Today we look at U.S. and global efforts to reduce carbon emissions and slow global warming. Last Friday, June 26 2009, The U.S. House of Representatives approved the landmark America Clean Energy and Security Act by a narrow seven vote margin, including 44 no votes from Democrats. The legislation, also known as Waxman-Markey after its sponsors, or the climate bill, will face an even tougher audience in the Senate, where it must meet a 60-vote threshold. The Minnesota Supreme Court’s decision to seat Al Franken in the Senate may add to the Democrats’ leverage. The bill aims to cut 2005 emissions levels by 17% by 2020 and has at its core a Cap-and-Trade system which calls for mandatory caps on greenhouse gas emissions. Any companies wishing to emit above a certain level will need to purchase permits to do so. Additionally the bill requires large utilities to increase their use of renewable energies such as hydro, wind, solar and geothermal power generation.

The bill’s passage by the House is historic and will likely increase President Obama’s leverage in global climate negotiations as global leaders try to replace the soon-to-expire Kyoto Protocol. Detractors though point to its economic costs and the limited nature of the final legislation

How the Bill Works

At the heart of the bill is a Cap-and-Trade system, a market-based system which caps emissions at a certain level and allows large emitters to buy permits for additional emissions from other companies that emit less than the upper limit. The legislation calls for the number of permits to be reduced over time to encourage lower emissions. In practice, establishing a market for these permits will increase the cost of using carbon-based energy (especially electricity from coal), which will in turn reduce demand.

The revenue earned through auctioning would be distributed among households to offset the negative effect on their purchasing power from the higher cost of energy. Initial plans called for all or at least a majority of the permits to be auctioned but the vote-getting process increased the number allocated. The bill passed by the House calls for 85% to be allocated and 15% to be auctioned. Some of the allocated permits will go to utility companies, the idea being that they will either invest the proceeds in renewable fuels or temper price increases for consumers. This change reduces the potential revenue generation of the policy and runs the risk that low electricity costs could actually encourage greater usage.

Cost Estimates

Estimates of the total economic costs of the U.S. Cap-and-Trade program have varied widely. According to the Congressional Budget Office (CBO), the net annual economic cost of the Cap-and-Trade program in 2020 would be $22 billion—or about $175 per household. Analysis of the CBO results suggests that the implicit tax is relatively progressive. While this estimate has been accused of being understated (and it is worth noting that the Environmental Protection Agency came to an even lower estimate) it presented a baseline for analysis. Other estimates put the ultimate cost much higher. An analysis from the Heritage Foundation concludes that the Cap-and-Trade system described in the bill would cost the economy $161 billion by 2020–or about $1,870 per household. Such estimates do not necessarily account for changes in the price of energy that would occur naturally as a lack of investment limits production of fossil fuel based energy. Furthermore, they may not fully include the technological and efficiency gains that the current legislation hopes to encourage. For example, some of the allocations to utilities are granted with the expectation that they will be auctioned off and the proceeds will be used to fund renewable energy development. It’s worth noting, however, that there’s no guarantee the utilities will do this in practice.

Sector-By -Sector

Where the United States is concerned, the likely impact of the new price for carbon varies by sector. Utilities are likely to the most affected, especially in those regions that derive much of their power from coal-fired plants. The Midwest, the country’s already-shrinking industrial and manufacturing base and the home of many of its coal-fired plants, seems particularly vulnerable. (The distribution of allowances in the legislation is intended to find the funds to improve competitiveness of coal plants.)

The effects on agriculture are also varied. Recent Deutsche Bank research suggests that no-till agriculture, which limits disturbance of the soil, as well as reforestation and planting of vegetative buffers could derive significant carbon credits annually under a Cap-and-Trade regime. By some counts up to 20% of U.S. carbon emissions come from the release of carbon dioxide from farmland. However, the bill puts off to the future one contentious issue–the promotion of agricultural land to grow corn for ethanol, which critics suggest is very inefficient and contributed to global food shortages in 2008. The legislators also chose the Department of Agriculture, more likely to be sympathetic to farmers concerns, rather than the EPA, to be the regulator for approving carbon offsets.

The oil and metals sectors may also face vulnerabilities. Some analysts worry that emissions standards would encourage companies to keep inventories low and to import more refined fuels, contributing to idle capacity in U.S. refineries. However, it may also encourage the creation of cleaner processes or the development of carbon capture technologies, which are as yet far from being commercial. Overall, businesses have supported establishing a climate regime, given that clarity over regulatory responses is key to planning. However, there are still many uncertainties about how such a regime will be implemented.

Trade Concerns

There is also a growing fear that climate change policies could prompt trade protectionist policies. The risk that higher costs might accelerate a decline in the U.S. manufacturing base as more production is moved offshore has contributed to the suggestion that compensatory import taxes might be placed on carbon-intensive imported goods. President Obama, in saluting the bill’s passage, did insist that the U.S. not discriminate against imports. Doing so might lead to retaliatory protectionism and a further hit to trade. In a report released last week, the World Trade Organization (WTO) suggested that import taxes might be WTO-compliant if they limit distortions. Paul Krugman suggests that the WTO’s view is analogous to that for value added taxes. However, Martin Feldstein notes that the system could be very complex. With different countries each having country-specific caps and different tariffs, it could be very difficult to assess how comparable the measures are and what remedies might be needed. Thus the implications for international trade and trade law could be quite significant. Moreover, developing countries are petitioning for trade restrictions on carbon-reducing technologies to be lifted or for technology transfer of such goods. The mostly advanced economy companies who developed such expertise have been reluctant to cut prices.

Other Efficiency Steps

The administration’s energy policy more broadly tries to offset potential costs with new opportunities and technological advances to boost productivity growth. It aims to generate 25% of U.S. energy from renewable sources by 2025, create “green jobs” and reduce dependence on imported oil. Projects to develop renewable fuels and improve the efficiency of the power grid received funding in the stimulus bill, in part to offset the impact of the triple shock of lower energy demand, lower credit and lower hydrocarbon prices on renewable producers. President Obama’s team plans to spend $150 billion over the next decade to promote energy from solar, wind and other renewable sources, as well as energy conservation.

Other key steps include the May 2009 auto efficiency program, which requires the American fleet to increase to an average mileage standard of 39 miles per gallon (mpg) for cars and 30 mpg for trucks by 2016 – a jump from the current average for all vehicles of 25 miles per gallon. Doing so would create a new national standard, after many states have unilaterally taken more aggressive steps. A national standard could make it easier for car companies to supply different jurisdictions. Government estimates that oil consumption may fall 1.8 billion barrels from 2012 to 2016 and greenhouse gas emissions may fall by 900 million metric tons could be overoptimistic. They may, however, be more effective than the recently announced “cash for clunkers” program in which consumers receive a rebate for a new more fuel efficient vehicle if they turn in a gas guzzler. Yet the required fuel efficiency increase is rather low (only 4mpg) and the threshold is lower than the current national average. As such, the latter policy, which has been effective in stocking auto demand in countries like China, Germany and South Korea, might have limited effect in the United States. However the effects of such incentives may be temporary. If they elapse without a sustained increase in consumption, demand for autos could fall quickly especially in developed economies which already have a high number of cars per household.

These initiatives together hope to reduce the amount of oil the United States imports. The bulk of energy imports (oil, gas, electricity) come not from the Middle East but from Canada. An increasing amount of the oil supplied is bitumen from the oil sands, which continues to bear an expensive environmental and economic cost per barrel under current technology. Bitumen’s carbon footprint is improving though through technological innovation – and the fuel expended in transport is clearly lower than the amount needed to ship oil from Saudi Arabia. Yet there is still a long way to go. Given the shift towards energy efficiency and lower emissions fuel supply, Canadian authorities and producers are struggling to improve production so that their largest consumer will keep buying. On President Obama’s visit to Ottawa, his first foreign trip as president, he and Prime Minister Harper announced joint investment in carbon capture technology, adding to funds already pledged by the province of Alberta. Such measures hope to help the U.S. meet energy security needs without adding to environmental insecurity. However, carbon capture technology is still far from being commercial.

Assessing Alternatives

One of the biggest benefits of this legislation is that it provides a mechanism to set a price for carbon over the mid-term. Doing so will help households and businesses make investment and savings decisions. However, economists have long argued that a carbon tax would be more efficient than a Cap-and-Trade system, as it would be less complex and vulnerable to distortions. A carbon tax would set a specific cost per unit of carbon dioxide, thus establishing a clear cost for carbon. A Cap-and-Trade system, on the other hand, would set an upper limit for emissions, but the prices it established for carbon might be variable. Of course, introducing new taxes is rarely popular, particularly not during a recession, even if the tax option would be more efficient and have lower compliance costs.

The European Union’s experience with Cap-and-Trade over the past several years provides reason for caution. The first iteration of the policy, issued too many permits, undermining demand. With prices for carbon low, so was the incentive to reduce emissions. A reformulation improved this balance and emissions have been reduced, though European countries still have a significant space to reach their targets. The EU system allows companies to bank or store their allocations for the future or to borrow them from the future. The EU system also illustrates an effect of the global recession. The drastic reduction in industrial output has meant that many companies are producing well lower than their quotas and are seeking to sell their excess allocation. Several companies sought to raise cash by selling their carbon certificates, causing the price of carbon to plummet. A market-derived carbon price might actually be very volatile.

The Road to Copenhagen

World leaders will meet this December in Copenhagen to negotiate a replacement to the Kyoto Protocol, which expires in 2012. The Kyoto Protocol aimed at reducing emissions of 1990 greenhouse gases levels by 5.2% by 2012. The range that is now being discussed is around 25% to 40% of 1990 levels by 2020. The previous U.S. administration withdrew from ratifying the Kyoto protocol, saying it deemed it unfair for allocating reductions targets between developed and developing countries. The reluctance of emerging market economies to make emissions cuts that might stunt their growth could again be an obstacle to a deal later this year.

The United States and China are the world’s top two greenhouse gas emitters, together accounting for more than 40% of annual emissions. If the United States and China can become catalysts in bringing about a strategic transformation to a low-carbon, sustainable global economy, the world will take a giant step forward in combating climate change. Given the complexities of global discussions, analysts like Kenneth Lieberthal suggest that climate change is yet another policy arena that could be best tackled by a G-2, that is bilateral talks by the two countries. Despite its reluctance to take any steps that might reduce economic growth, China, has been taking some steps to curb emissions growth. China rivals the United States as a carbon emitter, despite having low levels per capita, but now has domestic interests to slowly make changes. In particular, the increase in pollution-related illness is taxing the Chinese health care system. Yet many of these measures, such as China’s own cash for clunkers program, may be of limited effect given the potential demand for primary energy. Coal remains the primary feedstock for Chinese electrical plants, although the country is planning to build several nuclear power plants and is sourcing more of its electricity from wind. China is now the world’s largest assembler of solar technology, but little is applied domestically. Should China choose to allocate a greater share of infrastructure spending towards power generation from renewable fuel sources, it could have a significant effect on global use of such technologies.

Chinese heavy industry has been particularly hard hit by slumping global demand, leading to emissions reductions. Electricity demand continues to fall, year-on-year (as of May at least), despite the aggressive government stimulus which has including new metals processing. In fact, the persistent weakness in industrial electrical demand suggests that overall growth could be weaker than some officials suggest. Electricity demand has tended to be a proxy for economic growth. A more domestically driven growth pattern might reduce the pace of Chinese new energy demand growth over time, however, suggesting that this correlation could change if more output is shifted to the services sector.

Coming to a global consensus might therefore be difficult. Already many European countries, including Sweden, which takes up the EU presidency today, may have hoped for a more aggressive commitment from Washington. Emerging and frontier market economies like South Africa, Mexico and the UAE are now taking measures to reduce their carbon footprint. Brazil has moved to reduce the destruction of its rain forests. However these countries continue to be wary of restrictions on emissions, arguing that advanced economies should bear the bulk of the costs. They are also pushing for more technology transfer from the companies and countries that developed some of these techniques.

Higher Carbon Costs and the Global Economy

A higher price for carbon-based energy could be one of several increased taxes and costs which weigh on U.S. consumption in the near future. Should the recovery in U.S. consumption be as sluggish as feared, such higher costs could be a limitation in the absence of real investment which might prompt productivity gains. Despite the risks of a new carbon price, this cost, plus the allocation of government and private sector funds, could spur innovation and energy savings technology that could lead to productivity growth.

Moreover, the cost of energy could increase quite substantially even in the absence of a carbon price. Even in 2009, there is a risk that higher oil prices might dampen any economic recovery. Further increases, perhaps to the $80-90 a barrel range, could keep the economy well in recessionary territory this year. Given current and past short-falls in oil investment, production growth might be quite sluggish going forward. If petroleum demand returns to trend, this could contribute to higher prices in 2010. Higher oil and coal prices could encourage a change in behavior that could boost the position of alternatives in the energy mix, even though carbon-based fuels – albeit higher cost ones – are likely to fuel the economy for years to come.

As Franklin Roosevelt understood, Americans will postpone immediate gratification and endure hard sacrifices–if they must–so long as they are convinced the future can be better than the past. But we face a far more difficult problem at our moment in history. What do you promise people who have been told they can have anything they want, who are repeatedly congratulated for living in the best of all possible circumstances? How do you tell them “the good times,” as we have known them, are not coming back? Americans need a new vision that helps them deal with reality, a promising story of the future that helps them let go of the past.

Here is the grand vision I suggest Americans can pursue: the right of all citizens to larger lives. Not to get richer than the next guy or necessarily to accumulate more and more stuff but the right to live life more fully and engage more expansively the elemental possibilities of human existence. That is the essence of what so many now seem to yearn for in their lives. People–even successful and affluent people–are frustrated because the intangible dimensions of life have been held back or displaced in large and small ways, pushed aside by the economic system’s relentless demands to maximize yields of profit and wealth. Our common moral verities have been trashed in the name of greater returns. The softer aspects of mortal experience are diminished because life itself is not tabulated in the economic system’s accounting.

The political order mistakenly accepts these life-limiting trade-offs as normal, as necessary to achieve “good times.” At earlier periods of our history, the sacrifices demanded by the engine of American capitalism were widely tolerated because the nation was young and underdeveloped. The engine promised to generate higher levels of abundance, and it did. But what is the justification now, when the nation is already quite rich and the engine keeps demanding larger chunks of our lives?

What families, even those who are prosperous, typically lose in the exchange are the small grace notes of everyday life, like the ritual of having a daily dinner with everyone present. The more substantial thing we sacrifice is time to experience the joys and mysteries of nurturing the children, the small pleasures of idle curiosity, of learning to craft things by one’s own hand, and the satisfactions of friendships and social cooperation.

These are made to seem trivial alongside wealth accumulation, but many people know they have given up something more important and mourn the loss. Some decide they will make up for it later in life, after they are financially stable. Still others dream of dropping out of the system. If we could somehow add up all the private pain and loss caused by the pursuit of unbounded material prosperity, the result might look like a major political grievance of our time.

More important than all the other losses is that people are also denied another great intangible–the dignity of self-directed lives. At work, at home and in the public sphere, most people lack the right to exercise much of a voice in the decisions governing their daily lives. Most people (not all) are subject to a system of command and control over their destinies. They know the risks of ignoring the orders from above. Not surprisingly, many citizens are resigned to this condition and accept subservience as “the way things are,” and their lives are smaller as a result. Many find it hard to imagine that these confinements could be lessened, even substantially removed, if economic organizations were informed by democratic principles.

What’s needed in American life is a redefinition of “life, liberty and the pursuit of happiness.” Given the nation’s great wealth, the ancient threats of scarcity and deprivation have been eliminated. Yet people remain yoked to economic demands despite wanting something more from life–freedom to explore the mysteries and bring forth all that is within them. Collectively, Americans need to take a deep breath and reconsider what it means to be rich.

The challenge, as John Maynard Keynes wrote long ago, is how “to live wisely and agreeably and well” once desperation and deprivation are no longer the driving forces of our existence. As the British economist predicted, the old economic problems of scarcity and survival have been solved, at least for developed nations. People should put aside the old fears, Keynes suggested, and learn how to enjoy life. Free of want and worry, we face a new challenge: to discover what it means to be truly human.

That wondrous pursuit is what I recommend as the alternative to our old definition of progress. In the years ahead, Americans will suffer unavoidable losses of familiar pleasures and be compelled to alter some deeply ingrained habits of material consumption. These painful adjustments can be endured if the people are confident the country is progressing toward a more fulfilling transformation. The essential trade-off could be expressed on a bumper sticker: Smaller Cars for Larger Lives.

To accomplish this sweeping change, people need power–more power to say what they think without getting fired and to make choices that are more in line with their values and aspirations. They need more security–which would give them the self-confidence to explore new options without dooming their families to poverty. People need more philosophical space–the room to decide what “success” is in their own terms and to make their own “mistakes.”

We should start thinking of living larger lives as a fundamental human right and begin throwing off the confinements imposed on us by the old order. Since scarcity has been vanquished, the collateral suffering manufactured by the economic system should also be declared unnecessary–even immoral–in a healthy and wealthy society. A minority of Americans, people blessed with special talents, wealth or status, may already enjoy this level of freedom. But as rich people can attest, wealth does not exempt one from the human struggle, the search to find one’s groove in life, to draw forth one’s unique purpose and strengths. That treasure cannot be bought. It has to be earned.

Government can do many things, but it cannot transform the society. Only the people can accomplish that. They change the fabric of society gradually and in unannounced ways with their behavior and creativity, guided roughly by their enduring moral values. If government set out to impose transformed values on the rest of us, the results would be oppressive and wrong. During the last generation, the coarsening pressures of the market system did a lot of damage to our society, but they did not succeed in stripping Americans of what they believe. Most people still know the difference between right and wrong, and despite the obstacles, they struggle to live accordingly.

What government can do is construct the rules, legal premises and supportive platform that enable people to pursue social transformation more aggressively. Our inventive popular culture–the marvel of the world–does this in freewheeling ways. With a little help and less interference from Washington, Americans can similarly reinvent the society. An era of innovation and random experimentation would draw upon this same spirit, the life force of Americans, the people who are practical and idealistic.

One important condition government can provide is the platform of “essential needs” that will give everyone more security and therefore more confidence to explore new and different choices. We could dust off Roosevelt’s “second Bill of Rights” and address its unmet goals. FDR recognized in early 1944 that Americans were weary of the sacrifices imposed by World War II and so he announced a broadly conceived promise. After the war is won, he said, the country must construct a new set of meaningful “rights” for all, everything from health and education to work with remunerative wages. His vision of the future became the postwar political agenda of the Democrats, and in large measure the promises were kept. I think Barack Obama may eventually face a similar necessity to spell out the vision of what a transformed America can become on the other side of the ditch we are in. Some goals are already well understood. The thick backlog of legislative proposals that have been repeatedly blocked by powerful interests during the last generation should be revisited in order to establish concrete rights and protections for families and children, workers and employees. The extensive family-centered social systems in Europe suggest opportunities for US reforms. Reversing national economic policy on work and wages is, likewise, a necessary step toward healing the society. If government constructs a rising floor under wage incomes, starting from the bottom up, people at every level will be liberated to pursue creative social invention. In the face of deep recession and rising unemployment, there is not much anyone can do at present to boost wages. But government can make this promise for the future. When the economy recovers and unemployment declines, the minimum-wage floor will rise in step, and other work-improvement rules will kick in. Congress can enact the laws in advance and time their effective date to economic conditions.

Beyond these essential steps, there are taller mountains to climb. We can envision loftier goals that require social imagination and then practical testing before gaining broad agreement and implementation. This is where we get to dream a little. Can we imagine, for instance, a country that is virtually without poor children? A nation in which every child grows up entitled to explore life’s possibilities, free to go anywhere in this diverse country and feel at home? Can we imagine an economic system that is not organized on the principle of command and control, on the few giving orders to the many? Can we envision an economy designed to serve the society, rather than the other way around? Some will say this is an idle daydream. I say it is our birthright, our inherited privilege. We are Americans. We get to think larger thoughts about our country and ourselves. Daydreams are a seedbed for the possible. We can argue later about how to achieve them.

To encourage people to free up their imaginations, I add a radical proposition: instead of asking what will be good for the economy, government should start by asking what will be good for our people and society. Instead of thinking first about how to help businesses flourish, ask what people need in order to flourish in American life. Essentially, I am suggesting a reversal of the usual process employed by the system. In its efforts to take care of business, the social question is often never asked. Here are three big ideas–favorite daydreams of mine–to illustrate what it means to put the people first.

First, every American who is willing and able ought to have the right to a job that pays a livable wage. If the private sector will not provide these jobs, then the public sector should be the employer of last resort. Franklin Roosevelt described the goal–the practical equivalent of full employment–in his “second Bill of Rights,” and the public has overwhelmingly endorsed the principle ever since. In recent decades, the economy has drifted even further from the promise, creating in its place a broad labor market of the underclass–temporary jobs paying unlivable wages and often filled by undocumented immigrants. Guaranteed public jobs paying more than the minimum wage would permanently and automatically stabilize the economy, swelling the ranks of public workers in recessions and shrinking them when private jobs become more abundant. Instead of punishing the working poor most severely in downturns, as the system does now, the government would redistribute the costs of recession so that all taxpayers would share the burden as a public obligation.

The social consequences of a change like this could be profound: it would be a direct assault on the poverty and hopelessness of inner-city precincts and decaying rural towns where the same pathologies ravage families and young people without regard to race or ethnicity. Real jobs would mean that reliable incomes would flow into those communities, providing a concrete basis for economic development and neighborhood restoration as well as the redemption of damaged lives, especially the prospects for young people.

Obviously, permanent public employment–jobs for all who need them–would be enormously expensive, but the fulfillment of large goals can begin with smaller steps. The government might set some guidelines, then sponsor 100 or 200 projects sited around the country and invite impoverished communities to compete for those in their area. What work needs to be done? What skills and equipment are required? People can answer those local questions for themselves. Some initial efforts will fail, but the country will learn from the mistakes and from the successes.

The second idea is that everyone who works, whether in the front office or on the assembly line, deserves to “own their work”–that is, the right to exercise personal responsibility for what they do and enjoy mutual respect and the capacity to contribute and collaborate in important decision-making within the firm. These elements of individual voice and status are critical to satisfaction in one’s work, but democratic qualities are largely missing from American workplaces. When most people go to work, they submit to a master-servant relationship in which a few people determine everyone else’s behavior and most employees are denied a voice in the matter and have no right to object or criticize. These confinements are especially strict for lower-wage workers but often extend far up the occupational ladder to include middle managers and professionals.

Breaking free of this rigid top-down system and liberating workers to enjoy the freedom (and responsibility) of being human would represent a profound change for our society, a great leap forward in our social development as a people. As it happens, the shift to more cooperative and respectful workplaces can also yield economic gain for the nation. As numerous academic studies have shown and outstanding companies already understand, collaborative relationships between top management and the workforce are more productive and profitable. Instead of being ruled by fierce conflicts, the different elements within these companies share information constantly and steadily improve by learning from their mistakes. The profits are shared because the workers are also the owners.

This reorganization of employment and ownership cannot be commanded from afar, because it requires everyone–workers and bosses–to change, to put aside old hostilities and begin trusting in more open communication. That change is very difficult for people to achieve in any setting. Government can encourage the pursuit, however, by setting out some incentives and loose guidelines for reforming work. One of the most promising routes to change is the employee stock ownership plan that invests everyone as co-owners with the same economic incentive–sharing the returns from self-improvement. Some 11,000 companies–mostly smaller businesses–are organized this way, and workers accumulate capital savings in addition to their pensions. Employee-owned companies, however, must also make internal reforms to establish mutual accountability and honest communication if they want to gain the full benefits of having worker-owners. The concept may seem alien to many, but its core assumptions are very American: a practical belief that equality and liberty can be present in our daily lives.

The third idea is that to lead the way for social values, the economy needs a new, reform-minded business organization–call it a social corporation–that competes with old-line corporations adhering to their narrower values that enforce the supremacy of profit over society. The social corporations could be chartered by government and given certain benefits. To pursue a different set of values, they may need some protections in their infancy and perhaps modest start-up subsidies, and exemptions from the usual rules, but most of them would be independent and privately owned. They would produce needed goods or services that the private sector won’t provide and sell them at a price most people could afford. They might, for instance, fulfill the market for very cheap computers and other high-tech devices that are stripped of the bells and whistles that run up the prices. The social corporation would be a working model for how the social imperatives–environmental values and equitable relations with workers and communities–can be integrated into firms and efficient production processes. Business lore and economic dogma say this is impossible. Social corporations would set out to prove them wrong. The purpose of this competition is not to replace orthodox companies but to put real market pressures on them to change. Creating social enterprises, including nonprofit cooperatives, can liberate us from the political vetoes business interests exert over promising new ideas.

Another crucial objective is to limit the size of business organizations, including social corporations, in line with E.F. Schumacher’s famous dictum “Small is beautiful.” The bloated scale of America’s leading corporations has become a major impediment to innovation and experimental reforms, not to mention a corrupting influence in politics. Americans are learning anew from the financial crisis why it is a mistake to let private firms concentrate more and more power under one management. The failure of megabanks that the government helped create threatens our general well-being, and then government bails them out with taxpayer money because they are “too big to fail.” Revived antitrust laws could simply prohibit the concentration of economic power as a threat to social values as well as to healthy competition.

Economic power must be dispersed in this broad nation, especially in banking and finance. We need many more financial intermediaries to allocate capital and credit and demonstrate more respect for society’s needs. That includes regional banks, which are naturally closer to the customers. It means supporting and protecting the small and adventurous financial firms founded on commitments to social responsibility. They put capital into companies that have embraced environmental concerns, have equitable dealings with workers and communities and practice high-road behavior. On many fronts one can see the gradual advance of “social responsibility” in US capitalism. The pace is too slow to attract much political respect, but the current crumbling of the old order will clear the way for more dramatic progress.

These ideas may seem distant from the usual chatter of policy thinkers, but they offer alternatives to an economic system that has abused rather than served American life. I know a lot of smart people across the country who are pursuing these ideas in different ways–they constitute the beginnings of formations of citizens that can disrupt inert politics and overcome the timidity of incumbent politicians. These agitators are engaging in action for the long run, and the fainthearted need not apply.

By Alexander Cockburn, Counterpunch

On any rational assessment the popular new president is skating on thin ice. Pollyanna bulletins about the economy puff up from the White House and Federal Reserve, like auguries of a new Pope through the  Vatican chimney. “Habemus spem.” We have hope. We’ve just heard it from President Obama: “We are starting to see glimmers of hope across the economy.” From Fed Chairman Ben Bernanke, who’s so far unleashed $12 trillion in booster money, we get the always sinister reassurance, like Death giving the Appointee in Samarra a friendly tap on the shoulder, “the foundations of our economy are strong”.

The economic news in the near and medium term is ghastly, as Mike Whitney outlined on this site last Thursday. Retail sales crashed again in March, nowhere worse than in the car market, though electronics and building materials were way off too. They now reckon there’ll be just over two million housing foreclosures in 2009, up 400,000 from 2008. Industrial output is going through the floor at an annual rate of 20 per cent, the biggest quarterly drop since the end of the Second World War. US industry is now running at only 70 per cent of capacity, the worst number since they started tracking this stat in 1967. Job losses are currently running at 650,000 a month.

Round the next corner is credit card delinquency and  the long-heralded slump in commercial real estate, where vacancy rates are already running at 15 per cent,. Capital One, a huge issuer of Visa and Mastercard, just  said the annualized net charge-off rate for U.S. credit cards — debts the company reckons will never be paid — rose to 9.33 percent in March from 8.06 percent in February. In other words, Capital One – whose credit card promotions take up  hefty space in the mailbag of every US postman – is in big trouble, and  under one in ten of these credit card holders will have a messed up credit rating for several years to come.

Wall Street and its boosters are trying to pretend that indeed the worst is over. The Dow and S&P Index have been rallying for five weeks. Wells Fargo, the huge San Francisco-based bank, second biggest home lender, announced that first quarter net income rose 50 per cent to $3 billion.  No one seriously believes the bank is in anything other than continuing huge trouble, and will soon need – so Blomberg News surmises – $50 billion to settle near-term commitments. The profit figure stems from newly relaxed rules about the valuation of Wells Fargo’s assets.

In other words it’s thin economic ice from here to the horizon. Robert Reich, now teaching economics at Berkeley and formerly labor secretary in the Clinton administration, wrote a piece recently, titled “Why We’re Not at the Beginning of the End, and Probably Not Even At the End of the Beginning”. There are huge problems with the whole orientation of the US economy. The “free market” outsourcing model has failed. Even at the best of times the US consumers who account for over 70 per cent of all economic activity in the country, don’t have purchasing power to keep the whole show on the road, unless they put it on the credit cards which are now maxed out and going into default, or borrow on houses they can’t afford.

Amid a hail of well founded criticism from liberal and conservative economists alike, Obama, with Geithner, Summers and Bernanke at his elbow, remains absolutely committed to giving the bankers everything they ask for, trillion upon trillion.  As William Black, deputy director at the former Federal Savings and Loan Insurance Corp. during the thrift crisis of the 1980s, recently remarked in an acrid interview in Barron’s, (reprinted here last week) “ Unless the current administration changes course pretty drastically, the scandal will destroy Obama’s administration, both economically and in terms of integrity. We have failed bankers giving advice to failed regulators on how to deal with failed assets. How can it result in anything but failure?”

In foreign policy the ice is just as treacherous. As the nation emerges from its disastrous adventure in Iraq, Obama redeploys to the Afghan-Pakistan theater. The administration delightedly touts claims that its remote-controlled missiles are decimating al-Q’aida. The Washington-based journalist Gareth Porter last Thursday cited here data leaked by the Pakistani government showing that only ten out of 60 drone attack in February and March hit al Qaida leaders and the rest did what bombs and missiles usually do, namely kill civilians, 537 of them – thus immeasurably strengthening the hand of the Taliban  in the battle for hearts and minds.

Obama is no doubt unworried by this since the hearts and minds he’s mostly interested in belong to the American people and especially opinion-forming elites, who remain unflustered when high explosive falls on a wedding party in Waziristan. Failure in Iraq was re-labeled “victory” and in terms of domestic politics the chickens only come home to roost when there’s film of people climbing off the roof of the US embassy into a helicopter, or when the casualty rates among US soldiers start soaring. Soaring Pentagon budgets are popular with Congress, whose members nix any effort to cut back.

Where the ice is giving way for Obama is among those who thought he might strike out in a new direction in foreign policy. There’s not much sign of that. Whether it’s a sell-out of Haiti’s poor or acquiescence in Israel’s grim plans for the Palestinians, Obama’s game is strictly business as usual, up to and including the Cuban blockade whose damage, as Fidel Castro said here last week, “cannot be calculated only on the basis of its economic effects, for it constantly takes human lives and brings painful suffering to our people. Numerous diagnostic equipment and crucial medicines –made in  Europe, Japan or any other country– are not available to our patients  if they carry U.S. components or software.”

Obama has welshed on promises that America will stop kidnapping its enemies and “rendering” them to secret prisons overseas. As under Bush, enemy combatants languish without rights or recourse in prisons like Bagram. The torturers who flourished in the Bush years will not be prosecuted. Electronic eavesdropping continues unabated. It seems, so CounterPunch’s Fred Gardner is reporting in exclusives on this site, he and his attorney general are welshing on commitments not to harass medical marijuana operations in states where local laws sanction such activity.

Will the liberal-left mutiny? Never. Remember, Bill Clinton bombed Yugoslavia and kicked away life supports of America’s poorest and most of the liberal-left stayed loyal to the end and cherish his memory. The labor movement has already seen defeat for its cherished “card check” bill, designed to win a level playing field for union organizers, thus presumptively boosting effective purchasing power among working people, vital to the nation’s economic well-being.  They’re not really blaming this on Obama, even though it is his chief aide, Rahm Emmanuel who, in his years on the Hill, picked Democratic candidates who feel no loyalty to labor and refused to push for the card check bill, and though Obama recently stressed he is a “new” Democrat – transparent code for someone distancing himself from the labor movement.

Obama’s polling numbers remain good. He has only to say there are “glimmers of hope” and the pollsters duly find increasing sentiment among Americans that they feel the economy is moving in a “positive” direction. He gets good assessments from Democrats and Independents. Many  Republicans don’t like him but here again Obama is lucky, just as he was lucky – at least in the near term -  to have three Navy SEALS off the horn of Africa who were good shots. The Republican opposition is in appalling shape, lumbering from one ill-conceived stunt to the next.

Obama’s lucky to have succeeded a terrible president. He gets out a lot and talks a great game. His problem is the same as the country’s. The economic ice is cracking under his feet, and the “stimulus” is going to be about as efficacious as those cushions under the seats the flight attendants assure us are going to come in handy when the plane goes down in the North Atlantic.

The Curse of Rockefeller

He died in action thirty years ago, in intimate activity in a subterranean sanctuary at the end of a secret tunnel under a street in the West 50s in New York.  Nelson Rockefeller was one of the richest men in the world, but he never found a way to buy his way into the Oval Office. As Bruce Jackson writes in our April 16-30  newsletter, just published:

– he was the individual more responsible than any other for the rise to power of Henry Kissinger. Kissinger was on Rockefeller’s personal payroll for a decade; it was because of Rockefeller that Kissinger was brought into the Nixon administration;

– he was responsible for the September 13, 1971 bloodbath at Attica prison;

– in 1973 he created the most repressive drug laws in the nation. In 1973, he got the New York legislature to pass what immediately became known as “the Rockefeller Drug Laws,” These laws imposed very long sentences, many with mandatory minimums, for what were often minor offenses everywhere else. Sale of two ounces of heroin, morphine, opium, cocaine or cannabis in any form, or possession of four ounces of those same drugs brought the same sentence as second-degree murder: 15 or 25 to life, with no parole before the minimum was served and no judicial discretion.

Thousands of drug dealers, drug users and “mules” went to prison for decades under the Rockefeller laws, but few big time dealers did any more time under them than they would have under the laws that had been in place before 1973, primarily because many of them – like Nicky Barnes and Frank Lucas – were not only willing to turn informer, but had enough people to snitch on to make massive sentence reductions worthwhile to the prosecutors.

Now by agreement between Gov. Paterson and the New York state assembly, these laws are about to be repealed. Read Bruce Jackson in CounterPunch newsletter on the true reasons for repeal and the awful legacy of a truly appalling human.

Also in this terrific new issue: As the economy implodes, the social fabric frays and nutball groups organize for Armageddon. Pam Martens sets forth the national game-plan of the “Free State Project”. Is it coming to a town near you?

Half a million new jobless every month and the salesmen of “free trade” still hawk their credo. Paul Craig Roberts describes what offshoring has done to America.

Alexander Cockburn can be reached at alexandercockburn@asis.com

Less politically and more economically, optimists pin their philocapitalist hopes on China’s keynesian demand boost (which is working but is not enough to reverse the negative macroeconomic trends worldwide) and on the fact that prices of raw materials are rising again (this could spell doom for hundreds of millions, as food prices are set to rise).  We anticapitalists turning postcapitalists look at unemployment and housing data and conclude that the opposite is still true: they are just trying to provide self-fulfilling prophecies of financial optimism on friendly media, so that reform of capitalism doesn’t have to go too deep.  But the Atlantic regime of financial speculation is dead for good and can’t be resurrected, not even at huge cost for government finances. Economic redistribution and geopolitical rebalancing are the two major things that can solve the crisis. Put people first: sack the bankers, milk the capitalists, invest in society and the environment.

Later, i saw Geithner’s testimony. He wants to give yet more money to banks “to restore trust and the flow of lending”.  He came up with a vague plan for a bad bank with public and private money to absorb toxic assets. Same faulty approach of last year’s TARP program. I mean GoldmanSachs Paulson and Wall Street Geithner differ in the fact that at least the latter wants private capital to chip in in the mess it created. But hell, it’s still money with no strings attached, and it doesn’t put a value on these assets (think McMansions in the Nevada desert: how much are they worth now?).

Only nationalization of banks and socialization of credit will get us out of the slump, while undermining the power of those who got us into this mess. Eurobankers stay incredibly arrogant, viz. ackermann in germany or mazzotta in italy. These greedy dumbsters will hoard all the public money they receive and keep lending at penalty rates. Damn it, let’s make élites cough up this cash for social spending. The $10 trillion which, one way or the other, are being thrown at the parallel banking system and stimulus plan amount to more than $1.400 that could be given to every human on the planet. And most of these folks would spend this money instead of hoarding it.

Also no progressive policy is sustainable without restrictions on capital movements. The era of financial globalization ended in misery and indignity. Let’s make sure it doesn’t happen again. A minimal social plank for the left in europe and elsewhere could be:

- basic income and living wage
- socialization of credit
- taxation of wealth
- controls on capital movements and fixed exchange rates
- deficit spending on environment, culture, education, community empowerment financed by money creation

Let’s unite on March 28 and April 1st against financial capitalism. Let’s do a joint Mayday to make’em pay.

Nine years after, we can look back and see than none of this happened. The much-touted European miracle of a transnational polity turned out to be a mirage. The EU has been voted down in almost any open electoral contest (France, Holland, Ireland), and the neoliberal legacy that propelled Europe into Maastricht and Schengen has caused the biggest economic slump since the Great Depression. In fact, the eurocracy has been standing idle as the meltdown progresses, while national governments rushed to insure their banks from a run on them (ask the Icelanders who can’t use their credit cards any longer or indeed buy anything coming from abroad). To add worse to worst, new cold war tensions loom in its East. In short, political Europe lies in ruins, as nationalism, xenophobia, clericalism are dangerously on the rise everywhere.

Eurofederalism, once a progressive ideology commanding the allegiance of most of European élites, is definitely passé. While America is finally on the lookup with Obama’s election marking the end of the long, dark years of bushism, Europe lies in shambles. It does not have an economic or geopolitical direction, much less a social and a cultural agenda. In this confused scenario, a statist rightist like Sarkozy is looking like a giant standing amidst the rubble of laissez-faire, calling for unprecedented government intervention in the economy, altho this has splintered the traditional Franco-German core of the EU. Even a discredited leader like Brown is getting a new lease on life because of the crisis. Berlusconi instead is going to pay for the crisis dearly in political terms (and it’s not clear what
the cost of offloading the major toxic assets held by the Italian government and banks will be), as the Anomalous Wave student movement is proving as I write these lines. Their mobilization has already mobilized millions and produced two general strikes. It’s the only social force that manages to counter the cryptofascist policies and the persecution of gypsies, muslims and immigrants enacted by Berlusconi III, who presides over a government exclusively composed by fascists, xenophobes and all the sycophants on his vast payroll. Not even the clericals are in his government, although Mr B has been publicly blessed and praised while he was attending a Mass held by Papa Ratzy. The new socialist hope of Europe, Zapatero, is now paying the price for his mix of social progressivism and economic conservatism. The latter has propped up real estate prices to impossible heights and now the fall is very harsh. But there’s no question that socialist and social democrats are rediscovering their keynesian instincts and are moving to left in practically every European country. Also Merkel is being weakened by the crisis: her free-market and monetarist instincts are playing against her on the domestic side, and Putin’s aggressive stance in Georgia and elsewhere is weakening her foreign position. Unfortunately, the SPD does not seem posed for a united left approach with Die Linke and Greens that could defeat the CDU in the next elections (it would already have a majority in the Bundestag).

But events are unfolding rapidly as eurocorporations have started laying off workers and employees in large numbers, and this major fact could alter the political landscape dramatically. Right now, Europe seems to be coming apart at the seams, with an unloved political structure, an outdated economic policy, and an outmoded foreign policy. Many have started betting on the dissolution of the euro. It is likely that the great recession will hit Europeans harder than Americans, due to the neoliberal and monetarist inertia built into european institutions. In fact, the EU has never weathered a major recession in its history. Will it withstand the financial hurricane it never thought possible?
Already spreads on eurobonds issued by the Greek, Italian, Portuguese governments have risen sharply. Yet panic-stricken Iceland and Hungary want shelter under its umbrella, and even Denmark and Sweden are now considering joining the euro, not to say the UK. One of the few countervailing effects to European self-dissolution is that the split between Old and New Europe is likely to be repaired under Obama. But this will also mean that NATO will be strengthened, as euroatlantic relations are now on the sunny side.

Obama’s victory undoubtedly brings a wave of optimism, which after all these years of bushist darkness and obscurantism is refreshing. His administration should chart a fairly liberal, ecokeynesian course in socioeconomic policy. The gross inequalities created by three decades of free-market fundamentalism are likely to be reversed, in America. But what about Europe? From a European perspective, Obama’s election exposes the white christian xenophobic monetarist gerontocracy that still holds on to power in much of europe (definitely in spaghettiland). Strange as it may seem, Europe now finds itself to the right of America. The other time it happened it was in the very scary 30s and 40s with FDR, whose New Deal clearly represents a political template for BHO. His election was made possible by the mobilization of young, women, blacks, latinos. This is the political constituency that opens up venues for social change in Europe, too. In Europe, blacks, arabs, slavs, turks, latinos are either discriminated or persecuted by national governments; they should conversely be empowered by Europe’s Next Left. Let’s write on our banners once for all: Pour l’europe sans frontières du métissage sociale!

European movements have steadfastly refused to give priority to a European agenda, and thus to become the effective social and political opposition to Commission, Council, and Central Bank. The latter is a dangerous remnant of monetarist orthodoxy and if not decisively confronted by political and social pressures, will make the recession worse in Europe than in America, meaning millions more unemployed. Trichet was raising interest rates as late as July, when Europe was already in recession. Suicidal. (Today it’s still over 3%, while zero interest rates are already a reality in US and Japan). We must get rid of him and the Stability Pact. This is priority #1 for organized labor and egalitarian movements.

Since Rostock, radical movements in Europe have targeted three major issues: resurgent racism and fascism, climate change and greenwashing, NATO and euratlantic militarism. Other movement priorities such as precarity, gender, free media continue to be important, but comparatively less so than in previous years. In the wake of the Great Recession, capitalism’s biggest crisis since the 30s, I surmise the hypothesis that a renewed emphasis on the self-organization of precarious, immigrants, unemployed is absolutely crucial. Mass unemployment will give new life to rightwingers everywhere in Europe, we’re already witnessing this in Italy, Austria, Switzerland, Belgium, Denmark, to name just a few countries. And while antifa and antira action is absolutely essential during emergencies, such as when Lega Nord and Vlams Blok tried to stop Koeln’s mosque from being built, not addressing the social causes of xenophobia will make all of us weaker. We must build social solidarity. And to do so, we have to create organizations where mixité and métissage are the norm, where precarious and unemployed, no matter if black or white, christian or muslim, red or pink, can join in common struggles and campaigns against borders and precarity, i.e. against persecution and detention of migrants and exploitation of the disenfranchised in Europe today. More than that, now that deregulation and neoliberalism have been exposed as the market theology, we can actually fight for and obtain a European Welfare State revolving around a European basic income and living wage, p2p culture and ecosocial communities, and more.

We should be clear that this is an overinvestment crisis caused by massive deregulation and negative redistribution: three decades of market excesses, credit-fueled consumer expansion and business-friendly policies have finally come to an end. Neoliberalism, that ideology of the Commission since the 90s, has met its demise. Hayek and Friedman are now finally buried: the policies advocated by the shock therapists have turned out to dig the grave of laissez-faire. It will be decades before that corpse is unearthed again, if at all. This is a crisis like the 30s and harbors similar dangers, namely global fascism, militarist, ethnonationalist, genocidal. Since this is also a biocrisis, it will be ecofascism, regaling given economic and ethnic elites with mastery over their own lives as they send billions to their deaths: if you ain’t got an SUV, you drown, this is the ecofascist message that New Orleans sent to the world. Precarious, creative, migrant labor must win higher income share and expanded leisure at the expense of capitalist elites, while compelling the state to redistribute social productivity, but it will need the equivalent of last century’s radical industrial unionism to do so. At the same time we have to make sure that redistribution is not about fueling our carbon addiction (like in the old-style keynesian expansion), but spent for social activism, public welfare, economic innovation and grassroots redesign of production, energy, transportation systems. The conflicts over social power will be huge about whether to assert a radically progressive agenda or a radically reactionary one. We’ll see conflicts within and among regions of the world like we haven’t seen in decades, if not centuries.

Since Rostock, Copenhagen, Heathrow a new lymph is flowing in the anticapitalist movements adopting queer pink, anarcho black, radical green ideological forms. Pink, black, green urban insurgence seems the name of the game. Pink, because since at least Act Up threw the gauntlet of protest to the neoliberal order, queer has become revolutionary for all sectors of society: it’s no longer simply a matter of identity politics, it bespeaks a radical social transformation, and the contested institutionalization of the end of patriarchy. Pink because it refers to pinko deviant political
tendencies in non-pacified urban subcultures, experimenting with the radical mixing of codes, genders, ethnicities. Pink like a clown insurrection. And ecotopian green like reclaim the streets, guerrilla gardening, criticalmass-vélorution, and now the climate action camp, setting a new template for ecological protest. It’s a DIY, eco-hacking way of dealing with environmental issues, exploring how they can empower the people in adopting alternative forms of socialization and social organization. Urban insurgence, like the one that has mobilized Copenhagen’s alternative youth since March 007 in countless demos, large-scale rioting, and huge non-violent actions to defend to the last the very idea of social squatting as a way of life, which has become integral to the notion of european urban culture over the last three decades. Self-managed zones and radical collectives will have to federate all across Europe, if the political legacy of punk and autonomism is to survive in our cities.

The Great Recession holds promise for radical transformation, but we gotta be clear about what it is about. If we next ftist radicals want to act in defense of the biosphere and remove the capitalist causes of climate change, while maintaining the digital civilization which common labor, information and knowledge has created, I think we should use revolutionary means (civil disobedience and direct action) for ends that are ultimately reformist: a new urban environment, a new welfare system, a reregulated labor market, strongly curtailed capitalist freedoms: NGOs and civil society won’t do it in our place. In other words, anticapitalism is likely to trigger fundamental ecosocial reform, rather than the revolution. This is because the present capitalist crisis is not caused by social and political constraints imposed on accumulation and domination (such as in 1917-22 or in 1968-77), but rather by the lack of regulation from above as well as effective resistance from below.

Also, in the ideological fight with the right and in the ideological competition with liberals and ocialists, anticapitalism as a label doesn’t cut it. In fact, it’s already being appropriated by trotskyists for old New Left parties that cater to the protest vote but don’t change the fundamental hierarchical structures of politics in the direction the Next Left has been experimenting with since Chiapas and Seattle. We need a new social organization (the One Big Heretic Union) and a new (pink, black, green) political ideology for the anticapitalist movement, which, looking at it from the perspective of malmoe’s Klimax vs E-On street block or the night’s battle by the Hilton, is in a nutshell the interbreeding of the autonomous, anarchist, antifa, queer, vegan tendencies that have been brewing over the last two decades in metropolitan subcultures. I think next leftists can better expand their radical action and build alternative structures for society, if social liberals and green capitalists prevail over nationalist authoritarians and military-carbon corporatists in the present historical bifurcation.

The simultaneous interest rate cuts by the world’s central banks in early October 008 was the last-ditch effort to solve the crisis by monetary means. In fact, it didn’t work and monetary authorities have fallen into the liquidity trap, where monetary policy becomes ineffective, and only fiscal policy has an effect on the economy. Thus only major deficit spending of the equalizing sort can now drag the economy out of deep recession. The political battle in Europe and America will be on that, in my opinion. This overaccumulation crisis which is turning into a major effective demand crisis (realization crisis in the marxian terminology). Anyway my take on the Great Recession, which I somehow predicted (the article was printed in early 2007) is here (there’s one typo in the geopolitics cell, it should read “unstable UNIpolar” in the 80s and 90s):

www.leftcurve.org/LC31WebPages/Grid&ForkTable.pdf

Today the debate in movements seems to polarize around two ways to go about the new historical situation created by the Great Recession and America’s shift to progressivism:

i) let’s finally secede from the mad and corrupt world of capitalism and build the new society from scratch, a place were solidarity and sharing are in and inequality and exploitation (of women, peoples, nature) are out; let’s call it the steampunk solution.

ii) the great recession is a once-in-a-century opportunity to build radical political and social organizations/ federations/coalitions that can impose redistribution (and thus economic sustainability) and push for the redesign of basic social structures toward ecological compatibility; let’s call it the commonist solution.

But the two strategies should not be mutually exclusive, especially if we wanna beat the Right. For instance, a massive increase in public spending that goes toward financing alternative, sustainable communities, as well as environmental remediation public works are likely to be progressive ways out of the recession, while a new postcapitalist culture won’t be able to thrive if there aren’t enough spaces and hoods that experiment with new ways of collective living
and explore new dimensions of social conflict.

To conclude, a list of statements that in my wet dreams should spring all european radicals into common action, now that capitalism is in crisis and neoliberalism is over:

– the EU is engulfed by the great recession and is reverting to national sovereignties to solve the credit crisis: one more blow at the already vacillating political legitimacy of Commission; but in the present sociopolitical climate in Europe a rightist, authoritarian and xenophobic, even outright fascist outcome is more likely than a leftist outcome (reformist and/or revolutionary don’t matter)

– in fact, the elites are in disarray: they don’t know how they sank into shit so fast and don’t know the way out, while the free market suddenly has no longer any appeal for the media or the population at large

– the deepening recession will provoke escalating labor conflict, but the precarious generation must build its own organization or be left out from the redesign of economic institutions

– G2, as second-generation immigrant youth (first-generation europeans) are called in italy, will be at the forefront in the social conflict vis-a-vis securitarian and cryptofascist powers — today islamophobia is the functional equivalent of antisemitism in interwar europe: it’s the faultline between right and left in europe; in recessive conditions, which will fan the flames of xenophobia, only a transeuropean revolutionary social organization can bridge the gulf between immigrant and native workers, service and creative labor, between rebellious G2 youth and dissident white youth: let’s build the European Union of the Precarious and the Unemployed

– politically, it’s high time that we build a european federation of autonomous/anarchist/antiracist/queer metropolitan zones and movements sharing common symbols, tactics, strategies. A Hanseatic League of Social Centers, if you will. The circle and the jagged arrow (aka the Blitz) is probably the most universal symbol of european insubordination. For all my quest for a new radical iconology, let’s adopt the inherited one as common signature of our struggles: live it! share it! squat it! fight it! block it!