Everyday Socialism, Or How We Actually Pay for Things

Conservatives decry “socialism” with quivering jowls and red face. And it’s all hot air. They would be the first to complain if the everyday socialism they rely on were suddenly removed and they had to pay for their public benefits themselves.

When Obama won a second term there was a great hue and cry about seceding because he would surely lead us directly into socialism—which somehow hasn’t happened since conservatives first made the claim in 1857. When secession was hot I suggested those interested should indeed secede, but they would then be required to pay the actual cost for the American public services they use, that they currently enjoy for free, such as highways, the electric grid, airports, communications, and so on. But then, secession was as much hot air as the bloviating about “socialism”.

Conservative hot air about “socialism”
distracts us from the demise of democracy
and the rise of inequality.

As a democratic nation that has greatly benefited from social programs from the first, we can only wonder what the hell conservatives are so exercised about. But I’m being disingenuous. It’s basically a distraction to make us think that our public programs are the same as the spectacularly unsuccessful state socialism that does not reward individual initiative. This distracts us from the gradual compromise of the democratic principles on which our country was founded, and the erosion of the fortunes of everyone but the rich.

Conservatives also want us to believe that government programs are inherently inefficient, that virtually everything would be better managed by private enterprise. Balderdash. Take Gar Alperovitz’ example (from What Then Must We Do?, recommended reading) of publicly owned utilities. There are over 2,000 of them, and they provide dependable electric power to a quarter of the nation at significantly lower cost than private utilities. This is because private utilities are compelled to pay profit to stockholders, and they pay their executives twenty-five times as much as the perfectly competent managers of publicly owned utilities. Moreover, when privately owned utilities are threatened with conversion to public, they reliably respond with a campaign of carefully timed blatant lies that claim electric rates will skyrocket and we will march directly into socialism. Of course they would say that. Going public would end the ongoing party they enjoy at the public’s expense.

Private utility executives are
overpaid by twenty-five times.

Everyday socialism in the US includes a growing number of cities that are earning revenue by utilizing the land they own. Among the first to be established was Boston’s Faneuil Market, next to historic Faneuil Hall. It returns a portion of the profit of its businesses to the city instead of property tax. This brings in 40% more than property tax might. Other cities lease out land near transportation hubs. A number have fully or partially owned hotels, convention centers, hospitals, and other businesses, which earn a beneficial percentage of profit for the local government. A rising number of communities are developing methane recovery facilities at landfill sites, and other green ventures.

Various state retirement systems have shown themselves to be well managed, contradicting conservative claims, even showing increased value during economic crisis. Nineteen states provide assistance to worker-owned companies, and a number of others provide assistance for training, technical assistance, and other programs. Twenty-three states directly invest public funds in startup companies. In the great conservative bastion of Texas, the 150-year-old Texas Permanent School Fund owns half the public land and associated mineral rights. Profit from this socialist enterprise distributes about two billion dollars to Texas schools every year.

Everyday socialism is all around us,
common and efficient.

Alperovitz makes these points to show us that conservatives’ much heralded loathing of “socialism” is belied by the everyday socialism found all around us, even in firmly conservative locations. Later I’ll mention some other little-known economic developments.

A footnote:

Remember E. F. Schumacher’s Small Is Beautiful? Here is a new article from the Schumacher Center, an interesting summary of what’s going on with the Mondragon organization. Mondragon is now about 60 years old. It was started by a village priest in Spain’s Basque region, where he envisioned that a worker-owned company would give 20% of their profits to help the local community and to establish new businesses. The concept was outrageously successful, even during times of economic crisis. Mondragon now has over 100 cooperatives employing over 100,000 persons and grossing some €6-billion ($7.8-billion) a year.

When unemployment in Spain hit 27%,
unemployment at Mondragon was still zero.

Enterprises include a bank, Caja Laboral, which is doing very well. But when Spain joined the Euro zone the bank was forced by regulators to diversifying into “safe” Wall Street banks. This wise advice cost Mondragon $40M when those safe banks folded due to their reckless gambling. It’s also worth noting that while there is 27% general unemployment and 57% youth unemployment in Spain right now (with the conservative government claiming that recovery is just around the corner), Mondragon has zero unemployment, because the co-ops do not fire employees to maintain profit, and because they shift workers between co-ops as needed. Mondragon has a number of other forward-looking enterprises that benefit not only their workers and their families, but their communities, the Basque territory, and the whole country.

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2 CommentsLeave a comment

  1. It’s just the squeals of bourgeois socialism. Social isn’t a static state, unless your government has appropriated it for shifting the gains of the many into the pockets of the few. Which you ably point out. But it doesn’t much matter, no one is interested in what socialism really is – even the conservatives aren’t conservative though they’ll swear they are. But it’s nice to know that at least one other person in the world knows which way is up. Keep at it. Best of luck.

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