NO ADVERTISING, GOVERNMENT OR CORPORATE FUNDING

  • Latest News
  • Pitch a Story
  • Work with a Journalist
  • Join the Blog Squad
  • Afghanistan
  • Africa
  • Asia
  • Baltimore
  • Canada
  • Egypt
  • Europe
  • Latin America
  • Middle East
  • Russia
  • Economy
  • Environment
  • Health Care
  • Military
  • Occupy
  • Organize This
  • Reality Asserts Itself
  • US Politics
  • Is Public Ownership the Solution?


    Gar Alperovitz: When it comes to banking and other critical sectors, public ownership is the only solution -   July 13, 12
    Members don't see ads. If you are a member, and you're seeing this appeal, click here

    Audio

    Share to Facebook Share to Twitter




    I support The Real News Network because it lets viewers voice their uncensored opinions. - David Pear
    Log in and tell us why you support TRNN

    Bio

    Gar Alperovitz is the Lionel R. Bauman professor of political economy at the University of Maryland and co-founder of the Democracy Collaborative. He is the author of the newly released book, "What Then Must We Do? Straight Talk About The Next American Revolution."

    Transcript

    Is Public Ownership the Solution?PAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Baltimore.

    There was an interesting moment during the 2008 presidential elections. The last couple of weeks, President Obama was ahead, and summoning up all the demons of the Cold War, John McCain fired what he thought might be a decisive shot. He called President Obama socialist. Obama's reaction was rather interesting. He kind of stared it down. He said, I read my Bible; it says I should be my brother's keeper. Well, I don't think we've seen much of that President Obama since that moment. At the same time, he did go on to win the election, in spite of all of that rhetoric.

    But the issue of public ownership keeps reasserting itself. During the crisis there was a lot of discussion about the importance or need for nationalizing banks and such. But now, two years after the crisis—supposedly after the crisis—the issue of public ownership seems to be back off into the margins of the discussion. Well, we think it should be back up front and center.

    And now joining us is someone who's done some work on this issue of public ownership, Gar Alperovitz. He's a professor of political economy at the University of Maryland, College Park. He's the founder of the Democracy Collaborative at the University of Maryland and a member of the board of directors for the New Economics Institute. And he served as a legislative director in the U.S. House of Representatives and the U.S. Senate. He's the author of the book America Beyond Capitalism. Thanks for joining us, Gar.

    GAR ALPEROVITZ, COFOUNDER, DEMOCRACY COLLABORATIVE: Glad to be with you. Thanks, Paul.

    JAY: So what prompted you to write this piece? This was an article recently about public ownership you wrote in The Nation.

    ALPEROVITZ: Well, several things. One, the new poll data on all this is kind of very interesting. You know, the Cold War is over, and younger people, the people in the age 18 to 29, a recent pew study said, say they are 49 percent more favorable to the word socialism and 43 percent for capitalism. Isn't that interesting? There is a change going on. In fact, there's been a trend: a couple of polls earlier had been even, and now it's moving in this direction. The numbers for capitalism in general have been falling down. And this is a generation that's going to make the new politics. Also saw a poll just recently, just the other day: 36 percent of all Americans, not just young people, believe that capitalism is incompatible with Christianity—"my brother's keeper" line. So what that really means we don't know.

    And, finally, the other reason was—and I, frankly, get tired of this, the word is thrown around so much—anything at all that is progressive is now being labeled with the word socialism. And it's just ridiculous, because the right-wing language and rhetoric has gotten out of hand. It has no meaning whatsover [inaud.]

    JAY: Yeah, I guess it's a little—. I guess "greed is good" is not to be found in the New Testament. Now, in your piece you talk about the—.

    ALPEROVITZ: In fact, I think the line is that a rich man has more chance of going to heaven then a camel getting through the eye of a needle.

    JAY: Right. That's actually more Jesus's message, which today certainly would be branded socialism. More than that, I think it would probably be branded class warfare to talk like that.

    ALPEROVITZ: And if you go a little further, Acts 2 has everyone laying down their private ownership to join collectively in the common Christian effort. So there's a lot of love thy brother that is much more prevalent, and the preference for the poor is much more prevalent in the Old and New Testament than the notion about socialism that we're talking about.

    JAY: So the basic thesis of your article is that public ownership, at least in certain critical sectors of the economy, is actually the only way to solve some of these problems facing the country. What's your point?

    ALPEROVITZ: [incompr.] the only way, and it's much more efficient. Now, that's—that goes right directly contrary to the argument of many conservatives. And so take number one, you cannot anymore regulate the large banks. Theoretically you could regulate them, but they are far more powerful than any regulator. And the swarms of lobbyists on Capitol Hill—this is now conventional wisdom. Right wing, left wing, academics, everyone really knows this. They just don't say up the implications out loud. The lobbyists are writing the regulations and rewriting them. And the possibility and the likelihood we'll have another financial crisis, every expert that I read, left, right, and center, expects a crisis to happen again because the regulations just can't be done, there's too much power on the other side.

    So I suspect what's going to happen in the real world—we may have another crisis. And maybe the first reaction will be, okay, if people get angry enough, they'll break up the big banks. And then, obviously, the big fish will eat the little fish and we'll be back with the big banks trying to run the game again. And at some point I think it is all but inevitable that, someplace, we're going to turn some of these big banks into public utilities. And I think that's the only way to actually manage it. It's the only practical way to deal with the problem. I think it'll take us a decade, two, and a lot of pain to get there, but I suspect it's going to—it's obvious, because there aren't any other real-world alternatives that are workable. The head economist of Citicorp, no less, Citicorp, biggest bank, said before he became head economist that if the public's paying the bills, we really ought to be public utilities. And I agree with him.

    JAY: One of the points you make in your article: if you do make the main emphasis on breaking up the big banks, that even if you're successful, like the phone companies, once you break them up, over a matter of so many years, depending, they wind up reemerging as the big Goliaths again.

    ALPEROVITZ: Yeah, that's just the process, because the advantage is to them controlling more and more markets, more and more capital, more and more deposits, and as soon as they get rolling, they get more momentum, and, as I said, the big fish eat little fish, and we're back where we started.

    You know, another point about this, and I mentioned it earlier: efficiency. You know, right-wing economists or kind of what I call old-school conventional economists say that these big public enterprises are not efficient. Well, compared with what is always the question. These banks have cost us trillions of dollars in lost output, massive economic collapse, people thrown out of work, thrown out of their homes, the economy slipping to 10, 12, and in the real world, if you count everybody, 20 to 25 percent unemployment as a result of their so-called efficiency. It is ridiculous to look at whether or not, internal to some bank, the way in which they do accounting is more or less efficient than whether or not a public utility does accounting, more or less efficiency within the bank, and the outcome of the big efficiency—massive unemployment, loss of economic output, loss of—is neglected. We don't look over there. They are massively inefficient because they cause so much cost and so much waste by any standard at all.

    JAY: Right. The generalized cost of, for example, the fossil fuel industry is not taken into account when you look at the efficiency internally of the fossil fuel industry.

    ALPEROVITZ: Exactly. If you look narrowly, then—and this is the argument that's always put up on the other side—look inside. These guys are much more efficient than some government bureaucrat. Maybe so. But if you can maintain stability in the economy rather than crash the whole airplane, which has massive costs, that's the place to look. And we've got to balance those two. And the balance always comes out: obviously we've got to get some way to control these guys. And if you can't regulate them, and if you can't break them up so they stay broken up, there's only one logical—.

    You know, the people who made this argument are not liberals and they're not socialists. It was the founders of the Chicago school, the most conservative school of economics, that pointed out, if you can't regulate them, in the end the only way you get a free market is to socialize or nationalize some of the big ones in order to have the market to function. That was H. C. Simons, the founder of the Chicago school of economics, Milton Friedman's teacher and a very conservative economist who understood that these guys capture the regulatory organizations if they're that big, so you've got to deal with it.

    JAY: Well, President Obama has said many times, you know, in his last State of the Union and out on the campaign trail, that there is effective regulation now. He talks about Dodd–Frank, he talks about the Volcker rule. I mean, isn't—doesn't that show some evidence that regulation is possible?

    ALPEROVITZ: In theory, regulation certainly is possible. And, indeed, when we had a stronger progressive liberal movement, maybe in fact it was possible for a while. But the movement that supported that really at its heart had organized labor as the muscle, the economic muscle behind the movement. And labor has dropped from 35 percent of the labor force to 11 percent, and only less percent less than 7 percent in the private sector. And the muscle in the movement that really could make effective regulation, unfortunately, it's gone, which means that, you know, we either have to deal with the fact that regulation doesn't work or we're going to have another recession, which I think we will have. We'll have more crises. And at some point we'll wake up to say, look, the only answer is to make them into utilities, some of the really big ones, and that's the only way to make the system work efficiently at all, or just work.

    JAY: Well, now, there were some moments in the last couple of years, last four years, that presented themselves that one would've thought was the time when you could have had some assertion of public ownership. I mean, let's start in the financial institutions with AIG. And, I mean, we've essentially nationalized. But what happened?

    ALPEROVITZ: Well, AIG, which is the largest insurance company in the world, is in fact owned substantially—a majority of the stock is owned by the U.S. government today. But instead of using it as a way to really control it, we set up proxy votes and set up trustees who are kind of beholden to Wall Street, who are the people who, arm's length away from the public, are managing this operation, even though the public still owns it. Same thing could have happened with some of the big banks. We bailed them out. We could have bailed them and taken stock, and voting stock, and made them into public utilities instead of, you know, massively subsidizing them from the federal treasury and the Federal Reserve board, and then giving them back to the people who made all the trouble. So this is a possibility once you have to bail them out. That's the time to actually assert control and do what, as I say, the chief economist of Citicorp said: if the public pays the bills, you know, it's time to just turn them into utilities and make them run—kind of hold the line and be a stable system.

    JAY: Well, unfortunately, most of the leadership of Wall Street is saying the public should bail us out and we should keep our bonuses and great payments and keep things as they are—and, in fact, as we can see from JPMorgan, go right back into the risky derivatives trading again, never mind any kind of change at all.

    ALPEROVITZ: Yeah, it's much larger now than it was before the crisis, and I think we're going to see the results of that.

    But I'm an—in one sense, I think we're going to have the pain lessened. At some point, I think, this is not an issue just of liberals and left and right. As I say, the real ideas that I'm talking about came out of the Chicago school of economics, the most conservative economists, who were at least sophisticated enough to face the problem directly that you couldn't regulate them. And I think, as people are angry—even the Tea Party people get really angry at these big banks—at some point, the only obvious logical answer that's going to be left is, you know, make them into utilities. That's the only, you know, practical way to do it.

    JAY: Okay. Well, we're going to carry on our discussion in the next segment of this interview. So please join us for part two of our interviews with Gar Alperovitz on The Real News Network.

    End

    DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


    Comments

    Our automatic spam filter blocks comments with multiple links and multiple users using the same IP address. Please make thoughtful comments with minimal links using only one user name. If you think your comment has been mistakenly removed please email us at contact@therealnews.com

    Comments


    Latest Stories


    Assessing the U.S. Environmental Movement on Earth Day 2014
    Exclusive Investigation Uncovers How BP Uses Bribes To Do Business
    The Modern History of Venezuela, The Protests and Democracy - Edgardo Lander on RAI (8/9)
    Greek Politics 4 Years After The Financial Crisis
    CBO Report Confirms U.S. Deficit Back to Normal Level
    Israel Uses Refugees as "Currency" in Arms Trade with Africa
    Who Will Pay for Climate Change Disaster?
    Canada Shifts to Right Under Harper, Mimicking the United States
    The Savings and Loan Crisis Demonstrates the Importance of Glass-Steagall
    South African Platinum Miner's Struggle Challenges ANC Leadership
    TRNN Original Report: Manning Determined to Fight Back After Army Upholds 35- Year Sentence
    Hundredth Anniversary of the Ludlow Massacre
    The Bundy Ranch Standoff Demonstrates Values Shared by Corporations and the Far Right
    The Resegregation of American Schools
    The Modern History of Venezuela, Why Still So Much Crime? - Edgardo Lander on Reality Asserts Itself (7/9)
    What Role Has Russia Played in Eastern Ukraine?
    Can Johns Hopkins Afford to Pay A Living Wage? (2/2)
    University Sit-In Targets World's Largest Private Coal Company
    The Modern History of Venezuela and the Need for a Post-Oil Economy - Edgardo Lander on RAI (6/9)
    Can Johns Hopkins Afford to Pay A Living Wage? (1/2)
    One Percent of Environmentalists Killings Lead to Convictions
    Investigation Finds Former Ukraine President Not Responsible For Sniper Attack on Protestors
    The Modern History of Venezuela from 1973 to the Caracazo Massacre - Edgardo Lander on Reality Asserts Itself (3/9)
    Ukraine Transitional Gov't Moves Militarily To Reclaim Seized Buildings
    IPCC Report Flawed By Narrow Focus on Carbon Emissions
    The Modern History of Venezuela: The Bolivarian Revolution - Edgardo Lander on Reality Asserts Itself (5/9)
    Obama Signs Directives to Reduce the Gender Wage Gap
    Eastern Ukraine Lacks Political Representation in Kiev
    Demystifying the Role of Mitigation in the Most Recent IPCC Report
    Hypersurveillance State Won't Prevent Another Boston Marathon Bombing
    The Modern History of Venezuela from 1973 to the Caracazo Massacre - Edgardo Lander on Reality Asserts Itself (3/9)
    Univ. of Maine Faculty Reinstated After Students Protest Against Cuts
    The Modern History of Venezuela from 1908 to 1973 - Edgardo Lander on Reality Asserts Itself (2/9)
    IMF Will Address Global Inequality, Says Managing Director Christine Lagarde
    Raising Big Banks' Leverage Ratio Good, But Not Nearly Enough
    TRNN Replay: Austerity Road to 19th Century
    Has Palestinian Maneuvering Revived Peace Talks?
    Late Jackson Mayor Lumumba's Son Wins Primary to Replace His Father, Runoff Election Ahead
    Quebecers Reject PQ and Elect a Liberal Government Representing Big Business
    TRNN Debate: Decriminalization vs. Legalization
    The Beginning of the Chavez Era - Edgardo Lander on Reality Asserts Itself (4/9)
    "Off With His Head": Court Upholds Obama's Power to Kill
    Workers at Nation's Top Hospital Strike For Fair Wages
    From Exile to Radicalization in Venezuela - Edgardo Lander on Reality Asserts Itself (1/9)
    Rwanda 20 Years Later: Genocide, Western Plunder of Congo, and President Kagame
    Ukrainian Protesters in the East Demand More Autonomy From Kiev Government
    Hunger Strikers Demand President Obama Halt His Record 2 Million Deportations
    Indian Parliamentary Elections - A Primer With Vijay Prashad
    West Looks to Carve Up Ukraine & Privatize Industries Held by Kleptocrats
    Where Are Israeli-Palestinian Peace Negotiations Headed?
    The Multiple Kingdoms of Saudi Arabia (5/5)
    Do the Afghan Presidential Elections Signify Progress?
    Republican Presidential Hopefuls Pay Homage to Billionaire Casino Tycoon Sheldon Adelson
    Will Extremist Lieberman Become Israel's Next Prime Minister?
    Why do the Saudis Want the US to Attack Iran? (4/5)
    Immigrant Advocates and Families Tell President Obama 'Not One More'
    Elections, Pipelines, and Protests - The Canada Panel
    Chris Hedges on "Israel's War on American Universities"
    Baltimore Residents Decry Lack of Affordable Housing
    Yellen Talks the Talk But Will She Walk the Walk?
    Hopkins Hospital Workers Speak Out against "Poverty Wages"
    Will Venezuela's New Floating Exchange Rate Curb Inflation?
    The European Central Bank's War on Wages is Pushing Europe's Economy to the Brink
    Supreme Court Decision Opens Floodgates for More Campaign Cash
    Charles Keating, the Financier Behind the Savings and Loan Scandal, Dies at 90
    Saudi Arabia and the al-Qaeda Monster (3/5)
    Maryland Residents Voice Opposition to Natural Gas Fracking Export Facility
    Supreme Court Ruling Gives Wealthy Individuals More Influence Over Elections
    What are the Saudis Afraid Of? - Madawi Al-Rasheed (2/5)
    Baltimore's MICA Adjunct Professors Set to Vote on Unionization
    Boycott of Israel Moving to Next Level?
    Hypocrisy Dressed Up as "Realism" Justifies American Alliance with Saudi Dictatorship
    Immigration Reform in the Shadows of Cesar Chavez's Legacy
    Leaked Senate Report Shows Use of Torture As "Ineffective"
    UN Report Says Climate Change Will Threaten Food Production Worldwide
    The Hypocrisy of US Calling for Enforcement of International Law
    How the Ecuadorian Economy Grew in a Global Recession
    'Shadows of Liberty' Trailer
    Kristina Borjesson on Why CBS Shut Down Her investigation into Flight 800 (2/8)
    Glen Ford on Racism in the American Media (3/8)
    Paul Jay on What Drives Corporate Media and What Drive The Real News (4/8)
    Creating a New Media Paradigm After Citizens United (5/8)
    Should The Left Engage with the Mainstream Media? (6/8)
    What Is the Financial Backing For The Real News? (7/8)
    Standing up to Character Assassination (8/8)
    Oligarchs, Fascists and the People's Protest in Ukraine
    TRNN Debate: Is Obamacare In the Interest of Workers?
    Too-Big-To-Fail Advantage Remains Intact For Big Banks
    Obama and the Saudi Agenda
    TRNN Replay: Investigating the Saudi Government's 9/11 Connection and the Path to Disilliusionment - Sen. Graham on Reality Asserts Itself pt 1
    The Iraq War's Real Legacy
    Petitions with 100,000+ Signatures Call for Snowden's Passport to be Reinstated
    We Need to Harness People Power - Andy Shallal on Reality Asserts Itself (4/4)
    BC Pipeline Fight and Quebec Elections - The Canada Panel
    Jonathan Schell - 1943-2014: Board Member of TRNN on Why We Need The Real News
    Teachers on Strike from the UK to Argentina
    Connecticut Poised to Become First State with $10.10 Minimum Wage
    Oil Spill Threatens Wildlife and Local Economy
    DC School Test Scores Up, But Poor Black Kids Are Doing Worse - Andy Shallal on RAI (3/4)
    Obama's Proposal To End NSA Bulk Data Collection Won't Protect Privacy
    How Google, Apple & The Biggest Tech Companies Colluded to Fix Workers' Wages
    An American Should be One that Questions Their Government - Andy Shallal on RAI (2/4)
    What's Driving Putin & Obama's Posturing on Ukraine?
    Hundreds of Students & Faculty Occupy College Campus to Fight Cuts to Public Higher Ed
    Due Process 'Impossible' In Harsh Death Sentencing Of Over 500 Muslim Brotherhood Members
    Has Anglo-American Capitalism Run Out of Steam?
    Being the "Other" in America - Andy Shallal on Reality Asserts Itself (1/4)
    TRNN Debate: Should Baltimore 'Ban The Box'?
    How Fallujah Became the Iraqi Government's New Battleground
    Why I Decided to Blow the Whistle on the NSA
    NASA Climate Predictions Show Serious Threat To Humanity
    Professor Who Teaches Israel-Palestine Conflict Accuses College of Violating His Academic Freedom
    CIA and NSA Wrongdoing Requires Independent Investigation, Says Former Church Committee Staff
    Are Tuition Breaks Enough To Combat High Student Debt And Low Graduation Rates?
    Industries Across the U.S. Are Stealing Wages From Their Lowest Paid Workers
    Who In Ukraine Will Benefit From An IMF Bailout?
    NSA Recording All International Calls From U.S.
    Israel "Making Lives Miserable" for Africans, Hoping They 'Self-Deport' (2/2)
    BP Gets Green Light to Drill in Gulf, But Has Safety Improved?
    Residents Still Not Drinking Tap Water Two Months After West Virginia Spill (1/2)
    Libya's Descent Into Turmoil Three Years After NATO Intervention
    From Pipelines to Peladeau - Canadian Report
    Israel "Making Lives Miserable" for Africans, Hoping They 'Self-Deport' (1/2)
    Congressional Progressive Caucus Budget Strikes Back Against Austerity
    Libya Three Years Later - Chaos and Partition
    Why Was Gaddafi Overthrown?
    Should Ukraine and West Accept De Facto Crimea Joining Russia? (2/2)
    Tony Benn Saw Socialism as the Culmination of Democratization
    Why Didn't Bush/Cheney Attack Iran and Can Obama Make and Sell a Deal? - Gareth Porter on Reality Asserts Itself (3/3)
    After Late Mayor Lumumba is Laid to Rest, What's Next for Jackson, Mississippi? (2/2)
    Crimea Referendum: Self Determination or Big Power Manipulation? (1/2)
    Sen. Graham: President Must Side with Openness About CIA and 9/11
    Manufacturing a Narrative for War - Gareth Porter on Reality Asserts Itself (2/3)
    Protesters Hit the Streets of Brooklyn to Demand $15 Minimum Wage
    Hammer: 'Moral Bankruptcy' Behind Massive GM Recall
    White House Withholds Thousands of Documents from Senate CIA Probe
    I Grew Up Believing in Time Magazine's Version of America - Gareth Porter on RAI (1/3)
    Western European Banks Vulnerable to Ukrainian Sovereign Debt Crisis
    TRNN Debate: What's Driving Inflation in Venezuela? (2/2)
    CIA vs. Senate: Who Is Obama Protecting?
    Will Tipped Workers Get Excluded Again From Minimum Wage Hike?
    TRNN Debate: What's Driving Inflation in Venezuela? (1/2)
    After Late Mayor Lumumba is Laid to Rest, What's Next for Jackson, Mississippi?(1/2)
    TRNN Replay: A Look at Who's Poised to Become No.2 at the Fed
    How Right-Wing Nationalism Rose to Influence in Ukraine (2/2)
    Netanyahu Attacks Boycott As Campaign Enters New Phase
    Moving Towards a Police State - Michael Ratner on Reality Asserts Itself (7/7)
    Fighting Reagan's Secret, Illegal Wars - Michael Ratner on Reality Asserts Itself (6/7)
    Puerto Rican Independence Movement and Cuba Further Radicalized Me - Michael Ratner on RAI (5/7)
    The Butcher of Attica - Michael Ratner on Reality Asserts Itself (4/7)
    MLK and a Radicalizing Moment in American History - Michael Ratner on Reality Asserts Itself (3/7)

    RealNewsNetwork.com, Real News Network, Real News, Real News For Real People, IWT are trademarks and service marks of IWT.TV inc. "The Real News" is the flagship show of IWT and Real News Network.

    All original content on this site is copyright of The Real News Network.  Click here for more

    Problems with this site? Please let us know

    Linux VPS Hosting by Star Dot Hosting