ideas are in place, too. Having members on the key committee willing to listen to those ideas and act on them was the final missing piece of the puzzle. That puzzle is now complete.

David Dayen has written for several publications, including The Intercept, The New Republic, and The Nation, as well as the Prospect. In June, he will become the Prospect’s executive editor.

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BETO

VERSUS THE BARRIO The rock-star Democrat Beto O’Rourke, a candidate for president, once supported the bulldozing of a low-income neighborhood in his hometown of El Paso—a project spearheaded by his father-in-law.

BY CH R ISTOPH ER H OOK S

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E

EL PASO, Texas ver since his near-miss Senate defeat to Ted Cruz, Beto O’Rourke’s political project has been on hiatus.

“Have been stuck lately,” O’Rourke wrote in a post on Medium somewhere between Kansas and New Mexico. “In and out of a funk.” But here he is, across the street from where President Donald Trump is rallying supporters, at a baseball field on a cool February evening, getting the band back together. Annie Leibovitz is on stage, shooting photography for a much-discussed Vanity Fair profile. Dave Eggers is in the crowd, writing for The Guardian. And so are a few thousand El Pasoans.

The once and future candidate is on stage, waxing eloquent about “the best traditions and values of this country.” It’s the O’Rourke whom Democrats and the media fell in love with during the 2018 campaign: the crusader, the progressive, the man against the world.

It’s the man running for president after three relatively undistinguished terms in the House and a Senate loss, primarily on his ability to inspire and uplift.

The crowd starts chanting—Beto, Beto, Beto. “This is where we make our stance, there is no other place I would rather be,” O’Rourke exhorts, foregrounding his birthplace at the center of his story. “I love you El Paso, the country’s counting on us.”

The morning after, David Romo is spraypainting folding chairs on a dead-end street south of downtown El Paso. Locals call this place Duranguito. The city, which is trying to level the area to build a sports arena, calls it Union Plaza. It is one of El Paso’s oldest neighborhoods, where the whole history of the city can be told by walking block to block—Pancho Villa’s stash house sits a short distance away from an elegant brick mansion that served as a Wild West–era brothel. More recently, this place was home to the poor, elderly, and undocumented, who owned homes here, or could only afford to live in the low-rise tenements that dot the area.

Almost the whole neighborhood has been fenced off by the city and made derelict, with the exception of one tenement that houses two women in their nineties off Chihuahua Street, who refuse to leave while a series of byzantine lawsuits over the arena wind their way through court. Romo, a local historian, helps keep watch

SPRING 2019 THE AMERICAN PROSPECT 33

An organization run by Beto O’Rourke’s father-in-law was pushing the El Paso city council to enact policy that materially benefited his father-in-law’s friends. contained some of the city’s richest residents at one end and some of the country’s poorest at the other, O’Rourke championed a plan by the well-heeled to appropriate large parts of the city’s historic barrios for redevelopment. It was bitterly opposed by many of his constituents in the affected areas, but supported fervently by his father-in-law Bill Sanders, one of the richest and most powerful men in town.

This is the paradox of Beto O’Rourke, someone whom the nation is just getting to know, a relatively blank slate received by many with brimming anticipation and others with skepticism. He can be a loud and distinctive progressive voice on national issues and an avatar for the wealthy and powerful, sometimes simultaneously. He’s the House primary challenger who took on Silvestre Reyes in 2012, running to Reyes’s left on legalizing marijuana, and to his right on increasing the Social Security retirement age. He’s the rock-star Democrat who wouldn’t support a fellow House can-

34 WWW.PROSPECT.ORG SPRING 2019

didate over a Republican he considered his friend. And he’s the city councilmember who tried to be everything to everyone in El Paso— except for the people of south El Paso.

LOCATED IN THE FAR western corner of Texas, El Paso is not much used to being seen, and its essential remoteness was a key part of O’Rourke’s success in 2018. There’s a set of worn clichés to describe that distance—El Paso is closer to San Diego than Houston, say—but they usually undersell it. With Ciudad Juárez, El Paso forms a single sprawling city with a population greater than that of Phoenix, but there’s little else around. There’s seven hours of nothing to the east, a four-hour drive to Albuquerque to the north, five hours to Tucson to the west, and four hours to Chihuahua to the south. Within Texas, El Paso is a world away and mostly out of mind—and out of time at that, an hour behind the rest of the state.

When O’Rourke came home from New York

City in 1998, El Paso was at a crossroads. The towering smokestacks of the Asarco copper smelter, which had injected toxins into the city’s air and soil for more than a century, shut down shortly before the turn of the millennium.

NAFTA was bringing new economic life, and the poverty of decades past had been greatly alleviated. But while other large Texas cities were experiencing explosive growth, El Paso was advancing more slowly, and many residents still had a kind of inferiority complex about the place.

Around then, Romo says, he met O’Rourke.

“The first time that I met O’Rourke was at a Halloween party, and he was dressed as a nun,” Romo says. “To be honest with you, he struck me like a frat boy. ‘Punk rock,’ I don’t know.”

Romo’s dislike of O’Rourke is visceral, but his deeper case is impersonal—he views O’Rourke as an emblem for the money that runs the city.

In 2005, O’Rourke was elected to represent a pinched, gerrymandered district that stretched from the poor, predominantly Hispanic areas south of downtown to the rich, whiter areas to the northwest around El Paso Country Club. He had run, along with other reform-minded candidates, on ending the council’s inveterate corruption and making El Paso a great city.

Later that year, O’Rourke married Amy

v i c t o r c a l z a d a / e l pa s o t i m e s / a p i m a g e s pa g e 3 2– 3 3 : c h r i s t c h av e z / g e t t y i m a g e s

over them. Today, he’s trying to make the dead street around the tenement a little cheerier.

Romo opposed O’Rourke in the most important fight of his early political career, and no love is lost between them. “O’Rourke is a big piece of this machine,” Romo says, referring to the machine that runs El Paso, and a “masterful politician ... It’s all fluff, it’s all style, it’s all looks.”

The battle over Duranguito is part of a larger war that’s taken place in the south side of El Paso over the last 13 years, one that has consumed Romo’s life. It is arguably the episode in O’Rourke’s past in which his character was most tested.

While representing a gerrymandered city council district that

The El Paso neighborhoods of Duranguito, Chihuahuita, and the Segunda Barrio (pictured opposite) were in the crosshairs of redevelopment plans supported by O’Rourke in 2006. The map and promotional Powerpoint slides (right) present a vision of a revitalized downtown attractive to those the urbanist Richard Florida called “high bohemians” or the “creative class.”

Sanders, the daughter of Bill Sanders, the richest developer in town. Sanders was also the co-founder and leader of the Paso Del Norte Group (PDNG), a consortium of the mostly white business class in El Paso and the business class in Juárez, which held a kind of control over the combined city.

O’Rourke and friends spoke often about ending El Paso’s brain drain, making it a place where young people would want to remain—or return to, as O’Rourke had. These were the peak years of the theories of urbanist Richard Florida, who posited that a city’s economic potential correlated with the presence of “high bohemians,” or the “creative class.”

Those groups were attracted by urban vibrancy, which El Paso sorely lacked. PDNG’s members, meanwhile, wanted to make money.

The intersection of those two goals could be found in El Paso’s south side. The neighborhoods of Duranguito, Chihuahuita, and the Segundo Barrio, which together form a bulge between

the bridge to Juárez and El Paso’s stately, empty downtown, are low-density, walkable, and historically nonwhite neighborhoods with a poor but tightly knit residential base. Here was the obvious place to build the new El Paso.

In February 2006, a city councilmember showed Romo a map of a redevelopment plan generated by PDNG that hadn’t yet been made public. It envisioned the wholesale replacement of Duranguito and Chihuahuita by the kind of development that would draw the “creative class”—an arena, new entertainment and retail, an art walk from downtown to the river. There would be a big-box store near the international bridge to draw Mexican shoppers—Romo believes it would have been a Walmart—and its parking lot would sit in the space occupied by the Border Farmworkers Center, a nonprofit which provides a clinic, cafeteria, and safe haven for migrant workers.

A shocked Romo took the plan, attempted to spread the word, and then watched as it was

announced by Sanders with great fanfare the next month at the Plaza Theatre, the same place O’Rourke would launch his Senate campaign exactly 11 years later. Nearly 2,000 predominantly poorer, older people would need to be displaced. But literature in support of it argued that local residents paid too little in property taxes, and promised that downtown El Paso would be filled by “offices, lofts, restaurants and outstanding new places to shop” if the city council would show the requisite courage.

O’Rourke voted for the plan, and then continued to support it through a growing backlash. Soon after, PDNG hired a marketing firm—one founded by Sanders’s father—to present a vision for El Paso’s future to the city council. The presentation depicted the El Paso the city wanted to move away from with a picture of an old Chevy pickup truck and an older Hispanic man in a cowboy hat, accompanied by the words “Dirty,” “Lazy,” “Speak Spanish,” and “Uneducated,” while the El Paso of the

SPRING 2019 THE AMERICAN PROSPECT 35

on a silver platter,” she said recently through a translator. She’s sitting in her small house in Segundo Barrio knitting lace dresses for stuffed animals to sell for Easter baskets. More than a decade after the fear of losing her home has subsided, she still breaks down in tears talking about it.

“While he was at City Hall, he never did anything.”

El Paso City Councilmembers Steve Ortega (left) and Beto O’Rourke with downtown El Paso in the background, circa 2005

future was shown by pictures of a smart new SUV, Matthew McConaughey, and Penélope Cruz, accompanied by the words “Educated,” “Bi-lingual,” and “Enjoys entertainment.”

In a 2006 op-ed for the local alt-weekly Newspaper Tree, O’Rourke didn’t deny that the desperately poor would be the most affected; he leaned into it. “In the census tracts contained in the proposed redevelopment district, unemployment is nearly three times what it is in the rest of the city,” he wrote, adding that per capita income there was a mere $6,586 a year. Nevertheless, O’Rourke insisted the plan would “infuse capital, jobs and opportunity into a part of the world that badly needs it,” as if those poor and displaced people would be the beneficiaries.

O’Rourke’s constituents in south El Paso organized their opposition initially through Sacred Heart Church, a neighborhood Catholic parish. That evolved into an activist organization called Paso Del Sur, in opposition to Paso Del Norte. The network of residents attempted to harness popular anger at city council meetings and town halls, and kept the fight going long enough for the plan to lose momentum.

The full plan never came to fruition. It fell

36 WWW.PROSPECT.ORG SPRING 2019

apart due to community opposition, new state laws about the use of eminent domain, and (mainly) the 2008 financial crash. Parts of it, like Duranguito’s proposed arena, persist.

Today, the arena is on hold while a motley crew of residents, activists, lawyers, and historians contest its legality in Texas courts.

But the fight lasted years, while mostly older residents like Guadalupe Ochoa, now 76, attended meeting after meeting to try to save their homes. At one town hall, preserved on tape, Ochoa aggressively challenges O’Rourke in Spanish. “We’re treated like a stone on the road that needs to be moved out of the way,” she says.

He replies in Spanish: “There are a lot of people who are working very hard to frighten the people who live here.”

Ochoa: “It’s your own father-in-law.”

“No,” O’Rourke responds. “That’s just your opinion.”

Sanders himself was far more blunt in a meeting with barrio property owners: “You cannot have change without disruption.”

Ochoa is still angry with how powerful people in her city characterized her community. “We trusted in Beto, and he gave us away

O’Rourke’s friends on the council, has called Romo and his friends “malcontents trying to relive the battles of the 1960s Chicano movement.” If that sounds harsh, it should be made clear that Romo’s view of O’Rourke is a minority view.

In El Paso, O’Rourke pulled down 86 percent of the vote in both the 2016 primary and general elections, and most people around town seem pleased with the national profile for him and the city.

O’Rourke boasts of winning the votes of Segundo Barrio in his 2007 city council re-election campaign, which he views as validation of his support of the redevelopment plan, though whether it’s more a product of incumbency in a low-turnout race is up to the reader to judge.

Romo recognizes that the story of the redevelopment plan may not hurt O’Rourke. “If you’re an astute politician, the fact that you’re willing to side with Republican backers against working-class communities is kind of a signal that you’re willing to be bipartisan,” he said. He just wants it out there before the presidential campaign reclaims it and smoothes it over.

It’s an important part of O’Rourke’s record, and Romo worries that Beto fans will ignore the pain of residents like Ochoa, and his work over the last decade.

How should we evaluate it? Romo and his supporters charge that O’Rourke was acting as a front for a business class that stood to make money on the deal—Sanders pledged he would take no profit from the redevelop-

v i c t o r c a l z a d a / e l pa s o t i m e s / a p i m a g e s

STEVE ORTEGA, ONE OF

ment, but the organization he led was full of people who would—and would help secure Beto’s political career going forward. Indeed, PDNG’s member list constituted O’Rourke’s fundraising base when it came time to run for Congress, and a PAC that counted one of Sanders’s companies among its major donors spent $240,000 to oppose Silvestre Reyes, his primary opponent in 2012.

O’Rourke and his allies profess that their sincere interest was to bring life to a corner of the city that could have been put to better use. Accommodations would have been made for affected residents, they claim, had the plan come to bear.

Perhaps the more important question is: Did O’Rourke act forthrightly? Some observers think the answer is yes. Father Eddie Gros, formerly of Sacred Heart Church, credits O’Rourke’s willingness to speak to residents one on one and in groups, to try to assuage their anger and fear about the plan. “I think he tried. It was almost an impossible situation for him, because of his district,” Gros said. “He tried very hard to be open.”

Others question whether O’Rourke should have played any role in the redevelopment plan at all. The case that he should have recused himself from council votes is simple: An organization run by his father-in-law was pushing the city council to enact policy that materially benefitted his father-in-law’s friends. In his Senate campaign, O’Rourke became famous for his on-the-spot clarity about how power and justice work in America, and the corrupting influence of money in politics. When I first interviewed him in the summer of 2017, he spoke angrily about the culture of corruption in Washington, a way of doing business that he said would come to be considered as indecent as the selling of indulgences in the Middle Ages.

That’s not the O’Rourke who explained to reporter Sito Negron in April 2006 why he was declining to recuse himself. Bill Sanders had “decades of experience in developing and redeveloping, helping build up American cities, and he’s volunteering that expertise and his time to help make El Paso a better place,” O’Rourke said. And “then you’ve got me, a City Council representative who makes $18,000 a year,” and “we’re both working toward the same end to make this a leading American city. I just

don’t see where the conflict is.” Recusing himself “might be the politically correct thing to do, it might look good and make some people feel good, but that’s not what I’m here for.”

Amid pressure, O’Rourke ultimately did begin recusing himself on votes relating to the city’s authority to carry out the plan, a few months into the fight. The reason he gave for doing so in dozens of affidavits was not Sanders’s involvement but his wife’s work for a charter school in the development footprint, which seems to be far less relevant. And he didn’t recuse himself on a critical vote in 2008, instead providing the deciding margin to kill a measure limiting the city’s ability to use eminent domain in the affected neighborhoods.

But apart from the specific issues raised in the course of the fight, there’s also the question of O’Rourke’s involvement in El Paso’s power games. To say that PDNG was influential in city politics is an understatement—some of its opponents charge that it constituted a

Allala says O’Rourke entered a corrupt system and chose to become complicit in it. She voted for him in the Senate race, “but I’ll always remember when he had a chance to do something to promote good government and stop an actual incidence of corruption in his community.”

El Paso’s pervasive culture of influence-peddling, Allala added, flows in part from Sanders.

“He’s just a street thug with a billion dollars, and he goes around getting everything he wants whenever he wants however he wants,” she said. “He gets lauded for being a patron and a philanthropist, but there aren’t a lot of people saying what a nice guy he is.”

In 2003, Sanders founded Verde Realty, raising more than $800 million from realestate giants and private-equity firms to purchase vast landholdings on both sides of the border, explicitly to dominate post-NAFTA trade. “Whether the country likes it or not, the manufacturing platform in the U.S. is going to be on the Mexican border, and that’s where

O’Rourke insisted the plan would “infuse capital, jobs and opportunity” into a place that badly needed it, as if those poor and displaced people would be the beneficiaries. kind of shadow government led by Sanders.

Many veterans of the anti-development fight express suspicion that the real decisions were being made out of sight, and that PDNG’s members were getting a heads-up before the city announced its moves.

Stephanie Allala, an attorney and former journalist in El Paso, sued the city when she became aware that councilmembers were structuring meetings with developers to skirt Texas’s strict open-meetings law. O’Rourke, who cultivated an image on the city council as a reformer, “had a role to play in terms of standing up for democracy, open records, transparency, and he chose not to,” Allala says.

Romo explained how older politicians engaged in illegal corruption—they would take cash from powerful men in town, $10,000 at a time.

Some got caught by the FBI in a 2007 investigation. New members of the city government were friendly to the business class without needing envelopes full of cash.

the growth is going to take place,” Sanders told the Cornell Real Estate Review, a publication of his alma mater, in 2007. This shift ravaged El Paso’s garment manufacturing centers and facilitated a maquiladora empire on the Mexican side with a questionable labor and environmental record. A 2013 merger with Industrial Developments International made Verde one of the largest industrial and logistics facilities owners in North America. Sanders remains a top shareholder.

Sanders even managed to escape the redevelopment disaster on his feet. He formed Borderplex Community Trust, which was supposed to be a holding place for downtown property.

When the redevelopment plan faltered, Borderplex shifted to scooping up an $82 million portfolio of El Paso office towers and commercial buildings. Though he promised to not financially benefit from the plan, as of 2015 Sanders owned 1.7 percent of Borderplex.

Eileen Welsome, a Pulitzer Prize–winning

SPRING 2019 THE AMERICAN PROSPECT 37

investigative journalist who spent years digging into cross-border development issues in El Paso, wrote in a sprawling piece in 2007 that Sanders “builds complex rings of business entities, nested inside each other like Russian dolls, which give him flexibility, as well as protection from legal and financial liability.” In the same piece, she quoted Mexican journalist Julian Cardona: “Bill Sanders and the rich people in El Paso are as immoral as the people in Juárez … They have created the social conditions that create rampant crime and violence that is exploding every day on Juárez streets.”

A FEW DAYS AFTER his rally, O’Rourke has

me over for coffee. Asks his communications director Chris Evans: “Who wouldn’t want to spend part of their Valentine’s Day with Beto?!”

O’Rourke and his family live in a historic mansion in Sunset Heights; Pancho Villa and General Hugh Scott had a sit-down in the living room in 1915. He makes a bowl of oat-

Susie Byrd, another city representative, tried to advance a resolution calling for a national debate on drug legalization, in order to lessen cartel violence in Juárez. The congressman for the area, Silvestre Reyes, got it killed. At the time, Reyes, a former Border Patrol chief, compared the drug war in Juárez to the movie Last Man Standing, and suggested Americans should let the bad guys shoot it out. (Reyes would later premise a large part of his unsuccessful campaign against O’Rourke on the principle that O’Rourke wanted to “legalize drugs.”)

O’Rourke and Byrd wrote a book about the battle called Dealing Death and Drugs: The Big Business of Dope in the U.S. and Mexico.

“It was seven-year-old boys getting shot in the back of the head,” he told me. “It was young women lit on fire with their mouths duct-taped and their hands tied behind their back. We are in part culpable. It’s not our fault, but we are in part at fault. What do we do about that?”

Endorsing full marijuana legalization may

In hindsight, O’Rourke said,“I think I did initially a really poor job of listening to that criticism, and dismissing it as ‘These folks don’t want to see the city move forward.’” meal in a T-shirt, cardigan, and Vans. There’s a tomahawk on the kitchen counter from his Taos visit, as recorded on Medium, and in the main room, an extensive library and sizable collection of vinyl. As I’m struggling to remember my list of questions, O’Rourke’s beautiful black dog, Artemis, keeps putting her paw on my knee, and I briefly wonder if she’s been trained to do that with journalists.

Asked what he’s most proud about from his time on the council, O’Rourke mentions overhauled zoning codes to help cut down on sprawl, expanded open-space requirements, and a reformed Sun Metro, the local transit system. In 2009, the council extended domestic-partner benefits to city employees, and defended the decision from both attack by local Christians and a recall attempt.

The council and O’Rourke advocated for immigrants, and better relations with Juárez at the height of the drug wars. It fought the domineering local police union. In 2009, he and

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seem tame today, but ten years ago it was a radical proposition. The idea that the well-being of Mexicans should be a priority in American policymaking, even when it requires adopting politically difficult stances, was downright revolutionary. But El Paso and Juárez are two halves of one city, something that is not selfevident to the rest of America. On this issue, O’Rourke’s sincerity has been demonstrated repeatedly, and his experience as a borderland lawmaker in a time of cartoonish border panic is one of the biggest assets he brings to a presidential campaign.

On the matter of the downtown redevelopment plan, O’Rourke’s camp has made plain their frustration with Romo, whom they view as somewhat of a crank. But O’Rourke himself is relatively diplomatic. The lesson he learned, he said, is that “even if someone hates my guts, and thinks everything I’m doing is wrong, and has made it their mission to share that with everyone, they may still be bringing up legiti-

mate, good points that I should listen to.” In hindsight, he said, “I think I did initially a really poor job of listening to that criticism and listening to those suggestions, and dismissing it as ‘These people are against progress, these folks don’t want to see the city move forward.’”

What role did his father-in-law play in his political career? Bill Sanders is “one of the very most important people in my life,” O’Rourke said, “someone that I continue to look up to, looked up to then, who’d had real success based on pursuing excellence and holding himself accountable to that and being very ambitious.”

Sanders bucked the El Paso inferiority complex that O’Rourke felt in his youth. To O’Rourke, Sanders’s attitude was “Fuck that, this is a great community, and you have just as much a shot as anybody else.”

Sanders was also, O’Rourke said, a paternal figure at a time when he needed one. “I had lost my dad four years before [meeting Sanders], and here was a guy who could help me as I thought through decisions about my business,” and as he was thinking “about how you live your life. How you develop a work ethic to be able to achieve the things that you want to do.”

But there was a clear-cut separation between the familial relationship and the political one, O’Rourke said. “He was very respectful of my independence as a member of city council.

He made it a rule that he religiously followed, never to talk politics. We really kept that separate from our relationship.” And the two never talked about Sanders’s business on the Mexican side of the line, O’Rourke maintains. “I never knew what he was doing, didn’t ask him about what he was doing,” he said. “He is the most private person, and I just never felt comfortable, nor was it my place, to ask him about what he was doing.”

THE 2020 DEMOCRATIC primary has been

characterized so far by the “apology tour,” the extensive efforts by would-be nominees to atone for wrong views, wrong actions, and wrong positions. But with politicians, as with stocks, past results are no guarantee of future performance. It’s hard to know what a record is actually worth. O’Rourke is most comfortable on stage, crusading. He wants to be seen as upholding right. If the downtown plan was indeed a moment when O’Rourke acceded to

charlie neibergall / ap images

After announcing his presidential run on March 14, O’Rourke wasted no time, hitting the campaign trail the next day, in Mount Pleasant, Iowa.

power, is it notable that he seemed consistently uncomfortable doing so? And that in justifying himself, he wasn’t very good at it?

It was the right decision, politically speaking. O’Rourke fought for the redevelopment, and the redevelopers fought for him. When he challenged Reyes in the 2012 Democratic primary, he was more liberal than his opponent on social issues, and more conservative on economic issues. While Reyes ran bizarre ads featuring children fearful of O’Rourke’s radical takes on the drug war, O’Rourke talked up Reyes’s complicity in the size of the federal deficit and floated the idea of introducing means testing to entitlement programs.

At a November 2011 debate, O’Rourke blasted Reyes’s refusal to name parts of the federal budget where he would cut spending. “Those are the tough decisions that we sent him to D.C. to make,” he said. “We have to get our budget under control.” The first place O’Rourke

said he’d look to cut is military spending: “We spend 43 percent of the world’s military budget.” That’s a bold position to take in El Paso, where much of the local economy depends on ballooning military bases. But a moment later, he turned to Social Security: “We need to look at things like means testing … We need to look at a later [retirement] age … This is precisely why the U.S. almost defaulted on its national debt.” (It wasn’t.)

Sanders and other El Paso businessmen dropped money into a PAC called the Campaign for Primary Accountability, which blasted Reyes with negative ads, and right-wing donors from around Texas followed suit. O’Rourke won the primary with the help of Republican crossover voters—without them, Reyes would have beat him. El Paso Republican and business owner Eileen Karlsruher told a local publication that she and others she knew voted for O’Rourke because his record had demonstrated

that he was a “middle-of-the-road conservative Democrat” who had outspoken stands on a few key non-pocketbook issues that were easy to ignore. He was easy to swallow.

In truth, O’Rourke’s story bears a passing resemblance to that of the greatest Texas Democrat. Lyndon Johnson grew up under the thumb of a politician father, and married into a rich family. His father-in-law helped bankroll his first campaign, and in office he carefully tended to a small set of powerful Texas donors to ensure his elevation. He was a crook and a snake and wildly ambitious, but when he finally got power he unveiled his most tightly held secret—a piercing kind of moral clarity.

He did things no one could have expected.

O’Rourke is not Johnson, of course, for a hundred reasons—it’s just hard to say what he is.

Christopher Hooks is a journalist based in Austin, Texas.

SPRING 2019 THE AMERICAN PROSPECT 39

NEEDED: A U.S. Policy on Saudi Arabia The next administration would do well to revise the long-standing U.S. partnership with Saudi Arabia, and America has substantial leverage to produce change in the kingdom’s behavior.

B Y JONATH A N GUYER

O

n January 14, Secretary of State Mike Pompeo stood on the tarmac in Riyadh after meeting the Saudi crown prince. It was a key stop on the American envoy’s weeklong Mideast tour, after President Donald Trump had surprised allies by calling for abrupt troop withdrawals from Syria and Afghanistan. Although the American presence in those countries had come to reflect inertia rather than any long-term strategic goals, Trump’s retreat was particularly hasty, leading to

40 WWW.PROSPECT.ORG SPRING 2019

Defense Secretary James Mattis’s resignation.

Pompeo smiled and laughed with Crown Prince Mohammed bin Salman and his entourage during the brief touchdown in Saudi Arabia. On the runway before a scrum of reporters, he described his conversation as one with Saudi “partners and friends,” as if the recent killing of writer Jamal Khashoggi could be fixed over a chummy conversation.

It was as unconvincing as his marquee remarks days earlier at the American University in Cairo, where Pompeo heralded a new

Middle East policy, more antagonistic toward Iran and more rambunctiously pro-Israel than ever, without substance on policy issues.

Instead, the chief diplomat politicized the platform by dismembering Obama’s 2009 speech at Cairo University. These words undoubtedly pleased Arab Gulf states, notably Saudi Arabia, who felt undermined by Obama’s support, albeit tepid, for the 2011 Arab revolutions.

Speaking to a select embassy guest list inside the gated suburban campus 25 miles into the Cairo desert, Pompeo blustered about Iranian

andrew cabelleroreynolds / ap images

U.S. Secretary of State Mike Pompeo with the Saudi Minister of State for Foreign Affairs, as he departs from the airport in Riyadh on January 14

“mullahs” and “ayatollahs and their henchmen,” but glossed over abuses of authority from Egypt to Saudi Arabia. In particular, unlike Obama’s speech or even Condoleezza Rice’s 2005 remarks at the same university, Pompeo failed to say the words “human rights.” He also didn’t mention Khashoggi.

The CIA had determined with a high level of certainty two months earlier that Saudi Crown Prince Mohammed bin Salman had ordered the hit on the prominent Saudi writer. This crime could not be erased. To keep up with

sensational leaks from the Turkish press, the Saudis changed their narrative a half-dozen times and inadvertently exposed their culpability. Still, the Trump administration had redoubled support for the 33-year-old de facto ruler of the kingdom. “Our intelligence agencies continue to assess all information,” Trump wrote in a catty White House statement, “but it could very well be that the Crown Prince had knowledge of this tragic event—maybe he did and maybe he didn’t!” After disparaging his own intelligence reports, he went on to malign the deceased. “Representatives of Saudi Arabia say that Jamal Khashoggi was an ‘enemy of the state’ and a member of the Muslim Brotherhood, but my decision is in no way based on that.” Trump had sided with the Saudi cover-up. He had squandered American power and had nothing to show for it. The team that killed Khashoggi, according to The New York Times, had also conducted a dozen extrajudicial operations against Saudi citizens.

Pompeo’s shuttling is a caricatured version of America’s indulgent and shortsighted policy toward the Saudi kingdom going back several decades. But today with a newly pugnacious regime in Riyadh, the stakes are far higher. Until the 1970s, Saudi Arabia was simply a docile U.S. ally and source of cheap oil. That began to change with the OPEC engineered price hikes, masterminded by the Saudi government. The Saudi government then subsidized the spread of radically fundamentalist Islam through the Muslim world.

The stakes increased with the attacks of 9/11 (the majority of the skyjackers were Saudi).

But throughout this era, Washington continued to indulge Riyadh, either because of the politics of oil, plain conflicts of interest, the fact that the Saudi policy toward Israel was covertly not as hostile as it might have been, or all three. With the ascension of MBS , a newly bellicose kingdom has emerged. Saudi has reached out to allies in Asia who neglect human rights and are happy to displace U.S. influence. It has engaged in monstrous violations of diplomatic norms, of which the Khashoggi hit was only the most extreme case. The U.S.-Saudi relationship has at last reached the inescapable crisis that Washington has been dreading since 9/11.

But that said, what should our Saudi policy

be, even assuming a competent government in the White House after 2020? Washington’s leverage is ostensibly limited—by concerns about Israel, by other geostrategic goals in the region that require Saudi acquiescence—though Trump’s demonization of Iran needlessly enhances Riyadh’s leverage over Washington. A full-on reassessment of the U.S.-Saudi relationship is required, with the goal of restricting the possibility of Saudi aggression and transitioning the kingdom toward a more transparent and accountable governance. Otherwise, only time will tell what illogical and dangerous act Mohammed bin Salman pursues next.

“PURELY TRANSACTIONAL”

The U.S.-Saudi relationship was never based on deep cultural ties between the two countries but rather on security arrangements, petroleum deals, protecting the trade routes surrounding the world’s largest producer of crude oil, and sharing intelligence about terror groups that threaten both countries.

The relationship had already deteriorated after the September 11, 2001, terror attacks.

The U.S. military presence in the Gulf had been a source of friction for Saudis, and in America anger was widespread against the kingdom. “9/11 also crystallized Islamophobia in the United States, and the American reaction to it was seen as belying Saudi expectations and U.S. assurances of solid friendship,” Chas Freeman, who served as American ambassador to Saudi from 1989 to 1992, told me. “The relationship became purely transactional—each side asking what’s in it for me, rather than a partnership, which was the case when I was there.”

That partnership is rooted in FDR’s 1945 bargain with King Abdel-Aziz Ibn Saud, forged aboard the USS Quincy on Great Bitter Lake and endlessly recounted in both countries’ lore. U.S. security for Saudi energy supplies remains one of the fundamental pillars of the two countries’ relationship and indeed much of U.S. foreign policy in the Middle East. But in the 21st century, this relationship has potential to change. “They need us much more than we need them,” Bruce Riedel, a former CIA and White House official, told me. “We don’t need their oil, but they need our security guarantee.”

SPRING 2019 THE AMERICAN PROSPECT 41

As fracking has made the U.S. a net oil exporter since the mid-2000s, Americans have imported less oil from Saudi, from 1.36 million barrels daily in 2012 to shy of a million daily in 2017 and continuing to drop. Yet the U.S. remains the prime guarantor of the world’s crude. That assumed responsibility is infrequently questioned yet has a huge footprint: The Navy’s Fifth Fleet operates out of the Gulf island kingdom of Bahrain, where more than 7,000 servicemen and personnel serve as traffic cop for the global flow of oil around the Strait of Hormuz and the Arabian Peninsula. The U.S. also maintains 10,000 military personnel at Al-Udeid Air Base in Qatar, among the robust network of basing and military cooperation throughout the Arab Gulf and Levant, Israel, and the Horn of Africa.

The U.S. too depends on Saudi, and its strategic location on the Arabian Peninsula, for overflight permissions for aircraft operating in and out of Afghanistan and Iraq, but ana-

renewed nuclear development, including an arms race in the region.

Riyadh is eager to buy closely guarded nuclear technology from the U.S.—and Jared Kushner has been eager to help, seeking workarounds so that the kingdom can acquire power plants without going through Congress. Kushner’s efforts, according to a House Oversight Committee report, would benefit a company that helped bail out the Kushner family business, the first family’s financial interests again frustrating national security. Patterson told me that thwarting Saudi nuclear ambitions is a priority for U.S. security.

Saudi Arabia was among the countries lobbying loudest against the Iran nuclear deal, alongside its new unlikely partner in the shadows, Israel. The Israel-Saudi relationship has been based on realpolitik, collaborating on intelligence operations against Iran and Hezbollah. Saudi Arabia’s brutal campaign in Yemen has parallels to Israel’s attacks on

With the ascension of MBS, Saudi Arabia has engaged in monstrous violations of diplomatic norms, of which the Khashoggi hit was only the most extreme case. lysts note that it’s part of a broader security architecture that is of particular benefit for the Saudis.

The second pillar of the relationship is intelligence cooperation. “They’re a superstar counterterrorism partner, and their tips have saved lives,” Anne Patterson, a former ambassador to Egypt and Pakistan, told me over breakfast in Cambridge, Massachusetts. She cautioned, however, that “CT [counterterrorism] is not the same thing as Iran. These Sunni extremists pose a bigger threat.”

But when promoting American support for Saudi Arabia, Trump has accentuated the threat of Iran. Though Iran has potential to imperil U.S. interests on a variety of fronts, most experts agree that Obama’s nuclear deal, the Joint Comprehensive Plan of Action, had brought Tehran into the international fold and limited their nuclear projects. It’s Trump’s breaking of that “deal” that is shaking international confidence and feeding anxieties around

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Gaza, and the Khashoggi affair revealed Saudi’s ambition to mimic the Israeli intelligence services’ notorious operations abroad.

“The modus operandi of this hit team was like a classic Mossad execution,” Chas Freeman, the veteran diplomat, told me. If that’s true, the Saudis were poor students; it’s hard to imagine such a sloppy Mossad operation. Freeman said that a priority for U.S. diplomats is finding a way for Saudi to dismantle its newly formed hit teams and rendition capacities.

“Committing murder in your own consulate is an incredibly stupid thing to do,” he added.

What of continuing to work with a murderer? Saudi Arabia ranks 22nd in U.S. trade, according to the U.S. Trade Representative.

This would seem paltry, but there’s massive money to be made in oil and gas infrastructure projects, as evidenced by the decent turnout at the Riyadh investment conference in October, just a month after Khashoggi’s death.

Saudi money also flows to the U.S. in the form

of weapons sales, to be sure, but the numbers cited by Trump have proved to be vastly exaggerated, with Trump’s purported $110 billion figure, touted in a March 2018 Oval Office meeting with MBS, shown to be mythical. Only about $4 billion or $5 billion in sales were signed since then, and much higher levels of sales were carried out under Obama. These days, even smallbore deals are getting unwelcome attention. Last year, $61 million worth of weapons made in New Hampshire were sent to Saudi by a company that didn’t want itself named publicly.

Over the past decade, these types of deals— huge orders for weapons that were rarely used, certainly not on the battlefield—were a boon to American defense contractors. Congress enthusiastically supported them. But as images of the grievous attacks and humanitarian crisis in Yemen reach American televisions, this is starting to change.

The Saudis, however, are dependent on expensive U.S. weapons platforms, and it will be difficult for them to begin buying weapons from Russia or China. Their weapons systems and aircraft squadrons are all American, and require almost constant American repairs. As a hardball tactic, Congress could try to pass laws that would effectively ground the Saudi air force. And the next administration could condition close military systems collaboration on Saudi behavior.

There are other avenues of cooperation, and the Saudi government’s role as the custodian of two of three holiest mosques in the Islamic faith have made them important symbolic allies. But gone are the days when Saudis were great financiers of American foreign-policy adventurism, like funding the mujahideen in Afghanistan in the ’80s. The role of Saudi windfall oil profits and petrodollar “recycling,” which was so important to both U.S. banks and Third World oil-consuming countries in the 1980s and 1990s, is also long past.

The human-rights agenda, so often touted as part of U.S. policy, has never held Saudi to much of a standard. Importantly, the Obama administration’s support for the 2011 Arab uprisings frightened the sclerotic Saudi leadership. Washington had sold out Mubarak, its partner of 30 years. “Clearly, we’ve given the Saudis a lesson,” Freeman told me. “We reinforced the thought that we can’t be depended on.”

Saudi Crown Prince Mohammed bin Salman (aka MBS)

marco ugarte / ap images

“A BURGEONING AUTOCRAT” MBS has rattled previous arrangements to the

core. Traditionally, the Royal Court had been a consultative body that, through consensus with tribes and families, reached policy decisions. It was a slow process befitting a conservative kingdom. When King Salman, then 79, took over the throne in 2015, he appointed his 29-year-old son Mohammed as defense minister, making him the youngest in the world.

MBS in turn launched an impulsive campaign against a motley militia known as the Houthis who had run much of Yemen since the state’s collapse following the 2011 revolutions. There were some legitimate threats from unstable Yemen, but the Obama administration failed to recognize the threats posed by MBS. Soon the U.S. was supplying, refueling, and servicing aircraft that Saudi pilots were using to attack targets in Yemen, killing 971 civilians by late summer. The prince found support in the Obama administration. In September 2015, Mohammed bin Salman dined at Secretary of State John Kerry’s home. He took to the piano after dinner to serenade the guests with Beethoven’s Moonlight Sonata. “Everybody was so desperate for change in Saudi that they

believed it,” Anne Patterson, who served as the senior Middle East official in the Obama State Department, told me.

While the Yemen war raged, the Obama White House rolled out the red carpet for the then-deputy crown prince, inviting him for a meeting with President Obama in June 2016.

This wasn’t the usual protocol for a senior court-member’s visit. National Security Advisor Susan Rice, according to the account of a senior Obama official, said, “Like it or not, he could be the next king.” In the process, the Obama administration had legitimized MBS’s rise.

“We in the Obama administration could be faulted for not taking a firmer line with Mohammed bin Salman on some of the policies saying, hey you can’t do that. Yemen was certainly on our watch,” the official told me.

“The signs were there that he could be a burgeoning autocrat.”

From there, MBS exhibited a mastery of public relations, inoculating himself from future criticism by ingratiating himself with so-called thought leaders. But he didn’t hold out the hope of political reform other than on the role of women, which proved to be a brilliant feint that

gulled such commentators as Thomas Friedman: His much-touted vision for the country was economic.

On his first overseas trip as president, Donald Trump sword-danced and touched the enigmatic orb in Saudi Arabia. Ever since, Mohammed bin Salman’s destructive actions have accelerated.

“Saudis see themselves as a mirror,” said Patterson, the former diplomat. “As long as they have the king (Donald Trump) and the crown prince (Jared Kushner)—they’re okay. They think with Trump in their corner they’ll be fine.”

The story we didn’t hear at the time was the prince’s reputation as “Abu Rasasa,” which translates idiomatically as Mr. Bullet. As a threat, he had mailed a single bullet to a Saudi land registry official, as reported by The New Yorker’s Dexter Filkins.

MBS’s coup, however, didn’t require a single bullet. To become crown prince, he sidelined heir apparent Mohammed bin Nayef, 59, the longtime security chief and epitome of the Saudi deep state. In June 2017, MBS had put him under house arrest and badmouthed him in the media as a pain pill–addicted has-been.

“As the members of the royal family look at the crown prince’s behavior, they have to be asking the question, ‘Will the House of Saud survive 50 years of Mohammed bin Salman’s decision-making?’” Riedel, the former intelligence official, told me.

“HE IS A SADDAM, CLEARLY” The brutality of MBS can no longer be over-

looked. He has presided over the largest clampdown the kingdom has ever experienced. Many activists are in prison. Some have been tortured or sexually assaulted. And the Trump administration continues to enable him.

Kushner, the president’s son-in-law and adviser, secretly traveled to Saudi Arabia in October 2017. A month later, Saudi kidnapped and blackmailed Lebanese Prime Minister Saad Hariri. The U.S. didn’t speak up for the Lebanese head of state. A few days later, MBS held hostage dozens of princes, notably Prince Alwaleed bin Talal, among 400 businessmen in the Riyadh Ritz-Carlton, conducting what might be called the largest bank robbery in history. He had effectively neutered the country’s wealthiest. The only major impediments to his

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A 2017 lunch in the State Dining Room of the White House included President Trump, his son-in-law Jared Kushner, and Saudi Arabia’s new heir to the throne, Mohammed bin Salman.

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any attempt to link Khashoggi’s crime to our leadership.” But in a kingdom where all decisions are taken by the micromanaging crown prince, the line was hardly plausible.

Expect Congress to be increasingly aggressive in their condemnations. Eighteen Republicans crossed the aisle to pass a February 13 House resolution to stop aiding the Yemen war, invoking the rarely used War Powers Resolution. Further action might include holding back appropriations, blocking arms sales, and maybe passing sanctions targeting specific individuals in the Saudi government, making it difficult for them to travel to the U.S. “I think he is a Saddam, clearly,” a senior Senate aide told me. “We need to make clear to Saudi Arabia: Your relationship is not going to be what it potentially could be while you have someone like this at the top.”

For Congress, the most urgent task at hand— and the most doable—is ending all support for the war in Yemen and investing in that country’s renewal. The crown prince’s rise is intimately tied to the grave humanitarian crisis he has perpetuated there, fueled by American weaponry and logistical support. Ending the Yemen war

is a no-brainer given that the conflict is empowering al-Qaeda and ISIS, while exacerbating human tragedy that will lead a generation to hate America for selling its weapons to Saudi Arabia. Halting the war is an important goal unto itself, and it has the added knock-on effect of punishing Mohammed bin Salman.

But bigger changes are needed. More broadly, this is an opportunity to reassess the core oilfor-security bargain in the Arabian Peninsula.

“A LEADING CONTRIBUTOR OF POLITICAL STABILITY”

The Department of Defense is required to document the criteria for each arms deal that passes its desk. When it comes to Saudi Arabia, a milquetoast run-on sentence can justify a $1.3 billion transaction: This proposed sale will contribute to the foreign policy and national security of the United States by helping to improve the security of an important partner which has been and continues to be a leading contributor of political stability and economic progress in the Middle East.

e va n v u c c i / a p i m a g e s

absolute power were activists, journalists, and religious leaders.

“They are using legal means to kill people because they have different views, because they demand political change, because they demand liberties,” Abdullah Alaoudh, a law scholar at Georgetown University, told me.

His father, the cleric Salman Alaoudh, was arrested in 2017. “Just imagine: They are seeking the death penalty against my father for holding similar views to Khashoggi.” Alaoudh described a “pattern of cracking down on dissent, irrespective of ideology,” including liberals, Shiites, and Sunnis.

In early February, the deadline for the Global Magnitsky Act sanctions against Khashoggi’s killers passed. Under the act, which was passed in 2015, the president has expansive power to sanction foreign individuals who commit “gross violations” of human rights, like extrajudicial killings. The same week, a U.N. rapporteur called the Khashoggi affair “planned and perpetuated by officials” of Saudi Arabia. “Our leadership is a red line,” the kingdom wrote on social media with a threatening photo of the king and the crown prince. “We warn against

Each and every word in that rationale ought to be debated among policymakers. Important partners don’t murder journalists, least of all those employed by The Washington Post; endless wars don’t serve national interests, and political stability is not a one-man show. The brand of “political stability and economic progress” that Saudi represents is a dangerous one indeed.

As American energy production expands (and increases further with a growing shift to renewables), the U.S. will have more space to recalibrate its relationship with the kingdom.

A policy review would note that the free flow of oil and counterterrorism efforts remain priorities. Other aspects of the relationship, like cooperation on Islamic and religious issues, could benefit both countries but have largely languished. Overall, MBS’s rashness threatens the balance on each and every component of the relationship, adding a severe cost to Washington for even pursuing the same old approach.

A conversation might begin privately between senior officials of both countries. But if Riyadh is unwilling to remove MBS from dayto-day policymaking and loosen constraints on Saudi activists, media, and religious actors, then it’s a message that Washington should convey publicly, much like it did against China in the aftermath of Tiananmen Square. And unlike the weak U.S. follow-up after Tiananmen, this time America’s warnings should be followed by action.

Americans and Saudis not beholden to MBS need to work together to advance structural changes to ensure that no single impulsive prince could hold the entire kingdom hostage to his poorly thought through policies. “There are no actual institutions, no rule of law,” Hala Aldosari, a Saudi scholar and activist, told me. “The only people in a position to do anything are allies of Saudi Arabia in the socalled liberal world.”

There are three strategic goals that the United States should seek to advance within Saudi Arabia. First, Washington should urge a return to a consensus system of checks and balances within the royal court. Second, institutions independent of the House of Saud, like the attorney general’s office and other transparent agencies, must be bolstered to create new systems of justice. Executions and torture can no longer be tolerated. Third, Saudi Arabia

must open up the country to free expression.

This will be a gradual process, and to ensure it goes forward, American companies might condition their participation in the kingdom on such reforms, or the U.S. government could limit their freedom of action as it had done in the case of other totalitarian regimes during the Cold War and in the case of North Korea and Iran. In exchange for achieving progress toward these outcomes, the U.S. would provide even more security guarantees to the kingdom.

This is a regime with tenuous legitimacy and thus in a state of constant paranoia. Saudi recognizes that it is under strain from its population, which it bought off with cash subsidies after the Arab Spring. But it won’t be able to buy off its citizens in perpetuity. There has already been significant capital flight from Saudi since the Ritz roundup and drops in international investing in the country. MBS’s Public Investment Fund has only so much liquid cash to buy back Saudi stocks on bad market days.

military is so deeply ensconced in the Middle East and the long-term benefits of such inertia.

Washington could begin by considering a path toward a constructive relationship with Iran.

Containment of Tehran hasn’t worked, and a move toward rapprochement would theoretically provide the U.S. with more options.

Over time, the U.S. might downgrade the Saudi relationship and pursue a new regional strategy, reducing the American military profile in the Persian Gulf, sharing the security burden with European and Asian allies, and perhaps even relocating the U.S. Fifth Fleet currently based in Bahrain. Threatening or carrying out a military pullback is risky, but so is supporting an autocrat increasingly at odds with his own people and bent on destabilizing the region.

An alternative view is that meddling in Saudi affairs could backfire. The Saudi leadership will resent U.S. interference in the court, even among those concerned about MBS ’s cruelty. But the perils of a cavalier crown prince

Meddling in Saudi affairs could backfire, but after decades of coddling, the U.S. has a responsibility to take a firm line in containing further misadventures.

Among the points of leverage not often discussed is that Saudi does need economic change. For Mohammed bin Salman to achieve his purported post–oil economy reforms which would make Saudi more attractive for global investment, he has to have the cooperation of major American institutions, including hedge funds, private-equity shops, and more. The U.S. can make it easier or harder on him in terms of working with those firms. We can give them top cover—and both sides stand to make money—or we can name and shame financial institutions that have aided and abetted MBS’s worst tendencies, or even prohibit their operations with the kingdom outright.

We should also pressure U.S. companies not to provide technology that can be misused against Saudis and sanction Israeli firms that sell vicious spyware to Gulf autocrats.

If Saudi Arabia is unwilling to reform on these three points, then perhaps it is time to raise first-order questions about why the U.S.

increase whether the U.S. intervenes or not.

Indeed, it’s the spectrum of American support for MBS across two administrations that has led to this entanglement. The U.S. has a responsibility, after coddling Saudi Arabia for decades, to take a firm line in containing further misadventures. If the U.S. doesn’t try the full tool kit of approaches, then it is condoning MBS’s wet work and assuring that worse is yet to come.

It is worth remembering that Mohammed bin Salman was able to charm Western elites because people were genuinely excited about his efforts to transform the kingdom socially and economically. In hindsight, his promises seem incongruous if not grotesque. But one point is clear: Saudi Arabia desperately needs the reform that the young prince once held out as a promise.

Jonathan Guyer, a former Radcliffe Institute fellow at Harvard University, writes about Middle East affairs.

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The Migration Crisis and the Future of Europe

The identity crisis imperiling the continent isn’t one of race and religion.

It’s one of Europe’s willingness to preserve and expand its liberal values.

BY G E O RG DIE Z

I

t was a friend of mine, an older German woman who fled the Nazis and has lived in the United States since the late 1930s, who said the one sentence that summed it all up. Not a lot of people caught the full gravity of the situation then, in the fall of 2015, when the number of refugees arriving in Europe increased dramatically—and with it the pressure on governments and societies to react. The refugees came mainly from war-torn Syria, from Iraq and Afghanistan, heading to Austria, to Germany, to Sweden, traveling up from Greece and through the Balkans—long lines of people, a steady presence on the evening news.

“This,” my friend said, “changes everything, doesn’t it.” And, depending on how you would define both change and everything, it did.

The so-called European refugee crisis exploded into public consciousness in 2015.

The unrest that followed the Arab Spring of 2011 and the brutal civil war in Syria forced millions to flee their countries, first to neighboring states like Lebanon and finally to the richer countries of Europe, stressing the EU to the breaking point.

Migration will remain central to the politics of the continent, raising fundamental questions about European societies, challenging the legitimacy of the system, and increasing the political strength of the far right. Europe, this old continent of migrants and migration, of people fleeing and people arriving, was thrown into a profound identity crisis

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that has led to stunning political upheavals.

In Western Europe, these range from Brexit in the United Kingdom to the rise of far-right parties in Germany, France, Italy, even Spain.

In the eastern part of the continent, right-wing governments in Hungary and Poland propagate increasingly xenophobic and authoritarian policies that have brought the European Union to the brink of dissolution. The sense of democratic inevitability that Europeans had taken for granted ever since the fall of the Berlin Wall in 1989 has been shattered.

But history did not end then; it came back, with a vengeance. Indeed, the specters of the past set the stage for the conflicts of the present. The refugees and the reaction to them have unveiled some very old and very powerful fault lines. The crisis pitted northern Europe against southern and the richer countries of the continent against the poorer ones. It pitted the East against the West—more specifically, a tradition of illiberal societies versus the practice of liberal democracy. The migrants’ arrival brought out deep-rooted differences on the continent—but they were the catalyst, not the cause.

Europe’s reckoning with the hopeful, the desperate, the “wretched of the earth” was in that sense a reckoning with itself, with the contradictions and unresolved questions of capitalism, belonging, and national identity that make this continent at once charming and dysfunctional.

What happened in the summer of 2015 challenged European rules and regulations, but above all Europe’s supposed values of enlight-

enment and humanism when confronted with mass flight from suffering and death, which was tolerated or even made possible by decades or centuries of European governmental policies.

What, after all, are European values? How real are they when confronted with the legacies of colonialism, racism, and imperialism arriving on its doorstep?

My friend, it seems, saw all of this from a distance more clearly than most bureaucrats working in Brussels for the European Union or the politicians, journalists, and other cheerleaders for history’s triumphal progression. The history of the migration to Europe is the history of a continent falling apart, politically and morally.

1. ARRIVAL

The scene was ghastly only to the unkind observer. But it was a new sight to the workingclass district of Wedding, in the middle of Berlin. One hundred or more people, men, women, children, were huddled in the dark, waiting in front of an iron gate. It was early one morning in September of 2015 and still dark, when at six o’clock precisely the gate opened to the Lageso, the office where newly arrived refugees were supposed to register, and mayhem broke out. People jumped and fell, some got hurt, the strongest made it first, and the ambulance was waiting patiently at the side to treat the injured.

This show of fierce desperation then became a daily feature.

In the fall of 2015, the Lageso, the acronym for the agency for health and social affairs, was

markus schreiber / ap images

The scene outside the Lageso, Berlin’s central registration center for refugees and asylum seekers, in September 2015. That year, 55,000 refugees tried to register in Berlin.

a humanitarian hot spot in the German capital.

It became the symbol for much of what went so wrong in the early days of the refugee crisis: families camping in the open, confusion about procedure, a bureaucracy that was wrestling with itself as much as with the number of newcomers.

The sheer number of refugees coming to Germany—a nation of 80.5 million in 2012— was huge. It rose from 77,000 in 2012 to 126,000 in 2013 to 202,000 in 2014 to 475,000 in 2015 and peaked at 745,000 in 2016—before dropping to 222,000 in 2017 after a controversial deal with Turkey prevented most refugees from continuing their journey north. In 2015, 55,000 refugees decided to register in Berlin—or try to register, because the bureaucratic apparatus at the Lageso was slow to adapt to the urgency of the situation.

Whose fault was the daily chaos, and all it came to stand for? The city, the country, the continent—no one was really prepared for the number of people who came. It was an immense political failure on the part of the European countries to see and react to what

was happening on their southern front. There had been a steady rise in the number of people either crossing the Mediterranean by boat or taking another route and traveling north via the Balkans. But Europe as a whole opted to turn the continent into a fortress, to prevent people from coming.

In the years before 2015, the route across the Mediterranean—in ancient times a place of culture and connection but now the boundary between two worlds—was the primary path people took to reach Europe from North Africa.

Over a million people came along this route in 2014 and 2015, mainly from Libya to Italy, where 170,000 arrived in 2014, a 277 percent increase over the previous year. Sixty-two thousand of those applied for asylum in Italy, while the majority of Syrians and Eritreans chose to continue to countries like Germany or Sweden.

The journey was often deadly. More than 3,000 migrants died trying to cross the Mediterranean in 2014 alone. Overall estimates are that more than 22,000 migrants died between 2000 and 2014.

The policy for most of those years before 2015 had been one of trying to save people’s lives at sea. The rescue operation called “Mare Nostrum,” the ancient Latin term for the Mediterranean, “our sea,” exemplified this approach.

Around 100,000 migrants were saved by Italian naval ships in 2014 alone—but in the fall of that year, the Italian government in coordination with its European partners decided to stop this operation amid concerns about rising numbers of migrants. British politician Baroness Joyce Anelay voiced a widespread critique when she claimed that the Italian rescue attempts had led to a “pull factor,” encouraging refugees to risk a Mediterranean crossing.

“Mare Nostrum” was replaced by “Triton,” an operation not of rescuing but simply patrolling in the Mediterranean. This shift had dire consequences for the thousands of people who’ve drowned in the ensuing years.

The shift from Mare Nostrum to Triton also pointed to a deeper failure—the virtual negation of what the European Union was meant to be: a community of nations united in soli-

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darity, with a common purpose that went well beyond a common market.

To understand the flawed reactions of European nations and the European community as a whole, it is important to remember they followed closely upon the financial crisis of 2008, from which northern Europe (in particular, Germany) recovered quickly, but from which southern Europe has still not recovered—and its recovery has been slowed by the north (particularly Germany). The trust that the nations of Europe had in each other, if ever a reality, was largely gone. Egoism had taken the place of solidarity between nations, and also within a lot of nations.

You cannot, it turns out, bend, ignore, or destroy basic values of humanity at your borders without consequences for the very fabric of the society within.

2. THE FAILURE OF THE EU

They had come to the end of their journey, in the middle of a field in the north of Greece.

They had settled along the tracks of an abandoned railroad. They relied on the help of vol-

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unteers. They had their eyes on the mountains across the border, and each night some tried to find a hole in the border to slip through. They would walk along the river and try to make it to the other side, to Macedonia, to Europe proper, so to speak. Greece, for them, was just the entry port, one more place to leave behind on their journey to a country where they saw a future for themselves and their children.

By the summer of 2016, this place, the camp of Idomeni, had become another symbol of the larger problems facing not only the refugees who got stuck here in tents, in the mud, but also Europe as a whole. Travel in or to Europe is governed by two key agreements, one regulating crossing from one EU nation to another, the other establishing procedures for refugees seeking asylum. Taken together, they produce an outcome that ranges from dysfunctional to inhuman, as the refugees at Idomeni could attest.

The Schengen Agreement of 1985 created a common area that now includes 26 European countries free of border controls. If you are in one Schengen country, you can freely travel to

others. (The exceptions that do retain border controls are the U.K. and the Republic of Ireland, but they are obligated to admit citizens of EU countries.)

The Schengen Agreement interacted with the Dublin agreement, which basically requires that a refugee may only claim asylum in the country of entry. This means that the overwhelming majority of refugees are forced to settle in the poorer countries along the shore of the Mediterranean, namely Italy and Greece, while the richer northern countries like Germany and Austria have a de facto shield. The rules of the EU require unanimity to change such agreements. Refugees have legal status only in their country of arrival, but the porous provisions of the Schengen Agreement serve as a magnet for them to get to the richer countries of the north.

The efforts of EU leaders to get all member countries to accept a fair share of refugees failed.

But the contradictions went deeper, reaching back into the history of a continent that has been shaped by the challenges of waves of migration in the 20th century far larger

antonio cal anni / ap images

Migrants wait to disembark from the Iceland Coast Guard vessel Tyr at the Messina harbor in Sicily in May 2015.

than the current one. The historical perspective is necessary to understand the deeper misconceptions pertinent in today’s discussion around migration. In 1919, as the German historian Philipp Ther documents in his study Die Außenseiter (“The Outsiders”), a history of Europe as a continent of refugees, there were around seven million people on the move, escaping the Russian Revolution, the war between Greece and Turkey, and several local conflicts in eastern and southern Europe in the wake of the First World War. And at the end of the Second World War, there were at least 30 million people fleeing their countries.

The historian Gerard Daniel Cohen called the time of the Cold War the “golden age” of the refugee, because there was finally a framework for who was a refugee and how to grant them asylum and guarantee their rights. The Refugee Convention of 1951 defined a refugee as someone seeking asylum “owing to wellfounded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion,” a definition rooted in the experience of the Second World War and a concept of persecution that was mainly political as well as humane. It was an important step, built on widely shared democratic values (values, as Ther points out, that could now be in question with the “decline of the West” and the rise of more authoritarian states and ideologies). It has shaped the debate about immigration and integration in Europe up to this day. But it might be counterproductive in a lot of ways.

Many European nations had long been accustomed to their own particular forms of immigration and nationhood. The French and the British had their imperial histories, with immigrants who came from their former colonies, mainly North Africa in the case of France, mainly India and later the Caribbean in the case of the U.K. Other European countries held to the belief that they were somehow homogenous nations—which was mostly a sort of myth, because migration and border-shifting have been an essential part of European history.

But national myths are strong and prevalent.

They were often formed, as in the case of Germany, around the concept of culture, the foundation of the nation supposedly being a common heritage, a common story, a common understanding

of history, value, language. The boundaries were narrow for any newcomer. The idea was that he or she should change, assimilate, integrate himself or herself into the framework of the host society. Immigrants were guests, in some ways, and in the German case they were even called that: Gastarbeiter (“guest worker”) is the term for the Italians and Turks, mostly, who came starting in the 1960s to work in German factories, helping create the Wirtschaftswunder, the German economic success after the war. They changed Germany, but Germans refused for a long time to acknowledge that change.

In this context, the year 2015 marked the end of an epoch and the beginning of a new one. The post–World War II order had been replaced by

THE EUROPEAN UNION’S POLITICS AND RULES MAKE IT ALL BUT IMPOSSIBLE TO EQUITABLY ALLOCATE REFUGEES AMONG MEMBER NATIONS. a new reality. The old framework, the old logic, the old understanding of migration as something ruled by the principles of the 1951 convention had come into question. People were fleeing war and persecution, yes, but they were also fleeing economic hardship, despair, and the consequences of climate change. They will continue to do that for the foreseeable future, and Europe seems not really prepared, morally, politically, or institutionally, to deal with this challenge. European nations built walls and fences, avoiding the future by retreating to the past, which had been a place of conflict and bloodshed not all that long ago.

3. INTEGRATION

The debate about migration is really a debate about multiculturalism, about the fabric of European societies, about identity and a sense

of belonging. It has been marked by fears and insecurities on the part of the native populations; it has been shaped by a belief in European superiority that has fueled the aggression against the perceived newcomers, even more so since the decline of the West has been felt within the countries of the West.

The intellectual and political fight against multiculturalism dates at least to the early 2000s, since which time multiculturalism has largely been held in disrepute. The general view, as Angela Merkel famously and flatly declared in 2010, is that multiculturalism has “utterly failed.”

At the root of multiculturalism’s rejection is a historic shift. Ever since the attack on the World Trade Center in New York in September 2001, the worldwide conflicts formerly confined to the edges of the old empires have spread into the nations of the West itself. Once-distant conflicts have come to the heart of Europe, and culture and, most of all, religion have become the battlefields on which fights about identity take place. As Islam more and more came to be seen as the enemy of the West, Islamic populations within European nations became further disenfranchised. There were legal battles like the ban on headscarfs in France in 2004, and there were attacks like the Madrid train bombing that same year. It was a combination of such events that led to a shaky consensus across much of Europe that multiculturalism was not only dead but a danger.

Clearly, this has had consequences for the concepts of immigration and integration.

Moreover, during the last 30 years, the “cultures” from which migrants have been arriving have been more “multi” than they were previously. Most post–World War II migration was characterized by large flows of people from a few places to a few places: Turkey to Germany; Algeria to France; Mexico to the United States.

Today, there is movement from many places to many places, and immigrants are both highskilled and low-skilled. This is “super diversity” as Steven Vertovec, from the Max Planck Institute for the Study of Religious and Ethnic Diversity in Göttingen, calls it.

Many migrants are ending up in cities where they intermingle with people from earlier waves. This also has consequences for integration and social policy. While the trend

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in much of the world has been to loosen up the regulations for high-skilled migrants and tighten the rules for low-skilled migrants, Europe has made few such adjustments. The problem is one of distinguishing between economic migrants and political refugees— and “a lot of experts don’t want to tinker with that definition because they think it makes the situation worse,” says Vertovec. In Germany, conservative parties like the CDU have been pushing since the early 1990s to restrict the laws on political asylum, while avoiding any discussion on a broader shift in immigration policy.

This discussion is made no easier by the fact that many among the second and third generations of immigrants in countries like Germany, France, or the U.K. have seen their prospects dwindle, their economic and social mobility slowing or grinding to a halt, their expectations dashed. They are often far more radical and unassimilated than their parents or grandparents. Politicians talk about Parallelgesellschaften in Germany, parallel societies of Turkish or Arab populations—as though the problems were inherent within those groups and had nothing to do with Germany itself.

4. THE RIGHT-WING BACKLASH AND ITS ANTIDOTE

There was a huge positive aspect of the socalled crisis of 2015, best illustrated by one number: eight million. An estimated eight million people came forth in Germany to help the refugees then arriving in the country. That’s one German in ten. The number comes from a study conducted by the Protestant Church in Germany in late 2015, but the number of volunteers has remained high even years after the peak. The Willkommenskultur, the welcoming culture, left indelible images of citizens standing at the train stations waving to the newcomers, handing teddy bears to the kids, bringing sleeping bags, food, all the necessities.

Over time, however, this welcoming culture has been ridiculed, invoked to discredit an open way of thinking about migration.

And yet: If all the volunteers active in the refugee crisis had voted for one party in the German elections of 2017, this party would have come in third, way ahead of the rightwing, xenophobic, anti-Muslim AfD, which

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won about five million votes; the Left party with four million votes; and the Green party with 3.7 million votes—trailing only the Social Democrats with 11.4 million votes and Angela Merkel’s CDU with 14 million votes. Every party but the AfD would of course have lost voters to this virtual pro-refugee party, but the numerical strength of that group is largely overlooked in today’s distorted discourse.

There was in fact an opportunity, and still is, to reimagine the whole structure and fabric of society in the image of that moment of help and cooperation. Many Germans became politically active for the first time in their lives.

They realized what it means to be a citizen; they challenged a long-standing perspective in

THERE WAS A HUGE POSITIVE ASPECT OF THE SO-CALLED CRISIS OF 2015: SOME EIGHT MILLION GERMANS— ONE IN TEN—WORKED AS VOLUNTEERS TO HELP REFUGEES. the country, which sees the state as a strong, remote entity that individual action cannot really affect.

Apart from the relatively new AfD, founded in 2013 as an anti–European Union party, the established political parties were unsure about how to react to this surge of immigrants. The citizens were much more decisive. This gap— between active citizens and muted, hesitant political parties—signified the potential for a new form of politics that goes beyond the routines of representative democracy.

Technology is a large part of this story. It was technology that steered the refugees on their long and dangerous journey, that helped them communicate and coordinate; it was the smartphone that made the difference in a world that has become smaller—and more navigable to people fleeing their homelands—due

to the digital flow of information. And it was also technology that helped shape the forces of resistance, social media where the rumors and falsehoods about refugees spread, where the people organized who went into the streets in the winter of 2014-2015 to shout, “Wir sind das Volk”—We are the people—a reference to the peaceful citizen revolution in Germany in 1989, this time turned into a statement or threat of aggression against the refugees.

The AfD is huge on social media, bigger than any other German party, using emotional language that’s become a moral contagion.

It has been the right that has shaped public discourse in the years after 2015. The 87 percent of voters who did not give their vote to the AfD in the last election have seemed more and more eclipsed in the discussions around migration and its discontents. Responding to the threat that the AfD posed—the threat to win away some of their voters—politicians of the conservative party CSU and some more hesitant members of the CDU have been eager to push words and concepts that cater to antiimmigrant fears.

Over the past few years, there have been more discussions about the Obergrenze, the limit on the number of migrants who should be accepted into the country, than there have been about Germany’s manifest need for immigrants to sustain its system of retirement and provide the necessary workforce.

Similarly, there’s been more discussion about the Ankerzentren, the centralized institutions for refugees to register and live until their request for asylum has been granted or refused, than about the lack of funding for language courses or the fundamental injustice of returning people to a country where they face persecution. Indeed, more and more of the countries that refugees have been fleeing have been deemed “safe”—including Algeria and Georgia. The perceived threat to German society from a tiny minority of potentially dangerous extremists among the refugees has become the cornerstone for most discussions about immigration in general.

This climate of mistrust and fear-mongering replaced the constructive euphoria of the first weeks and months that saw the arrival of the great mass of migrants. German Chancellor Angela Merkel was portrayed as a traitor,

m i c h a e l d e b e t s / pa c i f i c p r e s s / s i pa v i a a p i m a g e s

Over a thousand people protested in Bensheim against the campaign rally for the 2018 state elections in Hesse by the far-right political party AfD.

and even mainstream publications repeated the myth that she had opened the borders in the fall of 2015, letting refugees pour into the country—notwithstanding that the borders were open as part of the Schengen Agreement.

All Merkel did was to decide not to close the borders, most likely avoiding a humanitarian catastrophe. But facts mattered little in this climate of angst and agitation.

The discourse shifted further and further to the right, especially as German public television and the national talk shows addressed what was called “die Ängste der Menschen,” the fears of the people. The door that opened in the fall of 2015 was slammed shut.

5. THE OUTLOOK

The pushback against refugees, migration, and multiculturalism is a pushback against a progressive vision of society. What is at stake, in the European Parliament election of May 2019 and beyond, is the very notion of what this continent is about—whether it embraces just the freedom of movement of goods or also

freedom of movement of people. In theory, the answer of the European Union has more or less been both. In reality, the economic imperatives that are historically at the core of the EU— founded in the 1950s as an organization for trading coal and steel across borders—always took precedence. The refugee crisis of 2015 offered and still offers the opportunity for the governments and people of this continent to rethink what kind of union they really want.

And what kind of society.

It is a discussion that is necessary, one way or another. The continent has shifted into a retro mode and has lost a sense of its future.

The economic and technological consequences to shutting out immigrants are already being felt. So is the political and societal regression. What Europe needs is a more inclusive discussion about progressive answers to the fundamental problems of an aging continent that needs immigration desperately. In the face of a world dominated by America and China, Europe needs to find a position of strength and unity—which, in this day and

age, only comes from diversity and openness.

A part of the electorate has moved right, and in countries like Italy and Poland this has led to governments with a clear anti-immigrant agenda. But in most European countries, the vast majority of voters have a much more balanced and often open and constructive approach toward refugees and all the questions about how to deal with them, how to integrate them, how to behave in the face of fundamental humanitarian challenges. There is room for a new and different thinking about the perceived threat to the lifestyles and values that people are used to in Europe. The continent has the opportunity to reconceive of what is at the root of the European idea, of European history.

This was always a continent of multitudes, and it needs to be reminded of this again.

Georg Diez works for Der Spiegel. His most recent book was an analysis of the rightward shift in German society in the last ten years called Das andere Land. In 2016, he was a Nieman fellow at Harvard. He lives in Berlin.

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NOT SO SUPREME? Congress actually has a lot of power, mostly unused, to rein in the Roberts Court by clarifying the intent of the law.

B Y I A N M I LLH I S ER

52 WWW.PROSPECT.ORG SPRING 2019

ber of federal laws overruling a Supreme Court decision dropped nearly 80 percent, according to a study by law professor Rick Hasen. Congress needs to reverse that trend.

Of course, many of the Roberts Court’s decisions are so poorly reasoned that they appear to be straight-up dishonest. Often, this Court seems to manufacture controversy where none should exist—and then selects the most conservative side of this made-up controversy.

Yet, even in these cases, it is worthwhile for Congress to clarify statutes that the Court read disingenuously. If nothing else, doing so will shine a light on the Court’s most political decisions, and force the Court’s Republican majority to choose between surrendering to the will of the people or spending even more political capital on increasingly unbelievable decisions.

So long as Donald Trump occupies the White House, and Mitch McConnell controls the Senate, there’s little chance that Congress will rein in an increasingly rogue Supreme Court. But 2021 will be a new year that will

hopefully bring a very different government.

Democrats are already thinking about which reforms they will prioritize if they regain control of both elected branches. That agenda should include laws to overturn many of the Supreme Court’s most consequential decisions.

FORCED ARBITRATION

Among the most extreme and legislatively reversible decisions handed down by this Supreme Court are a line of cases permitting companies to defy a broad range of laws by shunting consumers or workers who are injured by a company into a privatized arbitration system that overwhelmingly favors business interests.

It works something like this: Try buying a cellphone plan, or starting a new job, or even checking your elderly parent into a nursing home. Somewhere in the stack of papers you have to sign to complete this transaction, you will likely find a clause where you give up your right to sue the cellphone company, employer, or nursing home in a real court, and instead

k e v i n d i e t s c h / p i c t u r e - a l l i a n c e / d pa v i a a p i m a g e s

I

t is a grim time for the rule of law in the United States. Our Constitution is controlled by the mixture of Republican partisans and conservative ideologues who dominate the Supreme Court. Even before Justice Anthony Kennedy’s retirement turned the Court into a place where liberalism reliably goes to die, the Roberts Court had undermined numerous labor, environmental, consumer, and voting rights laws.

Yet, while many of these decisions are rooted in the Court’s interpretation of the Constitution—and therefore impervious to congressional review—the Court is just as likely to misread an act of Congress as it is to read the Constitution as coextensive with the Republican Party’s national platform. Congress has plenty of power to clarify the intent of the law, through ordinary legislation. In the past, it has used this power extensively. However, Congress has increasingly abdicated its responsibility to correct Supreme Court decisions that butcher federal laws. In the last four decades, the num-

economic policy institute

agree that all future disputes will be resolved by a private arbitrator.

Oh, and one more thing: If you refuse to sign, the company won’t deal with you at all. If you refuse to sign away your right to sue your employer, you lose your job.

Numerous empirical studies show that individual plaintiffs fare much worse before an arbitrator than they would before a real judge.

A study by the Economic Policy Institute, for example, found that employees are far less likely to prevail before an arbitrator, and that they typically receive less money when they do prevail.

The Supreme Court created this forced-arbitration regime from the Federal Arbitration Act of 1925, a law that, in Justice Ruth Bader Ginsburg’s words, was supposed to allow “merchants with relatively equal bargaining power” to agree to arbitrate disputes that otherwise could spiral into much more costly litigation.

Yet, beginning in the 1980s, the Court began reading this law expansively to apply to con-

tracts between major corporations and much less powerful individuals.

Many of the Court’s recent decisions expanding forced arbitration rest on fabricated legal reasoning without any basis in the law’s text.

The Arbitration Act, for example, says nothing whatsoever about class action lawsuits. Nevertheless, in AT&T Mobility v. Concepcion, the Supreme Court held that the Federal Arbitration Act has penumbras, and that these penumbras permit a company to say that it will not do business with you unless you sign away your right to join a class action lawsuit against it.

Other times, however, the Court plays word games, hunting through the Arbitration Act for words that can be read multiple ways, then reading those words selectively to thwart workers’ rights.

Consider the Court’s decisions in Circuit City v. Adams and Epic Systems v. Lewis, which establish that employers can force their workers to sign away their right to sue under pain of termination. The Court reached this conclusion by holding that the word “commerce” changes meaning, even when it is used twice in the same statute.

Circuit City turned on two related provisions of the Arbitration Act. The first provides that “a written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction” shall generally be enforceable. This is the provision of the Act

that prevents courts from striking down many forced-arbitration provisions.

The second provision of the Act exempts “contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce” from the general rule that arbitration contracts are protected.

In fairness to the Court, the word “commerce” can fairly be read in either of two ways.

In 1918, seven years before the Arbitration Act became law, the Supreme Court held that the word “commerce” rarely applies to employment contracts. This narrow reading of “commerce” formed the basis of an infamous Supreme Court decision striking down a federal ban on child labor.

In 1941, however, the Court overruled its child labor decision and held that the word “commerce” should be read more expansively to encompass labor contracts.

Yet, regardless of which definition of “commerce” you prefer, Circuit City and Epic Systems were wrongly decided. If the word means what the Supreme Court said it meant in 1918, then most employment contracts are not a “transaction involving commerce,” and thus the Arbitration Act does not apply to such contracts at all.

Alternatively, if you use the modern definition of “commerce,” then all “workers engaged in foreign or interstate commerce,” which means virtually all workers, are exempt from the act.

But Circuit City took a third option. It read the phrase “a transaction involving commerce”

Comparison of Outcomes of Employment Arbitration and Litigation DAMAGE AMOUNTS IN 2005 DOLLARS

Mandatory employment arbitration (Colvin)

Fed. court employment State court non-civil discrimination (Eisenberg & Hill) rights (Eisenberg & Hill)

Mean time to trial (days) 361.5 Employee trial win rate

21.40% (n=1,213)

709 36.40% (n=1,430)

723 57% (n=145)

Median damages $36,500

$176,426 $85,560

Mean damages $109,858

$394,223 $575,453

Mean including zeros $23,548

$143,497

$328,008

SOURCE: The “Colvin” dataset draws on all employment arbitration cases based on employer-promulgated procedures administered by

the American Arbitration Association from January 1, 2003, to December 31, 2007. Data are assembled by Colvin from reports filed by the AAA under California Code arbitration service provider reporting requirements. Alexander J.S. Colvin, “An Empirical Study of Employment Arbitration: Case Outcomes and Processes.” Journal of Empirical Legal Studies 8(1): 1–23 at 5 (2011). The “Eisenberg and Hill” litigation statistics are reported in Eisenberg, Theodore, and Elizabeth Hill, “Arbitration and Litigation of Employment Claims: An Empirical Comparison.” Dispute Resolution Journal 58(4): 44–55 (2003).

SPRING 2019 THE AMERICAN PROSPECT 53

under the modern definition, and read the phrase “any other class of workers engaged in foreign or interstate commerce” using the 1918 definition. The general policy favoring forced arbitration is given the broadest scope, while the exemption favoring workers is read narrowly.

There’s an easy fix for this erroneous decision: A bill called the “Arbitration Fairness Act” provides that “no predispute arbitration agreement shall be valid or enforceable if it requires arbitration of an employment dispute, consumer dispute, antitrust dispute, or civil rights dispute.”

ANTITRUST

The Sherman Antitrust Act of 1890, which forms the backbone of American antitrust law, prohibits “every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States.” Yet it leaves it to the courts to determine what, exactly, constitutes “restraint of trade.” Indeed, while antitrust law is technically governed by acts of Congress, the Supreme Court largely treats this area of the law as one where it has free rein. As the Court explained in 1981, “in antitrust, the federal courts enjoy more flexibility and act more as common-law courts than in other areas governed by federal statute.”

The Roberts Court took advantage of this power almost immediately after Justice Samuel Alito’s confirmation banished moderate Republicanism from its bench. Prior to the Court’s 2007 decision in Leegin Creative Leather Products v. PSKS, Inc., the Court followed a nearly century-old rule prohibiting “a vertical agreement between a manufacturer and its distributor to set minimum resale prices.” In Leegin, the Court overruled this absolute prohibition, holding that price-fixing agreements between manufacturers and distributors were, in some cases, lawful.

Leegin built on the work of failed Supreme Court nominee Robert Bork, whose book The Antitrust Paradox may be the single most influential work in American antitrust law. In it, Bork argued that “consumer welfare” should be the sole goal of antitrust law—an argument that, in practice, typically leads courts to uphold anti-competitive practices that reduce consumer prices, at least in the short term.

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The danger of Bork’s approach, however, is that it ignores other anti-competitive practices which antitrust law should proscribe. Yes, agreements like the one in Leegin can sometimes reduce prices in the short term, but if too few companies gain too much market power, they may eventually gain the power to jack up prices. And if too few companies gain too much wealth, they don’t just become economic powerhouses. They also become political powerhouses that can distort our nation’s politics in dangerous ways.

The world that Robert Bork imagined quickly becomes a world where Amazon can bully suppliers into submission or insolvency. It is a world where the entire field of journalism rises or falls based on a tweak to Facebook’s algorithm. And it is a world where the illusion of competition replaces the reality. If you drank a craft beer in the last month, there’s a very high chance the brewery was owned by InBev, the parent company of Anheuser-Busch.

The choice of how to balance difficult questions like “Are lower prices now worth the risk of one company wielding too much power later?” should not be left to the one unelected branch of government. And it certainly shouldn’t be left up to the same Court that gave us Citizens United. If Congress does not step in to restore more meaningful competition to the marketplace, there’s little chance that the Court will do so.

There is also a fix to this misreading of the antitrust laws. Congress can clarify what counts as an anti-competitive abuse, making clear that a short-term test of consumer welfare defined as pricing should not be the sole test.

THE EXECUTIVE BRANCH

One of the executive branch’s most important powers is the ability to promulgate regulations implementing federal statutes. While some laws are complete in and of themselves, others set out a broad policy, then task a federal agency with implementing the details of that policy and adapting those details to new developments.

The Clean Air Act, for example, requires certain power plants to use “the best system of emission reduction” that is both technologically and economically sound. So Congress determined,

when it enacted the Clean Air Act, that power plants should constantly improve as society discovers cleaner ways of generating power. But it is up to the Environmental Protection Agency to monitor new technology and to continuously update regulations which tell these power plants what they must do to comply with the law.

Ideology inevitably seeps into this regulatory process. Democratic administrations will tend to regulate business more aggressively, while Republican administrations will tend to hold off on regulations that could easily be justified by a statute—or even roll back existing regulations.

Which brings us to the Chevron Doctrine.

Chevron v. Natural Resources Defense Council is the Supreme Court’s answer to ambiguous statutes that may or may not authorize an agency to promulgate a particular regulation.

In Chevron, the Court held that judges should defer to an agency’s reading of such a statute so long as “the agency’s answer is based on a permissible construction of the statute.”

The reason for this deference is twofold.

When a federal law is ambiguous, agencies that specialize in that particular area of the law are more likely to read it correctly than a panel of judges who, by their very nature, are legal generalists. Additionally, Chevron is a doctrine of judicial humility.

“While agencies are not directly accountable to the people,” Justice John Paul Stevens wrote in Chevron, “the Chief Executive is.” Thus, it is better for a democratically accountable agency to make policy choices, if the other alternative is leaving this decision up to judges with lifetime appointments and no accountability to the voters.

Chevron was handed down in 1984, just a few months before President Ronald Reagan’s landslide re-election victory, and it was generally viewed favorably by conservatives for this reason. After all, in the 1980s, a doctrine requiring courts to defer to federal agencies meant that those courts had to defer to Reagan’s agencies and their deregulatory agenda.

In the Obama years, however, the conservative Federalist Society—an influential legal group that plays a major role in selecting Donald Trump’s judicial nominees—grew obsessed with limiting agency power and abolishing doctrines like Chevron. It’s not hard

to guess why. Thanks to the hardball tactics that locked Chief Judge Merrick Garland out of the Supreme Court, Republicans are likely to control the Court for a generation or more.

So why would Republicans want that Court to defer to a branch that is likely to be controlled

by Democrats at least half of the time?

Chevron is on its last legs. In the 2015 case of King v. Burwell, the Court sharply limited it, holding that its doctrine does not apply to questions of “deep ‘economic and political significance’” that are “central” to a statutory scheme.

Some of the Court’s Republicans outright called for Chevron to be overruled. At least one would eliminate agencies’ power to promulgate meaningful regulations of any kind.

In a world without Chevron, the Supreme Court will transform into a kind of board of censors—free to strike down many Democratic regulations at will while holding their fire whenever a Republican administration takes action. The Roberts Court, in other words, is conducting a wholesale transfer of power from the executive branch to the judiciary, and that transfer of power will give Republicans on the Supreme Court a powerful trump card.

Congress, however, can stop this power grab.

In theory, this can be done by paying greater attention to how it drafts statutes, and removing ambiguity whenever possible. In practice, however, it is impossible for lawmakers to anticipate every scenario that may arise under a particular statute, and draft it so precisely that ambiguities will never arise. For this reason, Congress should codify the rule that, when a statute authorizing an agency to regulate is ambiguous, courts should defer to the agency’s reading of that statute unless the law cannot reasonably be read as the agency suggests.

If Congress does not act, the Court will rapidly grow into the most powerful institution in the United States, vetoing regulations that its Republican majority disapproves of, while simultaneously giving the thumbs-up to the deregulatory actions of Republican administrations.

VOTING RIGHTS

Any piece calling on Congress to overrule a raft of wrongly decided Supreme Court cases is incomplete if it does not address the Court’s anti-canonical decision in Shelby County v.

Holder. Shelby County, which struck down a

key provision of the Voting Rights Act, is one of the most egregiously reasoned decisions of the Roberts era. Much of the opinion rests on the idea that the United States is no longer racist enough to justify a fully operational Voting Rights Act. Just over three years after the Court declared racism to be not that big a deal in American elections, Donald Trump became president.

Before Shelby County, the Voting Rights Act required many states and localities with a history of racial voter discrimination to “preclear” new voting rules with officials in Washington, D.C., before those rules could take effect.

In a party-line vote, the Court held that this preclearance regime is “a dramatic departure from the principle that all States enjoy equal sovereignty” which cannot be justified in the less racist America that Republicans on the Supreme Court imagine that we live in.

The one silver lining in Shelby County is that it leaves the door open to a future act of Con-

to take the Court at its word and attempt a fix for Shelby County. Failure to do so would ensure that candidates like Donald Trump have a structural advantage for many elections to come.

To their credit, Democrats in Congress understand that combating voter suppression must be a top priority—after all, their own jobs are on the chopping block if the GOP succeeds in depressing turnout among voters of color. The leading proposal to restore the Voting Rights Act, known as the Voting Rights Advancement Act, would require states that committed a significant number of voting rights violations in the last 25 years to preclear new voting rights, and it would also make it easier to bring additional states under the preclearance umbrella.

Should this bill become law, it is not only likely to rein in abuses by states like Texas, and Alabama—whose history of voter suppression stretches back to Jim Crow—but also to catch

Congress can stop the power grab of the Roberts Court by paying greater attention to how it drafts statutes, and removing ambiguity whenever possible. gress restoring the Voting Rights Act. According to the Court’s Republicans, the problem with the Voting Rights Act is that it singled out states for preclearance based on the states’ past behavior. “Congress—if it is to divide the States—must identify those jurisdictions to be singled out on a basis that makes sense in light of current conditions,” Chief Justice John Roberts wrote for the Court. So, in theory, Congress could restore the preclearance regime by updating the law to single out states with a more recent history of voter suppression.

Shelby County is so poorly reasoned, and so out of step with prior decisions, that it remains to be seen whether the Roberts Court will permit such an updated law to go into effect— when a court hands down a decision as dubious as the one in Shelby County, it’s normal to suspect that its judges were acting in bad faith.

Nevertheless, given the proliferation of voter suppression laws enacted by Republican state governments, it is worthwhile for Congress

states like Wisconsin, which became a voter suppression pioneer in the last decade.

OTHER FORMS OF DISCRIMINATION

Various federal laws prohibit employment discrimination on the basis of race, sex, religion, age, disability, and other protected criteria.

Yet, while these laws announce that such discrimination is forbidden, they often raise as many questions as they answer.

How does one prove that their boss acted with racist intent, for example, when they lack the ability to read their boss’s mind? How pervasively must sexual harassment infect a workplace before it amounts to gender discrimination? What if a worker is fired for a combination of several reasons, one of which is the fact that their boss hates Jews?

Past Supreme Courts, which were less hostile to civil rights, answered these questions in ways that facilitated the overarching goal of ending discrimination. In many cases, for

SPRING 2019 THE AMERICAN PROSPECT 55

example, a victim of employment discrimination can prevail if they show that their employer implemented a policy which has a “disparate impact” on people of color. Other decisions permit victims of “mixed motive” discrimination—where racism, sexism, or other such bigotry is one of several reasons why their boss targeted them—to still prevail against their employer.

The Roberts Court, however, appears determined to shrink anti-discrimination laws until they can be drowned in a bathtub. In University of Texas Southwestern Medical Center v. Nassar, the Court abolished mixed-motive suits for workers who face retaliation after they file a civil rights complaint. It did the same to victims of age discrimination in Gross v. FBL Financial Services.

Similarly, in Vance v. Ball State University, the Court effectively gutted a rule preventing supervisors from sexually or racially harassing their subordinates by defining the word “super-

It is incumbent on Congress, in other words, to make it absolutely clear that traditional civil rights protections such as disparate-impact litigation and mixed-motive suits are available to victims of discrimination. If the Court sees any opportunity to undermine these protections, it will.

RELIGION

Until very recently, the Supreme Court struck a careful balance between the interests of people of faith and those of, well, everyone else in society. Religious people have long enjoyed a robust right to practice their faith, but they could not wield that faith as a sword to cut down the rights of others. As the Supreme Court held in United States v. Lee, “when followers of a particular sect enter into commercial activity as a matter of choice, the limits they accept on their own conduct as a matter of conscience and faith are not to be superimposed on the statutory schemes which are binding on others in that activity.”

Roberts may decide that the best course is to moderate. With a less partisan court, Democrats would not need to resort to nuclear tactics such as court-packing. visor” so narrowly that few bosses in modern companies will qualify. These decisions had nothing to do with the Constitution—they were just a conservative Court’s decision that federal civil rights laws should be read narrowly.

Now that Brett Kavanaugh occupies a seat on the Supreme Court, moreover, the Court’s attacks on civil rights laws are likely to accelerate. In Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, for example, four justices claimed that the federal Fair Housing Act does not permit disparate-impact lawsuits. Retired Justice Anthony Kennedy voted with the liberals to save the Fair Housing Act, but Kennedy is no longer around to do so in future cases.

The lesson from these decisions is that Congress can no longer count on the Court to act as its partner in fighting discrimination. Indeed, if anything, the Court has become a Jobian adversary, seeking out ways to thwart civil rights laws at every pass.

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A federal law known as the Religious Freedom Restoration Act (RFRA) was supposed to preserve this careful balance. Among other things, RFRA explicitly states that its purpose is to enshrine in federal law some of the Supreme Court’s older First Amendment decisions that respected this balance.

Nevertheless, the Court held for the very first time in Burwell v. Hobby Lobby that a religious objector may use that objection to restrict the rights of others—in that case, the right of a woman to have an employer-provided health plan that covers birth control.

In a brief passage that is almost entirely devoid of legal reasoning, Justice Samuel Alito claimed that a 2000 amendment to RFRA was “an obvious effort to effect a complete separation from First Amendment case law.” Then, having divorced RFRA from Congress’s explicitly stated purpose, Alito transformed RFRA into something that Congress never intended.

Overturning Hobby Lobby is a fraught exercise. Because the First Amendment also protects the “free exercise” of religion, the Supreme Court could retaliate against a law attacking Hobby Lobby by simply reinterpreting the First Amendment to require the same result. Indeed, the Court’s Republican majority appears eager to rewrite the First Amendment to allow religious business owners to discriminate against LGBT Americans—regardless of what Congress does to stop them.

Nevertheless, overturning Hobby Lobby’s misreading of RFRA is a worthwhile project, especially if it is part of a broader bill reversing many of the Court’s statutory decisions.

COURT-PACKING OR COURT-SPANKING?

Since Brett Kavanaugh joined its bench, the Supreme Court has largely avoided politically charged cases involving matters such as abortion or LGBT rights. Among veteran Courtwatchers, there is widespread speculation that Chief Justice Roberts was spooked by the partisan nihilism that placed Kavanaugh on the nation’s highest court. And that, at least for now, Roberts is guiding the Court to avoid cases that could diminish its political capital.

The Supreme Court, in other words, does sometimes respond to political pressure. If Congress deals the Court a swift spanking, Roberts may decide that the best course is to moderate. And such moderation would not just be good for the country; it would be good for the Court as well. It would prevent the Court’s Republican majority from handing down so many partisan decisions that Democrats need to resort to nuclear tactics such as court-packing.

Thus, the best reason to overturn past Supreme Court decisions isn’t just that it will wipe bad decisions from the books; it is that Congress could potentially deter future decisions that undermine progressive values. It could ensure that power rests with the people’s representatives, and not with five unelected Republican men.

Ian Millhiser is a legal research analyst with the Center for American Progress Action Fund.

His recent book is Injustices: The Supreme Court’s History of Comforting the Comfortable and Afflicting the Afflicted.

MOBILITY

Do All Roads Lead to Congestion Pricing?

Portland, Oregon, and New York are taking different routes to charging drivers who need to get downtown during the rush hour. They’ll also have to think hard about the impacts on low-income residents.

BY G ABRIE LLE G U RLE Y

P

ortland, Oregon, should be a prime candidate for congestion pricing. The compact city is politically progressive, eco-conscious, bikefriendly, and choked by traffic. But cars still rule the roads in Oregon, and too many people driving alone in rush hour in one of country’s fastest-growing metropolitan areas means that Portland now ranks tenth in congestion nationwide. Like their brethren in the New York megalopolis, area residents now get to waste hours in traffic jams.

One remedy for car-clogged cities is congestion pricing, charging drivers a fixed or fluctuating fee to access roads prone to rush-hour backups. The interest in pricing access to roads has only intensified as federal funding evaporates for transit improvements and decaying infrastructure, and traffic jams bleed beyond rush hours into weekend and holiday travel.

Pricing frameworks come in several flavors, but the goals are the same: to persuade people to change their driving habits by using alternative routes, changing travel times, doubling up, or using mass transit or other transportation options during peak driving times.

The most common type of congestion pricing in the U.S. is high-occupancy toll, or HOT, lanes, variably priced lanes like Interstate 15 in San Diego or Interstate 66 in Northern Virginia. These roads reward certain behaviors (carpooling) while penalizing other types

(driving alone). Pricing strategies also include variable tolls on bridges or highways and “cordon pricing,” a fixed (or variable) rate to enter a congested urban district like Central London.

The explosive popularity of city centers comes at a price. Drivers can no longer think of road travel as a something-for-nothing proposition. Paying a charge to get downtown encourages people to make different choices.

One major challenge is minimizing the burden on poor and low- and middle-income people whose commuting choices are constrained by finances, distance from city centers, and limited public-transportation options—equity must be baked in from the start. Another is persuading financially strapped commuters and risk-averse politicians to support the idea.

New York, where most people, including low-income residents, use public transportation, is moving toward cordon pricing—charging motorists to enter a center-city area—to disgorge traffic from downtown Manhattan.

The Portland metro area is assessing how highway tolling might reduce congestion and protracted commutes without penalizing lowincome drivers who spend more time behind the wheel than low-income New Yorkers.

There are political storms in the offing on the coasts. State lawmakers from the New York City metro area are divided on the merits of congestion pricing, which must be approved by the state legislature. In metro Portland, there

is a growing divide between groups who support highway expansions and ones convinced that congestion pricing is the best way to persuade people to think differently about driving in a state where paying tolls is a rarity. London’s congestion-pricing scheme, launched in 2003, offers important lessons for New York, Portland, and other American cities.

WHEN KEN LIVINGSTONE proposed a congestion charge during his campaign for mayor of London in 2000, he conceded that his plan had its roots in the work of conservative economists like Milton Friedman and the Thatcherite right. But it was a measure of just how bad London traffic had gotten that a Labour politician, and a left-winger at that, supported what was in effect a flat tax that allowed more-affluent people to pay for the privilege of convenience.

The Economist called congestion pricing “politically dangerous.” Livingstone had to face down a legal challenge before implementing a charge of £5.00 (currently about $7.00) on cars entering a center city “cordon zone.”

Although more higher-income people drive into London and more poor people take buses, other middle-income earners like teachers, small-business owners, and medical professionals who make home visits also drive, The Guardian noted shortly before the charge went into effect. Residents living in or very close to the cordon zone get a 90 percent discount,

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improve outer-borough services. And with a nod to congestion pricing 2.0, the for-hire car exemption ends in April.

“There [has to be] a clear line between where the money is raised and where it goes, so that it’s not seen as some money-making scheme to penalize poor drivers by a burdensome fee,” says Simon Jeffrey of the Centre for Cities, an independent London-based think tank.

TRAFFIC CONGESTION IS a symptom of the failure of cities to manage demand for roads.

Despite decades of carpooling, high-occupancy vehicle (HOV) lanes, and mass transit, the vast majority of Americans still drive alone. The congestion debate forces lawmakers to balance shrinking revenues, demand for road access, and the inevitable pushback against paying for a commodity that is currently free.

The complaints came fast and furious in the Northern Virginia suburbs of Washington, D.C., in late 2017 when new, variable inbound toll rates on Interstate 66 initially soared to more than $40. Yet the rate only applied to solo drivers during rush hours in the peak direction who could bring another passenger, use alternative routes, or take public transportation to escape the charge.

“To say that charging for the road is antidriving makes no more sense than saying that Starbucks is anti-coffee,” says Michael Manville, an associate professor of urban planning at UCLA’s Luskin School of Public Affairs. Federal Highway Administration analyses have found that a decrease in traffic as little as 5 percent makes a huge difference to the rest of the drivers using a route.

Congestion fees are regressive, and lowincome people are at the greatest risk for negative impacts. An equitable congestion-pricing framework requires close attention to demographics, the direction of travel, and transportation alternatives. A 2009 RAND Corporation report noted that cordon pricing, in particular, could be “progressive, regressive, or neutral depending on where low-income people live.”

New York has one of the country’s highest percentages of extreme commuters, people who endure trips of 90 minutes or more.

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Discounts and exemptions can level the playing field. These must be carefully calibrated: Grant too many and the goal of getting more vehicles off the roads during peak periods is lost. Similarly, a pricing program that curbs congestion along a central artery only to clog streets in neighborhoods along the route simply creates additional headaches for drivers, residents, and the local officials who must address consequences, such as a decline in air quality and competition for on-street parking.

“The roads are a utility that cities run in a uniquely bad way,” says Manville, pointing out that supply and demand influences the prices of other utilities. “We often have congestionbased user fees for water, electricity, and heating oil and it’s no coincidence that we do not have a chronic shortage of those things. We give our valuable road space to anyone who has a car and as a result we run out of it every morning and every evening.”

Manville notes that equity is built into most utility payment frameworks, so concerns about harming poor people who drive are largely unfounded. Low-income people are not deprived of water, because portions of utility payments by other ratepayers fund subsidy programs.

Congestion pricing can work that way as well. “You shouldn’t do pricing if you’re not going to take some of that revenue and identify people who might be harmed by it and make them whole,” Manville says. “Free roads are not a subsidy for low-income people; they are a subsidy for high-income people that some lucky low-income people get to use.”

BY 2007, LIVINGSTONE could use three words

to sum up his success for his fellow mayor Michael Bloomberg of New York: “Buses, buses, buses.” Meanwhile, Bloomberg seized on congestion pricing and related transit upgrades as a remedy for Midtown Manhattan traffic jams and congestion around the East River bridges that do not have tolls, the popular routes for “toll shoppers” who want to avoid fees for tolled routes into the city. Bloomberg failed to convince Albany to back his plan.

New York may yet be the first U.S. city to implement congestion pricing. In the past decade, average travel speeds in Midtown Manhattan and the central business district

m a r y a lta f f e r / a p i m a g e s

and equity measures include exemptions for disabled people.

Transport for London, the city’s transit agency, put hundreds of extra buses on the streets when the charge went into effect in February 2003. Traffic plummeted, thanks in part to a school holiday period. By the end of the year, about 40 percent of London residents supported the program while 31 percent opposed it.

The following year, the transportation agency found that congestion had been reduced by 30 percent. Air quality generally improved, but because certain diesel-fueled vehicles, buses, and taxis received exemptions, concentrations of one pollutant, nitrogen dioxide, have increased.

Congestion pricing is now an accepted feature of London’s transportation network.

Livingstone was ousted by a Tory, Boris Johnson, in 2008, and two years later his Conservative gover nment repea led a short-lived extension of charges to West London, but left the rest of the zone in place. Today, drivers pay a one-time daily charge of £11.50 (currently about $15.00) to enter a roughly 13-square-mile area from 7 A.M. to 6 P.M. (Beginning in April, drivers of certain older vehicles also must pay an emissions charge, in addition to the congestion charge.)

But the increase in Ubers, minicabs, and delivery trucks made the congestion program much less effective. Traffic has increased, bus speeds have plummeted, and riders have fled.

Some people have switched to new tube (subway) lines and for-hire cars. Yet there are more than 2 million people living in poverty in the city, and buses are typically their cheapest option. More than 60 percent of poor Londoners live in outer boroughs, and one in five Londoners chooses the cheapest route to work, not the fastest or most direct, according to the Trust For London, a London poverty and inequality foundation.

The London Assembly’s Transport Committee has called on Mayor Sadiq Khan to devise improvements, including more busonly lanes and express buses, and eliminating duplicate Central London routes to

Typical traffic on the Williamsburg Bridge entering Manhattan

have dropped below ten miles per hour, according to the 2018 Fix NYC Advisory Panel Report.

As in London, ride-hailing vehicles, onlineshopping deliveries, pedestrian-only zones, and bike lanes offer quality-of-life improvements that dial up congestion. The metro area economy suffers, shedding billions because of interminable delays.

Neighborhoods that abut bridge crossings have serious pollution problems. “Not instituting congestion pricing has led to a disparity of impacts,” says Eddie Bautista, executive director of the New York City Environmental Justice Alliance and a former Bloomberg administration official. “Where you have some of the highest asthma rates in the city are also places where you have a lot of highways and contaminated air.”

For the past several years as commuters endured their daily dose of Metropolitan Transportation Authority decrepitude, New York Governor Andrew Cuomo and New York Mayor Bill de Blasio engaged in an exhausting blame game over the city’s transit crisis. In his January state of the state and budget address, Cuomo green-lighted his version of the Bloomberg-era remedy, a congestion charge to enter central Manhattan which would raise an estimated $15 billion over a decade for MTA capital projects, a sliver of the funding needed to resuscitate the system. (The alternative is a 30 percent increase in MTA fares and other tolls.)

Taxis and for-hire vehicles recently began paying a new congestion surcharge as the taxi sector continues to fight the fee in court.

The two men also found enough points of agreement to outline another MTA improvement proposal a month later. The plan includes exemptions that de Blasio would like to see, including ones for people with disabilities and patients who need to access hospitals and other medical facilities.

Diving into Manhattan to work is a choice made by a small cohort of wealthier New Yorkers. A 2017 analysis by the Community Service Society, an anti-poverty organization based in the city, found that only 4 percent of outer-borough working people drive into Manhattan and that the “overwhelming majority” of those people are moderate- and higherincome workers. However, nearly 56 percent of working people from the outer boroughs use

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pa u l m aya l l / p i c t u r e - a l l i a n c e / d pa v i a a p i m a g e s

mass transit to get to jobs in Manhattan, other boroughs, or outside New York. Just 2 percent of the working poor who live in the outer boroughs might pay a congestion charge when they drive; 58 percent use public transportation.

Statistics are cold comfort for a governor who will have to convince outer-borough and suburban Democratic lawmakers who currently oppose or have serious reservations about pricing. They argue that the proposal would burden many of their constituents with a congestion fee on top of a bridge toll and fail to fund improvements to the commuter rail lines that serve their districts. The battle could be a bruising one.

If the state legislature does approve the plan, the city The London Assembly’s Transport Committee has called on the mayor to devise improvements, including more bus-only lanes and express buses. could implement the business district cordon charge by the end of 2020. want better borough-to-borough routes to help insurmountable challenge. It does, however, As in London, buses are the answer central people get to their first or second jobs. Trans- require transportation planners and lawmakto New York’s goal of providing an equitable, forming the “dollar vans” that operate in the ers to understand how people move around a congestion-busting transportation network. transit deserts of Queens, Brooklyn, and the metropolitan area and limit who gets a pass Cordon pricing can be progressive in New York Bronx into a regulated micro-transit service from the congestion charge. To the extent that if it delivers a faster ride into Manhattan for would provide more safe and reliable rides. a charge targets the wealthy, they will take the bus riders in neighborhoods that do not have a A portion of new revenues is supposed to financial hit and continue about their wellsubway or commuter rail line. New York buses go toward improving bus services in the outer appointed lives. Yet they have immense politihave the slowest speeds of the country’s larg- boroughs. Rozic has her doubts about whether cal power to resist, and well-off suburbs are est cities and, not surprisingly, bus ridership the transit-deprived neighborhoods will see centers of political opposition. If congestion continues to fall. the money. “I hesitate to implement a plan that charges are approved, businesses will simply New York has one of the country’s high- would alleviate congestion in Manhattan, but adapt as the charge gets factored into the cost est percentages of extreme commuters, peo- not necessarily take a look at what’s going on of doing business. Such charges will hardly ple who endure trips of 90 minutes or more. in Queens or in south Brooklyn or in the upper make a region less competitive, and could And a bus leg of a trip usually compounds reaches of the Bronx,” she says. Rozic remains make it more competitive by making it more convenient, especially if walking, biking, and the problem. New York State Assemblywoman undecided on the cordon charge.

Nily Rozic, an eastern Queens Democrat, has London’s experience with congestion pricing transit alternatives are added to the mix. experienced her fair share of them. There are shows that charges can begin to remedy streets no subway or commuter rail stations in her chockablock with solo drivers. Fed up with daily CONGESTION PRICING ALSO makes sense district, so heading into Manhattan involves MTA drama, many New Yorkers are ready to in other cities—but is an even heavier politia bus ride to a subway station. accept a fee that most of them won’t pay. How- cal lift. Lured by a healthy job market, tens of The subway-centric debate, a recent his- ever, convincing drivers to think about roads thousands of people have relocated to Porttory of bus service cutbacks, and erratic night like a water or a natural-gas utility will require land, Oregon, over the past decade—and most of them didn’t ditch their cars. Traffic congesand weekend service do not inspire confidence a Promethean public-education campaign. tion is a major issue in the metro area, secResolving equity concerns—who pays a among Rozic’s constituents that the MTA will “do right by them,” she says. Her constituents charge and who gets an exemption—is not an ond only to homelessness. Air quality is also a

concern, since vehicles produce a chunk of the region’s greenhouse gas emissions, and pollutants get trapped near the ground by inversions, a common local weather phenomenon.

The Oregon Transportation Commission, which oversees state transportation policy, filed a proposal with the Federal Highway Administration for a tolling “value pricing” pilot program on two of the most congested regional routes: portions of Interstates 5 and 205. Oregon officials pitched a unique feature: tolling all the freeway lanes, rather than just specific (HOT) lanes. In January, the Federal Highway Administration indicated that those freeways were “likely eligible” for tolls. If Oregon gets the nod from the feds, decisions about other specifics are still several years away.

Several Portland environmental-justice advocates support congestion pricing to manage roadway demand. People who use alternative modes of transportation could receive credits when they have to drive, for example. Providing discounts to low-income people is already part of the area’s transportation fabric: TriMet, the metro area transit agency, offers reduced fares for low-income people. Their focus is securing more funding for transit alternatives—and a faster ride—in poor and low-income areas.

One of those areas is East Portland, across the Willamette River from downtown Portland, where housing is scarce and expensive.

East Portland has attracted people displaced by gentrification elsewhere, but even that area is changing fast. Poorer than the city as a whole, the neighborhood has higher percentages of African Americans, American Indians, Latinos, senior citizens, and immigrants. (Portland is the whitest major city in America—of its nearly 650,000 residents, 77 percent are white.)

Many East Portland moderate- and lowincome residents have jobs in the riverside industrial areas and other places that require a car to get to, according to Michael Andersen, a fellow at the Sightline Institute, a Pacific Northwest issues think tank in Seattle. Residents drive miles out of the neighborhood for affordable groceries, too. Like many outer-borough New Yorkers, East Portlanders suffer through infrequent bus service, which becomes more of a problem the further east one goes and complicates connections to light-rail lines.

“Using [congestion pricing] as a demand

management tool that helps people have a reliable travel time is one of the best things we could do,” says Jillian Detweiler, executive director of the Street Trust, a statewide transportation advocacy group.

But despite its green bona fides, the political environment for congestion pricing in Oregon is as fragile as the natural one. There’s Oregon’s lack of a tolling culture: Two Columbia River bridges, east of Portland, are the only tolled routes in the entire state. “People are not used to tolling; it’s anathema just like a sales tax,” says Detweiler. (There is no statewide sales tax.)

Under the state constitution, any revenues from a prospective congestionpricing plan must go to highway and roadway projects. A January poll commissioned by Metro, Portland’s tricounty regional gover nment , found greater support for highway and roadwidening projects than for transit improvements.

Not surprisingly, there are other checkoffs on the congestion-pricing to-do list: Metro wants to see another in-depth study of the tolling and so does the state, according to The Oregonian/Oregon Live. There are also environmental and other planning studies on the horizon.

Sensing an opening to kill the plan, tolling opponents recently secured an Oregon Supreme Court approval to proceed with signature gathering for a 2020 ballot question that would essentially require a statewide sign-off on Portland-area tolls. But a no vote could be the catalyst for Portland to devise a city-only scheme out of the reach of state voters. Metro Portland’s congestion-pricing battle may end up being just as bitter as New York’s.

and middle-class people to continue to take mass transit or to give up cars requires attention to issues like inefficient bus routes that currently operate like rolling afterthoughts in the outer sections of Portland and New York.

Cities must introduce new bus routes or supplement existing ones in transit deserts.

Schedules must offer reliable connections to rail links and reflect current travel patterns, not sentimental attachments to routes that few people use anymore, preferably before the start of a congestion-pricing program.

Limited discounts and exemptions can alleviate the burdens for low-income people who cannot give up their vehicles. Exemptions for disabled people and discounts for residents contributed to wider public acceptance of the charge in London. But a plethora of exemptions or discounts for specific groups (similar to the parking perks that some New York public employees currently enjoy) that keep people in their vehicles will dilute the benefits.

Pricing must be f lexible enough to incorporate future transportation disruptions, such as impacts of for-hire vehicles (and down the road, autonomous vehicles) that New York and London have addressed.

Congestion pricing will challenge risk-averse lawmakers in an era when voters are reclaiming their democratic superpowers. The reaction of New Yorkers to subpar transit put a scare into a governor up for re-election, forcing him to make some key decisions. Portland faces cultural and political hurdles that may get city residents behind a downtown access plan if Oregon voters strike down a tolling plan.

No matter what, people will complain bitterly about an approaching vehicular apocalypse. Seattle, San Francisco, and Los Angeles, among others, are also looking at pricing strategies. But here’s the paradox: A carefully designed congestion-pricing program means that drivers will squawk less as time goes on, if they can cruise past the folks in the slow lane.

It will take a while before the politics catches up with the reality.

As in London, buses are the answer to New York’s goal of providing a fair congestion-busting transportation network.

EVALUATING PUBLIC-TRANSIT alternatives must come early in the planning process and can make the difference between a progressive outcome that addresses low-income people’s transportation issues and a regressive program that just captures revenues without delivering benefits to the people who need them the most.

For significant numbers of poor, low-income,

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I

n early January, one month into his sixyear term, Mexico’s new president, Andrés Manuel López Obrador (AMLO), went to war against the vast network of criminal gangs, politicians, and businesses that had been looting the national oil company Pemex at the rate of more than 60,000 barrels of gasoline a day. He shut down illegally tapped pipelines, sent in the army to stop gas trucks from delivering to the black market, sent auditors to seize the fraudulent books, and began bringing criminal charges against corrupt managers.

It was a risky move. Gas supplies suddenly dropped across the country, frustrated motorists could not fill their tanks, freight shipments were delayed, and tourism plunged. The Mexican and international media screamed that AMLO was destroying the economy.

Yet the polls showed that 75 to 80 percent of the country was behind him. “The gas shortage is killing my business,” a taxi driver in the conservative state of Guanajuato, who had not voted for AMLO, told me. “But he’s doing the right thing. They’ve been stealing gas that belongs to the people.”

Within two weeks, supplies were restored, and the gas thieves were on the run—for now.

This is just the first battle of a long war.

“War” is not just a metaphor: When the head of the association of gasoline retailers was asked why he had not complained before AMLO confronted the Pemex mobsters, he replied that if he went to the authorities, they would say, “‘I don’t own a pistol’ … They tell you, ‘If you complain, you disappear.’”

At a time when most of Latin America— indeed, much of the world—is moving to the right, with Trump-like plutocrats winning elections as “populists,” the 65-year-old López Obrador is an unabashed man of the left. The son of a grocer from the southern state of Tabasco, he has spent his life organizing for social-justice causes, especially the plight of the indigenous poor. The name of his party is Morena—a reference to the complexion of the ordinary Mexican, which is darker than that of the typical member of the ruling class.

He is also a smart and practical politician. As mayor of Mexico City from 2000 to 2005, he initiated programs for poor, aid for the elderly, and major projects to ease the city’s monstrous traf-

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AMLO’s Gamble

Mexico’s decidedly leftist new president, Andrés Manuel López Obrador, is taking on the business-political-criminal elite that has dominated his nation, and drenched it in bloodshed, for the past 40 years.

B Y JEFF FAUX

AMLO at one of his daily morning press conferences in Mexico City.

rebecc a bl ack well / ap images

fic problems. He left office with an 85 percent approval rating and a reputation for honesty, both of which are extremely rare among Mexican politicians. The author of several books on Mexican politics and economics, he has thought long and hard about how to succeed against the enormous power of the neoliberal system.

Despite the free-market rhetoric of its champions, neoliberalism has never been about separating government from business. Rather, it is about capturing the public sector to promote private profits. The result is a double win for the rich and powerful: They get richer and the citizenry gets more cynical about the capacity of government to improve their lives.

Neoliberalism also destroys democracy. In Mexico, the despoiling of government by the governing classes has created a disrespect for the law that permeates the culture. Police protection, applying for public day care, registering a deed, shipping goods across the border, or getting a job as a teacher typically require bribes or the hiring of a “fixer.” It turns virtually everyone in need of basic services into an accomplice. And if you think government is run by crooks, you are unlikely to feel guilty about selling your vote for a chicken.

Mexico has always had its share of people on the take. But in the 1930s, after two decades of revolution and civil war, a single party of national unity was established that pursued policies that shared the wealth. Over the next 50 years, inequality and poverty decreased and rapid economic growth increased opportunities for the poor and working classes.

In the 1980s, a new generation of politicians, inspired by the Thatcher-Reagan glorification of greed, came to power. Corruption became no longer just an aspect of Mexican political life; corruption became its purpose. The result was slower growth, decreasing equality, and increasing criminal violence.

Only 5 percent of the crimes in Mexico are ever reported, largely because people never know which side of the law the police are on.

(Several years ago, when a Mexican friend whose niece was kidnapped called a high-level government official for help, his first response was: “Don’t call the police.”) Of those crimes that are reported, only 4 percent result in convictions.

Violence now reaches into every corner of Mexican life. During last year’s election cam-

paign, some 145 candidates and campaign workers were assassinated. In 2017, Mexico was third only to Syria and Iraq in the number of journalists killed. In one infamous incident, 43 students from a teachers college in Ayotzinapa, Guerrero, were stopped by police, handed over to a narco gang, and disappeared.

Five years later, no one has been convicted.

IN THE LANDSLIDE ELECTION of AMLO,

which also gave him a majority of the nation’s Congress, Mexican voters decided that they’d had enough.

The media pundits of Mexico’s governing class—echoing the jeremiads from Wall Street and Davos—warned voters that AMLO was a dangerous radical who would drive Mexico

For the generation of politicians inspired by the 1980s glorification of greed, corruption became not just an aspect of Mexican political life; corruption became its purpose. into a Venezuela-like economic catastrophe.

But after several decades, the credibility of such hysterics had crumbled. These were the same people who had hailed each of the last five neoliberal presidents—Carlos Salinas, Ernesto Zedillo, Vicente Fox, Felipe Calderón, and Enrique Peña Nieto—as “honest reformers.”

As it turned out, Salinas and his family were closely tied to drug cartels, Zedillo and Calderón profited from companies they privatized, and Fox, like the others, left the presidency far richer than when he’d arrived. At the U.S. trial of Mexican drug lord El Chapo Guzmán, witnesses testified that narco traffickers had paid $100 million in bribes to Peña Nieto’s office.

Peña Nieto denied it. But wherever the truth lies in that particular charge, there is no denying that under all of these leaders the drug cartels flourished, criminal gangs expanded, and

the systematic looting of public assets was tolerated, if not encouraged, from the president’s office down. Transparency International’s 2017 ranking of counties by open and honest government put Mexico 135th out of 180.

The hostility of the elite to AMLO is understandable. His explicit goal is a sweeping, historic “Fourth Transformation” of Mexican society—the earlier ones being the war of independence from Spain, the 19th-century reforms against the power of the church, and the 1910 revolution.

His vision includes economic justice for the poor; green infrastructure development; rebuilding the police, the courts, and much of the civil service from the ground up; and a revitalization of long-suppressed democracy within labor unions. Franklin Roosevelt is one of AMLO’s heroes. And like the New Deal’s first 100 days, AMLO’s have been a political whirlwind.

He holds press conferences every morning at 7:00, jolting awake bleary-eyed staff and journalists with new programs, pronouncements, or ideas. In his first two months, among other initiatives, he doubled the minimum wage on the Mexican side of the U.S. border, increased pensions for the elderly, initiated a massive infrastructure plan for the impoverished south, announced a goal of establishing 100 new public universities, and launched a campaign to get Mexicans to read more by lowering the cost of books.

His critics complain that he is a one-man show; he doesn’t consult enough with his cabinet and outside experts, nor think through all of the necessary details. His answer is that in order to accomplish what he was elected to do, he has to cram 12 years of work into the one six-year term a Mexican president has.

His urgency makes strategic sense. There will be no Fourth Transformation unless he can restore and maintain Mexicans’ confidence in the power of democracy to liberate their government from corruption. Thus, his highprofile move against the Pemex racketeers, which he has called a “rescue.”

Pemex was created in 1938 when a left-wing government nationalized the U.S.-controlled oil industry. The goal was to use Mexico’s oil to fuel its economic modernization.

It worked. Thanks to Pemex, Mexico became self-sufficient in oil and a major exporter,

SPRING 2019 THE AMERICAN PROSPECT 63

bringing in foreign funds for further development. The company also became a model employer, providing pensions, health care, and other benefits.

The neoliberals who came to power in the 1980s began systematically selling off the country’s natural resources and major public enterprises to their friends, both foreign and domestic. When public resistance prevented them from privatizing Pemex as part of the 1994 North American Free Trade Agreement (NAFTA), they launched a campaign to make the case for selling it off. They starved Pemex for investment by diverting its revenues to spending programs that would normally have been paid for with taxes. As a result, Pemex has not built a gasoline refinery in 40 years, nor a major storage facility in 17 years. Mexico, one of the world’s major oil producers, now imports two-thirds of its gasoline from American refineries in Texas.

The crippled Pemex became a poster child for government “inefficiency.” Over time, slices of its business were outsourced, privatized— and then vandalized.

Pemex has some 10,500 miles of pipeline, mostly in isolated rural areas. For years, smalltime thieves—huachicoleros—have tapped them, largely to use the gas themselves. Gradually, the narco gangs—flush with drug profits—moved in with sophisticated equipment, national networks for distribution, and money to bribe Pemex employees to help them, and the police and politicians to protect them.

Pipelines were tapped much more efficiently, tanker truck deliveries were diverted, and contracts made with phantom vendors.

The black-market gas was then sold to retailers at a price that undercut Pemex’s. Not surprisingly, politically connected people rushed to open gas stations. The Mexican newsweekly Proceso reported that between 2015 and 2018 some thousands of permits to open gas stations were given to families of officials, political leaders, and other well-connected elites.

Losses to Pemex last year are estimated at well over $3 billion. At many gas stations in Mexico, people work for nothing but tips.

Rescuing Pemex—replacing managers, democratizing the union, and instilling the lost sense of mission—is by itself an enormous job. But it is a warm-up for the larger battle AMLO must inevitably face cleaning out the

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corruption that infects the police, the courts, and the military.

The previous Mexican governments’ answer to the spread of drug cartels was an alliance with the Pentagon that provided the Mexican military with training, equipment, and money for a War on Drugs. After 11 years, it is clear that drugs have won. The narco cartels have expanded, spawning criminal gangs that kidnap, extort, and steal. Low-level thugs are killed and arrested. Occasionally a capo like Guzmán gets enough media notoriety to be an embarrassment and is brought down. But the drug business has boomed, and the carnage has escalated. Since the War on Drugs began, some 250,000 people are estimated to have been killed and another 40,000 “disappeared”—pre-

Previous Mexican governments’ answer to the spread of drug cartels was an alliance with the Pentagon’s War on Drugs. After 11 years, it is clear that drugs have won. sumed dead with their bodies not yet found.

During his campaign, AMLO spoke against using the military to fight criminals. The military has its own record of corruption, and, as he argued, it is not trained to do police work. Moreover, he insisted, the root cause of violence was a lack of jobs and opportunities, which made crime the only option for many young people.

AMLO promised to track down the gang leaders and their political patrons. But for the poor who were driven to the gangs for want of any other work, he promised there would be “abrazos,” not “balazos” (hugs, not bullets). He would create jobs, reform and strengthen the civilian police, and return the army to its barracks.

Unfortunately, these are long-term solutions. To keep the public from sliding back into cynicism and indifference, AMLO has to demonstrate progress in breaking the power of orga-

nized criminal gangs and their political patrons.

According to an account that one insider gave me, AMLO first asked his civilian cabinet for a strategy for Pemex. They argued among themselves for a week and couldn’t agree. He then asked the military. They promptly responded with a detailed plan, which he accepted.

Both AMLO and the military claim that the use of soldiers is just temporary, until the police and judicial system are rebuilt. But this has made human-rights activists nervous. “I trust AMLO,” one said to me. “But what about the next president?”

His supporters reply that it is naïve to think that AMLO can take on all the powerful forces against him at once. He must keep them divided and deal with them one by one. To succeed, he will need more than just the authority of the presidency or a majority in the Congress.

He will need the active support of the people.

This is AMLO’s biggest gamble: He is betting that he can create a safe space for independent forces of reform that can continue to battle for social democracy outside, and beyond the term, of his presidency.

People are slowly, gingerly, beginning to fill that space. Thus, AMLO’s creation of a truth commission to reopen the case of the missing 43 students of Ayotzinapa has inspired families of others murdered and disappeared to demand their cases be reopened, too. In many cases, the trail of evidence will lead to people in the military.

There are also signs of a reawakening in the judiciary. One judge has ruled that courts had to recognize the evidence gathered by scientific forensic teams that the previous government had rejected. Another court has instructed the government that it must extend social security to domestic workers.

Encouraged by AMLO’s call for union democracy, dissident trade unionists—suppressed by previous governments—have come forward to denounce the system of “protection contracts” through which corrupt union bosses defend the interests of employers rather than workers. In Matamoros, some 50,000 auto parts workers walked off the job after the mostly U.S.-based employers changed their wage calculation to avoid paying the increased minimum wage.

After two weeks, workers won substantial increases in roughly 50 factories. Since then,

marco ugarte / ap images

Though the elite press throughout much of the world is critical of AMLO and skeptical about his popularity, polls show his approval rating is between 75 and 80 percent.

strikes have spread to other sectors—including bottlers and supermarkets—where labor has been exploited for decades.

Keeping the public’s trust also requires some theater. So, as president, AMLO continues to live in his old house with his family, opening up “Los Pinos,” the lavish presidential residence, to the public for the first time in history. He is selling the presidential plane and flies around Mexico on commercial airlines. When a dispute between Netflix and the firms that control film distribution in Mexico City kept the film Roma out of the movie houses, he showed it in Los Pinos for free.

He holds well-publicized town meetings and conducts polls to get citizen feedback on a wide variety of proposals, ranging from a new train system in the Yucatán to the creation of a new national guard. Critics scoff that these “consultas” are biased in favor of his supporters. But it is the first time people outside the governing class have been asked. And, given his present popularity—which depending on the poll ranges from a 70 percent to an 86 percent favorable rating—a pro-AMLO “bias” is unavoidable.

Despite death threats, he has disbanded the military security guard every previous president has had (although he does have some plainclothes protection), declaring that “the people will protect me.” Asked if he was afraid, he answered yes, “but I am not a coward.”

So far, his popularity has kept his establishment enemies at bay and divided. Big business fears for their privileges, but their profits depend on a friendly government. His reassertion of national sovereignty appeals to professional soldiers, but opening investigations into past atrocities is likely to lead to the military’s doorstep.

And then there is the United States, which no Mexican president can ignore. AMLO has wisely avoided personally antagonizing the ego-driven adolescent in the White House.

So far, despite his refusal to join the U.S.-led coalition threatening Venezuela, the BoltonAbrams hard-liners running U.S. foreign policy have pretty much left him alone. AMLO invited both Venezuelan president Nicolás Maduro and Mike Pence and Ivanka Trump to his inaugural lunch.

But there are potential land mines ahead.

If the Democratic House of Representatives amends the changes in NAFTA agreed to by Trump, Peña Nieto, and the Canadians last fall, AMLO will have to go back to the negotiating table, facing a wounded and belligerent Trump likely bellowing threats to close the border if he doesn’t get his way.

And the Central American immigrants keep piling up at the U.S. border. Given the snail’s pace at which the Trump government is processing refugee applicants, immigrant camps

are expanding. Mexicans in the border cities already are complaining about being overwhelmed. If the recent experience of immigrants in Europe is any guide, sooner or later such camps could explode with frustration, which would damage AMLO in Mexico and at the same time feed into Trump’s fear-mongering strategy for his re-election.

López Obrador’s attitude toward the several thousand Central American immigrants coming into Mexico has been the opposite of Trump’s. He has treated them with respect and provided work permits for those who want to stay in Mexico. But there is a limit to the numbers Mexico can absorb, and in any event, most want to come to the United States. Consequently, Mexico has started to tighten up its porous border to the south, which has made some immigrant advocacy groups unhappy.

On the other hand, AMLO does have a solution to the fundamental problem—a Marshall Plan for Central America, which a post-Trump Democrat in the White House could embrace.

The existence of a genuinely progressive government in Mexico could change these political equations. There is sentiment in the Democratic-controlled House of Representatives to make NAFTA’s labor rights protections stronger. Reversing the policies of previous Mexican governments, AMLO’s labor minister and the head of the Mexican Senate’s labor committee both champion a range of progressive labor reforms, setting up the possibility of genuine cross-border cooperation in the struggle to make rising wages a part of trade law.

In ways such as this, AMLO’s presidency could be a game changer, not only for Mexico, but in helping the U.S. recover from the catastrophe of Trump. Yes, the risks of having so much depend on one man are real. An assassin’s bullet or a heart attack (he’s already had one) could suddenly throw Mexico—with 130 million people on our southern border—into chaos and, some even fear, a civil war. There is no wall high enough to keep that from spilling over.

As one left-wing activist told me, “Sure, he is going to make compromises that we won’t like. But we have to make this work. If he goes down, we all go down.”

Jeff Faux was the founder, and is now Distinguished Fellow, of the Economic Policy Institute.

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How to Rebuild the Labor Movement

STATE BY STATE

What progressives can learn from conservative anti-union advocacy B Y A LEXA N D ER HERTEL -FERNANDEZ

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ast year’s strikes and direct action by workers, especially red-state public school teachers, have rightly been celebrated for injecting new energy into the American labor movement.

Yet these mobilizations should not distract progressives from the magnitude of the challenges facing unions and their supporters in the Democratic Party. The next time Democrats regain control of Congress and the White House, they will need to put major reforms of federal labor law front and center. In the meantime, they ought to learn from conservative anti-union efforts about pursuing change through the states and developing a politically minded strategy for labor reform.

In particular, Democrats need to think about labor law reform not just as yet another area of public policy, but rather as conservatives do: as a set of reforms that can build durable political power that enables further policy wins on other issues. Before spelling out the specific lessons that the left can take from the right’s victories, it is helpful to step back to see just how differently Democrats and Republicans think about unions.

ALL-OUT REPUBLICAN OPPOSITION VERSUS DEMOCRATIC AMBIVALENCE

Over the past four decades, conservative political activists and donors, often bolstered by private-sector businesses, have fruitfully used public policy as a political weapon to weaken unions, especially public-sector unions. Crucially, these cross-state conservative coalitions, above all the conservative “troika” of

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the American Legislative Exchange Council (ALEC), the State Policy Network, and Americans for Prosperity, have never seen their antilabor efforts as simply an end in themselves.

Instead, right-wing advocacy against unions recognizes the inherently political role that the labor movement plays—and thus that efforts to weaken unions will eventually redound to conservatives’ long-term political victories.

The State Policy Network, a consortium of state-level conservative think tanks, has described this strategy to its donors in the following way: Efforts to curb the power of labor unions like right to work, cuts to public-employee collective bargaining, and restrictions on union political activities have the promise of “permanently depriving the Left [of] access to millions of dollars in dues … every election cycle.” Such efforts can “defund and defang one of our freedom movement’s most powerful opponents, the government unions,” while also “clear[ing] pathways toward passage of so many other pro-freedom initiatives in the states.”

In contrast to conservatives’ view of unions as being central to politics, mainstream Democrats have been much more reluctant to recognize just how important labor has been to their party. Support for labor rights is not unanimous among Democrats in the same way that opposition to unions is among Republicans.

One piece of evidence comes from the behavior of Democrats during the short window in 2009 and 2010 when the party enjoyed near filibuster-proof majorities in Congress and could have enacted labor law reform in the form of the Employee Free Choice Act. The different

ways that the bill’s Republican and Democratic opponents spoke about their qualms is telling.

Like many of his fellow Republicans, Senator John Ensign of Nevada stressed that “if you know anything about politics, [the Employee Free Choice Act] is a game changer,” and that by strengthening the labor movement it could help Democrats to win elections “for the next 40 to 50 years.” Similarly, the U.S. Chamber of Commerce’s main staffer working to defeat the bill observed that Democrats would “be foolish to waste the opportunity” presented by full control of the White House and Congress to bolster union power. In contrast, moderate Democrats expressed qualms about how the legislation might hurt a weak economy. “I have 90,000 Arkansans who need a job, that’s my No. 1 priority,” holdout Democratic Senator Blanche Lincoln declared. Nowhere did these skeptical Democrats even acknowledge the bill’s political implications.

Moving from the federal to the state level, pro-union legislation is not typically part of the set of policies pursued by Democrats after they take control of state governments. Put simply, there is no liberal version of state-level rightto-work laws that Democrats have consistently pursued over the years on a scale that matches conservative efforts to retrench labor power.

A survey I conducted of over 300 state legislators and over 400 state legislative staff in the fall of 2017 underscores just how unified Republicans are in their opposition to unions—and how divided Democrats are over the sort of reforms that might bolster labor strength. I asked respondents about their perceptions of, and preferences

prospec t map gr aphic with photo by j o h n h a r t / w i s c o n s i n s tat e j o u r n a l / a p i m a g e s

(States with right-to-work laws are pictured in red on map.)

for, different labor union rights. Fully 96 percent of Republican state legislators and staffers I surveyed opposed the right of unions to charge non-members dues or fees for collective bargaining and grievance protections—the fair-share fees that right-to-work laws bar.

By comparison, 70 percent of Democratic respondents said that they supported such fees, no small figure but still less than the virtual unity present among Republicans. I observed a similar reluctance among Democrats to embrace unions’ right to engage in the political process. Nearly a third of Democratic respondents in the survey said that they did not support the right of unions to make campaign contributions to political candidates, and around 15 percent of Democrats also opposed the right of unions to lobby government. Overall, state Democratic support for unions tended to be highest in the Northeast and Midwest and lowest in the South, with respondents in the West falling somewhere in between.

The state legislative survey also illuminates the sources of the partisan differences in union support. For Democrats, support for unions was bundled with views on other social and economic issues: The more liberal a respondent was on issues like climate change, health care, abortion, or the minimum wage, the

stronger their support for union rights. For Republicans, in contrast, opposition to unions was near-universal regardless of how liberal or conservative they were on other policies.

Democrats’ lack of support for the labor movement at the state and federal levels has come at a real cost to the party. Even in its weakened state, labor remains an important organizational support for Democrats and progressive causes. Few, if any, other associations have the same capacity to mobilize workers and represent their interests.

The example of Wisconsin is instructive.

From 1999 to 2011, Wisconsin Manufacturers and Commerce—organized business’s main voice in Wisconsin legislative politics—was roughly at parity with the state education association in its lobbying efforts. That balance of power changed in 2011 after the state passed legislation curbing collective-bargaining rights and ending agency fees for nearly all public-sector workers (teachers included). Following the enactment of that bill, the power of Wisconsin’s public-sector labor unions, and particularly the Wisconsin Education Association Council, plummeted and the organization ceased to be a significant force on the state political stage.

“It decimated our ability to represent local and state government employees,” explained

one veteran government union staffer. Another leader summed up the post-2011 situation more succinctly: “Do we have less boots on the ground? Yeah. Do we give the same amounts of money to the candidates? No.” The Wisconsin story is mirrored in other states that passed right-to-work laws in recent years. Examining the passage of agency fee rollbacks across the states from 1980 to 2016, I find in joint work with Boston University economist James Feigenbaum and Brookings Institution fellow Vanessa Williamson that right-to-work laws disadvantage Democrats and liberal policymaking for years into the future. The passage of right-towork laws, we find after comparing neighboring counties straddling state right-to-work lines, lowers Democratic vote shares and turnout up and down the ballot. Weaker unions mean that fewer working-class Americans are asked to participate in elections; campaign contributions from unions to Democrats also fall after the passage of those laws. After the passage of right-to-work laws, states are less likely to elect working-class candidates to state legislatures and Congress, and state economic policy moves sharply to the ideological right. In one especially important example, we find that states are less likely to pass minimum-wage increases in the wake of right-to-work laws.

In short, it is hard to imagine either a sustained left or Democratic Party without a vibrant labor movement. As a result, labor reform ought to be a “day one” issue for Democrats that can then pave the way for other progressive legislative measures and eventual electoral victories. But to maximize the impact of such reform, progressives ought to pay close attention to four lessons from conservatives: organizing at the right levels of government, working across different arenas for policy change, connecting policies to individual citizens, and adapting reforms to local contexts.

LESSON 1: ORGANIZING AT THE RIGHT LEVEL OF GOVERNMENT

Spurred on by the rise of public-sector unions in state and local government in the 1960s and 1970s, conservative activists realized that a focus solely on Washington, D.C., would be inadequate and directed more of their efforts

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to the states. As ALEC ’s executive director notes, states are responsible for setting important policies over a range of issues. When it comes to labor policy, it is states that oversee the ability of public-sector unions to organize, collect dues, participate in politics, and collectively bargain. States also have authority over important aspects of labor market policy, like setting and enforcing the minimum wage or creating paid sick or family leave programs.

And states can also use their public-contracting activities to strengthen or weaken unions.

Facing mounting conservative cross-state victories, many progressives have shifted their energy to cities, especially on labor issues such as the minimum wage. That is understandable since liberal voters are increasingly concentrated in urban areas. Yet liberal urban initiatives have faced two big obstacles.

Progressives have found that cities have few levers for substantially bolstering union mem-

ists can use to push reforms in another one. In labor policy, conservatives have moved seamlessly from litigation to electoral and legislative politics and back again to the courts, all with the goal of reducing the power of labor unions.

The example of conservative efforts to cut union agency fees is instructive. The chair of ALEC ’s labor committee argues that right to work in Michigan would not “have happened in 2012 without … Indiana’s passage of right to work,” as his group was able to show wavering Michigan Republicans that “in the election after Indiana passed right-to-work [Republicans] did not lose a single seat in the state Senate and even picked up nine seats in the House.” But since such measures are nonstarters in Democratic-controlled states with the most powerful public-sector labor unions, conservative activists had to work through the federal courts to impose binding rulings that applied nationally.

The 2014 Supreme Court decision in Harris

Given the power of states, progressives cannot retreat to urban enclaves and expect to make much headway on labor issues. bership or political power, since those powers rest at the state and national levels. Equally important, the conservative troika has responded to local-level progressive initiatives by vigorously encouraging state preemption—the passage of state laws that circumscribe what cities can do. A state with a minimum-wage preemption law, for instance, bars cities from passing their own minimum wages that exceed the state minimum. In 2000, fewer than 2 percent of Americans lived in a state preempting local minimum-wage hikes. By 2016, that share had increased to nearly six in ten Americans.

The lesson is clear: Given the power of states, progressives cannot retreat to urban enclaves and expect to make much headway.

LESSON 2: WORKING ACROSS POLICYMAKING ARENAS

The American political system offers many different venues through which to pursue policy change—the courts, state legislatures, Congress, or regulatory agencies. Crucially, successes in one arena can unleash new resources that activ-

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v. Quinn was the first significant victory on this front for conservatives. That case involved a group of workers who provided care to disabled individuals eligible for Medicaid benefits. Although these workers were technically employed by the patients they served, the workers were paid through the federal-state Medicaid program. As a result, the Illinois state government ruled that these workers should be considered state employees for purposes of union representation. A dozen other states followed Illinois in facilitating the unionization of home health aides. Some states extended the logic to cover other similar state-reimbursed employees, such as day-care providers, as well.

Because Illinois is not a right-to-work state, home health aides were required to pay fairshare fees to their unions even if they were not union members themselves. A group of dissenting workers sued the state to protest this requirement, and the case was eventually heard by the Supreme Court. Appealing to the Court’s conservative majority, the plaintiffs in Harris successfully argued that Illinois home health aides did

not count as full-fledged state employees for the purposes of agency fees. That had the immediate effect of permitting dissenting non-members to opt out of paying agency fees to their union.

But more ominously, Justice Samuel Alito’s controlling opinion signaled that the conservative members of the Court were skeptical about the constitutionality of agency fees altogether, inviting further challenges that would invalidate such fees for all public-sector employees.

The response of conservative anti-union activists to the decision nicely captures the effectiveness of pursuing the same goals across arenas. First, right-leaning cross-state organizations launched large publicity campaigns to educate home health aides about their right under the Harris decision to save money by leaving the union. Think tanks affiliated with the State Policy Network began broadcasting TV spots with sympathetic health aides seated next to the disabled family members they cared for, describing how the workers decided to leave their union to have a little extra money to spend on themselves and their loved ones.

But the most significant follow-up to Harris came in the form of Janus v. AFSCME, in which the Supreme Court ended agency fees for all public-sector workers. The next step laid out by conservative opponents of public-sector unions in Janus—including both the litigants and broader advocacy groups like the State Policy Network— is to sue unions for agency fees charged in the past, which might bankrupt many unions.

LESSON 3: CONNECTING POLICIES TO INDIVIDUAL CITIZENS

The case of public-sector agency fees also underscores the imperative of continued investment in political organization and mobilization to connect policies to individuals and build power over time. The State Policy Network has billed the Janus decision as “the opportunity of a lifetime” to defund the public-sector labor movement. The Freedom Foundation has reportedly trained 80 canvassers to start knocking on the doors of public-sector workers in California, Oregon, and Washington to convince them to opt out of their unions. Affiliates of the State Policy Network in Illinois, Michigan, Ohio, and Pennsylvania are leading large-scale targeted opt-out campaigns with the support of the national network as well.

Progressive activists seeking to entrench their own labor policy victories would be wise to draw from this experience and not simply assume that a legislative or judicial victory signifies the end of a political battle. For policy changes to register effects, especially in the mass public, activists have to stay on the ground to show citizens how those policies affect their lives and connect the policies to concrete political actions. This means not only battling for the hearts and minds of public employees to encourage them to remain union members after Janus (as many unions have already done) but also pursuing a more proactive agenda after progressive policy changes, too.

LESSON 4: ADAPTING REFORMS TO LOCAL CONTEXTS

The final lesson that progressives can learn from conservatives involves taking advantage of varying political contexts to achieve the same policy objective in multiple states at once.

As the State Policy Network points out in a “tool kit” for its affiliates, advocates should select “the best reform based on [their] state’s political and cultural environment … Success does not hinge on a single reform tactic.”

To that end, the State Policy Network called for activists to pursue union recertification requirements (like those passed in Iowa and Wisconsin) in states that had “legislative majorities and executive branches that support union reform”; opt-out campaigns for privatesector workers (and before Janus, public-sector workers) in right-to-work states where conservatives lacked full control of the legislature and the governorship but where state laws permit SPN affiliates to request lists of public employees and union members through public-record laws; and right-to-work laws in states where conservatives enjoyed veto-proof majorities in the legislature and a strong ally in the executive who could stand up to the public backlash such a proposal would likely engender.

By tailoring their ambitions to the local political climate, the conservative troika was able to rack up additional wins that they would not have achieved pushing for all-or-nothing proposals. In addition, these incremental victories slowly chipped away at the power of organized labor across the country. That is because unions, and especially public unions,

transfer revenue from blue states with stronger memberships to red states with weaker locals.

Putting pressure on wealthier unions reduces the power and potential growth of their affiliates in less favorable political climates.

WHAT MIGHT A POWER-BUILDING REFORM AGENDA LOOK LIKE?

Turning the tide after years of conservative success in the states will not be easy. But just as right-wing opponents of public-sector unions learned from the unions’ earlier successes, so the unions and their supporters would be wise to learn from what conservatives have done.

Reformers ought to prioritize what I dub the ABCs: expanding access to unions and collective-bargaining agreements for all workers, broadening the benefits that unions can offer to members, and ensuring that unions can diversify their revenue beyond voluntary contributions from workers.

Under current law, workers have the option of joining a union if and only if they win a costly and time-consuming drive at their individual store, business, factory, or plant—an effort that their managers are all but certain to fight tooth-and-nail. And even if workers do win that election, their managers may never come to the table to negotiate a first contract.

Ideally, the United States would follow the example of Western European democracies where unions negotiate contracts that apply to an entire sector or region regardless of whether the individual businesses in that sector or region are unionized. Such a reform would help raise labor standards for more workers than are reached by the current labor movement.

It would also reduce employers’ incentives for opposing unions since they would be less likely to face competition from non-union firms in their industry. Some low-wage, anti-union employers might be driven out of business altogether, thus mirroring conservatives’ successful use of the law to put financial pressure on unions.

Beyond regional or sectoral bargaining, Democrats ought to take additional steps to facilitate union formation, like protecting unionization efforts as a civil right alongside workplace anti-discrimination law (as Richard Kahlenberg and Moshe Marvit have proposed) or by requiring that non-union employers hold regular elections to allow their workers to

decide on union representation (as Benjamin Sachs has argued). Both measures would provide the political space for union organizers to do more to build grassroots interest in unions.

Ultimately, however, all these changes in labor law will require congressional action, making them unlikely until Democrats have undivided control of the federal government. In the meantime, labor’s supporters should focus on state-by-state efforts to make progress.

Pro-labor state governments could expand their approaches to public-sector bargaining even in the absence of national reform by permitting or even requiring state governments to bargain over a broader set of outcomes with public-employee unions—what the Kalmanovitz Initiative at Georgetown dubs “Bargaining for the Common Good.” Teachers unions, for instance, might bargain over classroom resources, institutionalizing the demands that many of their colleagues in “Red for Ed” teacher strikes made for higher spending on education and more instructional supports for students. State legislatures could also do more to build public- and private-sector unions into the administration of government programs and policies. For instance, state governments could contract with unions to enforce labor standards, provide training or certification programs, or conduct public educational and outreach campaigns for social programs such as Medicaid and unemployment insurance. Because of the federated structure of labor unions, efforts to bolster unions in very blue states could strengthen their position all across the country.

Many of these measures would broaden the benefits and services that unions offer to workers, too, which will be essential to boosting membership rolls in a context where unions can no longer charge agency fees. Ongoing survey research I am conducting with Thomas Kochan and William Kimball at the MIT Sloan School of Management suggests that American workers still value traditional collective bargaining very highly. But even in the absence of collective-bargaining rights, we found that workers would be willing to pay voluntary dues to unions that offered them valuable services and benefits. These include portable health insurance coverage and retirement savings opportunities for when workers move between jobs, as well as legal help with work-related

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and non-work-related civil issues like housing or immigration. Workers are also excited by the prospect of union-offered unemployment insurance benefits and job training.

These survey findings are further supported by additional research I am currently conducting with George Washington University political scientist Ethan Porter on teachers unions.

Studying the Iowa education association, we found that teachers were most likely to try to cast a ballot supporting the recertification of their union when we reminded them about the valuable professional benefits and training opportunities offered by their association.

Unions already provide some of these benefits (like job training and professional-development opportunities) on a limited scale, but much more could be done to expand the reach of existing programs and enable unions to offer other services—and especially to use those benefits as incentives in membership drives

distinct, politicized gun-owner social identity.”

The implication of the NR A experience for unions is that generic discounts on products are unlikely to attract substantial member engagement or foster worker solidarity.

Instead, unions need benefits and services, like unemployment benefits or training opportunities, that tie in to the broader social identities that the labor movement is trying to cultivate.

This mismatch between benefits and identity may explain why previous union initiatives to build membership through discount programs do not have much to show for their efforts.

Even as unions try to attract more members, they also need to move away from a dues-only model of raising revenue. One of the many ways in which unions in the United States differ from their peers in other countries is that American unions rely nearly exclusively on dues from their members (and in non-right-to-work states, fairshare or agency fees from non-members). This

Labor law reform should free up unions to use valuable workplace benefits to recruit and retain workers as dues-paying members. and union elections. Labor law reform should therefore free up unions to creatively use valuable workplace benefits to recruit and retain workers as dues-paying members.

Of course, not all benefits offered by unions will be equally persuasive to potential members, nor are they equally likely to maintain unions as organizations over time. Past research suggests that it is not enough for membership organizations to simply provide scarce and valuable benefits to build membership and political clout.

Rather, the benefits have to be aligned with the organization’s core purposes and designed in ways to foster shared social identities.

Perhaps no other organization exemplifies this model for success more than the National Rifle Association (NRA). The key to the National Rifle Association’s historically potent grassroots membership is not just that the organization offers magazine subscriptions and discounts on gun-related products and services. Rather, as Northwestern University political scientist Matthew Lacombe has documented, these benefits “assiduously and strategically cultivate a

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model is not sustainable for maintaining, let alone building, labor’s political clout. To be sure, some dues revenue is important for keeping labor unions accountable to their members, but a near-total reliance on dues has left American unions highly vulnerable to right-to-work laws and other agency fee cutback efforts.

Reformers thus need to expand the opportunities for unions to diversify their funding sources. This need is especially acute for publicsector unions, which face an immediate decline in revenue following the Janus decision—and so progressive labor reforms ought to start here.

The advantage to pursuing a benefits-and services-related strategy for building membership is that it provides a path for unions to expand both dues and non-dues revenue. For instance, unions might expand their training, certification, and professional development opportunities as a means of attracting members while also contracting with state governments to partially (or fully) fund those programs. Take the example of teachers unions, which already provide popular, high-

quality classes, workshops, and trainings for educators to maintain and expand their classroom skills. Unions could contract with local and state governments to provide these classes on a fee-for-service basis—and these trainings could provide additional opportunities to pitch non-members on joining the union.

Unions should also find ways of monetizing the administration of other existing or new benefits that they might offer, such as unemployment benefits or health insurance and retirement savings funds. In many Western European countries, unions derive substantial revenue from the investment and management of such social-welfare funds. At one extreme, unions in several northern European countries such as Denmark and Sweden are responsible for administering unemployment benefits—so workers have a strong incentive to enroll in unions. Congressional Democrats might consider giving states the option of pursuing a similar approach with jobless benefits.

Apart from a social benefits–oriented strategy, in their capacity as political organizations with extensive campaign and advocacy experience, unions might also consider charging parties or other interest groups for political support or consulting they could offer where appropriate and legal. And lastly, public-sector unions might follow the lead of the National Education Association and create new categories of membership for “allies” willing to make financial contributions to unions, especially around political advocacy. Such “ally” membership categories ought to be treated carefully (with more limited governance rights, for instance) but could help to bolster and diversify unions’ finances.

Regardless of the specific mix of proposals that reformers pursue, what is crucial is that Democrats learn to use policy as a means of building long-run political clout. Conservative lawmakers have not hidden their intentions in reducing the political power of unions. It is time for Democrats to be equally clear about reversing that process.

Alexander Hertel-Fernandez is an assistant professor of international and public affairs at Columbia University and the author of State Capture: How Conservative Activists, Big Businesses, and Wealthy Donors Reshaped the American States—and the Nation.

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Is There Such a Thing as Progressive Nationalism?

In his most recent books, John Judis makes the case that there is— and that by indiscriminately embracing globalism, many liberals helped create nationalism’s virulent Trumpian version. BY E.J. DIONNE JR.

fischer twins / unsplash

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ost liberals have a problem with nationalism. John Judis has a problem with the problem liberals have with nationalism. This dynamic—or dialectic, if you prefer—makes Judis’s latest book, The Nationalist Revival, essential reading.

There are important lessons here for progressives. But there is also more to liberal unease with the

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new nationalism than Judis may acknowledge.

Through his long career in progressive journalism, Judis has made a habit of seeing things that others were missing. In the early 1990s, he took Ross Perot’s movement seriously from the start.

Through excellent reporting and listening, he came to understand the coherence of this middle-class,

middle-of-the-road, and largely secular movement. He also saw early on how powerful a political issue opposition to free trade could become.

Judis offered a revelatory book in 2001 calling attention to the increasingly selfish and inwardlooking nature of the American economic elite. The Paradox of American Democracy traced the

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transformation of the politics of business between the New Deal era and the end of the 20th century. From World War II through the late 1960s, Judis argued, significant parts of the business sector, while decidedly conservative, leaned more toward a middle-ofthe-road, consensual approach to public life, reflected in the work of the Committee for Economic Development. Business leaders of this stripe supported moderate and even liberal Republicans and broadly accepted both Keynesian economics and the welfare state.

But during the 1970s, in reaction to growing foreign competition, the new consumer movement led by Ralph Nader, and the rise of new regulatory agencies (many of them, ironically, established during the Nixon administration), business shifted right. “[C]orporate leaders and bankers,” Judis wrote, “abandoned their commitment to disinterested public service and to a politics that transcended class. They turned against union organizers, environmentalists and consumer activists with the same resolve that an older generation of business leaders had turned against the AFL , the IWW and the Socialist Party.”

It might be said that the perception of Washington as a “swamp” of special-interest groups took off in this period. Judis noted that the number of businesses with registered lobbyists in Washington rose from 175 in 1971 to 2,445 in 1982.

The number of trade associations nearly doubled between 1978 and 1986, from 1,800 to 3,500.

Then came Judis’s reporting over the last decade from Arizona and other states, which called attention to a burgeoning antiimmigration movement. Again, far earlier than most journalists, he saw how a backlash against migrants not only animated significant parts of the electorate but also spurred new forms of organizing on the right.

With his work on trade, elite

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behavior, and immigration, Judis might be said to have spent decades preparing himself for our current moment and developing the depth of understanding that allowed him to pack so much into his two compact and revelatory volumes for the impressive Columbia Global Reports series.

His first, The Populist Explosion, provided one of the best early explanations for Donald Trump’s victory—before Trump had actually won the election. It made an indispensable contribution to the debate over what populism is and isn’t by pushing back against the idea that populism must necessarily be, as some scholars have argued, authoritarian and exclusionary. Rather, Judis saw populism more expansively, with both democratic and autocratic possibilities.

“It is not an ideology, but a political logic—a way of thinking about politics,” he wrote. Populists wave warning flags that establishments are foolish to ignore: “They signal that the prevailing political ideology isn’t working and needs repair, and the standard worldview is breaking down.” That both the Bernie Sanders and Trump campaigns could be fairly called populist drove home Judis’s central argument that populism existed on the left and the right (and, in the case of Perot, in the center, too).

In Europe, France’s far right National Front was populist, but so were Syriza in Greece and Podemos in Spain.

It was thus inevitable that Judis would turn his attention next to The Nationalist Revival. And nationalism is the harder challenge, intellectually, politically, and morally.

If both populism and nationalism are contested concepts, nationalism arouses even more alarm—and loathing. Once again, Judis makes the case for conceptual nuance. Nationalism, he insists, “can be the basis of social generosity or of bigoted exclusion.” It can be both “an essential ingredient of political democracies” and “the basis for fascist and authoritarian regimes.”

Unlike many on the left, Judis has a long history of sympathy for nationalism. He wrote a manifesto for The New Republic in 1995 titled “For a New Nationalism” with Michael Lind, the brilliant and ideologically eclectic student of American nationalism and the

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contributions made by its advocates.

Lind includes in their ranks Alexander Hamilton, John Quincy Adams, Abraham Lincoln, and Theodore Roosevelt (whose progressive 1912 program was also proudly touted as “The New Nationalism”).

For Judis, a defense of nationalism is synonymous with a defense of a more egalitarian economy. The institutions necessary for greater economic justice, he argues, are under attack by globalization. He writes: The emergence of globalization in the 1970s has undermined the labor union and the locally owned factory and business and the community they sustained.

Finding themselves at the mercy of currency flows, footloose multinational corporations, and migrant flows, and afflicted by anomie and a sense of powerlessness—the individual has little recourse except the nation.

THE NATIONALIST REVIVAL: TRADE, IMMIGRATION, AND THE REVOLT AGAINST GLOBALIZATION

BY JOHN B. JUDIS

Columbia Global Reports

He goes on to use the everyday language of our politics to put nationalism in a sympathetic light.

“Nationalism,” he writes, “provides a framework within which citizens and their governments deliberate about what to do—and justify what they have done. Citizens debate whether a policy is in the ‘national interest.’”

Judis rightly points toward the prophetic and critical work of the economist Dani Rodrik on the paradoxes and costs of globalization. Had more attention been paid to Rodrik’s warnings back in the 1990s about the political and social impositions of globalization, the nationalist backlash of our era might have been avoided—or, at the least, its most dangerous effects might have been mitigated.

One of Judis’s conceptual contributions is to draw a sharp line between globalism, which he opposes, and internationalism, which he supports. Globalism, he says, “subordinates nations and national governments to market forces or to the priorities of multinational corporations.” Internationalism, on the other hand, refers to the decision of nations to “cede part of their sovereignty to international and regional bodies to address problems they could not

adequately address on their own.”

It’s a useful distinction that helps explain arguments within the British left over the decades about the European Union. Most left-wing opponents of the EU in Britain have always seen it as serving international capitalism. In Judis’s terms, they saw it as globalism’s agent. The majority of the British left (measured by opinion polling among the Labour Party’s supporters) have come to see it instead as a classic case of internationalism, an effort to pool sovereignty for the purpose of empowering its members within the global system.

Many on the left will be receptive to Judis’s focus on globalism, his discussion of the impact of trade on manufacturing jobs, and his argument that national sovereignty has been essential in the advancement of broadly social democratic policies. His insistence that national feeling has been central to the social solidarity that generous welfare states require is not a standard argument made by progressives, but it is important to ponder.

His is definitely not a book for those who argue that the proper location of solidarity is global and that it should reach all of humankind regardless of nationality. I don’t say this to denigrate this generous side of cosmopolitanism. On the contrary, a strong case can be made from both religious and secular perspectives that more attention should be paid in our dayto-day politics to the poorest people in the poorest countries on earth. Yet I think Judis is right to call our attention to the need to pay far more attention than we do to those who typically pay the highest costs for globalization and technological change—the least advantaged classes in the wealthiest economies. Egalitarianism does begin at home, and economic justice within nations is a precondition to a sustainable politics of economic justice that stretches across borders.

Judis knows that in trying to vindicate the democratic forms of nationalism, he is pushing uphill with many liberals. After World War II, he writes, “the leaders of the victorious powers tried to prevent the revival of the toxic, aggressive nationalism that had arisen in Germany, Italy and Japan.” The result? “In Europe and to some extent in

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the United States, the very term ‘nationalism’ and its cognates acquired a pejorative connotation. To call someone a ‘nationalist’ insinuated some underlying sympathy for Nazis or fascists.”

Well, yes. For many on the left and center-left—I am among them—it is very hard to divorce nationalism from its murderous 1930s-1940s downside.

In our book One Nation After Trump, my colleagues Norm Ornstein, Tom Mann, and I offered arguments that parallel Judis’s in important ways.

We agreed that progressives needed to acknowledge that democracy has largely prospered within nation-states and that the rise of nationalism in recent years was an expression of a desire by citizens to subject globalization to democratic discipline. We, too, cited Lind’s work on the positive contributions of democratic nationalism in our history. And the very title of our book and its echo of the Pledge of Allegiance’s commitment to “liberty and justice for all” reflected our view that progressive politics have always been linked to nation building rooted in social fairness and inclusion.

For this reason, we argued that progressives needed to embrace patriotism without shame or embarrassment. But we also sought to distinguish between patriotism and nationalism. We followed George Orwell, who saw patriotism as stemming from “devotion to a particular place and a particular way of life” while insisting that “nationalism, on the other hand, is inseparable from the desire for power.” The 1930s experience really does make a difference.

As Isaiah Berlin noted in the early 1970s, those who foresaw more benign forms of nationalism in the 19th century never contemplated “the pathological developments of nationalism in our own times.”

“No one, as far as I know,” Berlin continued, “had ever prophesied the rise of modern national narcissism: the self-adoration of peoples, of their conviction of their own immeasurable superiority to others and consequent right to domination over them.”

Perhaps, as Judis and Lind might argue, the patriotism my colleagues and I recommended was not all that different from the democratic

Judis’s insistence that national feeling has been central to the social solidarity that generous welfare states require is not a standard argument made by progressives.

nationalism they endorse. We might be seen as making a distinction that is more sentimental than rigorous.

Yet I do not think it mere sentiment to challenge the idea that we can now safely ignore the toxicity that attached itself to nationalism in the decades after World War I. The rightwing ethno-nationalism of the Trump movement—visible in nationalist movements in Europe as well—draws on these older forms of fascism, sometimes explicitly, often implicitly. If this makes many on the liberal left nervous, well, it should.

This view has led some of Judis’s critics to argue—Guardian columnist Jonathan Freedland’s December review in The New York Times Book Review is thoughtfully representative—that he is too ready to adopt some of the anti-immigrant movement’s language (about “a flood of refugees” and “a raging stream of migrants”). Freedland also noted that Judis’s accounts of how the regimes of Orban’s Hungary, Kaczynski’s Poland, and Putin’s Russia behave the way they do sometimes morphed from intelligent historical analysis into justification.

Freedland has a point on Hungary, Poland, and Russia. Judis clearly wanted to keep his book short, but he owed us more about the problematic nature of these regimes. He expresses proper discomfort with Orban’s antiSemitic campaign against George Soros, for example, but is too eager to criticize the European Union’s pushback (an extremely mild pushback, it should be said) against the rise of authoritarianism in its ranks.

On immigration, the picture is more complicated. Judis is right to point out that we have had many earlier outbreaks of nativist feeling, and that the current backlash can be explained in part by the facts on the ground. There has been a sharp change in the ethnic composition of the pool of immigrants since the 1965 Immigration Act. And the proportion of our population that is foreignborn has risen dramatically, from 4.7 percent in 1970 to 13.7 percent today.

Suggesting that it is not surprising that these factors have produced a reaction is not the same as justifying either racism or nativism. Nor is Judis

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wrong to argue that those of us who support relatively generous immigration policies need to think hard about the difficult compromises that might be required to rebuild a national consensus on behalf of the humane treatment of newcomers. Judis is sometimes too quick to rationalize the fears of the anti-immigration movement and to accept its faulty definitions of reality. There are times when he seems more morally offended by the obtuseness of cosmopolitans, the British author David Goodhart’s “Anywheres,” than by the rage of Goodhart’s “Somewheres,” those deeply attached to localities who are quite capable of their own old-fashioned prejudices.

Nonetheless, it is vital that progressives come to terms with what both of Judis’s books have to teach. It is certainly a form of willful blindness to underplay the role of racism and prejudice in Trump’s campaign and to deny that racism and nativism motivated a substantial share of his supporters.

But in political terms, the more costly mistake would be to assume that all of Trump’s working-class voters were motivated by race alone and that they can therefore never be persuaded to an alternative politics.

The Democrats’ 2018 successes in Pennsylvania, Michigan, and Wisconsin suggest that this pessimism is not justified by the electoral facts. And moving the country toward greater harmony (and, yes, justice) across the lines of race, ethnicity, and immigration status requires a new capacity for empathy toward those suffering from the costs of economic dislocation—in African American and Latino innercity and rural neighborhoods and the old, predominantly white factory and mining towns alike. Judis may be a bit too grumpy about liberals. But his grouchiness should force liberals who live in prosperous precincts to ask themselves what role their indifference to the costs of the last two decades of economic change played in creating the mess we’re in.

E.J. Dionne Jr. is a Washington Post columnist, a Georgetown University professor, and a Senior Fellow at the Brookings Institution.

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The Courage to Defy Brutality The case of a black Army veteran that spurred a South Carolina federal judge to defy his state’s white supremacist power structure BY RANDALL KENNEDY B

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acially motivated police brutality daily affronts us in two dimensions. First there are the episodes in which police deploy more force against racial minorities than they would have deployed against similarly situated whites. Second are the episodes in which the legal system wrongly absolves police of criminal culpability for racially discriminatory wrongdoing even in that small fraction of cases in which there is an investigation. Black Lives Matter and related protests have focused muchneeded attention on this long-standing scandal. But progress is difficult to attain. Perhaps some forward motion can be generated by more fully educating the public about our history of racially motivated police violence.

Unexampled Courage: The Blinding of Sgt. Isaac Woodard and the Awakening of President Harry S. Truman and Judge J. Waties Waring contributes splendidly to that project. Its author, Richard Gergel, is the United States District Court judge who presided over the successful prosecution of the murderer of nine black parishioners at the Emanuel African Methodist Episcopal Church in Charleston, South Carolina, in 2015. In Unexampled Courage, he chronicles a criminal attack by a white police chief upon a black soldier and the miscarriage of justice that permitted the crime to go unpunished.

On February 12, 1946, at Camp Gordon, Georgia, Isaac Woodard was honorably discharged from the army.

An impoverished, rural Southerner, he had served in World War II as a longshoreman, loading and unloading military ships sometimes under fire. He had been awarded three citations that he wore on his uniform as he boarded a Greyhound bus headed to Winnsboro, South Carolina, where he looked to be reunited with his wife.

During the bus ride, Gergel observes, Woodard “displayed a degree of assertiveness and self-confidence that most

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southern whites were not accustomed to nor prepared to accept.”

When the bus driver cursed at Woodard after he requested a toilet break to relieve himself, the veteran cursed back, exclaiming, “I am a man just like you.” For that demand of reciprocity, he paid dearly. Upon exiting the bus after the driver had reported Woodard to local police, the veteran was hit over the head with a blackjack without provocation by Lynwood Shull, the Batesburg, South Carolina, chief of police. Shull then proceeded to whack Woodard with the blackjack several more times as he dragged him to jail. One of those assaults occurred after Shull asked Woodard whether he had been discharged from the army.

When the veteran answered “yes,” Shull immediately struck him, adding the admonition that the correct response was “yes, sir.”

Subsequently, after Woodard was further beaten, Shull jabbed the baton into the veteran’s eyes, one after the other, blinding him. After spending a night in jail, Woodard was taken before a local judge who fined him $50. The veteran was then transported to a hospital at which physicians determined the full, terrible extent of his injuries.

The assault on Woodard was part of a pattern of postwar, racially motivated atrocities. Two weeks after Woodard’s blinding, a riot erupted in Columbia, Tennessee, after an altercation that featured a black veteran who had the temerity to defend himself when a white radio repairman slapped him. When blacks rallied to his aid to ward off a lynching, state police reacted wildly, ransacking black businesses, stealing jewelry and cash, committing vandalism (for instance, writing “KKK” on coffins in a black-owned mortuary), and beating, shooting, and arresting scores of blacks indiscriminately.

When a black veteran, Maceo

UNEXAMPLED COURAGE: THE BLINDING OF SGT. ISAAC WOODARD AND THE AWAKENING OF PRESIDENT HARRY S. TRUMAN AND JUDGE J. WATIES WARING RICHARD GERGEL

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Snipes, dared to vote in the Georgia Democratic primary—the only African American to do so in his rural county—white men shot him dead in retribution. In another rural area of Georgia, a black farmhand, Roger Malcolm, got into a dispute with his white employer who had reportedly made sexual advances on Malcolm’s pregnant wife. Malcolm stabbed the man in a fight. A white mob that included police officers captured Malcolm and his wife and another black couple. Initially, it appeared as though the mob was intent upon “only” killing the two black men.

When one of the women, pleading for mercy, called the name of a white man she recognized, members of the mob decided to leave no black witnesses. The four were shot executionstyle and Malcolm was castrated.

In Minden, Louisiana, John C. Jones, a black veteran, and his 17-year-old cousin, Albert Harris, were subjected to the wrath of a mob because they had been seen in the backyard of a white woman and Jones had complained of unfairness in a land transaction, a complaint marking him as an “uppity nigger.”

Upon being released from jail after no charges were filed against them, Harris was pistol-whipped but survived, while Jones was killed with a meat cleaver and blowtorch.

The National Association for the Advancement of Colored People (NAACP) made the attack on Woodard the centerpiece of a campaign to combat racially motivated violence. It organized a tour that put the veteran in pulpits and auditoriums nationwide to publicize the police brutality that permanently maimed him and to raise desperately needed funds, inasmuch as his veterans benefits were pitifully insufficient. (Because he had been discharged hours before he was injured, the government took the position that he was ineligible for full disability assistance.)

The NAACP also affiliated itself with other groups to create the National Emergency Committee Against Mob Violence, which succeeded in conveying to President Truman personally the dire situation on the ground. An upshot of the committee’s

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effective lobbying was intervention by the president that prompted a rare federal prosecution of a white police officer accused of violating the civil rights of an African American.

The prosecution failed miserably.

The local agents of the Federal Bureau of Investigation (FBI) were hostile.

Gergel notes that their “failure to obtain a copy of Woodard’s VA Hospital records, an essential starting point to investigate the cause of his blindness, speaks volumes about the FBI’s myopic and incomplete investigation.” The prosecutors were incompetent and indifferent. They paid no attention to jury selection. They failed to subpoena key witnesses. And the lead prosecutor, the United States Attorney for South Carolina, did not even ask the jury to convict. Instead, he ended his insipid closing argument by saying that “whatever verdict you gentlemen bring in, the government will be satisfied with.”

By contrast, the defense was aroused and vehement and prepared to use every possible available argumentative weapon, including open appeals to regional resentment and racial prejudice. “If a decision against the government means seceding, then let South Carolina secede again,” thundered Shull’s defense counsel. Continuing, he maintained that Woodard belonged to “an inferior race that the South has always protected,” and that Woodard’s back talk to the bus driver indicated that the veteran must have been intoxicated because “that’s not the talk of a sober niggra in South Carolina.” The all-white jury acquitted Shull within less than half an hour.

The brutal farcicality of the trial prompted the presiding judge to reset the course of his life. United States District Court Judge J. Waties Waring was a South Carolina blue blood, an eighthgeneration Charlestonian whose path to the bench, according to Gergel, “had

Isaac Woodard was savagely beaten and blinded by the chief of police in Batesburg, South Carolina.

been thoroughly conventional without the slightest suggestion that he questioned the racial status quo.” After stints as an assistant United States Attorney, a private attorney, the corporation counsel of Charleston, and a supporter of key state politicians, Waring was elevated to the bench in 1942 by President Franklin Delano Roosevelt.

Judge Waring presided over the case of Woodard’s assailant four years into his judicial tenure. At that point, Gergel notes, “he still did not question either racial segregation or black disenfranchisement.”

Yet Waring had displayed an unusual willingness to recognize inconvenient facts that other judges in the Deep South resolutely ignored.

In 1944 (in Duvall v. Seignous), Waring ruled in favor of African American plaintiffs who charged that the Charleston, South Carolina, school board violated their rights under the federal constitution by paying white teachers more than similarly situated black teachers. Thurgood Marshall, then a lead attorney for the NAACP Legal Defense Fund, recalled that that was “the only case I ever tried with my mouth hanging open half the time.”

Why? Because, Marshall said, “Judge Waring was so fair.”

Judge Waring still did not question the validity and wisdom of racial segregation. He did, however, insist that state authorities pay some heed to their legal obligation to offer blacks “equal” albeit separate services and facilities.

By the time of the Shull prosecution, Waring had undergone a dramatic experience in his personal life that profoundly affected his juridical trajectory.

He had divorced his wife of 30 years, a fellow Charlestonian, with whom he had had a child. This in itself was a scandal. South Carolina did not permit

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divorce. Parties seeking one had to leave the state to do so. At Judge Waring’s insistence, his first wife moved briefly to Florida, where she divorced him. Then Judge Waring married a twice-divorced, rich Northerner who proved herself quite willing to defy confining social expectations. She attended the trial of Police Chief Shull, was shocked by what she witnessed, and, along with the judge, undertook to educate herself more fully about the racial facts of life in the Jim Crow South, reading such books as W.J. Cash’s The Mind of the South and Gunnar Myrdal’s An American Dilemma.

Although a fiasco, the failed prosecution did generate beneficial consequences that showed up in the jurisprudence of Judge Waring, particularly in two cases that constituted the signature judgments of his career.

In Elmore v. Rice (1947), he invalidated the state Democratic Party’s white primary. Since at that time all state and federal elected officials in South Carolina were Democrats, exclusion from the Democratic Party primary greatly diminished a voter’s effective political influence. By excluding all blacks from its primary, the state Democratic Party condemned them to virtual disfranchisement.

Responding to a 1944 Supreme Court decision (Smith v. Allwright) that invalidated the white primary in Texas, Governor Olin Johnston persuaded the South Carolina legislature to erase from its statute books all laws regulating primaries in order to buttress the claim that the Democratic Party was a private organization and thus beyond the reach of the federal constitution. Governor Johnston did not bother to hide his purpose. “White supremacy will be maintained in our primaries,” he declared. “Let the chips fall where they may!”

Judge Waring blocked the state’s attempted evasion of Smith, noting that, regardless of form, the primary of a major party performs an essential governmental function that should be subject to constitutional standards.

“It is time,” Judge Waring wrote, “for South Carolina to rejoin the Union.

It is time to fall in step with the other states and to adopt the American way of conducting elections.”

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Influential white supremacists denounced Waring’s ruling even though it was upheld by a conservative court of appeals. The Charleston Evening Post, which was edited by Judge Waring’s nephew, denounced the decision, maintaining that it “arbitrarily” encroached upon “the rights of private citizens” and arrogated to the courts “the power to amend the Constitution by judicial fiat.” That was gentle, however, in comparison with the reaction against Judge Waring’s most daring opinion: his dissent in Briggs v. Elliott, a case in which plaintiffs in a poor, rural area of the state charged that their federal constitutional rights were being violated by officials who, for racial reasons, relegated black children to facilities that were unequal to and separated from facilities afforded to white children.

Clarendon County served some 6,531 black students and 2,375 white ones. Yet, exclusive of salaries, the county spent $395,000 on the white schools but only $282,000 on the black schools. Officials offered bus transportation to white children while abandoning the black children. White schools enjoyed running water and indoor toilets. Black schools did without. The number of students in classes in the black schools was often twice the number of students in the white ones.

Thurgood Marshall’s initial complaint focused mainly on the contrast between the educational facilities; only obliquely did he challenge the constitutionality of segregation per se. Judge Waring suggested privately and rather aggressively that Marshall rescind the initial pleading and file a new complaint, this time expressly challenging the constitutionality of segregation. Judge Waring’s prompting stemmed partly from his recent conversion to anti-segregationist abolitionism; he had come to believe that Jim Crow arrangements represented a dire social evil that should be eradicated immediately. His suggestion also stemmed from a strategic calculation. Attacking the constitutionality of the state laws requiring segregation would trigger the convening of a three-judge federal district court whose ruling would proceed directly to the Supreme Court for review.

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J. Waties Waring, a federal judge in South Carolina who challenged the prevailing Jim Crow orthodoxy

Marshall followed the judge’s advice. When he did so, the defendants surprised everyone by confessing that they had (inadvertently, of course!) failed to provide equal resources to black and white students.

The defendants sought to preclude proceedings that would have shown in stark detail the extent to which local and state officials had shortchanged African American children. The lower court accommodated that strategy.

That should not have been surprising.

One member of the panel was Chief Judge John J. Parker, whose nomination to the Supreme Court by President Herbert Hoover had been scuttled by opposition from organized labor and the NAACP. Another member, George Bell Timmerman, was a vocal and fervent segregationist. That twosome, outvoting Waring, found in favor of the plaintiffs but without questioning segregation. Taking refuge in a mountain of judicial precedent, the Parker-Timmerman majority ordered the local authorities to provide equality within

the confines of separate but equal.

Judge Waring took a dramatically different tack. First, he deplored the “judicial evasion” that allowed the Briggs court to avoid grappling with the constitutionality of racial segregation in public schooling. Second, he did something that was perhaps unprecedented for any federal judge, not to mention one in the Deep South. He lauded the bravery and public-spiritedness of black plaintiffs suing state officials in a suit seeking racial justice.

He wrote that the plaintiffs had “shown unexampled courage in bringing … this cause at their own expense in the face of the long established and age-old pattern of the way of life which the State of South Carolina has adopted and practiced and lived in since and as a result of the institution of human slavery.” The plaintiffs and their supporters had been fired from jobs, threatened with violence, deprived of essential emergency assistance, and subjected to trumped-up criminal charges. Judge Waring, to his everlasting credit, bestowed upon these admirable dissidents the recognition that has all too often been denied to them.

Third, Judge Waring let loose with a full-throated denunciation of racism embodied in law. “The whole discussion of race,” he asserted, “has been intermingled with sophistry and prejudice. … What possible definition can be found for the so-called white race, Negro race or other races?” He excoriated “the sadistic insistence of the ‘white supremacists’ in declaring that their will must be imposed irrespective of rights of other citizens.”

He denounced “the false doctrine and patter called ‘separate but equal,’” declaring that racial segregation in education “can never produce equality.” Insisting that Jim Crow education “is an evil that must be eradicated,” and that “[s]egregation is per se inequality,” Judge Waring maintained that segregation in public schooling in South Carolina “must go and must go now.”

There were a few other judges around this time who were outspokenly exposing and condemning racism in American law—for instance, Justice Frank Murphy at the federal Supreme Court (see his indictment

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of state harassment of Japanese Americans in Oyama v. California [1948]), Justice Roger J. Traynor at the Supreme Court of California (see his castigation of state law prohibiting interracial marriage in Perez v.

Sharp [1948]), and Judge Henry W. Edgerton at the United States Court of Appeals (see his censure of racially restrictive housing covenants in Hurd v. Hodge [1948]). None, however, outdid Waring in polemical ferocity, and he was alone in residing in the Deep South. His pronouncement in Briggs, Gergel observes, is a major landmark in American jurisprudence in that it constituted “the first instance where the per se analysis [rejecting segregation in public schooling] was fully developed in a decision issued by a federal judge.”

Waring was already persona non grata among the ruling figures of the state. Not only had his previous rulings displayed an absence of commitment to white supremacism, but he had also begun to do other things that markedly challenged Jim Crow orthodoxy. He desegregated his courtroom.

He placed prospective black jurors on the same benches as prospective white jurors. He hired a black bailiff.

He entertained blacks at his home and permitted them entrance through his front door. He declined to prevent his new wife from publicly castigating segregation. For these infractions, he suffered ostracism, attracted threats, had a cross burned on his lawn, had a brick thrown through a window at his home, and became the target of a campaign seeking his impeachment.

After his dissent in Briggs, however, the intensity of the enmity Judge Waring generated rose dramatically.

He went from being viewed as an obnoxious oddball crank to a dangerous enemy—indeed, that worst of all enemies: a traitor. The Charleston News and Courier maintained, for example, that the ascendency of Waring’s views would lead to “mixed race schools” which would in turn lead to “the extermination of the white race.”

Many politically engaged blacks, of course, viewed matters differently. The president of the Charleston branch of the NAACP told Waring: “The people of my group have thanked

God for you in the past. America will thank God for you in the future and at some later date the South will raise a monument to you.”

Soon after handing down his dissent in Briggs, Waring retired and moved to New York City, where he spent the remainder of his life. President Truman lauded him as “a very great judge.” The New York Times observed that he had served with “courage, integrity and intelligence.”

Even his hometown adversary, the News and Courier, complimented him, albeit equivocally, writing that but for his “crusading on the Negro question,” Waring had made “an excellent record on the bench.”

Judge Waring lived to see the Supreme Court follow him in finding racial segregation in public schooling to be unconstitutional. It did that, of course, in a bundle of cases known as Brown v. Board of Education. Although one of those cases was Briggs, Chief Justice Earl Warren’s famous opinion in Brown made no mention of Waring’s prescient dissent.

Waring died on January 11, 1968.

For years his legacy sank into obscurity. Then, in 1987, Professor Tinsley E. Yarbrough wrote a thorough biography, A Passion for Justice: J. Waties Waring and Civil Rights. In 2011, the South Carolina Supreme Court Historical Society sponsored a twoday conference on Waring. In 2015, a statue outside the federal courthouse in Charleston was erected to memorialize him. The next year, the federal courthouse itself was named in his honor due to a remarkable turnabout.

The courthouse had already been named in honor of former United States Senator Ernest “Fritz” Hollings, a segregationist in the 1950s. Hollings asked that his name be removed from the building in favor of Waring. As Hollings explained it, displaying rare humility in a politician, he had simply raised the money for the courthouse, while Waring had “made history in it.”

Judge Gergel crafts incisive profiles of the people that animate Unexampled Courage—Isaac Woodard, who lived a difficult, scuffling life at the end of which he died apparently unaware of his own historical significance; President Truman, who

Judge Waring lived to see the Supreme Court follow him in finding racial segregation in public schools to be unconstitutional.

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surprised many with the strength and sincerity of his contributions to the black freedom struggle; George Elmore, the hero of black enfranchisement in South Carolina who died penniless because of his lawsuit; Walter White, the multitalented, effervescent executive secretary of the NAACP who looked white but identified as a black man; and Lynwood Shull, Woodard’s assailant, who died at age 92 and was remembered in his community “as a kindly and faithful elderly usher at the local Methodist church.” Judge Waring, though, is the figure upon whom Gergel lavishes the most empathy.

Although Gergel’s depiction of Waring is persuasive, there is one issue regarding which his admiration appears to have prompted him to back off from a more probing examination of his hero. Gergel notes that Judge Waring’s conduct in Briggs was highly irregular. Recall that Judge Waring had “advised” Thurgood Marshall to attack segregation more frontally than he had initially intended to do.

“A natural question,” Gergel writes, “is whether Waring should have been disqualified to sit on the [Briggs panel].”

Gergel contends that what might now seem to have been an infraction of judicial ethics was not really a violation because, back then, “judicial standards of conduct were far different in practice from what they are today.” That defense is untenable.

Judge Waring crossed the line of judicial impropriety when he offered advice to Thurgood Marshall and then adjudicated the legal status of that advice. Furthermore, he crossed the line again when he offered suggestions to NAACP lawyers on how best to present their case in their appeal to the Supreme Court. Admirers of Judge Waring can take the position that, despite his breach, he is entitled to praise because of the good that he attempted to accomplish. Or they can take the position that in certain circumstances judicial propriety should be subordinated to other priorities and that this was one of those circumstances.

Clearly, though, Judge Waring transgressed conventional judicial ethics. Judges were and are expected to forgo playing a role as an advocate

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in cases they adjudicate. But by the time of Briggs, Professor Yarbrough writes, “Judge Waring was no longer concerned with proper judicial behavior. … [H]e was like a disciple with a mission, and one essentially religious in its intensity. … He had drafted the first modern judicial ‘sermon’ repudiating [segregationist] doctrine. And he now could not bring himself simply to sit idly by while his cause moved through the appellate process.”

In Unexampled Courage, Judge Gergel continues a mission on which he and his wife Belinda Gergel (to whom the book is dedicated) have long been embarked: bringing to the fore a full, nuanced, forthright, unblinking history of the South. Gergel has been in the forefront of efforts to honor figures who have wrongly been ignored or vilified. He contributed significantly to the campaign that led to rehabilitating the reputation of Jonathan Jasper Wright, who sat in South Carolina in the 1870s as the country’s first black state Supreme Court justice. He also contributed to the campaign that led to the long overdue public valorization of Matthew Perry, the Palmetto State’s leading civil rights advocate in the 1950s and 1960s and its first black federal judge (the federal courthouse in Columbia is named in his honor).

Gergel’s hallmark is an emphasis on how people at every level contribute to the making of history. He insists, for example, that judges never make rulings alone. Without parties willing to make complaints, without communities willing to offer support, without lawyers willing to present cases, judges would be unable to do their part to advance the law. He makes that point memorably in Unexampled Courage.

Hopefully it will nurture the ground from which will arise more effective efforts in our own time to confront the ongoing menace of racially motivated police violence.

Randall Kennedy has been a contributing editor of the Prospect since 1995.

He is the Michael R. Klein Professor of Law at Harvard University. His several books include The Persistence of the Color Line: Racial Politics and the Obama Presidency.

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Prosecutors Against Mass Incarceration?

Reform is under way at the nerve center of the penal state, but it won’t be enough. BY DAVID GARLAND B

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f anyone still thinks American criminal justice is a matter of jury trials, constitutional rights, and adversarial justice, this book should disabuse them of all that. The reality is that millions of defendants—largely indigent, minimally represented people of color—acquiesce to plea deals proffered by busy prosecutors with little time for individualized justice.

And although copping a plea enables defendants to avoid the delay and increased penalties they risk if they go to trial, their punishments are markedly more severe than those imposed in Canada or Europe and much higher than in the United States 40 years ago. Mass incarceration is the name we give to the cumulative result.

Prosecutors have always been key players in criminal justice, especially in America, where their powers are subject to little oversight. But today their control of case outcomes is unmatched and largely unchecked.

Prosecutors bring charges, propose bail, shape plea deals, and specify penalties with little effective resistance from defense attorneys, grand juries, or judges. The district attorney’s office has become the nerve center of the penal state, the place where the ideals of American justice are translated into the realpolitik of penal control.

While prosecutors are supposed to play a dual role—advocates for “the people” as well as impartial ministers of justice—for as long as anyone can remember, all the political pressure has pushed toward the former.

This shift in the balance of power has been under way ever since America became a high-crime society in the late 1960s. The move away from rehabilitation, the spread of mandatory penalties, the creation of new categories of crime, and the priority given to public safety over offenders’ rights—these all increased prosecutors’ leverage and incentivized them

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to use it aggressively. American sentencing was once a multistep process, involving prosecutors, judges, juries, parole boards, and prison administrators. Today, prosecutors have become the dominant actors, disposing of cases with the stroke of a pen.

Prosecutors do their work behind closed doors, with little public accountability other than to grand juries (who are little more than rubber stamps) and periodic elections (that are mostly uncontested). And they have discretionary power to bring any charges that the law allows and the facts support. Given the interpretive latitude enabled by our duplicative criminal-law codes, any wrongful act can give rise to multiple charges and penalties of varying seriousness. In New York, shoplifters can be charged with misdemeanor theft, felony theft, or even burglary (if they were previously barred from the store, or reached behind the counter without permission), exposing them to punishments ranging from a few months’ probation to seven years in prison. A burglary that involves no actual violence can be charged as a violent felony carrying a mandatory minimum prison sentence of 42 months (and a 15-year maximum) on the theory that the burglar might have encountered someone inside. This loose relation between wrongful acts and criminal charges allows prosecutors to pile on charges and negotiate from positions of strength. Is it any wonder that between 95 percent and 98 percent of convictions result from guilty pleas?

Mass incarceration was never a planned policy goal or an articulated strategy. It is, instead, the cumulative result of four decades of toughon-crime laws and practices adopted all across the nation: a long-term buildup that has left America with the world’s highest rate of incarceration, largely targeted on lower-class blacks

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and Latinos. Given the many moving parts that produced this outcome, there is much blame to go around and critics have pinned responsibility on everyone from Nixon and Reagan to Bill and Hillary. Some even blame Lyndon Johnson for abandoning social-policy programs in the face of conservative opposition and for increasing federal funding for law enforcement. More-balanced accounts point to public concern about criminal violence, including in minority communities where the body count was worst, and to America’s tendency to deal with social problems using penal controls rather than welfare provision.

Blame is easy; reversing mass incarceration will be hard. The War on Drugs has been scaled back, reducing racial disparities in imprisonment; felon disfranchisement is being reversed, most notably in Florida where nearly 1.5 million people recently regained their votes; the Ban the Box movement has reduced employment discrimination against former felons; the First Step Act, passed with bipartisan support, has eased some mandatory sentences and early release from federal prison; and dozens of states have passed laws designed to reduce imprisonment.

Since 2008, the nation’s prison and jail population—which peaked at a daily total of 2.3 million, with an annual flow of 12 million admissions and releases—has shown moderate declines. The relentless, year-on-year increases of the prior 35 years suddenly appear to be a thing of the past.

But no one believes existing trends will “end” mass incarceration. At this rate, it would take 50 years to reduce the prison population to 1980 levels, which were already historically high.

To downsize to Canada’s current rate, the United States would have to release 1.8 million inmates. What will happen when crime rates spike again,

as they surely will? And how much bipartisanship will there be when the prospect of reducing public expenditure on imprisonment— which brought the Koch brothers and Grover Norquist together with George Soros and Barack Obama—gives way to the realization that large-scale welfare programs will be needed if we decarcerate millions of inmates and resettle them in low-income communities?

Nevertheless, now is a time for action. Large-scale crime reductions— murder rates are now at a 50-year low— have reduced public fears and opened up political possibilities. Prosecutors and judges no longer face intense pressure to lock offenders up and throw away the key. The human and fiscal costs of mass incarceration have become visible and salient. States such as New York—which reduced its prison and jail populations by more than 50 percent between 1993 and 2016, while the number of murders fell by 75 percent—have demonstrated that it is possible to reduce incarceration without experiencing any increase in crime.

Meanwhile, Black Lives Matter activists, aided by Michelle Alexander’s critique of mass incarceration as The New Jim Crow, have put penal reform firmly on the Democratic Party agenda—to the discomfit of figures such as Hillary Clinton, Joe

CHARGED: THE NEW MOVEMENT TO TRANSFORM AMERICAN PROSECUTION AND END MASS INCARCERATION

BY EMILY BAZELON

Random House

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Biden, and Kamala Harris, who are paying a price for prior policies that are now sharply at odds with progressive sentiment.

Emily Bazelon’s book Charged: The New Movement to Transform American Prosecution and End Mass Incarceration is located squarely within this new space. Bazelon highlights the relationship among prosecutors, over-imprisonment, and racial injustice, describing prosecutors as “the missing piece in the mass incarceration puzzle” and insisting, in the words of one of her sources, “Mass incarceration is made or broken by a bunch of assistant DAs and their supervisors and the decisions they make between 10am and noon.”

The premise of the book is that prosecutors have the power to steer the system toward a more equitable, temperate, and racially conscious criminal justice. They can use diversion programs rather than jail, charge with restraint, plea-bargain fairly, end cash bail, treat drug addiction as an illness and kids as kids, establish conviction review, expunge criminal records, and utilize data and cost-benefit analysis to improve decision-making. The book celebrates the election of reform-minded district attorneys such as Ken Thompson and Eric Gonzalez in Brooklyn; Larry Krasner in Philadelphia; Kim Ogg in Harris County, Texas; Mark Dupree in Kansas City; and Kim Foxx in Chicago.

A staff writer at The New York Times Magazine, Bazelon offers us in-depth accounts of two contrasting cases that highlight the power of prosecutors to seal defendants’ fates.

The first concerns Kevin, a 20-yearold from Brownsville in New York City, who was arrested when he tried to hide a friend’s gun from the police, making him liable to a range of “criminal possession of a weapon” charges and to lengthy terms of imprisonment.

Unlucky in other respects, Kevin had

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the good fortune to be assigned a persistent, effective lawyer, courtesy of the Brooklyn Defender Services.

She begs, cajoles, and eventually persuades an assistant district attorney (ADA) to take a chance on Kevin and send him to a program rather than to prison— though Kevin’s circumstances are such that he struggles to complete the program and more than once comes close to being incarcerated.

The second tells the story of Noura, a young, middle-class woman from Memphis who was convicted of murdering her mother and who, many years later, was shown to have been wrongfully convicted by an overzealous prosecutor who withheld exculpatory evidence.

These real-life narratives give immediacy and human interest to Bazelon’s tour through the criminal process. Her journey introduces readers to hearings and charging processes; inequitable cash bail and extortionate bail bond companies; “gun court”; diversion programs; “offender-funded justice”; life inside a women’s prison; and assorted other hazards in the drawn-out ordeal that awaits defendants in the months and years following their arrest.

Bazelon is a reliable guide to crime-control politics as well as to criminal procedure. She explains why increased punishment is so often the political path of least resistance, why the system’s impacts are so racially patterned, and how—in a remarkable reversal that no one predicted—criminal violence has declined in recent years, making our cities safer and opening up opportunities for reform.

Bazelon’s case histories show state power being used for good and for ill, depending on the choices of line prosecutors and the culture of their DA’s office. Kevin’s story features a Brooklyn ADA who refrains from using the heavy artillery of criminal justice

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In February, Philadelphia District Attorney Larry Krasner unveiled plans to keep more juveniles out of the court system and keep many who are charged out of custody.

normally deployed to crack down on weapons offenses and instead offers him “diversion,” thereby rescuing him from incarceration and a lifelong criminal record. Noura’s story recounts how the DA of Shelby County, Tennessee— an old-line, hard-charging prosecutor—ignores evidentiary weaknesses and presses for the maximum penalty when Noura has the temerity to go to trial. The wrongful conviction that follows has devastating consequences for Noura, who never quite knows what has hit her, but its eventual discovery generates no sanctions for prosecutorial misconduct. “A prosecutor like Amy Weirich can destroy a life,” Bazelon writes, but a culture of “prosecutorial impunity” ensures that their misuses of power go mostly unpunished.

This is a vivid, disturbing primer on American criminal justice, and readers will come away better informed and motivated for change. And if the book spreads the word about progressive prosecution—prompting people to turn out and vote for reform candidates—it will have served a larger purpose. But Bazelon’s account of our broken justice system hints at a deeper pathology that lies behind mass incarceration, one that won’t be mended by progressive prosecutors. The central problem of American criminal justice is the overpunishment of the guilty, particularly

violent, sexual, and repeat offenders, who receive sentences of a severity that is unknown elsewhere. This problem stems not from misused prosecutorial discretion but from structural characteristics of American society and the disorders to which they give rise.

The United States has the highest rates of imprisonment in the developed world largely because it has the highest rates of interpersonal violence, the worst social problems, and the most immiserated lower classes. Kevin’s case is instructive here—not in what it says about lenient prosecutors but in what it tells us about the lives so many lowerclass Americans lead. Kevin is a black, male high-school dropout, with little prospect of gainful employment, living in a segregated community marked by guns, gangs, illegality, and violence.

We see him struggle to cope and to maintain his shaky self-respect as he strives to comply with the demands of his program, multiple court appearances, the scrutiny of his social worker, and the needs of his pregnant girlfriend, while he also navigates the hazards of a dangerous neighborhood where he must comply with codes of gang loyalty and face serious violence if he is believed to have cooperated with the police. (“Why,” his friends wonder, “was he let off so lightly?”)

Kevin’s travails, and his limited life chances, point to the failures of schools, labor markets, housing, health care, social services, and support for families in America’s underserved communities that produce the social disorganization and despair in which crime and violence take root.

Mass incarceration came into existence when the nation abandoned the War on Poverty and chose to treat social problems and wayward lives as problems for police, prosecutors, and prisons. It is hard to see how it can be ended without a transformation of America’s urban policy, its welfare state, and the political economy that underlies them.

David Garland is the Arthur T. Vanderbilt Professor of Law and professor of sociology at NYU. He is the author of The Culture of Control and, most recently, The Welfare State: A Very Short Introduction.

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The Crisis Last Time The 2008 financial collapse should have brought the repudiation of neoliberalism. What happened? BY SIMON JOHNSON B

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very Democrat who aspires to win the presidency in 2020 (or ever) should already be asking the question: How do we avoid what happened to Barack Obama and his ideas in the fall of 2008?

Obama was, of course, the progressive candidate. He built a lane to the left of Hillary Clinton in the course of 2007 and then expanded it into a broad highway along which he could coast to victory in November 2008.

The hope and change he promised was in no way about continuity with the past. Yet what President Obama delivered, over two administrations, was profoundly disappointing—and directly contributed to the rise of dangerous and despotic Donald.

The trite riposte is that Obama was overtaken by events. In mid-September 2008, Lehman Brothers went bankrupt. Lehman was a significant trader of and investor in mortgage-backed securities, with total liabilities of around $600 billion. The knock-on effect of this failure was much larger than expected by officials, quickly threatening to bring down a very large insurance company (AIG), other investment banks (Goldman Sachs, Morgan Stanley, and Merrill Lynch), and even the largest bank in the country (Citigroup), which had total debts close to $2.5 trillion.

It was not immediately obvious that the crisis would derail the Obama agenda. Initially, in fact, Obama seemed calmer and more likely to respond effectively to the disaster than his Republican opponent, John McCain. As Reed Hundt points out in A Crisis Wasted: Barack Obama’s Defining Decisions, a meticulous blowby-blow reconstruction of Obama’s transition to power, for a brief moment everything seemed possible—including perhaps reforms as profound as the New Deal. Here was a newly elected leader who could produce, no matter how difficult the moment, a just and equitable set of solutions.

Instead, what the country got

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was Republicans in charge, literally.

The three main decision-makers of the moment, Ben Bernanke, Tim Geithner, and Hank Paulson, have a new, jointly written book, Firefighting: The Financial Crisis and Its Lessons. Their slim volume is a further attempt to explain and defend what they did. Combine this volume with their three individual memoirs, and it starts to feel like they doth protest a bit too much in unison.

Bernanke is a Republican who was nominated to the Board of Governors of the Federal Reserve by George W. Bush—before becoming the chair of Bush’s Council of Economic Advisers and then chairman of the Fed. Paulson led Goldman Sachs until being brought in by Bush as Treasury Secretary.

Geithner had a more bipartisan career— rising to prominence in the Clinton Treasury, becoming a senior official at the International Monetary Fund, moving to lead the Federal Reserve Bank of New York under the auspices of influential Wall Street Republicans and Democrats, and then hired by Obama to be his first Treasury Secretary. Geithner is a political independent (and former Republican); Bernanke and Paulson are long-standing Republicans.

“Personnel is policy” is a Washington cliché that also happens to be true. Let me venture a corollary: If you hire Republicans, you will get Republican policy.

Of course, there are several kinds of Republicans in the modern era, measured in terms of what they really believe. And it is becoming harder to know what some of them believe. Irrespective of their previously expressed views or votes, most congressional Republicans will turn their backs on anything reasonable if proposed by a Democratic president—and support even the most outrageous expedient if supported by Donald Trump.

However, Bernanke, Geithner, and Paulson are genuine Status Quo Republicans, and this is quite evident

A CRISIS WASTED: BARACK OBAMA’S DEFINING DECISIONS

BY REED HUNDT

Rosetta Books

FIREFIGHTING: THE FINANCIAL CRISIS AND ITS LESSONS

BY BEN S. BERNANKE, TIMOTHY F. GEITHNER, AND HENRY M. PAULSON JR.

Penguin Books

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in their book. In their view, the world was basically fine before 2007. A modest fire broke out in that year and, despite their best efforts, became an inferno. When fighting a fire, surely, there is no time to argue about redecorating the living room. The fire was extinguished, the world was saved, and they continue to be surprised that we are not all more grateful.

Everything in this interpretation of events—and in their view of history— hinges on the metaphor of fire, chaotic and uncontrolled. No doubt the authors feel they are reaching out to people by popularizing economics; there are no tables or figures in their book, and very few numbers. But the metaphor is a smoke screen. This was not any kind of fire. Extreme financial deregulation allowed blue-chip financial-sector executives to make large bets backed by very thin amounts of equity. The bets went bad, and potential cumulative losses at their banks threatened dire consequences for the economy.

Status Quo Republicans have a simple preference in this situation: use all available central-bank and government resources to cover those losses fully and with no repercussions for those responsible. The accurate name for this approach is Lemon Socialism, meaning in this case: financial sector executives get the upside when things go well; you (the taxpayer, the unemployed, and the dispossessed) own the lemons when the economy turns down.

Bernanke-Geithner-Paulson did not invent Lemon Socialism. They did perhaps take it to a new level. The U.S., contrary to what is (sometimes) claimed by Expedient Republicans, has a strong national balance sheet and a highly credible central bank—so massive amounts of government support could be deployed. As a result, highly compensated bank executives generally did very well from the boom-bust cycle. Investors who had cash in hand were even better placed to snap up distressed assets and experience steep capital appreciation. They (not you) got the upside—and then the Trump tax cuts let them keep more (or perhaps almost all) of those gains.

This is the real reason that Donald Trump’s Treasury Department is currently working hard to undermine

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financial regulation. It is not at all because they have forgotten what happened and why. The explanation is much simpler: Top current officials made good money in the crisis. If you know how to play the game, the roller coaster of modern finance works just fine. As Trump himself said in 2006, when asked about the prospect of a major fall in house prices, “I sort of hope that happens because then people like me would go in and buy.”

THIS BRINGS US BACK to Reed Hundt,

who is asking the important questions.

Was there an alternative way forward in the fall of 2008? Why was that not followed? After all, there were plenty of actual Democrats in the White House, including Christy Romer at the Council of Economic Advisers, Larry Summers at the National Economic Council, and Peter Orszag at the Office of Management and Budget.

Reed Hundt was chairman of the Federal Communications Commission (FCC) under President Clinton, and he had a ringside seat for the meteoric political rise of Barack Obama. As a member of the Obama transition team in 2008, Hundt had access to everyone and apparently remains on good terms with the leading players. He argues persuasively that the major Obama-era decisions were all taken in late 2008 and the very beginning of 2009.

Hundt’s book is based on interviews and it sometimes reads like a loose synthesis of oral histories or even depositions. But this is actually refreshing. The articulate protagonists approved the quotes that he uses.

Hundt feels that the underlying political beliefs of Clinton-era officials were part of the problem. He uses the term “neoliberal” rather frequently and not always with great precision, but his general instinct is right. Top officials from the Clinton era retained a greater preference for less regulation and a generally smaller role for government than, for example, Hundt would prefer.

Their style of economic governance from the 1990s was to score singles and steal bases, not swing for the fences.

Hundt is right that more could have been done, but it is hard to design a dramatically new policy once you are

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in office—the press of events tends to dominate, even when there is not a confusing, fast-evolving international crisis. Obama did not bring with him a large, experienced team, and during the campaign he developed only broadbrush ideas. The experts on the details were almost all people who had worked with the Clintons. They were Small Ball Democrats—smart people with admirable ideas, but hardly in a position to stand up to Status Quo Republicans. New Deal–style Democrats were conspicuous by their absence.

The financial sector was saved, largely intact, by unprecedented government support. If homeowners had received the same level of support in 2008-2009—for example, in the form of cheap refinanced mortgages—what would have happened? The American economy would have recovered, house prices would have risen, and everyone involved would have looked like a genius. Modern central banks control the price level and this has a primary, direct effect on asset prices—including housing. In most of the country, house prices bounced back but millions of homeowners could not finance their way through the trough. Powerful people in the financial sector could obtain cheap loans, even in the darkest days, because their access to credit was the top priority for both the Bush and Obama administrations.

The result, in rough chronological order, was: mass unemployment, greater inequality, collapsed opportunity, confused anger, and President Trump. The efforts put into financial reform—making sure this could not happen again—by Messrs. Bernanke, Geithner, and Paulson were weak.

They lament that next time the central bank will not have the tools to deal with an incipient crisis. If that proves true, it is because their generation undermined the legitimacy of the Federal Reserve through inattention to regulation, consumer protection, and blatant bad behavior before the crisis, and through subsequently allowing the Too Big To Fail banks to become even larger and more dangerous—the total indebtedness of JPMorgan Chase today is in the range of $2.5 trillion.

What are the implications for people who would like to call themselves

Why were progressive critics of the status quo shut out of almost all influential economic positions throughout the Obama years?

progressives? Hundt has a broader vision of what government could do, but the details remain slightly elusive.

He argues that the FCC in the 1990s helped create the basis for broader investments in the digital economy, and this benefited many people. He also suggests there are analogies that could be implemented for energy, clean water, and much more. Probably he should develop those ideas more fully in another book—and preferably soon.

You might or might not like the work of the Hamilton Project, organized in 2006 under the auspices of the Brookings Institution, but there is no question that they helped prepare the Small Ball Democrats for another round in power. Not only were their ideas tested in numerous proposals, panel discussions, and debates, but their smart young people were given every possible policymaking opportunity.

When Obama did make progress, for example in terms of extending health-care coverage, it was in part because of these diligent efforts. When Obama struggled, from a progressive point of view, it was primarily due to problems in the financial sector—a blind spot in terms of Hamilton Project preparation. Anyone who thinks that President Obama did all he could to advance a progressive agenda, under difficult constraints, should ponder this: Why were progressive Democrats shut out of almost all influential positions throughout the Obama years?

It is unlikely that the next Democratic president will want to be seen as another reincarnation of the Clinton administration. But are the potential home-run policy ideas being debated and honed in sufficient detail? Who will be hired—and with what experience—to be in charge of implementation? What are the plans for regulating the financial sector, which is more powerful than ever? And who exactly will be in charge when anything starts to go wrong in the macroeconomy? On these questions may turn both the election and the future of American democracy.

Simon Johnson is a professor at

MIT ’s Sloan School of Management

and former chief economist at the International Monetary Fund.

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The Trouble With Tech Once you understand the tech giants are capturing unguarded human experience, their business makes sense. BY MICAH L. SIFRY B

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ot long after whistleblower Edward Snowden’s first revelations appeared in The Guardian and Washington Post in the summer of 2013, longtime digital-freedom activist and writer Cory Doctorow declared that we had finally passed the point of “peak indifference to surveillance.”

That fall, upset at rising rents and declining public services, people in San Francisco and Oakland starting blockading and sometimes throwing rocks at the private buses taking privileged tech workers to their Silicon Valley jobs. But the backlash to Big Tech and its massive power didn’t really gather force until the news broke in the spring of 2018 about Cambridge Analytica’s stealthy acquisition of the personal data of 87 million Facebook users.

Now America’s love affair with Big Tech is clearly over, and we’re finally starting to re-evaluate the terms of the relationship. But it remains to be seen whether we will merely patch things up or try to start over on completely new terms. This is not a small question. At stake is whether we continue to let giant tech companies, along with many other Fortune 500 firms, function as the de facto owners and organizers of the 21st century’s most valuable underdeveloped resource— our personal information and the connections we make with it—or if we act to reassert control over what should rightfully be ours. To get to that answer, we need to look afresh at what today’s data barons actually do.

The reach of Big Tech and concerns about its power stretch far beyond America’s borders. The industry commands territories bigger than the population of nation-states.

Facebookistan has 2.3 billion users.

Googlestan has more than a billion users of each of seven services (Gmail, Android, Chrome, Maps, Search, YouTube, and the Google Play Store). Microsoftistan boasts 700 million running Windows 10.

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And other platforms are also extending their reach: Amazon, which is the starting point for more than half of all online shopping searches in the United States, is now partnering with carmakers to install Alexa in their dashboards; Pokémon Go, a Google offshoot, has demonstrated that online gaming can move crowds in real life to “sponsored locations”; and iRobot has upgraded its Roomba robot cleaners with mapping capabilities in order to vacuum up their owners’ home floor plans.

As the tech platforms expand into the far corners of the world and every aspect of our lives, public policy and public understanding have trouble keeping up, but several new books provide important insights. In the delightfully titled Zucked, the venture capitalist Roger McNamee recounts his role in the early development of Facebook and his disillusionment with the company. Tarleton Gillespie’s Custodians of the Internet takes us inside the decision-making at tech firms about what communications they allow and what they block. And Shoshana Zuboff’s The Age of Surveillance Capitalism—the most important book I have ever read on the intersection of technology, politics, and society—offers a radical reinterpretation of the changes the tech industry has wrought.

As a recently woke Silicon Valley capitalist, McNamee has become a traitor to his class, or at least to the young man he once mentored, Mark Zuckerberg, who, at least according to McNamee, has a lot to thank him for.

Years before Facebook went public, McNamee urged Zuckerberg not to sell it to Yahoo for a reported $1 billion, and then later suggested he hire Google ad whiz Sheryl Sandberg as his chief operating officer to help him figure out how to make money. But while the enterprise certainly did well, it did not do the good that McNamee expected. “It turns out that connecting 2.2

The industry commands territories bigger than the population of nation-states.

Facebookistan has 2.3 billion users.

Googlestan has more than a billion users.

billion people on a single network does not naturally produce happiness for all.” The environment that Facebook created has encouraged people to form “into clusters or tribes,” which has led to polarization in the United States and mob violence, even genocide, in other societies.

In early 2016, McNamee grew concerned about the spread of divisive political content on Facebook driving wedges between Hillary Clinton’s and Bernie Sanders’s supporters, and then watched the unexpected success of the “Leave” campaign in the Brexit vote.

Convinced that Facebook’s News Feed algorithm was amplifying fear and anger and that bad actors were gaming the system, McNamee tried to sound an alarm with his protégé. But he was fobbed off on one of Zuck’s lieutenants, who treated his warnings as a “public relations problem.” So he decided to go public with his criticisms, teaming up with former Google ethicist Tristan Harris to create a new organization, the Center for Humane Technology, and to educate lawmakers on Capitol Hill.

As McNamee writes, Facebook is, among other things, “a massive artificial intelligence that influences every aspect of user activity, whether political or otherwise. Even the smallest decisions at Facebook reverberate through the public square.” One man stands at the center of those reverberating decisions, but how does that decision-making process work, and what rules does it follow?

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The rule-making at Facebook and other platforms about allowable content is the subject of Gillespie’s Custodians of the Internet. Gillespie’s custodians are the moderators at social networks, search engines, blogging services, photo- and video-sharing sites, opinion hubs, dating apps, collaborative knowledge tools, recommendation and ratings sites, goods exchanges, fundraising platforms, and video-gaming worlds—in other words, the platforms that consume much of our collective time online. “All platforms moderate,” Gillespie writes, even though they downplay how much they interfere. The process of moderation, he shows, is “a prism for understanding what platforms are, and the ways they subtly torque public life.”

As Gillespie notes, the hyperscale of today’s online platforms makes individualized content moderation an impossible task, and even with a combination of automated detection using artificial intelligence, community flagging of objectionable content, and editorial review, plenty of objectionable stuff makes it online.

To take a relatively benign example, the best “nudity detection algorithm,” he observes, claims to spot nude pictures with a 94 percent accuracy rate and a false-positive rate of just 5 percent. With more than a billion active monthly users of YouTube and 350 million photos uploaded every day to Facebook alone, that means plenty of naked pictures make it onto these sites. “Platforms dream of electric shepherds,” Gillespie wryly notes. “But it is not clear that the human labor necessary to support such automated tools can ever go away.”

The result, which he explicates with great precision throughout the book, is a new industry of content moderation, with a small elite of policymakers atop the major platforms writing the rules for a burgeoning and largely invisible archipelago of digital sweatshops. That’s where hundreds of thousands of so-called “janitors”— click-workers making a few dollars an hour in Third World countries, or little more than poverty wages here in America—spend their days dealing with a never-ending flow of traumatizing content.

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Moderators inevitably make contestable judgments. Here, for example, are some of the contradictions in Facebook’s policies that Gillespie cites:

ZUCKED: WAKING UP TO THE FACEBOOK CATASTROPHE

BY ROGER MCNAMEE

Penguin

CUSTODIANS OF THE INTERNET: PLATFORMS, CONTENT MODERATION, AND THE HIDDEN DECISIONS THAT SHAPE SOCIAL MEDIA

BY TARLETON GILLESPIE

Yale University Press

THE AGE OF SURVEILLANCE CAPITALISM: THE FIGHT FOR A HUMAN FUTURE AT THE NEW FRONTIER OF POWER

BY SHOSHANA ZUBOFF

Public Affairs

Hate speech is prohibited, but only for protected categories of people (specific races, religions, sexualities, nationalities), and “migrants” constitute only a quasi-protected category, so although dehumanizing statements about them should be removed, cursing at them, calling them thieves, and urging them to leave the country do not amount to hate speech. Holocaust denial is allowed, but geo-blocked from countries that outlaw it—not all fourteen countries with laws prohibiting Holocaust denial, just the four that have pursued the issue with Facebook explicitly.

The custodians of online platforms face an inescapable dilemma: If they don’t curate content enough, they risk losing users. And if they curate too much, they risk stifling their own growth and losing favor on Wall Street.

Curating is not a role that Big Tech’s leaders wanted, as Gillespie points out.

They promised an open, participatory culture, but as the promises have soured, the companies are “grappling with how best to be stewards of public culture, a responsibility that was not evident to them at the start.”

Like McNamee, Gillespie frames the trouble with tech as a paradise lost, as though platform makers were just innocent victims of their own success. Who could have known how hard it would be to police sites with billions of users? Who could have imagined that fine-tuning the user experience to show people content they find most engaging would lead to filter bubbles, increased societal strife, and the spread of conspiracy theories? This narrative is overly friendly to Big Tech as it faces its moment of democratic reckoning. Furthermore, it misses the central truths about the forces we are dealing with. To understand those forces, we must turn to Zuboff’s The Age of Surveillance Capitalism.

For Zuboff, companies like Facebook and Google are not friendly

providers of free services such as search engines or social connectivity that just happen to be struggling with the unintended consequences of massive growth. They are the 21st century’s robber barons. Only instead of plundering the natural environment, they are plundering us. More or less by accident, they discovered a source of fabulous riches and now, by design, they have created a whole new kind of capitalism, rooted in their ability to track, digest, and with increasing precision, predict and even behaviorally modify everything that we do.

Our posts, blogs, tweets, and other actions online are what Zuboff calls “the first text.” That first text provides us with unprecedented opportunities for connection and knowledge. But that first text also supplies the basis for a second, shadow text. “Everything that we contribute to the first text, no matter how trivial or fleeting, becomes a target for surplus extraction.”

Once you understand the titans of tech as surveillance capitalists bent on capturing as much unguarded human experience as possible, many of their previously curious business decisions become more legible. Google’s 2006 purchase of YouTube for $1.65 billion before it had any revenue, its massive expenditures mapping the world for Google Street View, Facebook’s $1 billion purchase of Instagram and $19 billion purchase of WhatsApp, Verizon’s $4.4 billion purchase of AOL, Microsoft’s pivot to providing free cloud services rather than selling licensed software—all of these choices and others too numerous to mention make sense when you think of them not as risky speculation but as the shrewd colonization of raw materials and the protection of supply lines. Maps create empire, Zuboff reminds us, citing the cartographer John B. Harley.

And the plunder is intensifying, driven by an economic logic now understood by many industries if not the general public. As a senior engineer at a major tech company heavily investing in the so-called Internet of Things told Zuboff: “Imagine you have a hammer. That’s machine learning.

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mountain to reach the summit. That’s machine learning’s dominance of online data. On the mountaintop you find a vast pile of nails, cheaper than anything previously imaginable. That’s the new smart sensor tech. An unbroken vista of virgin board stretches before you as far as you can see.

That’s the whole dumb world.

Then you learn that any time you plant a nail in a board with your machine learning hammer, you can extract value from that formerly dumb plank. That’s data monetization. What do you do?

You start hammering like crazy and you never stop, unless somebody makes you stop. But there is nobody up here to make us stop.

This is why the ‘internet of everything’ is inevitable.”

Surveillance capitalism, Zuboff argues, took off when the founders of Google, Larry Page and Sergey Brin, faced an existential crisis as the first dot-com boom imploded in early 2000. As graduate students who discovered the value of using web linking patterns to deliver authoritative answers to search questions, they had built a dominant search engine. But they didn’t know how to monetize all the traffic Google was drawing, and they were philosophically critical of advertising and its corrupting effects.

“But as the evidence mounted that ads could save the company from crisis,” Zuboff writes, “their attitudes shifted.

Saving the company also meant saving themselves from being just another couple of very smart guys who couldn’t figure out how to make real money, insignificant players in the intensely material and competitive culture of Silicon Valley.”

They were also under immense pressure from their venture capitalist backers, one of whom, Michael Moritz of Sequoia Capital, later revealed that Google’s first source of income, selling licenses to the search engine to larger companies, wasn’t going all that well. “Cash was going out of the window at a feral rate,” Zuboff quotes him as saying. Once Page and Brin agreed to start mining user data to better match ads to their interests,

We are caught in a Faustian bargain. Being connected is essential for participating in life, but the internet has been commandeered by commerce, and “commerce is now subordinated to surveillance capitalism.”

the company’s fortune was made.

As Google learned how much value it stood to unlock from user data, it advanced on two fronts simultaneously, moving from crawling the web to crawling the physical world, while carefully deflecting attention from its real agenda and asserting that the death of privacy was a technological inevitability. Thus, as Zuboff notes, Google chairman Eric Schmidt, upon being asked on CNBC in 2009 why Google retains our search histories indefinitely, replied, “The reality is that search engines including Google do retain this information for some time,” as if this was an engineering necessity. “In truth,” she writes, “search engines do not retain, but surveillance capitalism does. Schmidt’s statement is a classic of misdirection.” Had we been able to see these encroachments not as privacy violations alone but as acts of digital dispossession, perhaps the rise of surveillance capitalism would have faced some real roadblocks.

Instead, its growth was greased by Democratic politicians like Barack Obama, who turned his administration into a Google annex and who, Zuboff writes, “used his proximity to Schmidt to cement his own identity as the innovation candidate poised to disrupt business as usual in Washington.” Senator Ron Wyden was primarily responsible for writing Section 230 of the 1996 Telecommunications Act, a safe-harbor provision that was designed to encourage early platforms such as CompuServe and Prodigy to take active steps to moderate content without holding them legally liable for all that they enabled users to publish. “What Wyden and his colleagues could not have anticipated, and still do not grasp,” Zuboff charges, “is that the logic [of the early internet service provider platforms] no longer holds. … They no longer merely host content but aggressively, secretly, and unilaterally extract value from that content.”

We may individually want to escape this new enclosure movement, but Zuboff is right. We are caught in a Faustian bargain. Being connected is essential for participating in life, but the internet has been commandeered by commerce, and “commerce

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is now subordinated to surveillance capitalism.”

The solutions on offer, she adds, are not anywhere close to addressing the problem at hand. Calls to break up Google or Facebook might simply establish more surveillance capitalist firms, and “demanding privacy from surveillance capitalists or lobbying for an end to commercial surveillance on the internet is like asking Henry Ford to make each Model T by hand.”

Europe’s new General Data Protection Regulation offers hope for a different future, but Zuboff’s eagle eye catches Facebook’s Zuckerberg characteristically promising to operate according to GDPR’s spirit while quietly moving 1.5 billion Facebook users who used to be clients of its Ireland subsidiary back to the mothership in the United States, in order to avoid the law’s reach.

In the last third of her book, Zuboff wrestles with the philosophical implications of a society run by distant technocrats with “God-like” knowledge of humanity’s desires and actions, delving into the intellectual roots of such thinking in the works of Harvard behaviorist B.F. Skinner. She theorizes that surveillance capitalists are not digital totalitarians but a new form of overlord, “instrumentarians” indifferent to the day-to-day effects of their platforms as long as the raw materials flow into their analytical maws unmolested. This section could have been a whole second book, and readers may find some of her argument repetitive. But these are quibbles against a masterwork of synthesis.

The Age of Surveillance Capitalism is not an obituary for democracy.

Zuboff has provided the latticework on which to hang useful new initiatives. “We have yet to invent the politics and new forms of collaborative action … that effectively assert the people’s right to a human future,” she writes. But now that she has named the system, described it, analyzed it, and helped us understand it, we may begin to change it.

Micah L. Sifry is the president and cofounder of Civic Hall, a collaborative community center in New York City that works to embed civic values at the intersection of technology and society.

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Colleges need to focus on their original mission— undergraduate teaching—for a new wave of low-income and minority students. BY DAVID KIRP B

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n a little-noticed development, access to college has grown dramatically since 2000: Postsecondary enrollment is up by about 5 million students to a total of nearly 20 million. The increase comes largely from minority and low-income students, who are often the first in their families to go to college. If these “newgen” students stay in school and graduate, they may get the ticket to the middle class that they are hoping for.

Over their lifetimes, college graduates earn on average $1 million more than those with only a high school diploma.

But for the four out of ten freshmen who don’t graduate within six years, the prospect of upward mobility often turns out to be an illusion. Dropout rates are also staggeringly high at community colleges.

New-gen students are 20 percent less likely to graduate than their middle-class peers, a gap that has widened in the past four decades. Here’s a stunning statistic: Only 9 percent of

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students whose families are in the bottom income quartile get a bachelor’s degree by age 24, versus 77 percent of those from a family in the top quartile.

Many dropouts are actually worse off economically than if they had never enrolled in college. While they earn slightly more than those who have only a high school diploma, they leave college with a pile of debt. They are nearly twice as likely as college graduates to be unemployed and four times likelier to default on student loans. More than their lifetime income is on the line— over the course of their lives, homeownership, voting behavior, marriage, health, retirement, and life expectancy are also adversely affected.

In The Privileged Poor, Anthony Abraham Jack, an assistant professor at Harvard’s Graduate School of Education, explores what happens to low-income students who enter an institution he calls Renowned U. Like most schools perched atop the U.S. News & World Report prestige ladder,

The lesson is plain— simply admitting low-income students is just the start of a university’s obligations.

Renowned U has been recruiting poor and minority students in recent years.

(Today, about a sixth of the students at Harvard and Princeton are black or Latino, and a sixth are Pell grant recipients.) The increased admission of students from those backgrounds marks a change for the better, but Renowned U remains a bastion of wealth and privilege. It is one of 38 universities, including five in the Ivy League, that enroll more students from the top 1 percent in income than the bottom 60 percent.

As Jack shows in impressive detail, the different routes these students previously took in high school lead to distinctive college experiences. At Renowned U, like other elite universities, more than half of the poor African American students and about a third of the poor Latino students went to wealthy private secondary schools.

When they arrive on campus, they already possess the cultural capital that enables them to connect, off the bat, with their professors and classmates. The other minority undergraduates attended neighborhood public schools, most of which were racially and socioeconomically segregated, and to these “doubly disadvantaged” students, a university like Renowned seems as foreign as Mars. Treating these two types of students as indistinguishable does them a disservice,

haizhan zheng / istock by get t y

The Unkept Promises of Higher Education

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says Jack, and “continuing to do so limits our understanding of the ways in which poverty and inequality shape the lives of today’s undergraduates.”

Although the privileged poor and the doubly disadvantaged have had varied cultural experiences, their experience growing up poor hits both groups with the same punch. Wealthy classmates may be clueless—“Come with us to Europe over the summer”— and the institution is worse. Because administrators at Renowned blithely assumed that every student takes off for spring break, the university shuttered its dining halls, and undergraduates who couldn’t afford to go away endured a spate of food insecurity.

Renowned U provided poor students with free tickets to campus events that they otherwise couldn’t afford—a thoughtful gesture that the university ruined by making them collect their tickets on a separate line. (It took Jack’s prodding to change those practices.) Hiring students to clean the toilets in rich students’ dorm rooms, as Renowned did—it attracted poor undergraduates to do that work by paying them slightly more than students with cushier jobs—is no way to melt social-class boundaries.

The lesson is plain—simply admitting low-income students is just the start of a university’s obligations. Once they’re on campus, colleges must show them that they are full-fledged citizens, and Renowned flunked that test.

Christopher Newfield, a professor of English at the University of California, Santa Barbara, argues passionately that universities have betrayed their undergraduates. In The Great Mistake: How We Wrecked Public Universities and How We Can Fix Them, Newfield identifies the culprit as market forces and market values. His ideals hearken back to Cardinal Newman, the seminal 19th-century educational philosopher, for whom nurturing the “real cultivation of the mind”—the capacity to think—was the raison d’être of higher education. “Universities,” Newfield writes, “are the only social institutions devoted to helping the rising generation master coherent parts of the vastness of human knowledge.”

But market logic defines the purpose of college in narrow economic

THE PRIVILEGED POOR: HOW ELITE COLLEGES ARE FAILING DISADVANTAGED STUDENTS

BY ANTHONY ABRAHAM JACK

Harvard University Press

THE GREAT MISTAKE: HOW WE WRECKED PUBLIC UNIVERSITIES AND HOW WE CAN FIX THEM

BY CHRISTOPHER NEWFIELD

Johns Hopkins University Press

TWO CHEERS FOR HIGHER EDUCATION: WHY AMERICAN UNIVERSITIES ARE STRONGER THAN EVER— AND HOW TO MEET THE CHALLENGES THEY FACE

BY STEVEN BRINT

Princeton University Press

terms as a glide path to greater earnings, and this understanding of higher education, Newfield argues, is what has led states to cut back on their investment. After all, the argument runs, if students are the ones who derive the main benefit from college, they should bear most of the cost.

University officials have adjusted to diminished state support by pursuing private dollars, accepting whatever strings are attached. Instead of break-the-mold inquiry, they deliver education on the cheap through “mass commodity learning” and online instruction. The biggest losers are the new-gen students, the minus sign on the balance sheet (what one administrator at an elite college memorably labeled the “runoff”), who get shunted to the weakest institutions.

There’s a way out of this mess, Newfield argues. We need to see higher education as a public good and recognize that people who get a thinking person’s education contribute to the commonweal in ways not measured by their incomes. Although Newfield does the cause no favors by making outsized demands on the public purse, he is right to argue that today’s bottom-line-driven instruction does not serve society’s best interests.

In Two Cheers for Higher Education, Steven Brint, a professor of sociology at the University of California, Riverside, adopts a softer tone. Where Newfield points to the market as the villain, Brint is more nuanced in his critique. Despite the “two cheers” Brint gives the universities, he shares some of the same concerns as Jack and Newfield about undergraduate education—what he describes as higher education’s “Achilles’ heel.” As colleges have raised tuition to make up for lost public support, students have slipped deeper in debt. The caliber of teaching and learning has deteriorated as well.

Students study much less than they did a generation or two ago, and they also learn less. The higher-education best-seller Academically Adrift, by Richard Arum and Josipa Roksa, found that only half of undergraduates have become better critical thinkers during their college years.

Brint mostly blames the universities for this sorry situation. Even as

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they have added phalanxes of administrators, they have thinned the ranks of tenure-track professors, with more courses now being taught by adjuncts than full-time faculty. Classes are big and feedback minimal. With upward of six classes to teach, the adjuncts don’t have much time to read students’ papers. Since their livelihood depends heavily on ratings by students, they may go easy on them in a bid for popularity. Instruction is often secondrate, with instructors lecturing to bored and passive classes, rewarding memorization rather than thinking.

The growth of so-called practical arts majors like recreation and leisure caters to what students demand, while not giving them a worthwhile education, and it is these undergraduates who are stagnating intellectually.

Brint isn’t optimistic about reform.

The failure of most colleges to reduce the number of dropouts—especially those new-gen students—is a telling indicator of their priorities.

At universities whose leaders strongly believe that the success of the institution and the success of its students are inseparable, graduation rates have risen dramatically and the opportunity gap has shrunk to near nothing.

The proven-to-work practices that those universities have adopted are readily implemented and needn’t cost a mint. But most college presidents are preoccupied with other things. They’re busy raising money; stroking professors’ egos; placating state lawmakers, trustees, and alumni; and managing campus crises. They want their school to move up in the U.S. News rankings, and achieving that goal requires that they become more selective and less concerned about the opportunities for new-gen students.

No one at the higher reaches of higher education gets fired because there are too many dropouts. But that is what ought to happen if colleges are going to get serious about making good on their promises.

David Kirp is a professor of public policy at the University of California at Berkeley, a contributing writer to The New York Times, and author of the forthcoming book The College Dropout Scandal.

SPRING 2019 THE AMERICAN PROSPECT 87

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—harold meyerson

VOLUME 30, NUMBER 2. The American Prospect (ISSN 1049-7285) is published quarterly by The American Prospect, Inc., 1225 Eye Street NW, Suite 600, Washington, DC 20005. Periodicals-class postage paid at Washington, DC, and additional mailing offices. Copyright © 2019 by The American Prospect, Inc. All rights reserved. No part of this periodical may be reproduced without the consent of The American Prospect, Inc. The American Prospect ® is a registered trademark of The American Prospect, Inc. Postmaster: Please send address changes to The American Prospect, P.O. Box 421087, Palm Coast, FL 32142. PRINTED IN THE U.S.A.

88 WWW.PROSPECT.ORG SPRING 2019

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Fund Our Future

By Randi Weingarten, President AMERICAN FEDERATION OF TEACHERS he wealthiest Americans don’t have to worry about how they will pay for groceries, or a visit to a doctor when they’re sick, or heat for their homes during frigid weather. They never have to think about whether their children will be able to afford to go to college or how they’ll pay for summer programs to keep their children safe when school is out. But tens of millions of Americans are consumed with those worries, and the budget President Donald Trump released last week decimates the very programs that help address the needs of the most vulnerable Americans.

Budgets reveal priorities. They reflect choices. And Trump, whose lavish 2017 tax cuts for corporations, special interests and the ultra-wealthy exploded the deficit to perilous heights, is making choices that are as heartless as they are reckless.

Trump’s budget eliminates funds for community schools, preschools, and after-school and summer school programs in high-poverty areas. It cuts home energy assistance for seniors and people with disabilities. The man who promised “there will be no cuts to Social Security, Medicare and Medicaid” wants to cut all three programs, proposing to slash more than $1 trillion from Medicare and Medicaid.

In the midst of the opioid addiction crisis, Trump’s budget guts $12.4 billion from the Department of Health and Human Services. Even the administration’s supposed priorities, career and technical education and child care, aren’t funded in a meaningful way.

increases in school funding in several states, but that funding remains well below 2008 levels in those states, and several have enacted only short-term fixes.

her an extra $5,000, she’d spend it on lab supplies and replace the broken chairs in her classroom.

After a decade of neglect and austerity in our country’s schools, the American people have had enough—and want a reordering of the country’s priorities to focus on things that make their families’ lives better. And that starts with our children and sustainable investments in public schools, colleges, infrastructure and healthcare.

In the first week of March alone, there were 90 Fund Our Future events nationwide, with students, parents and communities joining educators in demanding adequate investments in public schools and colleges. In Illinois, they’re fighting for a fair tax system. In Washington state, they’re calling for investments in community and technical colleges. In Philadelphia, educators and allies are demanding safe learning environments.

That is the aim of Fund Our Future, the AFT’s campaign to demand those in power invest in our public schools and in the resources students need to succeed—particularly children of color, children with special needs, children who are vulnerable and children who live in poverty.

In Michigan and New Mexico, we’re working with new governors whose priority is public education, and in places like New York we’re building on progress toward ensuring all, not just some, of our children have access to the public schools and colleges they deserve.

On the same day that Trump and DeVos released their budget abandoning public schools and the families they serve, I was with parents, students and educators in Texas for their Fund Our Future kickoff rally.

Texas has a $15 billion Rainy Day Fund, yet the state has cut public education spending by $2.5 billion over the past decade. A Dallas high school physics teacher at the rally said that, if the school district gave

In an ideal world, our elected leaders would use the country’s economic resources to improve people’s lives—to make the American people healthier, better educated and more secure; to promote their potential and create opportunity where it has been denied; and to make the vulnerable among us less so. In reality, we must elect and hold accountable leaders who are committed to funding our future.

Lack of investment is the root cause of every single one of the teacher walkouts that are roiling this country.

At a time when the soaring cost of higher education is saddling Americans with record college debt and putting college out of reach for many people, Trump’s budget would make higher education even less accessible. He wants to eliminate public service loan forgiveness and divert $2 billion from Pell Grants, which help students from lower-income families.

It is no wonder Trump plays so loose with the truth, as it disguises the fact that, by governing to favor America’s elites, he is hurting the very people who thought he would work for them.

It’s not just this administration that has misplaced priorities. Twenty-five states still spend less on K-12 public education than before the recession. And 41 states still spend less on higher education. The lack of appropriate investment is the root cause of every single one of the teacher walkouts that are roiling this country. The Center on Budget and Policy Priorities found that the recent teacher strikes led to substantial

Photo by Matthew Jones

Weingarten at a rally for public education in Austin, Texas, on March 11.

Follow AFT President Randi Weingarten: www.twitter.com/RWeingarten

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