Steady state economics and the new Congress
My New Year’s wish is for everyone to see the movie Inside Job. It’s a dynamic overview of the people, forces, and philosophy behind the global financial crisis and the ensuing bailouts of the “too-big-to-fail” banks and investment firms. Inside Job shows how pervasive the corruption of the global financial system has become. The movie singles out various Democrats and Republicans as being part of the problem, but it also contains scenes of some keen Congressional investigators such as Senator Levin of Michigan, Chairman of the Permanent Subcommittee on Investigations, who is shown grilling the heads of the big banks and exposing the kinds of swindles that took place.
Advocates of the steady state economy should be working more closely with the cutting-edge organizations fighting global corruption because the corruption and its attendant bribery of public officials is undermining governance around the world.
The ongoing economic depression is the very time steady state advocates should be pushing for a totally different way of proceeding, a way to avoid the boom and busts of the past. We need to blow right by the typical politicians pushing their pet hackneyed ideas for getting the economy moving.
We don’t want to return to the same spot we were in, only to have a new round of speculators crash the economic system and undermine governance. It is important, therefore, to force decision makers in Congress and the Executive Branch to think about a paradigm shift and what a steady state economy would look like.
One obvious approach is to continue increasing the teach-ins, symposiums, and conferences that feature this deep economic debate. CASSE (the Center for the Advancement of the Steady State Economy) can provide the names of experts to university groups, religious congregations, and public interest organizations who want to host events to educate their members and the public about new economic models.
Rallies and demonstrations can help make a difference in awareness and can stimulate Congress to conduct hearings. For example, Tea Party activists demonstrated repeatedly this past fall at Republican primaries to protest the deficit and the gridlock in Congress and to push for tax cuts. Many were bankrolled by powerful right-wing interests, and they got a lot of press. Advocates of big economic change need to think about doing more demonstrations to raise awareness and force Congressional oversight into new economic models of sustainability.
For example, on the United Nations Anti-Corruption Day, December 9, I organized a demonstration outside the headquarters of the U.S. Chamber of Commerce. The U.S. Chamber has been a large force pushing growth at all costs and is well known for its anti-sustainability positions. But what is not so well known is the Chamber’s opposition to those trying to clean up global corruption and improve governance.
On behalf of the Tax Justice Network with participation by Common Cause, Public Citizen, and Friends of the Earth, we paraded in front of the U.S. Chamber and laid out the charges against it. For example, the Chamber is seeking to weaken the Foreign Corrupt Practices Act and is blocking efforts to abolish offshore tax havens, which contain vast sums of money (about $20 trillion) that go untaxed by any jurisdiction.
In addition to protests, rallies, and teach-ins, there may be other opportunities to confront the new Congress to get a deeper economic discussion going. Here are a couple of possibilities. Given the stated desire of most of the 97 new Members to cut federal spending, Congress should be challenged to eliminate the subsidies for polluting industries, especially for fossil fuels. The last Congress unfortunately continued the big subsidy for corn ethanol that will cost several hundred billion dollars by the year 2022. The new Congress could reverse this decision, and it could cut the agricultural commodity subsidies that benefit agribusiness and undermine organic food production. The challenge is to make the Congress vote and then we can tabulate the results and expose any hypocrites.
Many advocates of a steady state economy criticize gross domestic product (GDP) for failing to give an honest indication of the well-being of the nation. In 1989 Senator Robert Kasten (R-Wisconsin) added an amendment to the Commerce Department appropriations bill that required the Department to product an index of gross sustainable production in addition to the usual GDP. The provision became law and the Commerce Department started implementation, but in the mid-1990s the fossil fuel lobby forced the removal of this modest requirement. Perhaps as part of truth-telling to the American public, Congress could reinstate this provision.
I have suggested several measures of offense, but in 2011 we may have to work significantly on defense. For example, more bailouts may be proposed without any serious reform conditions. Keep in mind the inability of Congress to resist bailing out too-big-to-fail corporations.
For example, take the bailout of General Motors and Chrysler by the last Congress and the Obama administration. Why wasn’t a provision added to prohibit these companies from suing state or federal governments? GM got bailed out and then sued the State of California over clean car standards.
The Obama administration could have insisted on binding conditions for the production of better mileage vehicles similar to Toyota’s Prius and provided for government fleet purchases of high-mileage vehicles. Dan Akerson, CEO of General Motors, recently told the Economic Club in Washington: “We commonly refer to the geek-mobile as the Prius…I wouldn’t be caught dead in a Prius.”
Let’s make sure that Obama and the new Congress don’t continue rescuing fossilized corporations that stubbornly cling unsustainable policies of the past.