Cruel & Unusual Punishment: All the Rage Again

Glenn Greenwald discusses how the US government’s judiciary-abetted contemporary campaign to reinstate cruel and unusual punishment reflects growing elite apprehension that the American working class needs to be harshly, emphatically repressed and intimidated–because the long beating that the oligarchy has been giving to the working men and women of America is getting much, much more viscous, institutionalized and undeniable. There is no visible light at the end of the tunnel. Elites are anxious that even Americans may use the technology of the age, and begin to resist in critical mass.

“The common thread in the (Aaron) Swartz and (Bradley) Manning persecutions — as well as similar cases such as the two-year prison term for non-violent climate change protester Tim DeChristopher, the FBI’s ongoing investigation of pro-Palestinian peace activists, and even the vindictive harassment of White House/DADT protester Dan Choi — is the growing efforts to punish and criminalize non-violent protests, as a means of creating a climate of fear that will deter similar dissent,” Greenwald points out.

“…(The US government’s growing efforts) to stifle meaningful dissent of any kind — especially civil disobedience — through intimidation and excessive punishment, the cruel and degrading treatment of Bradley Manning, the attempted criminalization of WikiLeaks, the unprecedentedly harsh war on whistleblowers: these are all grounded in the recognition that the technology itself cannot be stopped, but making horrific examples out of those who effectively oppose powerful factions can chill others from doing so.”

Elites are anxious that even stupefied Americans may break out in organized opposition. Greenwald posts a Gallup poll showing that today only 11% of Americans are satisfied at “the way things are going,” and quotes David Bromwich’s analysis of the Bush-Obama regime’s devastating impact on American society: “A redistribution of wealth and power more than three decades in the making has now been carved into the system and given the stamp of permanence. Only a Democratic president, and only one (originally) associated in the public mind (however wrongly) with the fortunes of the poor, could have accomplished such a reversal with such sickening completeness.”

Divide by Generation and Conquer

“(T)hirty years ago… voters realized that while they had done very well from (the previous generation investing in public middle class institutions), they could do even better by walking away from their obligations and spending what they had inherited on themselves.”

Michael O’Hare, Berkeley Professor of Public Policy, calls out working and middle class voters’ culpability in the post-1980 stepwise demise of the American middle class. The American middle class was divided by generation, and conquered. And now we’re left with the stark raving mad Republican lunatic savages on one hand, and The Catfood Commission (as if it weren’t enough to revise the inflation price index to reduce people’s social security income) on the other.

Value struggles at the heart of capitalism

Synopsis of:

McNally, David. 2009. “From financial crisis to world-slump: accumulation, financialisation, and the global slowdown.” Historical Materialism 17: 35-83.

How is capitalism reproduced? What is capitalist crisis?

McNally is arguing that Brenner’s concept of post-1973 “global turbulence” is more accurate than a “long downturn.” The Bretton Woods era (core growth (prolonged expansion; rising levels of output, wages, and employment—p. 45) + no overaccumulation crisis) was a deviation, not the capitalist norm (44). While capitalists argue that their system steadily promotes growth, promotes welfare, and does not generate its own limits, McNally argues that crisis and global turbulence is the norm in capitalism (43). Capitalist expansion throws up limits to itself, such as when it demands wage compression (45). Crisis does not prevent but rather accompanies globally-shifting growth. After 1973, capitalist expansion centered on East and South Asia (43). McNally argues that problems of overaccumulation did not manifest in the core in 1973; they manifested in the East Asian semiperiphery in 1997 (46).

[MF note—to revise: “Crisis” is understood popularly. From a popular perspective, and from a parochial capitalist political perspective, “crisis” is understood as a condition whereby capitalism is exposed as a destructive system and a conflicting class system. Local capitalist leaders are exposed as unable to rule for the common good. To talk about a crisis of accumulation that occurred after 1973 is to talk about the rise of conditions—declining profitability (people must buy more things and services, but people are only part of the cost of goods and services), cured by local wage compression and production relocation that spatially and temporally defers accumulation collapse—that expose its destructive and class-conflicted nature.]

Methodological issue: The national-state and national economies should not be the unit of analysis when analyzing the reproduction of capitalism. “…(C)apitals in the ‘core’ economies of the world-system have demonstrated a systematic tendency to move investment outside the core in search of higher rates of return,” producing higher rates of accumulation in select semi-peripheral regions, and slower rates of growth in the “dominant economies.” Because capitalism is a world-system dedicated to accumulation, frameworks attempting to explain the reproduction of capitalism must analyze the operation of capitalism as a global social relation. (44-45)

Thesis I:
After 1973 crisis of profitability in the core, capital restructured, growth occurred in East Asia

After the recessions of 1974-75 & 80-82, the ruling class launched offensives against unions and the Global South. Generated primitive accumulation & larger reserve labor armies, introduced lean production, raised the rate of exploitation. Ruling class invested in East Asia (45).

McNally argues that 1983-2007 was a period of capitalist restructuring, that involved the destruction of capital in the core (47). Characterized by rapid de-industrialization and de-unionization in the core (47). In the US, the rate of surplus value was increased by 40% (48). Profit rates climbed between 1982 and 1997, though at their peak they remained half of mid-1960s profit rates (see confirmation by Mohun, Moseley, Wolff, Dumenil and Levy, Husson, Brenner; McNally 2009: 49-50).

Cites Ch. 13-15 of Capital v. III, discussing the tendency for rate of profit to decline and capital’s arsenal of countermeasures. Restructuring countermeasures can only be stopped by “massive organized working-class resistance.”

“In the absence of such powerful class-resistance, crises will serve as moments of reorganization that create conditions for increases in labour-productivity and rates of profit—which, in turn, make renewed expansion possible. (49)”

[MF note: TINA enters when capitalist agents insist that renewed expansion is what the working class wants.

Yet what are those restructuring countermeasures, according to Marx?

According to McNally, post-1980, restructuring countermeasures included a) re-subordinating “Global South” (peripheral countries) to promote primitive accumulation; b) using primitive accumulation (in India and China) to create huge new global labor-reserves; c) relocating accumulation to China (semi-peripheral countries); d) financial market ascendance. (55) They also included wage compression accomplished through union-busting, bifurcated wage tracks, cuts to the social wage (reduction in social rights and benefits); lean production techniques and technology to boost the relative surplus-value; and increases in work hours in the US to boost absolute surplus-value (60) This latter group of restructuring countermeasures reduced living standards of working-class people while concentrating wealth at the top of the social ladder, thereby increasing inequality within societies. In 1991 the wealthiest 1% of Americans owned 39% of corporate wealth, but 2003 they owned 57.5% (60). This creation of vast inequality produced a huge demand from the wealthy for interest-paying financial instruments; it fueled the extension of vast amounts of credit to working-class households desperate to sustain living standards (67). Now restructuring countermeasures include collapse, merger/nationalization of financial institutions, auto and electronics industries, service sector slumps, the ongoing collapse of sales and profits. With the centralization of capital we will have decline in wages, benefits and employment. With the diminishment of the dollar to act as a stable form of world currency, there will be pressures to develop an Asian currency bloc, and competition among currency blocs for greater conrol of financial markets and global monetary privileges (77). Debt loads in the emerging market economies will make countries like Turkey and South Africa vulnerable to restructuring and asset appropriation. Core governments will further regulate the movement of labor (78).

“At the same time as they press for ‘free movement’ of capital, governments at the core of the system also demand tighter control and regulation of the movement of labour. With the deepening of the conomic crisis, many have already started to play the anti-immigrant card. Britain, in particular, has signaled a tightening up of immigration policy, as has Canada, and others will surely follow. As businesses fail, factories close and unemployment mounts, protectionism—‘Buy American’, ‘British Jobs for British Workers’—is likely to fuel xenophobia and immigrant bashing.’ Government officials and parties on the Right will continue to fan xenophobic sentiments…This crisis will thus put a premium on a Left for which anti-racism and defence of migrant workers are absolutely central to a politics of resistance” (78-79)]

By mid-1980s, Japanese & German capital turn to FDI (Foreign Direct Investment, rather than domestic investment) (50; data from OECD). In the 1990s, there was a 300% jump in capital-formation in East Asia (outside Japan) (63). FDI follows tractable labor; invests in East Asia, where people pushed off the land (primitive accumulation) due to rural impoverishment, dispossession and war (52). Post-1990, this contributed to a quadrupling of the world working class population (reserve army of labor) after 1980.

Primitive accumulation and higher rates of labor exploitation is the cause of 1982-1997 profitability rebound (54-55). McNally argues for Marxist basics, against a magic box view of credit.

Thesis II:
Based on fictitious capital, the dollar creates demand for hedging risk, financialization of capitalist relations

Due to escalating debt taken on to pay for the Vietnam War, the US printed more money in 1971. The US was wreaking havoc with the value of the gold underlying the currency. Countries began demanding gold in exchange for dollars and withdrawing from the Bretton Woods system. The Nixon administration unilaterally ended the gold standard, and exchange-rates floated. This was seen as an American victory over adversaries at the time. As we shall see, by refusing to deal with the mounting costs of the Vietnam War, Nixon merely staved off a reckoning for one generation and laid the basis for a global crisis. To hedge risk in the uncertain financial system, new financial instruments were developed. These financial instruments created a large financial services market and financial sector profits, as well as large speculation. New credit instruments were created for financiers and consumers, but these credit instruments did not play an important role until after 1997. Neoliberalism is the financialization of capitalism (46).

Why the financial sector collapsed is because 1) money became volatile after early 1970s end of dollar-gold convertibility; 2) wages were compressed for 30 years; 3) the world economy is flooded with US dollars (56).

When dollar became the international credit money, it was grounded in fictitious capital (general confidence in the future increase in the dollar). This made global credit money (the dollar) a magnet for speculation (57). Now money could not measure value reliably. Value is the socially-necessary (abstract) labor-time and commodities’ market value (57-58).

To protect against this volatility, capital had to assess risk and hedge against risk, especially those capitals moving through multiple currencies. Derivatives were developed to assess and hedge against risk. Investors could buy derivatives (insurance) against risks to assets they did not own—that is, speculate. Therefore, financial instruments have been developed to capture future values—shares of surplus-value not yet produced. This is a proliferation of fictitious capitals, eg. mortgage-backed securities and Collaterialised Debt Obligations (59). Working-class debt was packaged by banks and hedge funds and sold to themselves, as well as pension funds and financialized corporations (61). During Alan Greenspan’s tenure as President of the Federal Reserve (1987-2005), private and public debt in the US quadrupled to $43 trillion (61). When the bubble burst in 2007, capital fled the US. Private capital flows were reduced by $1.1 trillion in the third quarter of 2007 (65).

Thesis III:
1997 East Asian overaccumulation crisis at the root of core credit overextension

Capitalist expansion began to falter in 1997, with East Asian overaccumulation crisis. Rates of growth, postponement of general capitalist crisis bolstered with expansion of credit. Credit bubble burst in summer 2007.

McNally has previously argued that there was an overaccumulation of capital in East Asia by the Asian crisis of 1997. The investment boom had created excess capacity in computer chips, autos, semi-conductors, chemicals, steel, and fiber optics (62). US prices for consumer durables began to decline in the autum of 1995 and continued falling into 2008 (62). As a result East Asian economies cut local currency exchange rates, shed labor, reduced costs, and restructured industry. Still capacity was not reduced very much, as foreign investors snatched it up. East Asian firms drove down costs, but exports continued to grow. Their market was the US, which accounted for 1/5 of world exports, and which sustained $857 billion current-account deficit. Low interest rates and cheap consumer credit allowed US consumers to go into massive debt to consume imports and permit a temporary global economic recovery (63). Only the US could have built up such a current-account deficit, because it held the inconvertible world money, the dollar (64). No matter what US finances looked like, it was in countries’ interest to back the dollar.

Asset values dramatically departed from wealth creation after 1996. Eg. The NYSE continued to rise while profits turned down (53-54). Gargantuan credit expansion and low interest rates “’financialized’ (“embedded in interest-paying financial transactions”) relations between capital and labor’” as well as between capitals (55-56). Lines between industrial capital and financial capital blurred. Firms financialized themselves during neoliberal period because finance was more profitable (56). Bewteen 1980 and 2004, FIRE (Finance, Real Estate, and Insurance) doubled to capture nearly 50% of US profits.

By the mid-2000s, due to overinvestment, China was experiencing overcapacity, in steel, iron-alloy, auto, aluminum, cement, coke, and home appliances (64). Overcapacity again weighed down profit rates (65). The US appears to be exhausted as a source of demand sufficient to restart sustained global capital growth (66). Real capital is destroyed because there’s no sufficient engine of demand (67). Fictitious capital, based on expectations of obtaining future from working class Americans, has deflated and will continue to decline: there is not working class income to pay much credit card debt; as corporate profits sink, corporations cannot repay the IOUs they used to finance Leveraged Buy Outs (LBOs); commercial mortgages are in trouble; Credit Default Swaps (CDS) were used for speculation, and the sellers of CDSs have to pay not just the creditors insuring against debtor default, but the army of speculators as well (that’s why the US bailed out AIG to the tune of $150 billion, most of which has been used to cover losses in the CDS market.) There remain $54 trillion in CDSs (67-68). Most derivatives including CDSs are not regulated. No one can tell where they are, and this destroys banks’ confidence in each other, so markets remain illiquid (69).

The violent abstraction of the capitalist value form v. sensuous, concrete working-class values

So: As money became more volatile, its measure of value has become troubled (69). The solution that the fearless capitalist leaders came up with was derivatives. But they translate all risk onto a single, abstract metric. Value at Risk (VaR) is used to assess risk, and as a risk-assessment instrument, VaR assumes that all history, social, political, climatological and economic relations are the same, there are no qualitative breaks; so for example to calculate housing prices in 2007, VaR used price data from a period of soaring housing prices. VaR is a typical capitalist “violent abstraction” (Marx) (71). Yet, “during every crisis, value measurement is radically disrupted and destabilized. Pressures of overaccumulation and declining profitability induce a destruction of values…” We don’t know the value of “trillions of dollars worth” of financial assets. This is a systematic problem, exacerbated by the financialization of neoliberal capitalism. Derivatives are a primary symptom of a crisis of value measurement. But value collapse is caused by “overaccumulation, falling profits, and unsustainable build-ups in fictitious capitals” (72).

Systemic crises are moments of both great danger and opportunity (72). Debt—the financialization of relations between capital and labor—disciplines the working class in the Global North. Debt also permits capital to accumulate by dispossessing the working class, and the Global South (72). The only alternative to unfreedom is to repudiate debts (73). Yet without capitalist investment, there is no source of livelihood for workers under capitalism (73).

As well, the working class can struggle against the violently abstract, volatile capitalist value form, instead asserting life values—land, water, food, housing, income (74).

From the perspective of capital, value abstraction, the commodity (the exchanged object without sensuous, concrete working class use-value) is the point of all human activity, because of its capacity to promote accumulation (capitalist use value) (74-75). [M-C-M’.]

[MF note:

A commodity’s capacity to promote accumulation is not simply a matter of whether there is an unmodified demand for it. Rather, the preferred commodity removes wealth into the exclusive control of capital. That’s what accumulation is.

Value-abstraction shifted valuation, to the demise of feudalism. It got rid of patriarchal aristocracy. Then, in using the commodity value form to distance economic prices from sensual, concrete working class values, it removed valuation to spheres which only the capitalist neo-aristocracy manages under the scarce-capital conditions of capitalism.]

Even if capitalists can be indifferent to the sensuous, concrete use-values of commodities, the working class cannot be indifferent to such use-values of commodities (75). There are value struggles at the heart of capitalism.

The crisis puts a premium not only on anti-racism and defence of migrant workers, but also on socialist organization. “Leashed capitalism” is a false construction. To build the capacity of workers to remake the world, they must have access to socialist ideas and to socialism, to a systemic transformation that breaks the hold of the capitalist value form over human life (79).

Senate Republicans block union bill

Senate Republicans block union bill
Staff and agencies
26 June, 2007
By JESSE J. HOLLAND, AP Labor Writer 1 minute ago

WASHINGTON – Senate Republicans on Tuesday blocked a bill that would allow labor unions to organize workplaces without a secret ballot election.

The final vote was 51-48.

The House passed the bill in March. Democrats and labor unions pressed for a vote in the Senate in hopes of rallying their voters in the 2008 elections, where they hope to win the White House and increase their majorities in the House and Senate.

The GOP also plans to use the vote for election-year campaigning, with corporations and businesses being the top opponents to the legislation. The National Republican Senatorial Committee sent out a fundraising video last week asking people to contribute in order to help stop the Employee Free Choice Act.

The legislation was a litmus test vote for organized labor and businesses, strong supporters of Democrats and Republicans respectively. “Today‘s vote shows us who is standing with workers and which politicians are in collusion with corporate America to destroy the middle class,” Teamsters President Jim Hoffa said.

The bill would require employers to recognize unions after being presented union cards signed by a majority of eligible workers on their payrolls. Under current labor law, a company can demand a secret ballot election supervised by the federal government after being presented the union cards.

Unions complain that employers have greater access to workers during secret ballot campaigns and claim that corporate threats, intimidation and eventual firings have become common for union activists. By dragging out the election process, companies often succeed in wearing down union enthusiasm, they add.

The communications professional Holland concludes his article by listing the amount of money labor gives to Democrats. But since he somehow failed to list how much money organized capital gives to the Republicans, or even how much money organized capital gave to Republicans for this particular anti-union campaign, both of which figures would dwarf labor contributions to the Dems, I am not going to dignify such unbalanced storytelling with repetition.

neoliberals dictate new working class consciousness

Inequality has skyrocketed in the U.S. over the past few decades. Social mobility has come to a grinding halt. Democracy congeals at a rudimentary, formal, political level, and crumbles–from stolen elections to secret prisons. The creative human energy that pushed capitalism, as the Marxists tried to tell us all along, was only a small step partway out of feudal relations. Despite the successive, glorious proclamations about the End of History, greater emancipatory effort is needed before the widespread development of human potential can be a prospect. This is all becoming obvious–painfully for some, uncomfortably for others. Facing the irrefutable, no longer able to dismiss the evidence as a narrow problem of racism or the South or poorly-bred Midwestern hicks or underdevelopment or bad apples not trying hard enough at capitalism, no longer needing to lie to save Cold War face, the New York Times has set upon itself the leadership task of developing its own liberal discourse on class in America.

As usual in the U.S., a land where anyone can be an expert if someone will pay him for it, scholars, usually among the least well paid in the overpopulated shouting chamber of expertise, are painted in the new hegemonic project as the villains, with their data-based insistence that people will do better by each other when they are informed—not just that class is a matter of tastes and habits, but that class is mostly a matter of high-stakes political and economic conflict, institution-building, organizing, and social movement.

The NY Times hired Paul Tough to present the argument that “elite” scholars bully goodhearted motivational speakers who are paid big checks to remind teachers to have sympathy for their working class students. Nobody objects to Ruby Payne popularizing Bourdieu to help teachers relate to poor students. Many, many kind-hearted people—called scholars—often working class, often middle class, occasionally an upper class sympathizer, have worked their whole lives, together studying, listening, comparing, experimenting, communicating about how class and caste work and hurt in America and beyond. They are trying to tell us about the crucial requirements found to make effective more than a few show-pony individuals’ tactical adjustments. They’re saying that in order to help people caught in U.S. class inequality better their lives, there’s a big piece of understanding required, much more salient and much more demanding than the entertainment, instruction, and discipline that a few personable liberals have ever been and will ever be able to give to middle class educators.

Paul Tough’s “The Class Consciousness Raiser” in the NYTimes (June 13, 2007) retreads the old standby American elite tactic of silencing scholars’ voices by painting them as the mean “elites”.

Yet it also makes one wonder how secure the NYT editorial staff feels about their ability to both acknowledge and contain working class consciousness and politics through crafting stories.

race and class justice

Frederickson, George M. 2005. “Still separate and unequal.” The New York Review of Books 52 (18).

Frederickson reviews Katznelson, Ira. When affirmative action was white: An untold history of racial inequality in 20th century America. Norton.


Affirmative action, the policy of giving preferences for jobs, university admissions, or government contracts to members of designated racial and ethnic groups, has never been popular, and it could soon be abolished. In 2003, the Supreme Court struck down an undergraduate admissions policy at the University of Michigan that provided extra points for minority applicants. At the same time, the Court approved by a single vote the more subjective practice of taking race into account as one factor among several in admissions to the university’s law school. The change of one vote (by the recently confirmed Chief Justice John Roberts?) would have meant the end of overt affirmative action in higher education. The trend against affirmative action in the states is even more pronounced. In California and Washington constitutional referendums have banned the government from using affirmative action in any of its activities. Other states have ended or severely limited affirmative action by executive authority.

More remarkable than the current opposition to affirmative action is the fact that it ever came into existence in the first place. On its face, the policy seems to violate one of the most basic American values—the idea that individual merit as manifested in a fair and open competition should be rewarded. A practice that seems to go against the individualistic and meritocratic American ethos is clearly vulnerable to an attack that is likely to be persuasive to many of those who do not stand to benefit from it. Moreover, affirmative action seems contrary to the emphasis on colorblindness that was characteristic of the civil rights movement of the Fifties and early Sixties, and was expressed in the language of its greatest achievement—the Civil Rights Act of 1964.

Two very different arguments have been advanced for affirmative action. One claims that it is just compensation for historical injustices and disadvantages. In the case of claims by African- Americans the emphasis is usually on the wounds inflicted by centuries of slavery, segregation, and discrimination. President Lyndon Johnson made one of the most elegant and influential statements of this position in his Howard University speech of 1965, which is quoted by Ira Katznelson in When Affirmative Action Was White:

You do not take a person who, for years, has been hobbled by chains and liberate him, bring him up to the starting line of a race and then say, “you are free to compete with all the others,” and still justly believe that you have been completely fair…. It is not enough just to open the gates of opportunity. All our citizens must have the ability to walk through those gates…. We seek not just legal equity but human ability, not just equality as a right and a theory but equality as a fact and equality as a result.

The other argument, which is reflected in recent Supreme Court decisions and is currently much heard, is based on the assumption that racial and ethnic diversity among “elites”— relatively well-off people who have some degree of responsibility for others, whether private or public—is beneficial to society and its institutions. Prominent among those who defend affirmative action, for example, are spokesmen for the American mili-tary who lent conspicuous support to the University of Michigan’s side in the 2003 Supreme Court case. Since the enlisted ranks are disproportionately black and Latino, discipline and morale are presumably inspired by having the same groups represented among the officers, including those of the highest rank. Corporations that deal with a multicultural and multiracial clientele, sometimes on an international scale, find obvious advantages in being represented by people who reflect the racial and ethnic diversity of those with whom they are do-ing business. Many large corporations practice affirmative action voluntarily even when there is no significant pressure from the government.

In higher education the diversity argument takes a slightly different form. Racially and ethnically heterogeneous student bodies are said to create an appropriate educational environment for students who will encounter many different kinds of people when they go out into the world. Faculties, moreover, must be diverse if they are to provide inspiration and suitable “role models” for minority students.

Clearly affirmative action has had its greatest success in producing more diverse elites, particularly in the much-heralded emergence of a substantial African-American middle class, something that never existed before. But as the sociologist William Julius Wilson has argued for many years, this process of embourgeoisement has been accompanied by the equally substantial growth of “the truly disadvantaged,” the economically marginal black inhabitants of the urban ghettos. Since the advent of affirmative action in the 1960s, the overall differences between blacks and whites have changed very little with respect to average incomes, property holdings, and levels of educational attainment. What is new is the gulf that has opened in the black community between the middle class and the lower or “under” class.[1]

Affirmative action originated as a pragmatic response by those in the federal government responsible for enforcing the fair employment provisions of the Civil Rights Act of 1964.[2] The Equal Employment Opportunity Commission (EEOC) set up under the act lacked the staff to investigate most individual claims of discrimination in employment. It also lacked legal authority to act effectively on behalf of the complainants. As a result, the only way that the EEOC could begin to do its job was to request government contractors to provide statistics on the racial composition of their labor force. If blacks (and by the 1970s other minorities as well) were underrepresented among the workers relative to their percentage of the local population, the EEOC set numerical goals for minority recruitment sufficient to correct this disproportion. Employers were then required to make “good faith efforts” to meet “quotas” for black workers. If they didn’t hire more blacks, they risked losing contracts. The professed aim was equal opportunity, not racial favoritism; but the paradox that bedeviled the program from the start was that it appeared to require preferential means to reach egalitarian ends.

After its fitful beginnings during the Johnson administration, affirmative action took a dramatic turn under Richard Nixon, whose administration put into effect a controversial plan to integrate Philadelphia’s construction trades. Historians have concluded that the Philadelphia Plan of 1969–1970, which set firm racial quotas for hiring for one industry in one city, was a political ploy. It was designed by the Nixon Republicans to cause friction between two of the principal consti-tuencies of the Democratic Party— organized labor, which opposed the plan because of the threat it posed to jobs under its control, and African-Americans, who had overwhelmingly supported the Democrats since the New Deal.[3] At the same time, Nixon was trying to appeal to Southern whites by doing little to enforce desegregation, especially in the schools.

When rising opposition to the war in Vietnam became the critical issue for his administration in 1970 and 1971, and hard hats like the construction workers of Philadelphia were in the forefront of those opposing the anti-war protesters, the Philadelphia Plan was quietly shelved. From then on, Republicans were, for the most part, strongly opposed to affirmative action and benefited from the backlash against it, attacking the Democrats as the “party of quotas” because of their continued support for the policy.

Affirmative action was declared constitutional in 1971 when the Supreme Court ruled in Griggs v. Duke Power Co. that discrimination in employment could be subject to affirmative action even if it were not intentional or motivated by prejudice. The Court found that the standardized aptitude tests given by the company to employees prevented blacks from moving to higher-paying departments. Such requirements could be “fair in form,” the Court said, but they could still be described as “discriminatory in operation” if they had an “adverse impact” on blacks. Hence the EEOC was legally entitled to set goals for increasing minority employment and to require periodic reports on the progress being made on fulfilling such goals by any of the 300,000 firms doing business with the federal government.

In 1978 in Regents of the University of California v. Bakke, the Court held by five votes to four that strict numerical quotas, such as those that the medical school of the University of California at Davis had set for minority applicants, could not be permitted. But the concurring opinion of Justice Lewis Powell, who cast the deciding vote, held that race could still be used as a positive factor in considering the qualifications of candidates for admission so long as two criteria were satisfied. If a university were to give preference to blacks it had to establish a direct connection between the claim to such special consideration and a specific historical injustice such as the exclusion of blacks from professional schools over the years (generalized claims of past racism would not suffice). Racial preferences must also serve a “compelling public interest” or purpose. The constitutional foundation for affirmative action laid by Justice Powell has endured for the past twenty-six years. The recent Michigan decisions forbid numerical point systems as well as statistical quotas; but it continues to be constitutional to use race among other factors to determine qualifications for university admissions and employment.


Ira Katznelson has made a major contribution to the affirmative action debate in his book When Affirmative Action Was White. He accepts Justice Powell’s criteria and uses them to justify a much more ambitious governmental attack on racial inequality than currently exists. He presents a new version of the argument that affirmative action is justified as compensation for historical wrongs against black people. Instead of going back to slavery, he maintains that people who are still alive (or have living children or grandchildren) and have been the victims of specific historical injustices can provide strong claims for restitution from the United States government, the direct source of these injustices.

Most of Katznelson’s book is devoted to showing how the economic and social legislation of the 1930s and 1940s favored whites over blacks. Katznelson is not the first historian to argue that the New Deal and Fair Deal widened the gulf between whites and blacks in the United States, but he is the first to consider such discrimination as the principal justification for an ambitious affirmative action program that would include reparations for blacks.[4]

The undeniable fact is that, by comparison with whites, blacks became relatively worse off during this per-iod. But this relative failure has been obscured by the equally undeniable fact that the material circumstances of African-Americans improved and were, on average, significantly better in 1950 than they had been in 1930. What Katznelson shows is that the Democratic social and economic policies of the Thirties and Forties were rigged so that whites got much more than a fair share of the benefits.

The primary cause of this inequity, Katznelson contends, was the influence of Southern segregationists within the Democratic Party. In the 1930s, when the first New Deal policies were being enacted, white Southern congressmen provided necessary votes for liberal measures that strengthened the labor movement, set minimum wages, and gave relief or temporary work to the unemployed. But they did so only on the condition that the Southern racial order remain insulated against federal actions that might threaten it. The cooperation of New Dealers and segregationists broke down in the 1940s, when a strengthened labor movement began to look south and consider organizing blacks as well as whites. At that point, a new coalition of Northern Republicans and Southern Democrats succeeded in stopping the advance of organized labor, especially by passing the Taft-Hartley Act of 1947, which put heavy restrictions on union organizing.

In 1948 the Democratic Party, with labor support, took up the cause of civil rights for the first time, and Harry Truman was elected president despite the defection of much of the South to the States’ Rights or “Dixiecrat” Party. But this change of heart by the Democrats was, Katznelson points out, less than a complete conversion to the cause of racial justice. He reminds us that the Democrats of the 1950s, trying to keep the South’s electoral votes, backtracked on civil rights and made renewed overtures to Southern white supremacists. In support of his argument, Katznelson might have noted that Adlai Stevenson’s first running mate was a solid segregationist and former Dixiecrat—Senator John J. Sparkman of Alabama.

The New Deal policies that wors-ened the situation of blacks were not overtly discriminatory. The primary device used by Southern white supremacists was to exclude agricultural laborers and domestic servants from coverage under the Social Security Act and National Labor Relations Act of 1935 and the Fair Labor Standards Act of 1938. Since these were the occupations of most Southern blacks and of much smaller proportions of Southern whites, such exclusions meant that most blacks were being left out of the new welfare state and denied the same chance to escape from poverty that was available to many relatively poor whites. In the South, therefore, the New Deal actually had the effect of strengthen-ing the economic basis of white privilege. It is true that at the height of the Depression African-Americans received some help from the WPA and other emergency measures to provide relief and work, but since Southern white supremacists locally administered these programs, racial discrimination continued.

Service in the military during World War II provided blacks with some opportunities for education and for developing valuable skills. But as Katznelson points out, smaller proportions of blacks than whites actually served in the armed forces (more were considered physically or mentally unfit for military service) and the separate but unequal segregation of the armed forces meant that blacks had relatively fewer chances to acquire new skills and advance to higher ranks. Although he mentions it, Katznelson pays little attention to one bright spot in the World War II experience for African-Americans—the increased access to industrial jobs, especially in the North, resulting mainly from the tight wartime labor market.

The federal government made a modest contribution to diversifying jobs through the activities of the Fair Employment Practices Committee (FEPC) established in 1941 as the result of protests led by the African-American labor leader E. Philip Randolph. The FEPC, by hearing complaints from blacks and demanding explanations from businesses, allowed more blacks to benefit from the new welfare state and narrowed the difference between the average white and black incomes. Here for the first time since Reconstruction the federal government was acting against ra-cial discrimination rather than facilitating it. The federal FEPC did not survive the war but it established an important precedent for later civil rights campaigns.

In the immediate postwar period, Katznelson convincingly argues, the GI Bill widened further the economic and social differences between the races. Southern segregation meant that educational opportunities available to whites were withheld from blacks, who were forced to compete for a very limited number of places in all-black institutions. Even in the North many colleges and universities either excluded blacks or admitted only a handful. GI loans for buying houses or financing small businesses were very difficult for blacks to ob-tain because of the discriminatory policies of banks and other lending agencies. Katznelson concludes that most government social policies during the 1930s and 1940s were, in effect, part of a vast affirmative action program for whites that left blacks further behind than they had been at the beginning of the period. He makes a chilling case.


Katznelson is somewhat more effective in describing the problem than in suggesting how to solve it. The general principle behind the kind of affirmative action that he recommends is clear enough: “Under affirmative action,” he writes,

[blacks should be] compensated not for being black but only because they were subject to unfair treatment at an earlier moment because they were black.

In an effort to fulfill the requirements that Justice Powell prescribed in the Bakke case, Katznelson offers two possible approaches. One would have the government identify all the people, or their immediate descendants, who were injured by exclusions from the various social and economic programs of the 1930s and 1940s. The government would calculate how much they would have gotten had they not been left out, and pay it to them in a lump sum.

Acknowledging that such a program would be “administratively burdensome” (clearly an understatement), he proposes an alternative, an all-out assault on poverty in general, based on the assumption that most of the people who are currently poor have been put at a disadvantage by the unjust policies of the 1930s and 1940s. To some extent, the program he favors would function like the GI Bill with “subsidized mortgages; generous grants for education and training; and active job searching and placement.” Health insurance and childcare could also be provided.

What is striking and somewhat unexpected is that these proposals do not depend on racial categories. All who suffered from policies of exclusion, whether in education or jobs, including some whites, would be entitled to compensation. It occurs to me that Katznelson’s essentially colorblind proposals, especially his second approach, could easily be justified on other grounds than as an antidote to racial inequality. If one simply assumed, as a good social democrat would, that poverty itself is an evil and that wealth should be more equitably distributed, similar policies could be justified. What he may be implying is that white America needs to face up, psychologically as well as materially, to its current as well as its past history of racial oppression, and that basing a colorblind antipoverty program on the need to redress racial discrimination will further this goal. But it remains unclear to me how Katznelson’s proposals would differ substantially in practice from those of William Julius Wilson, who distinguishes between affirmative action, which he defines as a way of producing more diversity among elites, and the kind of class-based assault on economic inequality that he believes is needed to raise up what he calls “the truly disadvantaged.”[5]

A question that can be raised about the adequacy of Katznelson’s historical analysis may also have implications for our understanding of the current prospects for racial equality. Are the South and Southern politicians as fully to blame for the increase in white advantages as he contends? Arguably the most important source of the current economic gulf between the races is the vast difference in average net worth or property ownership. Although average black incomes may be around two thirds those of whites, their average net worth, as Katznelson shows, is only about one tenth. Much of this difference is explained by the fact that whites own far more homes than blacks and therefore their net worth is higher.

How did this vast inequality come about? It was mainly the result of the greater white access to home mortgages that were insured and subsidized by the federal government. Before the 1930s a home buyer had to put down 50 percent of a house’s price and could get only a relatively short-term mortgage, perhaps only ten years. By the 1950s, as a result of a series of federal housing programs, including the GI Bill, most Americans could get long- term mortgages—up to thirty years— with a down payment as low as 10 percent. By 1984 seven out of ten whites owned their own homes, worth on average $52,000. But only one in four blacks owned a home, worth, on average, less than $30,000.

Katznelson outlines these facts toward the end of his book, and they illustrate dramatically his general point about the widening economic gulf between the races during the middle decades of the twentieth century. But he makes no effort to explain them as manifestations of Southern influence within the Democratic Party. The advantages of whites over blacks that he’s describing were more characteristically Northern than Southern; they manifested themselves in the growth of virtually all-white suburbs outside the major cities and virtually all-black ghettos within them.[6]

This new form of racial segregation was not simply the product of private choices, among them the refusal of white home-owners to sell to blacks, blockbusting and the racial “steering” of home buyers by real estate agents, and the personal prejudice of bankers asked to approve loans for blacks. The urban segregation that has contributed so much to the persistence of black inequality came about in large part because between the 1930s and the 1970s federal housing agencies refused to approve mortgage loans in neighborhoods that were “redlined,” which meant property values were deemed uncertain because of the presence of blacks.[7]

It is difficult to see the hand of Southern segregationists in these policies. It seems that Northern politicians were responding more directly to the racist attitudes of Northern whites who refused to live close to blacks. They were in effect underwriting the spatial segregation of the metropolitan North. It is not entirely clear how Katznelson’s proposal would try to rectify this aspect of affirmative action that benefited whites. Perhaps people could be compensated for the mortgages they were denied; but this would be extraordinarily difficult and would omit those who did not apply for mortgages because they expected they would be turned down.

Also in need of clarification is whether Katznelson’s attempt to justify large affirmative action programs for blacks applies to other minorities that are not black. He says virtually nothing about them. Since Mexican-Americans in the Southwest during the New Deal era were, like blacks in the South, disproportionately servants and farm laborers, they were similarly excluded from coverage by social security and labor rights legislation. Many of the same factors that make African-Americans eligible would thus apply to Chicanos, or at least to those who were in the United States between the 1930s and the 1950s, and to their descendants. But what about more recent Latino immigrants? They cannot claim as forcefully as blacks can that they were historically denied opportunities, such as obtaining mortgages, that were open to non-Hispanic whites.

A case can in fact be made that affirmative action was stretched out of shape and rendered incoherent when it was extended beyond African-Americans, Indians, and long-resident Mexican Americans to include recent nonwhite immigrants.[8] Katznelson might agree with this view, but he does not address the question specifically, or even mention Latinos or other non-black ethnic groups (an omission that will be particularly striking, for example, to readers who live in multicultural California). But Katznelson’s book makes as strong a case as I have ever seen made for vigorous action to bring about equal opportunities for African-Americans.


[1] See William Julius Wilson, The Truly Disadvantaged: The Inner City, the Underclass, and Public Policy (University of Chicago Press, 1987) and The Declining Significance of Race: Blacks and Changing American Institutions (University of Chicago Press, 1978).

[2] The following historical survey is based on the book under review, supplemented by Terry H. Anderson, The Pursuit of Fairness: A History of Affirmative Action (Oxford University Press, 2004).

[3] For descriptions and assessments of the Philadelphia Plan, see John David Skrentny, The Ironies of Affirmative Action: Politics, Culture and Justice in America (University of Chicago Press, 1996), pp. 193–211; and Anderson, The Pursuit of Fairness, pp. 111–140.

[4] Philip F. Rubio makes this point in his A History of Affirmative Action, 1619– 2000 (University Press of Mississippi, 2001). But as his title indicates, he presents the New Deal’s inequities as one of a series of episodes going back to the introduction of African slavery that collectively constituted affirmative action for whites, rather than giving the 1930s and 1940s the kind of unique and self-sufficient importance that Katznelson does.

[5] See the works cited above by Wilson and also his When Work Disappears: The World of the New Urban Poor (Knopf, 1996).

[6] The best account of this develop-ment is Douglas S. Massey and Nancy A. Denton, American Apartheid: Segregation and the Making of the Underclass (Harvard University Press, 1993).

[7] According to Michael B. Katz, Mark J. Stern, and Jamie J. Fader, “The underwriting practices of fed-eral agencies that insured mortgages introduced redlining, that is, the re-fusal to lend to buyers in certain neighborhoods, which virtually destroyed central-city housing markets, froze blacks out of mortgages, and encouraged white flight to suburbs.” See the “The New African American Inequality,” The Journal of American History, Vol. 92, No. 1 (June 2005), p. 79.

[8] This is the view of Hugh Davis Graham in Collision Course: The Strange Convergence of Affirmative Action and Immigration Policy in America (Oxford University Press, 2002).

sexual assault, working class abasement

Excerpted from a critique of the movie “North Country”, this article discusses the connections among economic decline, company unions, working class abasement, and sexual assault. It critiques privileged artists’ facile romanticization of legal resolution within the U.S.
North Country is directed by Niki Caro; screenplay by Michael Seitzman, based on the book, Class Action: The Landmark Case that Changed Sexual Harassment Law by Clara Bingham and Laura Leedy Gansler.

The Jenson v. Eveleth Mines case, the first class-action sexual-harassment lawsuit in US history, inspired North Country, the new film directed by New Zealand filmmaker Niki Caro (Whale Rider). The lead plaintiff in that case, Lois Jenson, who began working at the northern Minnesota iron mine in 1975, along with 14 other women, ultimately won a multimillion-dollar settlement in 1998—eleven years after the suit was filed.

The punishing and often degrading legal battle against the company exacted an immense toll on the women, most of whom were left physically and mentally debilitated.

The Mesabi Iron Range contains some 110 miles of small towns built at the turn of the last century along a seam of iron ore called taconite. Eveleth Mines was opened by Ford Motor Co. in 1966, and the workers were organized by the United Steelworkers of America (USWA). In 1974, there was an affirmative action “consent decree” between the federal government, nine of the largest steel companies and the USWA, requiring the companies to provide 20 percent of their new jobs to women and racial minorities.

The Bingham/Gansler book hints at some of the conditions that led to the attacks on female workers: “At Eveleth Mines, attrition was high. In 1980, 1,425 employees worked at the mine. But in 1982, the mine shut down an entire line of production, cutting the workforce in half. In August 1983, Eveleth shut down completely for eight weeks. By the end of 1983, a paltry 723 remained—702 miners had vanished as if into the pit. Eveleth Mines had an additional problem: It was the least efficient of all the mines on the Range. Its labor and railroad costs were the highest, and it expended the second largest amount of energy per ton of taconite pellets.

“With so few jobs to go around, hostility at the mine increased toward the women who had enough seniority to keep their jobs.”

Various elements fed into the severity of the sexual harassment, aside from the brutality of the conditions and the inevitable backwardness of the semi-rural area. The United Steel Workers bureaucracy, steeped in chauvinism and anti-communism, refused to conduct a struggle against the loss of jobs, pitting workers against each other in times of economic downturn. In the late 1970s and 1980s, this same bureaucracy presided over the decimation of the US steel industry without lifting a finger.

Clearly, when workers are stressed about the possibility of losing the only decent jobs in a given area and cut off from any progressive solution, the imposition of racial and gender quotas will tend to bring out the worst in the most susceptible layers of the population. Moreover, the events took place under conditions of a general turn to the political right, not only within the more privileged layers of the American population, but also within sections of the working class. All in all, unhappily, the most propitious possible conditions existed for the abuses the women miners suffered.

The actual Jenson trial was a far more torturous ordeal than its shallow recreation in the film would suggest. Jenson describes the 11-year lawsuit as her rape by the judicial system; Class Action cites her comment: “I felt naked on the stand. The atmosphere in the courtroom was just like being at Eveleth Mines. I felt like a criminal and I was going to be sentenced to something.”

Are life’s problems (and the problems of working class women in particular) solved by victory in a hard-fought court case, with the hero(ine) handed a check at the end, as North Country implies? This schmaltz is little more than the American lotto myth. The conditions of working women are hardly idyllic in America; indeed, they are measurably worsening, thanks to bipartisan efforts in Washington.

A recent press release from the National Women’s Law Center notes that on October 26, the House Ways and Means Committee approved more than $8 billion in cuts to programs that benefit low- and middle-income women and their families in order to finance an additional $70 billion or more in tax cuts for the wealthy.

As well as cutting child support enforcement and other services, the Committee intends to reauthorize the Temporary Assistance Needy Families program with more severe requirements and restrictions on access to education and training. Also affected are Child Care and Development Block Grants, for which only $500 million in additional funding will be provided over the next five years. This represents half of the $1 billion increase previously approved by the House, far less than what will be needed to meet the increased child care demands resulting from the bill’s increased work requirements.

“Poor women and their children who have so little are being asked to make painful sacrifices while Congress moves ahead with plans to give even larger tax breaks to those who already have so much,” summarizes the NWLC.

Such is real life in America. From the film industry, often even with decent intentions, we largely receive stereotyped and trivial products, sharply at odds with life.

It is also worth noting that North Country, which rather complacently lauds the practice of launching class-action suits, appears precisely at the historical moment when the Bush administration, with the support of the Democratic Party, has signed into law a measure that will severely curtail the ability of consumers and workers to use class action lawsuits to seek damages for corporate malfeasance. The “golden age” of American jurisprudence advertised in North Country, in other words, which was never so golden to begin with, is already at an end!

Laurier, Joanne. 2005. “Serious problem, treated by not so serious people.” World Socialist Website, October 31. See