Economic Update: Social Movement Gains in LA

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On this week's show, Prof. Wolff discusses the immense social waste of today's US unemployment  the Trump ban on investments in Chinese companies, new global organization for worker co-ops, and higher education cuts in UK and US. The second half of the show features an interview with Niki Okuk, South Central LA activist fighting for community control of downtown Crenshaw Mall.

Transcript has been edited for clarity.

Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives: jobs, debts, incomes — our own and our children’s. And I'm your host, Richard Wolff.

I want to begin today by making a simple observation that needs to be said. The horrific explosion of COVID-19 cases and deaths across the United States is, in significant ways, a product of an economic system, capitalism, that was unprepared for it, as it should have been, and was unable to contain it, as it should have been. I say “prepared,” and I say “should have been,” and I say “contained,” because many other countries — advanced industrial countries like the US, but not as wealthy as the US —were able to be prepared and were able to contain it far, far better than the United States. Did Mr. Trump have a lot to do with it? Yes. But it goes deeper and further than that, and that needs to be said and understood.

I want to turn next to the unemployment situation in our economy. The way unemployment works is, most states provide about 26 weeks’ worth of it, half a year, and then if you're still eligible and you've run out of your 26 weeks, you qualify for federal unemployment assistance. Currently, roughly 21 million Americans are getting insurance, state or federal. That's 13 percent of the US labor force. If you add to that the so-called “discouraged workers,” those who've given up looking, at least for the time being, and large numbers of people who have only part-time jobs or jobs that earn below the $20,000 a year which everyone who pays attention knows puts you in poverty, you're talking nearly half the labor force in this society. That's what you're talking about when you use the phrase “economic crisis.” Nor is there any sign of it getting better. On the contrary, it's getting worse as the resurgence of the covid virus plays itself out across the United States.

What this means is that the horrific damage of the virus is compounded by the damage and waste of an economic crisis that has tens of millions of people either out of work or unable to live a decent life with the part-time or the low-paid work that they do get. This is crazy. We are supporting millions of people, which of course we ought to do, but we're not getting anything back. We're not having those people do useful work, which, ironically, is what they want, what we know would be better for their family life, for their mental health, for their physical well-being. This is a society that is unable to get the benefit for all of us of what those unemployed people could produce, while being unable to give those unemployed or low-paid people the very thing they want, which is a job at decent pay.

That's an economic system that fails. The solution is obvious. It's what the United States did in the 1930s, when we had unemployment like this. We created a federal jobs program. What could the federal jobs program do in this country? Are you kidding me? You know and I know, we haven't covid tested most of our people. That's a job for the unemployed. We don't track most of the people who have the disease. That's a job for the unemployed. We have a million fewer people working in city and state governments providing public services now than we did a year ago. During a pandemic and during a depression we need more public services to make up for what the private sector can't do. That's a job for the unemployed, who can become the providers of government services.

I mean, everybody understands that we could be way better off if we had a program, but neither the Republicans nor the Democrats, neither Biden nor Trump, have talked, let alone done, anything about a massive jobs program which is the screaming need for which they have no response. It's a problem of the system.

My next update has to do with an order Mr. Trump gave out right after he learned that he wasn't going to be president much longer. Here's what the order he did does: US citizens are banned from owning shares in 31 companies that do business with the Chinese military establishment. Now, what's this for? Let me be clear so that we all understand. If Americans can no longer hold shares, buy shares — investors cannot invest in 31 huge companies, by the way, in China that are global megacorporations but that have special relationships with the Chinese military — they will sell those shares to other people. There are plenty who want to buy them. So it will have the following effect on the Chinese companies: zero. It'll just mean that instead of a US investor, it's a British investor, or a German investor, Italian investor, or an African investor — get the picture? So what's this for?

Well, it's also a very bad precedent. What are you doing telling people in your country that you're going to ban them from owning shares in other companies that do business with the military? Guess what, American audience of mine: Most of the big corporations in the United States, American corporations, have dealings with the American military. It's the largest single consumer of goods and services in the United States, our military is. So of course every major corporation, or at least the vast majority, do business with it.

Do you really want to establish the precedent that, all over the world, people who currently own shares in General Motors, or Ford, or Raytheon, or General Electric, or Amazon, or Facebook or — you get the picture? They all do business with the American military. Is that a precedent you want to set? That's a precedent that's going to come back and haunt you and hurt you. That's not smart. But it may be clever politics for your political base; that's possible. You can look like you're whacking the Chinese.

But is that really sensible? No, for another reason. The United States is the world's largest debtor country. We borrow more money from the rest of the world than any other country borrows from the rest of the world. And you know who the biggest single creditor of the United States is? The People's Republic of China. That's right. They've lent trillions, or at least more than a trillion dollars, to the United States.

Now let me explain, for those who don't know this, and that might include just a few of Mr. Trump's followers: If the United States borrows a trillion dollars from China, it has to pay interest on those borrowings, just like everybody else pays interest on borrowings, which means that every year the United States has to pay interest to China for the trillion dollars they've lent to the United States. You know how much that comes to? Tens of billions of dollars.

Mr. Trump will not allow private investors to hold shares of Chinese companies; meanwhile, he is shipping to China tens of billions of dollars in interest from the United States, paid for by taxpayers. And you know what the Chinese are free to do with the tens of billions in interest we pay them? They can use it for their military, which they no doubt have, partly at least, done. So you're not cutting off the military. You're, in fact, financing it. But you're hoping your audience doesn't know and therefore can't evaluate it.

Well, friends, a little footnote: In the last few days, the Chinese signed an agreement called the Regional Comprehensive Economic Partnership. It's a free-trade area with 14 other countries in Asia. They're now having a no-tariff program. They're going to cut their tariffs, and they're going to free trade with one another. And who do they include? China is the leader, but it includes such economic powerhouses as Japan, Australia, New Zealand, South Korea, Indonesia. You know what this is? This is the largest such agreement in the world. Thirty percent of world trade, 30 percent of GDP, is handled by these 15 countries. China is moving forward, while games are played here that have marginal effect and risk a blowback that will hurt the United States economy. Remarkable to watch these things unfold.

I'm happy to announce that the notion of worker co-ops, which many of you know we are advocates for here at Democracy at Work, is spreading. I want to bring to your attention an interesting development. Last May a work manifesto was produced by a group of scholars from all over the world, talking about what kind of economic system was responsible for what was then the COVID-19 crisis — which looks pale in comparison to how bad that crisis has become. But they said that one of the problems was the commodification of labor, buying and selling people as if they were things, and in particular the undemocratic organization of the workplace, where a tiny group of people at the top make all the decisions. This was bad for controlling, containing the virus.

And so they wrote a manifesto, and they built an organization, and I want you to see how much the notion of worker co-ops is spreading. The website they started is called democratizingwork.com. That's all one word: democratizingwork.com. And the leading academic working in this country, with the people around the world, is a professor at the Harvard University Business School by the name of Julie Battilana. Julie Battilana, professor at the Harvard Business School, promoting worker co-ops as a better way to go. We have more allies than you may have thought.

Last update I have time for: an event in England and what it portends for the US. The conservative government in England has created a Higher Education Restructuring Regime — I kid you not, that's their name — and they appointed a board to administer it. They're using profit calculations to cut down the number of universities and colleges in England. “We don't need them anymore,” one member is reputed to have said. Well, covid is hurting education, and money is not being given to schools, so they can't provide the education that the students need, and the students can't afford it, so the solution is not to give the students the money to afford it, or to give the subsidies to the colleges — no, it's cutting the colleges. And if you think that's crazy, you're right. And you know what it reminds me of? The last 10 years, when we cut hospitals, and beds, and clinics, and medical education, leaving us unprepared for covid. We're going to be unprepared for much if we cut back our higher education.

We've come to the end of the first part of today's show. Before we move on, I want to remind you, our new book, The Sickness Is the System: When Capitalism Fails to Save Us from Pandemics or Itself, is out now and available at democracyatwork.info/books. I want to also thank our Patreon community for their invaluable support. And if you haven't already, go to patreon.com/economicupdate and sign up today for access to exclusive content and more. Please stay with us; we will be right back with today's guest.

WOLFF: Welcome back, friends, to the second half of today's Economic Update show. It is with great pleasure that I am able to introduce to both our radio and TV audiences Nikki Okuk. She is a South Central Los Angeles resident and activist working to halt rapid gentrification. She's doing that with her associates by means of a community-led bid to buy and redevelop the 40-acre Crenshaw Mall, under a cooperative and community-wealth-building model. She has spent several years building green-collar jobs and a democratic workplace, which she spoke about in her 2017 TED Talk, “Fire the Boss.” She is a Black Lives Matter organizer and tribal member Awakane Kamanuku. I brought her onto the program because the kind of social movement that she's involved in, and is a part of the leadership of, is exactly the kind of movement that can, and should, and I believe will, change America in fundamental ways.

So first of all, Nikki, if i can call you that, thank you so much for giving us some time off of your schedule.

OKUK: Thank you so much for having me.

WOLFF: Okay, so let's start right off by asking you, please give us an overview of what the struggle around the Crenshaw Mall is about, with particular emphasis on the community-wealth-building, co-op dimension. But I have to stick in, because I know our audience will be interested, that you're on the other side of the barricades from a certain Jared Kushner, and tell us about that.

OKUK: Well, yeah, absolutely. So the CIM Group is a group that has been building these sorts of developments in New York. They came to Los Angeles, and the community was immediately outraged at the idea that they would purchase this large tract of land in South Central, which has been really historically the heart and soul of black Los Angeles. And the development that they had planned there was high-end, luxury condos and apartments, along with some retail. I think the community in general, we were really excited about having some high-end retail and some restaurant options. The mall has been sort of dilapidated and underused for quite a long time. But we knew that this was actually just going to tip the scale towards further gentrification in the neighborhood. Similar developments close by have two-bedroom apartments going for $5,000 a month.

So the community really rallied together and, I think, sort of scared the group away. The sale was announced in the Los Angeles Times just a few months ago, and immediately there were Zoom calls with two and three hundred participants, all of these community members coming together to form sort of a very impromptu coalition to stop the sale.

Now, the sale was stopped, but then very quickly the sellers turned around and found another bidder. It's this LIVWRK group. Asher Abehsera is also very good friends with Kushner. They've done lots of deals together with the Kushner Group and CIM. So these are all the same folks, they move in the same circles, and they have the same plans for our community. And our community has different plans.

So we got ourselves together — and have really gotten some great support from the likes of other folks who are building cooperatives and collectives across the country — and have put together this great framework for how we can actually have community investors involved, we can have social-impact investors involved. It's been driven entirely by volunteers and donations. We've had thousands of local community members sign our petitions, and come to our actions, and contribute small dollar amounts here and there. And all of that work has actually brought on some really great architects and well-known other support services that we're going to need.

So we have this great team and put together this great bid. However, they sort of backdoored us and just gave the deal away to this guy Asher Abehsera with LIVWRK. And so now we continue to fight, to make them back away from the deal so that we can have this property, so we can develop it for ourselves and our community in a way that's aligned with our values.

WOLFF: Tell me something, Nikki, that I know is in the minds of our audience. How do you account for the success that you just described? Why were people as responsive to your efforts as they've turned out to be? Why were so many drawn in? I mean, the complaint on the side of progressive movements like yours is so often that, yes, we have a few people, but it's hard to get folks kind of on board, to get them moving, mobilized. You seem to have tapped into something. Can you help us understand what that might have been?

OKUK: Yeah, well, honestly, you have to give thanks to the ancestors, right? Because, honestly, this is decades of groundwork and organizing that has gone on in South Central. We have had a strong black community here for a long time. But also, you know, the Black Lives movement catalyzed us, then we had the Black Lives Matter movement, then we've also had anti-gentrification work going on for a long time. There are lots of local groups — Crenshaw Subway Coalition, and our local neighborhood councils. You know, we have leadership who have been organizing and thinking about these questions. In fact, I remember being a part of a study group, much like the Democracy at Work study groups in South Central, that was sort of asking the same thing: How do we start to purchase land and put it into a land trust? How do we start to pool our funds to sort of own some of this commercial real estate so that it remains in the control of black Los Angelenos?

And, you know, all of that work really just came to a head. We'd all been thinking about these things, talking about these things, studying these things. And then in that TED talk in 2017, I had even posed the question, could we build something like Mondragon in South Central? Could we create an ecosystem of cooperatives that would create employment for us, and wealth for us, and give us self-determination and sovereignty?

And now when this happened, and everybody thought of the mall, this sort of iconic — if you've never seen it, it's got sort of an art deco facade, and all of us have lived here, have passed it every day of our lives — and we thought, nobody can have this but us. It belongs to us, and we have to continue to fight for it and hold the line.

WOLFF: So give me your best guess — and I know, of course, you're not a neutral observer here. But do you have a chance to win this? Do you have a chance to back off the profit-driven developer and reorient this entire place and space to a different goal, to a different public service?

OKUK: I believe we do. We have sort of scared away or backed off a couple of different development plans for this mall that we believed were not aligned with our, the community's, vision and asked for what this space really should be. So I believe that we can do it again. I think that it is a struggle, because they have said repeatedly that they plan to move ahead with their bid. We have some actions coming up. We will be protesting frequently, and we are definitely trying to also move the dial with our local politicians. Local City Councilperson Marqueece Dawson, who reps for that area, can have a say in whether or not this is approved. And so we're working every single possible connection and angle that we can find to put pressure on the group to make them honor, really, the requests of the community.

WOLFF: Any connections or help with the labor movement? Because this is a question that keeps coming up — can we find ways to bring the labor movement and social movements like yours so that they help each other, they strengthen each other. Is there any light on that possibility that you can shed, based on your experience?

OKUK: Yeah, I certainly believe so, in two or three different ways. Quite a few of our organizers, our local community organizers, are also union organizers. And we have a long history of linking up with labor. We also are very well organized as far as the black workers of South Central and advocating for local-hire policies when developments like this do come through.

However, I think we found in the past that they are not very often honored. So we have a bunch of very like-minded organizers and workers who are thinking, if the way that we have done things in the past has not worked, has not employed local folks, has not created more job opportunities or training, has not recycled wealth in our community, has not lifted us up in the way that has always been previously promised by developers, then we have to think seriously about creating the systems that will.

WOLFF: Here's another question, coming at similar topics from another direction. I have always had, in my experience, the sense that if you can win even some modest victory, some modest things that might have been thought impossible — for example, making an initial bidder have to back off and go through the games you described with real or fake other associations, being able to delay the bid, being able to slow down the whole process so you had breathing room — that these are the kinds of victories that you can then build on because they give people a feeling of the sort you just said, that there is a possibility. Because people don't need a guarantee; they just need to know that there's a reasonable chance. Is something like that happening to help build your struggle there?

OKUK: Yeah, absolutely. And I think one of the other things that I hope has been the most encouraging, at least it has for me, has been the number of people that consistently come back every week. You know, I said that first Zoom call a few months ago had a couple of hundred people on it, but it's been like that almost every Saturday, or every other Saturday: hundreds and hundreds of people continuing to attend the meetings, to get updates, to find where they can fit in, whether it's creating collateral, or conducting actions, or, you know, lawyers are linking up the lawyer group to help us draft what our direct public offering or financial vehicle would be.

So everybody has found a way to sort of fit into this work. And the fact that they keep consistently coming back every single week — meeting sometimes on Tuesday and Wednesday nights with 30 to 50 people, Saturdays with two to three hundred people — I think that what we've built here, and the investment and the time that we're investing into building out this model, will stand in good stead for many, many years to come and in many, many other projects outside of downtown Crenshaw. I mean, just aside from this one 40-acre lot which would be a huge win for us and represent the strength of our numbers and our power, we hope that other communities can use this across the country. And so that's why I believe so much in the time, and the money, and the energy that we're investing in this project.

WOLFF: That's right. And, you know, you'll have the effects, you'll have the payoffs, in a sense, many of which you'll never even know about, as the individuals caught up in this struggle go on in their own personal lives to do this in countless other communities. That's why this is so important and why I'm so happy that you took the time to talk to us.

What are the immediate steps ahead? What are the urgent, if I can put it that way, the urgent things you now know you need to do? And I ask this partly because people want to know, but there may be people in the audience who will step up and offer some kind of support as well.

OKUK: Oh, absolutely. So the very first thing that everybody should do is on our website, downtowncrenshaw.com. We have a petition that had something like 12,000 or 15,000 signators, but now that petition has actually been changed into an automatic email send. So for anyone that goes onto the website and clicks to support our work, an email will automatically go to our local city councilperson. They will also go to the heads of the pension funds which are selling the mall. And the emails will go to everyone who has a stake and has a say and can control where this deal goes.

Because I think our power is really in our people numbers. And the fact that they've been receiving hundreds, thousands of emails telling them that this project is worthwhile and should be allowed to move forward is the very first thing. And then, as I mentioned, we've been doing all of this work on a volunteer basis, and there sort of are real costs associated with it, including, as I mentioned, lawyers and architects, designers and developers. So we're launching a big fundraising effort. So anybody can make small contributions on our website, or if they work with larger donors and investors, we need those types of folks really now to come through, because what we're building is a framework that won't just be for this mall. It is a framework for how democratic economies can and should work and how community-led organizations can really have control over the way our local economy works.

WOLFF: All right. We've come, Nikki, sad to say, to the end of our time, but you have really provided the kind of explanations and explorations that we're looking for. And every wish for every success. We will stay in touch. And know that there are people all over the country that are excited and inspired by what you're doing. Thank you again.

And I will be eager to talk with all of you in the audience once again next week.


Transcript by Marilou Baughman
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Showing 1 comment

  • carole oleniuk
    commented 2020-12-07 14:19:13 -0500
    Great inspiration. Great workk. Venceremos.

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