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Inside America’s Largest Worker-Run Business

August 19, 2017 - 10:01am
Above Photo: From fastcompany.com Can workplace democracy pave the way to better conditions in low-wage industries? For home care aides, the results of one 30-year experiment are mixed. Fifteen years ago, Clara Calvo had just left her husband and her job. Both were abusive in their own ways. Her husband beat her, while her job at a beauty salon required long, unpredictable hours for little pay. Before that, she worked in a clothing factory in midtown Manhattan, earning a pittance for each hat she sewed, having immigrated from the Dominican Republic in 1995. Today, Calvo is able to support her three children as a single mother and sits on the board of company with over 2,000 employees that does $60 million in business per year. Solving Inequality: This is part of Co.Exist’s collection of stories about rising income inequality and big and bold ideas for how society can reverse this trend. See the whole list here. But Calvo also works as home health care worker, making just $10 an hour. Her company, Cooperative Home Care Associates (CHCA), is not like most other companies. It is a worker cooperative, an ownership structure that is somewhat rare in the U.S. but much more common in Spain, Italy, and parts of Latin America. In a worker cooperative, every worker can own an equal share of the company (and its profits) and get a say in company decisions. Today, worker co-ops are growing in popularity in the U.S., both for people ideologically drawn to an equitable workplace and as a means for economically disadvantaged people to control their own destiny. But among worker cooperatives, CHCA is rare in for its size (employing over 2,000 workers), its longevity (currently in its 30th year), and its success (it has been profitable in all but three of those years). It was the first time I was interviewed for a job by home care workers. I didn’t know how to act. Unlike other corporations, CHCA’s workers get a say in important decisions: Eight of its 12 board members are home health care aides, the company’s front line workers. That board makes major decisions just like in other corporations, such as hiring the company’s president. When Michael Elsas, CHCA’s current president and a veteran of the home health care industry was interviewed by the board, he says he was shocked. “That interview was horrifying for me,” says Elsas. “After 25 years in the home care industry, it was the first time I was interviewed for a job by home care workers. I didn’t know how to act.” “THEY’RE SEEN AS AN EXPENDABLE WORKFORCE.” Now in his 15th year at CHCA, Elsas has seen the industry from many sides. “Most agencies don’t care about the workers in this industry,” says Elsas. “Nobody cares about their benefits. Nobody cares about how much you train them. They’re seen as an expendable workforce.” Home care workers are near the bottom of the medical hierarchy: beneath doctors, pharmacists, and nurses; beneath technicians, and beneath medical assistants. Because of the little training required–as few as 75 hours to be certified–others in the field tend to look down on them. And yet, these aides do some of the most intimate and physically demanding work imaginable. They care for our elderly and disabled, assisting with daily tasks that people can no longer perform for themselves, like cooking, dressing, and even bathing and using the bathroom. A quarter of the workers who do this labor live in households below the federal poverty line and half only do the job part-time. These workers are overwhelmingly female (90%), people of color (56%), and lacking formal education (58% have at most a high school diploma or GED). Despite being health care workers, one in three did not have health insurance as of 2014. For those who need home care and their loved ones, these should be troubling statistics. Workers who are treated poorly are prone to being abusive themselves, much like in nursing homes. Both industries have the ingredients for the toxic cocktail of abusive caregivers: lack of supervision, poor wages, and understaffing. Precise data is hard to come by because of the unsupervised nature of the work, but according to one study, 20% of disabled women reported being physically or sexually abused by their home care providers. A quarter of the workers who do this labor live in households below the federal poverty line. Despite the poor conditions and problems in the industry, personal care aides and home health aides are one of the nation’s largest occupations and also the second and third-fastest growing occupations in the country, according to the Bureau of Labor Statistics. (And the fastest growing occupation, “industrial-organizational psychologists,” only accounts for 1,600 people nationwide; whereas PCAs and HHAs total over 2 million workers.) THE NOT-SO-MAGIC FORMULA OF TREATING WORKERS WITH RESPECT The median annual wage for home care workers is just around $20,000 a year, making it a crucial workforce to target to improve conditions for the working poor. That was the mission when social entrepreneur Rick Surpin founded CHCA in the South Bronx 30 years ago. “CHCA was founded on the premise that if you provide a quality job, you’ll get quality care,” says Elsas. “The other thing you would be doing is you would be stabilizing a workforce that historically has been very transient–going from one job to another.” For years, CHCA has offered wages slightly above the industry standard, which in New York was often the state minimum wage. Yet workers at CHCA don’t necessarily earn much more than their full-time counterparts at other agencies. The biggest difference is that more at CHCA actually do full-time work: After three years at CHCA, it guarantees workers full-time pay, whereas many agencies operate using contract workers. In addition, all CHCA workers get health care benefits—which, nationwide, is not the case for about a quarter of these workers. Finally, as worker-owners, CHCA members receive a share of the profits in the form of dividends. The president gets the same dividend as...
Categories: Friends of GEO, SE News

The Work Lives Of Uber Drivers: Worse Than You Think

August 19, 2017 - 9:00am
Above Photo: In addition to showing solidarity with immigrants, people of color, and workers nationwide, the actions will also take on Uber, a central figure in critiques of the U.S. “gig economy.” (Photo: Reuters) To be an Uber driver is to work when you want. Or so Uber likes to say in recruitment materials, advertisements, and sponsored research papers: “Be your own boss.” “Earn money on your schedule.” “With Uber, you’re in charge.” The language of freedom, flexibility, and autonomy abounds, and can seem like a win for workers. But the reality of our research shows something very different. The price of flexibility in the gig economy is substantial. Last year we conducted 40 in-person interviews and online surveys with Uber drivers in the Washington, D.C. metro area. Our project—which creates one of the first independent, qualitative datasets about the rideshare industry—found that the economic realities of precarious work are a far cry from the rosy promises of the gig economy. In exchange for flexible schedules, Uber retains near total control over what really matters for drivers, namely the compensation and costs of work. Aman bought a Lincoln Town Car in 2012 after he been approved to drive for Uber Black, the brand-new private car service. As an Ethiopian immigrant in Washington, D.C., he had supported himself by driving a taxi so he already had the chauffeur license that was then required. In 5 or 6 hours of driving, he earned what would have taken him 8 hours in a taxi. But, not long after he took on the $35,000 loan for the car, Uber changed a policy about how old cars could be, and the Lincoln Town Car no longer qualified. Aman could no longer drive for Uber Black, and he could no longer make his car payments. Like Aman, many Uber drivers are on a debt-to-work pipeline, taking on a significant financial risk to get the chance to earn a wage. Drivers invest upfront nearly all of the costs of running a car service: the vehicle itself, maintenance, gas, insurance, and taxes. On top of that they incur tolls, parking tickets, “dead miles” (the distance driven while waiting for or driving to pickup a passenger), safety devices (dash cameras and mace), and rider extras (water and mints). And drivers have no guarantees about how much they will earn, when there will be surge pricing, or whether they will come down with an illness and be unable to work. One driver put it this way: “You’d be better off working at McDonald’s.” The problem isn’t just uncertainty about what drivers can earn. Some also end out in deeper financial trouble by leasing cars from Uber’s Xchange program. One driver, Joan, got caught in this trap after she hit a pothole and damaged her car’s suspension system. She spent nearly all the money she had to get the car fixed. Then, when efforts to repair the vehicle failed, she spent more to lease a car from Uber. While Xchange offers lower credit barriers than traditional lenders, the payments which Uber automatically deducts from drivers’ paychecks, are high. Joan pays $138, more than the national lease average of $100 per week. Another driver we interviewed pays $290 per week and, at the end of her 3-year lease, she will have paid two or three times her car’s value. Think company town, or as one of our other drivers said, “indentured servitude.” The costs of these subprime leases are exorbitant, but, according to the Federal Trade Commission, Uber has actively deceived drivers about those costs. A Massachusetts Attorney General also found that Uber’s former lender charged higher-than-allowed interest rates to drivers in low-income communities. Along with significant financial risks, Uber drivers struggle to make sense of the company’s constantly changing rules and opaque management practices. In the four years it has been operating in Washington, D.C., Uber has reduced its base rate for drivers several times, added a rider safety fee (and then increased it, calling it a booking fee), and raised the commission it takes from new drivers. The rules and details of work for Uber change, sometimes hourly. A majority of the drivers we interviewed reported that their wages have dropped so much that they will only drive during hours when there is likely to be surge pricing or in areas where other incentives give them a better chance of earning decent wages. One driver commented that “They’re really playing games with [the rates], and…I don’t like that.” These games, which are built into the heart of the Uber platform, have a point: to keep Uber drivers on the road and in the dark. Workers do not know how much they earn largely because of the fluctuating algorithms on which pay is based and the numerous expenses they must deduct. Of the 40 drivers we interviewed and surveyed, only a handful knew what percentage of their fares Uber takes. The majority did not know how Uber determined how much drivers take home on a single ride (whether, for instance, the booking fee is removed before or after Uber takes its commission), whether they are required to buy commercial insurance, or how tax filing works at the end of the year. Workers also have little information about company decisions. Drivers reported that Uber was not transparent about its policies on both minor issues, like how much a driver would be compensated when a passenger vomits, and major ones, like “time-outs” (penalties for not accepting the right number of rides in a certain time period) and de-activation (permanent suspension). It’s a system of “smoke and mirrors,” in the words of one driver. Drivers also reported little recourse in disputes with Uber. One driver, Larry, was unsuccessful in recouping a fraction of a fare that he believed Uber wrongly took. He said, “I mean, I’m never going to find a lawyer who’s going to take on my case to help me get my $4.71 back, and that’s part of the frustration.” This experience is not unique. According...
Categories: Friends of GEO, SE News

How Cities Can Save Small Shops

August 19, 2017 - 9:00am
Above Photo: This space on First Avenue has been vacant for months. Karen Loew Some places are already taking action, but New York City is lagging behind. Here’s a blueprint for keeping local retail healthy. Over its two decades in business, Jane’s Exchange, a secondhand children’s and maternity clothing shop in Manhattan’s East Village, has clothed generations of diverse New Yorkers and served as a de facto resource center, water cooler, and play spot. When she’s not running Jane’s Exchange, the co-owner Gayle Raskin, who also lives nearby, is usually active elsewhere in the community. Especially on this island of the empty storefront, her shop is a textbook example of why shopping local matters: The store fills a need, employs local residents, re-invests locally, supplies warmth and personality to a city block, and supports neighborhood connections and institutions, which support it back. Shops like this one are disappearing fast from city streets, particularly in Manhattan, where they’re often left empty—leading to so-called high-rent blight—or else replaced by chain stores. According to the Small Business Congress, at least 1,200 small businesses close every month in New York City. Even if that number is correct, some are replaced by new small businesses. But the immense scale of the problem is clear: “This is the number one issue in Manhattan,” Borough President Gale Brewer told the City Council at a hearing last September. At that hearing, councilmembers members upbraided city officials for not gathering data on a scale commensurate with the problem. Meanwhile, cities around the U.S. and the world are recognizing the value of homegrown retail and are enacting policies to enrich the frequently poor soil where small businesses attempt to grow. That’s because municipal leaders are realizing that the basis of any community is its sense of place—its singular look and feel, roots and aspirations—and local retail is essential to expressing that. Shops are part of culture—in addition, of course, to being the places where you can fix a shoe, find a dress, buy a coffee, and chit-chat. The toolbox of local shop-saving solutions is expanding, even at this moment when we don’t know what shopping will become in the face of online commerce. San Francisco, for example, has for some time only permitted chain stores on a case-by-case basis. Phoenix is banned from giving large retailers tax and other incentives. Palm Beach, Florida, created a Town-Serving Zone, and Fort Collins, Colorado, declared a development moratorium in order to more sensibly handle a rush of chain stores wanting to locate there. Seattle is working to launch a program to support historic businesses. (There’s a long history here: Before the Great Depression, the U.S. charged an extra tax on chain stores.) Jane’s Exchange co-owner Gayle Raskin in her shop (Karen Loew) This is the moment for mom-and-pop shops to assert their value proposition, says Olivia LaVecchia, a research associate at the Institute for Local Self-Reliance in Washington, D.C. “There’s really a failure to recognize what a powerhouse small businesses are,” says LaVecchia, citing their interdependency with other desirable local outcomes, such as maintenance of affordable housing and jobs. A recent report from ILSR advocates six policy approaches that any locality can apply. These ideas lend themselves to being customized. After a raft of tavern closures in England, a new process was born to dub locals Assets of Community Value that could follow a path to business preservation. Now the Ivy House is thriving as the first cooperatively owned pub in London. In the Latin Quarter of Paris, when too many bookstores closed, and too many tourists thronged, the city’s Vital Quartier program was born to combat “blandification” and promote the tenancy of culturally significant organizations. From Barcelona to Buenos Aires, cities are demonstrating that local retail culture matters. But in New York City? “Crickets,” as Kirsten Theodos would say. She’s the passionate coordinator of Take Back NYC, which advocates for passage of the Small Business Jobs Survival Act, or SBJSA, the only measure to directly address the matter of rent rates and lease renewal, which is what proprietors will tell you is their number-one problem. But the sound of silence in New York is starting to change. There are many ideas circulating from various politicians and groups—even more now than two years ago, when I optimistically wrote a roundup of proposals for my former job in East Village preservation (and came to know some of the people cited in this article). A proposal under consideration by Community Board 3 in downtown Manhattan would create a special zoning district in the East Village aimed at limiting the number of new chain stores and banks. A recent rally in favor of the special zoning district was held in front of a Starbucks under construction on Tompkins Square Park, one block from where the popular Café Pick-Me-Up was reportedly driven out by landlord demands. A candidate for mayor and a candidate for public advocate are both making small business a central campaign topic. But that’s just the thing: So much is always on the brink of happening. While Gotham talks, Jersey City, directly across the Hudson River, acts. Its city leadership just voted to reaffirm a similar “formula retail” provision capping how much of its downtown street-level retail can be chain stores. Small business advocates say the reason for inaction, in this case, is that Mayor Bill de Blasio and the most powerful councilmembers simply have no desire to touch the third-rail topic of commercial rents when the Real Estate Board of New York is one of the most reliable sources of campaign cash. A REBNY rep was one of the four people to speak against the proposed special district in the East Village, among several dozen emphatically in favor, at a June hearing on the matter, held by Community Board 3. As State Senator Brad Hoylman, a Democrat who represents much of the East and West Village, delicately put it to me in an interview last month: “The truth is at the local level, and state level, the real estate community is very influential. It’s up to constituents and tenant advocates and small business owners to push back on that.” James Armata, general manager of the popular East Village coffee spot Mud, speaks at a recent rally outside a new Starbucks under construction on Tompkins Square...
Categories: Friends of GEO, SE News

Solar & Wind Energy Save Thousands Of Lives, Tens Of Billions Annually On Health Costs

August 19, 2017 - 8:00am
Above Photo: Glittering future. (Reuters/Carlos Barria) One of the biggest criticisms of the renewable-energy industry is that it has been propped up by government subsidies. There is no doubt that without government help, it would have been much harder for the nascent technology to mature. But what’s more important is whether there has been a decent return on taxpayers’ investment. A new analysis in Nature Energy gives renewable-energy subsidies the thumbs-up. Dev Millstein of Lawerence Berkeley National Laboratory and his colleagues find that the fossil fuels not burnt because of wind and solar energy helped avoid between 3,000 and 12,700 premature deaths in the US between 2007 and 2015. Fossil fuels produce large amounts of pollutants like carbon dioxide, sulfur dioxide, nitrogen oxides, and particulate matter, which are responsible for ill-health and negative climate effects. The researchers found that the US saved between $35 billion and $220 billion in that period because of avoided deaths, fewer sick days, and climate-change mitigation. How do these benefits compare to the US government’s outlays? “The monetary value of air quality and climate benefits are about equal or more than state and federal financial support to wind and solar industries,” says Millstein. Between 2007 and 2015, Quartz’s own analysis* finds that the US government likely spent between $50 billion and $80 billion on subsidies for those two industries. Even on the lower end of the benefits and higher end of subsidies, just the health and climate benefits of renewable energy return about half of taxpayers’ money. If the US were to stop subsidies now, those benefits would continue to accrue for the lifetime of the already existing infrastructure, improving the long-term return of the investments. What’s more, those benefits do not account for everything. Creation of a new industry spurs economic growth, creates new jobs, and leads to technology development. There isn’t yet an estimation of what sort of money that brings in, but it’s likely to be a tidy sum. To be sure, the marginal benefits of additional renewable energy production will start to fall in the future. That is, for every new megawatt of renewable energy produced, an equal amount of pollution won’t be avoided, which means the number of lives saved, and monetary benefits generated, will fall. But Millstein thinks that we won’t reach that point for some time—at least in the US. The debate whether subsidies to the renewable industry are worth it rages across the world. Though the results of this study are only directly applicable to the US, many rich countries have similar factors at play and are likely to produce similar cost-benefit analyses
Categories: Friends of GEO, SE News

Black-Led Credit Union: ‘Most Important Work’ To Drive Economic Vitality

August 18, 2017 - 1:00pm
Above Photo: Me’Lea Conelly, Jonathan Banks and Malcolm in the hall of the Association for Black Economic Power office. Photo by Annabelle Marcovici. “We can’t keep using the bodies of youth as the only tool for resistance,” Me’Lea Connelly, executive director of the Association of Black Economic Power (ABEP) said, “we need something else.” In the wake of the killing of Jamar Clark on Nov. 15, 2015 and the ensuing Fourth Precinct occupation, followed less than a year later by the killing of Philando Castile on July 6, 2016, Connelly recalled a drive for a concerted effort with movement organizers to diversify tactics of resistance against police brutality. A meeting was called, and after hours of conversation with a cross section of community, the group voted to create Minnesota’s only Black-led financial institution in North Minneapolis. A symbiotic relationship exists between ABEP and Blexit. Connelly described Blexit as the incubator and nest where ideas put forth by the community are percolated. ABEP puts them into action. The ABEP Executive Committee composed of – Connelly, Brett Grant, Ron Harris, Amber Jones, Danielle Mkali, Felicia Perry and Y. Elaine Rasmussen – are leading the effort to build the foundations of the credit union while still remaining deeply grounded in the conceptions of resistance movement. But really, Connelly said the decision to launch was an outcome largely driven by community input and demand. The new credit union, now called Village Trust Financial Cooperative, “was a community effort,” Connelly said, “a lot of participants who were from North Minneapolis believe [building a Black-led financial institution] is the most important work that we can do right now to change what is happening in our community.” Ditching a problematic system for equitable alternatives Connelly cited the lack of any Black-led financial institutions in the state as a catalyst to this decision by the community. While Minnesota has two Native-led credit unions, White Earth Reservation and Northern Eagle Federal Credit Union, with a total of 120 credit unions across the state, the dominance of white-owned financial institutions in the state looms large. “When you don’t have foundational financial institutions at the roots of certain communities, it’s very difficult for them to become economically healthy and strong,” she explained. To ABEP, the establishment of a credit union in North Minneapolis is a branch of activism and a means of community protection. While a bank is owned by shareholder and is a for profit institution, credit unions are owned by its members. “A credit union is a cooperative so the purpose here is to benefit those members,” Connelly declared. “It’s not about making money, it’s about moving money. It’s about velocity and circulation of money.” Payday lending companies continue to perpetuate predatory behavior that disproportionately targets Black workers. “I’ve said this many times,” Connelly reiterated, “you can’t throw a rock without hitting a payday lender or a check cashing place in North Minneapolis.” The average annual percentage rate (APR) on payday loans in Minnesota is 273 percent, and according to Exodus Lending, a nonprofit dedicated to helping Minnesotans get out of payday lending debt, about 30,000 Minnesotans are trapped in a cycle of debt through payday loans. The severe consequences of debt resulting from a systematic lack of access to bank loans or credit cards disproportionately impacts people of color, especially in times of need. While new regulations have tried to curtail the damage of payday lending, a disproportionate number of Black residents do not have fundamental access to credit and equitable loans. Racist lending practices run deep in Minnesota too. A report published from the University of Minnesota Law School’s Institution on Metropolitan Opportunity concluded that banks in Minneapolis and St. Paul are nearly four times more likely to give subprime loans to high-income Black residents than low-income white residents. Large banks have a record of issuing exorberant subprime mortgages for homes fueling the disenfranchisement of Black people. The National Community Reinvestment Coalition published a report declaring that Black people living in the Twin Cities Metro area, around 7 percent of the population, were receiving a scant 2 percent of mortgage loans. The same UMN report noted that banks such as Wells Fargo failed to distribute mortgage loans proportionately in areas with predominantly residents of color. Connelly and her Village Trust colleagues are concerned by the exploitative and predatory environment in North Minneapolis and hope that the credit union will provide a different outlet – while also maintaining key products and services to help people succeed financially. The primary differences between Village Trust and traditional financial institutions are that Village Trust would work to lower interest rates and make all exchanges equitable and affordable. This foundational service is one that ABEP believes every single neighborhood in America needs to have. Village Trust seeks to provide a place where members can have anything from a payday lending service to college savings account, access to car loans, or financial education. Above the expected services of a financial institution, leaders of the new credit union hope to build a space where staff are, according to Connelly, first and foremost “kind and understand you on a cultural level.” Stephannie Lewis, a Minneapolis resident who grew up on the Northside felt it was important to pledge her support for Village Trust because the movement to build a Black-led credit union touches on her personal experience. “Historically, I have a family that tried to start their own business and had no clear access to capital,” Lewis said. “Seeing and going through that journey has been a frustrating experience for me. If we have an institution which […] can provide those services and has that understanding, it would be beneficial to generate wealth in that community. I want to make sure other people with great ideas have access to the capital they need too so those ideas can flourish.” A Black-led credit union becomes a powerful tool in North Minneapolis, but Connelly is quick to point out that these cooperative tactics are not unprecedented in the Twin Cities community. “To be honest,” Connelly...
Categories: Friends of GEO, SE News

Madrid As A Democracy Lab

August 18, 2017 - 8:00am
Above Photo: From Opendemocracy.net For some years now, we have been witnessing the emergence of relational, cross-over, participative power. This is the territory that gives technopolitics its meaning and prominence, the basis on which a new vision of democracy – more open, more direct, more interactive – is being developed and embraced. It is a framework that overcomes the closed architecture on which the praxis of governance (closed, hierarchical, one-way) have been cemented in almost all areas. The series The ecosystem of open democracy explores the different aspects of this ongoing transformation. During the occupation of Puerta del Sol in Madrid in 2011, the hackers at the core of Madrid’s 15M developed a platform for anyone to make political proposals. Designed in free software, the Propongo platform allowed users to put forward ideas which could then be voted on. The operational arrangement was pretty simple: decentralized proposals, from the bottom up. The State of Rio Grande do Sul (Brazil), where participatory budgets came to light in 1989, used part of the Propongo code and its philosophy for the Digital Cabinet, its star citizen participation project. In Spain, the political class turned its back on the Indignados. On the other side of Propongo, no one was there. No local, regional or state government listened to the new music coming out of the squares – and even less to the proposals. Meanwhile, collective intelligence and networking in the squares were developing sophisticated mechanisms for participation and deliberation, both online and face-to-face. The powerful technopolitics made in Spain conquered the hearts of activists all over the world. And the hearts of some foreign academics and politicians too. In May 2015, the so-called “citizen confluences”, overcoming the traditional political party formats, conquered the governments of the main cities in Spain. And part of the squares technopolitical intelligence was transferred to local governments. Hacktivists, programmers, assembly and participatory process facilitators went on to work for the institutions. Pablo Soto, a historical hacker from the peer-to-peer movement and one of the Puerta del Sol regulars, was one of them. In June 2015, Soto became the head of participation of the Madrid City Council. Ahora Madrid, Barcelona en Comú, Zaragoza en Común, among many other political confluences, began to rev up participation in the country’s main cities. “All roads lead to Spanish cities, where they are experimenting with citizen empowerment tools like nowhere else in the world”, noted Geoff Mulgan, head of Nesta in the UK. Two years after taking power in the so-called Cities of Change, participation has become one of the biggest disruptions. And hacker Soto’s Madrid is the city that has gone further down this road. From the networks to the territory, and vice versa, Madrid is turning the collective dream of the occupied squares of 2011 into public policies. Democracy from the bottom up Pablo Soto uses a word that the dictionary of the Royal Academy of the Spanish Language does not recognize (yet): disintermediation. Political disintermediation means removing intermediaries from representative politics. The aim is clear: getting citizens to make their own decisions. The launch of Decide Madrid, the city participation platform running on the Consul free software, signaled a real revolution. On the one hand, it paved the way for democracy from the bottom up, through direct and binding mechanisms. Unlike other historical participatory budgets, the 100 million Euros devoted to Decide Madrid participatory budgets in 2017 are allocated according to proposals coming from below. The proposals that get the most votes, whenever technically feasible, are approved. The platform also carries a section for “citizen proposals”. If a proposal gets the support of 1% of the registered Madrid citizens over the age of 16 (that is, 27.064 citizens), it gets to the final voting stage. The first such vote on citizen proposals took place on February 13-19 2016, on the Internet and in several physical places in the city. The 100% sustainable Madrid proposal was voted by 188.665 people (89.11% of the voters). The proposal A single ticket for public transport, although it exceeded the City Council’s area of jurisdiction, was supported by 198.905 people (93.94% of the voters) and put pressure on the Madrid Transport Consortium, where the regional government has a major stake. Image source: Decide Madrid. Decide Madrid is also being used for binding urban planning consultations, such as the ones on Plaza España, the Gran Vía, and the remodeling of 11 squares in the city’s suburbs. Thanks to the cultural disintermediation of the Napster software, unknown music groups have been organizing concert tours without any help from the record companies. Thanks to the disintermediation of Decide Madrid, a proposal by an individual citizen from the Retiro district has managed to turn the almost abandoned Daoíz y Velarde Theatre into a film library. “The bottom-up belt which enables people to impose decisions on top-level officials is not a technological tool: it is a popular initiative mechanism. Before, the mechanism consisted of collecting signatures. Now, citizens use technology to collect them, opening up a Change.org, an Oiga.me. We have done that in Madrid (…) The Propongo philosophy governs most direct democracy platforms implemented in Spain by the councils of the Cities of Change”, says Pablo Soto. The Decide Madrid platform was not initially well received by the traditional neighbourhood associations, used to face-to-face participation and to mediating between citizens and government. In order to tackle this, a number of face-to-face deliberation spaces are being set up, such as the Local Forums (physical participation spaces in the districts), and also projects such as If you feel like a cat (participation for children and teenagers), or processes such as G1000, which aims at promoting collective deliberation and fostering proposals from below on the basis of a representative sample of the population, so that the participants’ diversity and plurality is guaranteed. Most projects are being carried out with the support of the new Laboratories of Citizen Innovation of the prestigious Medialab-Prado. The Participa LAB(Collective Intelligence for Democracy), the DataLab (open data) and the InciLab (Citizen Innovation Lab) are joint public/common initiatives, acting as a bridge between local government and citizens. The Participa LAB, which is the one working more closely on participation, is...
Categories: Friends of GEO, SE News

Korean Unions Call For A Just Energy Transition

August 17, 2017 - 11:00am
Above Photo: From systemchangenotclimatechange.org In a series of landmark statements following the May 2017 election of the pro-reform President Moon Jae-in, Korean energy, transport and public service workers have called for “a just energy transition” allowing the sector to “function as a public asset under public control.”  Unions support the new government’s decision to close the country’s aging coal-fired and nuclear power stations, and its planned reconsideration of two new nuclear facilities, Kori 5 and Kori 6. In a statement issued in late July, the Korean Public Service and Transport Workers’ Union (KPTU) and the Korean Labour and Social Network on Energy (KLSNE), a coalition of unions and civil society organizations, said, “We actively support the policy of phasing out coal and nuclear and expanding clean renewable energy.” The statement urged the development of, “A roadmap for energy transition that ensures public accountability and strengthens democratic control of the energy industry.” KPTU andKLSNE also committed  “to work together with the public and civil society to achieve a just transition.” July 24th: KPTU leaders’ press conference on the call for a Just Energy Transition. Photo: KPTU July 27, 2017Full KPTU and KLSNE statement The Korean Labour and Social Network on Energy (KLSNE) and the Korean Public Service and Transport Workers’ Union (KPTU) Support the Government’s Policy of a Transition towards a Coal-free, Nuclear-free Energy System The Moon Jae-in government, which was elected on a pledge to phase out coal and nuclear generation and scale up clean renewables, is now moving quickly to enact these promises. Following a temporary shutdown of old coal-fired power plants, the Kori 1 nuclear reactor was permanently closed down on June 19. The government is now reconsidering plans to build new nuclear reactors Kori 5 and 6. The KLSNE and KPTU declare our support for these policies and our intentions to play a leading role in bring about a just energy transition. The government’s establishment of a commission to assess public opinion on the plans to build Kori reactors 5 and 6 on July 24 sparked immediate outcry from nuclear power business interests and pro-nuclear power scholars. The press has exacerbated this conflict with sensational reporting. It is deeply regrettable that those who oppose the government’s policies are speaking only from their individual self-interest without putting forth viable alternatives. It is even more regrettable that the voices of workers at the Korean Hyro & Nuclear Power Corporation and other nuclear-power related companies who support a just transition are being stifled in the process. We stress the importance of recognising the difference between nuclear power business interests and the nuclear power workers. These workers are the people most easily exposed to radiation and at the most risk in the case of accidents. Electricity and gas workers, who have been discussing paths for a just transition for many years now, are sure that nuclear power workers will soon join us in this effort. During the last nine years of conservative rule, South Korea’s energy policy has been focused on restructuring aimed only at meeting the interest of corporations (i.e. privatisation). The result has been the expansion of nuclear power and private coal and LNG generation and massive profits for corporations. Energy policy has been consistently undemocratic and anti-climate. With South Korea now facing the threat of earthquakes and air contaminated with fine dust it is only natural that we energy workers, who have fought for almost two decades to stop privatisation and protect our public energy system, would take a leading role in the fight for a just energy transition. Given the scale on which a transition must take place, it is predictable that many conflicts will occur among the various stakeholders involved. Nonetheless, we must seek the best path for transition by applying a standard of justice based on public safety, happiness and public accountability. This requires moving away from an energy policy based on the interest of big business towards one that seeks to minimise the harm to ordinary people and workers, while strengthening public accountability and democratic control. As can be seen in the statement entitled ‘The Korean Power Plant Industry Union Welcomes President Moon Jae-in’s Enactment of Measures to Reduce Fine Dust, released on May 16, the majority of energy workers support the policy of phasing out coal and nuclear and scaling up clean renewable energy and are ready to put our collective future ahead of immediate personal interests and participate actively in the process of energy transition. Energy transition must not mean that all the burden is put on the public through increased electricity or gas prices or onto workers through job cuts. Large corporations, which for years have enjoyed subsidies and guaranteed profits while they contribute to climate change, must pay their fair share of the costs. In addition, the new government’s policies can only be enacted if the differing positions of various stakeholders are mediated in the process of mapping out the transition. The most immediate goal of the transition must be the provision of a safe and reliable supply of electricity and gas, and a fair repositioning of energy workers as producers. These tasks will be achievable if the energy industrial is reformed to function as a public asset under public control, which would correct for the distortions caused by the drive towards privatisation led by conservative governments and business interests over the last several years. Around the world large energy corporations are the main obstacles to energy transition policies. For this reason it is important that the government, the National Assembly, the public, environmental and other civil society organisations and energy industry trade unions work together to come up with a plan for democratic control over energy capital. The problem of employment for energy workers that will necessarily occur can also be solved through a publically controlled transition and democratic reform of the energy industry. Within the overall framework of a ‘just public energy transition’ we seek not only to tackle the issue of employment, but also to increase public...
Categories: Friends of GEO, SE News

How Capitalist Central Banks Have Been Creating The Next Financial Crisis

August 17, 2017 - 11:00am
Above Photo: Jonny White/flickr/CC As central bankers, finance ministers, and government policy makers head off to their annual gathering at Jackson Hole, Wyoming, this August, 24-26, 2017, the key topic is whether the leading central banks in North America and Europe will continue to raise interest rates this year; another topic high on the agenda is when the three major central banks – the Federal Reserve, European Central Bank and Bank of England – might begin to sell off their combined $9.8 trillion dollar balance sheets that they accumulated since the 2008-09 banking crisis. But the more fundamental question – little discussed by central bankers and academics alike – is what are the likely effects of further immediate rate hikes and/or commencement of central banks’ balance sheet reductions? The assumption is further rate hikes and sell-offs will have little negative impact on the real economy or financial markets. But will they? The effects of hikes and sell off will prove the opposite of what they predict. Central banks in the US and Europe were grossly in error predicting in 2008 that massive liquidity injections and zero interest rates would re-stimulate their economies and return them to pre-crisis real GDP growth rates. They are now about to repeat a similar error, as they presume that raising those rates, and retracting excess liquidity by selling off balance sheets, will not have a significant negative impact on the real economy or financial markets. Central banks’ balance sheets have been growing for almost nine years, driven by programs of zero-bound (ZIRP) interest rates and the introduction of firehose liquidity injections enabled by quantitative easing, QE, bond and other securities purchases. After eight years, the official consensus among central bankers and government policy makers is that the 2008 shift to unlimited central bank liquidity and zero (or below) interest rates is now over. The front page business press and media lead story is that central banks are now about to embark collectively in a new direction – raising their benchmark rates and selling off their massive, bloated balance sheets. But don’t bet on it. They may find sooner, rather than later, that rates cannot be raised much higher and that balance sheets—now totaling $9.8 trillion for the US, UK and Europe alone—may not be reduced much, if at all, without provoking a further slowdown of their still chronically weak real economic recoveries, or without precipitating a serious contraction in equity, bond and other financial asset markets. Globally, balance sheet totals are actually far greater than the $9.8 trillion accumulated to date by the big 3 central banks—the Fed, Bank of England, and European Central Bank. When other major central banks, like Switzerland’s, Sweden’s, Canada’s and others are added, it’s well more than $10 trillion. And then there’s the nearly $5 trillion balance sheet of the Bank of Japan and the more than $5 trillion of the People’s Bank of China. Worldwide, central banks’ balance sheets therefore exceed well over $20 trillion…with the total still growing. It’s equally important to understand that the $20 trillion in central bank balance sheet debt essentially represents bad debt from banks, corporations, and private investors that was in effect transferred from their private balance sheets to the balance sheets of the central banks as a result of nine years of bailout via QE (quantitative easing), zero interest rate free money, and other policies of the central banks. The central banks bailed out the capitalist system in 2008-09 by shifting the bad debts to themselves. In the course of the last 9 years, the private system loaded itself up on still more debt than it had in 2007. Can the central banks, already bloated with $20 trillion bail out bankers and friends once again? That’s the question. Attempting to unload the $20 trillion to make room for the next bailout—as the central banks now propose to do—may result, however, in precipitating the next crisis. That’s the contradiction. Attempting to sell off such massive balance sheet holdings will prove far more daunting than those central banks now anticipate. And their coordinated raising of interest rates risks precipitating another recession – given their fundamentally weak economies with chronic low bank lending, slowing investment, stagnating productivity, contracting public investment, and lack of real wage income gains. For the global economy has undergone a major structural change in recent decades that has been rendering central bank interest rate policies increasingly ineffective with regard to stimulating real investment and growth, while simultaneously contributing to further financial fragility as well.1 The US Economy is Fragile and Weakening—Not Robust and Stable All eyes are on the US central bank, the Fed, and what signals it gives at the Jackson Hole August 24-26 gathering, and the Fed’s subsequent policy committee in September. Will it continue to raise rates? Will it announce formally a schedule for balance sheet reduction in September? If the latter, will the announcement of sell-off be so minimal and token that it will generate a mere 0.25% hike in rates by year end 2018, as some pundits predict? Or will the psychological effects on investors – who have enjoyed eight years of record equity, bond, property, and derivatives asset price and thus extraordinary capital gains – consider the announcement as the signal to “cash in” and take their money and run, given the bubble levels already attained in equities, some bond markets, and real estate? And should the Fed continue to raise interest rates at a pace of 3 to 4 a year, what will be the impact on the US real economy? Economic potholes are beginning to appear in a number of places. Bank lending to US business has declined sharply, now growing at only 2%; consumer loans for auto, mortgages and credit cards have halved over the past year; real investment and productivity have nearly collapsed; the so-called “Trump Bump” has dissipated; government investment has contracted below 2007 levels and infrastructure spending is still but a discussion envisioned for 2019 at the earliest, if...
Categories: Friends of GEO, SE News

Federal Bank Regulator Drops A Bombshell As Corporate Media Snoozes

August 14, 2017 - 8:00am
Above Photo: Andrew Harrer/Bloomberg Graphic Provided by Thomas Hoenig, Vice Chair of the FDIC, to the Senate Banking Committee in his Letter of July 31, 2017 Last Monday, Thomas Hoenig, the Vice Chairman of the Federal Deposit Insurance Corporation (FDIC), sent a stunning letter to the Chair and Ranking Member of the U.S. Senate Banking Committee. The letter contained information that should have become front page news at every business wire service and the leading business newspapers. But with the exception of Reuters, major corporate media like the Wall Street Journal, Bloomberg News, the Business section of the New York Times and Washington Post ignored the bombshell story, according to our search at Google News. What the fearless Hoenig told the Senate Banking Committee was effectively this: the biggest Wall Street banks have been lying to the American people that overly stringent capital rules by their regulators are constraining their ability to lend to consumers and businesses. What’s really behind their inability to make more loans is the documented fact that the 10 largest banks in the country “will distribute, in aggregate, 99 percent of their net income on an annualized basis,” by paying out dividends to shareholders and buying back excessive amounts of their own stock. Hoenig writes that the banks are starving the U.S. economy through these practices and if “the 10 largest U.S. Bank Holding Companies were to retain a greater share of their earnings earmarked for dividends and share buybacks in 2017 they would be able to increase loans by more than $1 trillion, which is greater than 5 percent of annual U.S. GDP.” Backing up his assertions, Hoenig provided a chart showing payouts on a bank-by-bank basis. Highlighted in yellow on Hoenig’s chart is the fact that four of the big Wall Street banks are set to pay out more than 100 percent of earnings: Citigroup 127 percent; Bank of New York Mellon 108 percent; JPMorgan Chase 107 percent and Morgan Stanley 103 percent. What’s motivating this payout binge at the banks? Hoenig doesn’t offer an opinion in his letter but he does state that share buybacks represent 72 percent of the total payouts for the 10 largest bank holding companies. What share buybacks do for top management at these banks is to make the share price of their bank’s stock look far better than it otherwise would while making themselves rich on their stock options. If just the share buybacks (forgetting about the dividend payouts) were retained by the banks instead of being paid out, the banks could “increase small business loans by three quarters of a trillion dollars or mortgage loans by almost one and a half trillion dollars.” Hoenig also urged in his letter that there be a “substantive public debate” on what the biggest banks are doing with their capital rather than allowing this “critical” issue to be “discussed in sound bites.” Most corporate media responded to this appeal by ignoring Hoenig’s letter altogether. How 10 U.S. mega banks developed such a stranglehold on the U.S. financial system that they are in a position to starve the U.S. economy of $1 trillion in loans was explained in detail by Hoenig in a speech he delivered at the Conference on Systemic Risk and Organization of the Financial System at Chapman University in Orange, California on May 12. Hoenig stated: “Following Gramm-Leach-Bliley [legislation in 1999], commercial and investment banks began a series of significant mergers that affected the combined industries in a profound way. “Investment banks originally were formed as partnerships, where owners were liable for all of the firm’s debts. When the New York Stock Exchange relaxed its rules to permit joint stock corporate ownership in 1970, over time it became an attractive opportunity for the investment banking industry to grow and expand its business model. Investment banks that converted to public companies altered the incentives of owners and management, increasing appetite for risk and leveraging balance sheets. The further effect of combining insured commercial banks and investment banks under Gramm-Leach-Bliley magnified these outcomes. In the end, there was a profound change in industry culture that further changed the competitive dynamics among firms. As universal banks formed and matured, and with increasing support from the expanding safety net, the largest banks were increasingly drawn away from relationship banking and lending and toward the higher risk-return model of the broker-dealer-investment bank focused on trading and other fee-based income. “Of course a pivotal force of change was the financial crisis of 2008 itself, out of which came more than new legislation. The effect of the crisis on the U.S. economy, the numerous bank failures, and the government’s response in addressing those failures dramatizes accelerated industry consolidation and altered its structure and direction in ways that will have lasting effects. JPMorgan Chase acquired Bear Stearns with government assistance, and subsequently acquired Washington Mutual after it failed. Wells Fargo acquired Wachovia. The government injected capital into Citibank, thus bailing it out. Bank of America purchased Countrywide and Merrill Lynch, and later also received extraordinary government assistance. After the failure of Lehman Brothers, regulators allowed two remaining investment banking firms, Goldman Sachs and Morgan Stanley, to become bank holding companies, providing them explicit access to the federal safety net. In short, the crisis and government’s reaction to it quickly and dramatically changed the composition and structure of the U.S. financial system. “The crisis altered the industry’s structure in other ways as well.  Between 2008 and 2014, there were 507 bank failures and 1,576 private mergers, mostly among community banks; and practically no chartering activity. Among regional and community banks, this trend toward consolidation continues nearly a decade after the crisis.” In summary, while the reckless Wall Street banks brought on the crises, the Federal Reserve rewarded them in the midst of it by allowing the biggest banks to gobble up other banks, thus becoming a greater future threat to the nation in terms of controlling deposits and lending as well as presenting unfathomable levels of risk going forward. This is a critical issue...
Categories: Friends of GEO, SE News

Wells Fargo’s Lyin’ Cheatin’ Ways: Banking With A Sociopathic Institution

August 14, 2017 - 7:00am
Above Photo: From Occupy.com …And How To Let Go Are you facing serial cheating, abuse, lies, ongoing stress about money, issues of fidelity, questions about your future and are at a loss as to where to turn? Do you often feel angry, taken advantage of, less than, a voiceless victim? Did you put your trust and your nest egg, your faith and your money on someone or something that took you for all you’re worth, jilted your faith in the institution and robbed you blind? Deep down, do you think you may be going steady with a good looking grifter? I hate to tell you this, but you may be banking with a sociopath. That’s right. That harmless tall handsome stone wall that promises you the world, smiles at you shamelessly through bulletproof glass and marble floors, black suits and lollipops, is a sociopathic lover out to take all that you hold dear. All that you’ve put your faith, and money, into. This is not fifty shades of gray. It is now clearly black and white. Do you still bank with Wells Fargo? Can we talk? Maybe you have a thing for bad boys? Fast talking flashy – “Here’s a new credit card, baby,” Scaramucci-style pinky ring? Maybe you have low self esteem issues, looking for a paternal ideal of what it means to be rich, to be safe, to have your nest egg all wrapped up for a bright and comfortable future. Maybe, just maybe there’s still time to save yourself and what’s left of your self worth. I’m gonna give it to you straight: Wells Fargo is the banking equivalent of the Menendez Brothers. I know you know, but what have you done to help yourself out of this kind of relationship? Some people have a thing for danger, a high tolerance for risk. Some even reap rewards for being a victim. Many hold the notion that size matters while others are innocent and naive to the ways of sophisticated criminals. As astute as we may think we are, with where we invest our time and money, we have a lot on our plates in life just trying to keep up with all that’s running around our brains, the news, the economy, the climate, the robotic take over of our bright futures, that sparkling dress in the window….the vacation we never get to take. Most of us grew up thinking we would have a home like our parents, a regular job that hopefully we liked or could tolerate, a car or two, 2.5 children and a dog in the yard. Let’s throw in a tire swing out back, a toothy braces-covered smile and white sheets on the line just for ambiance. Feeling safe yet? Something happened in the late 1970s and 80s that shifted and the “American Dream” started to rot slowly from the basement paneled mold on up. The institutions we put our faith in as steady and unshakeable began to shift their attention away from safety and reliability and got a wandering eye toward Vegas-style philandering, shimmering lights, spinning wheels, fatter dividends and the big short as opposed to the long slow steady-as-she-goes building of a wholesome relationship. Let’s look at the cold hard facts of what we have witnessed and been a party to over the last decade in our relationship with Wells Fargo. Yes, you have to claim personal, financial and ethical responsibility as well if you are to heal and move on. If you didn’t have trust issues before, you will now. Now you’re damaged goods, simply by association. As painful as it is, the first step to healing is to take a cold hard look at the issues that led us down this path – issues we face now that the harm has been done – and figure out what we can do to move on with our lives. Cue the song, “You’re no Good.” Let’s begin our intervention, shall we? Let me explain; just hear me out and try to have an open mind as I pull down the screen and elongate my pointer stick for you. Hit the lights. occupy.com RECENT SUMMARY OF WELLS FARGO The bad boy ways of this financial institution that you were banking on, and with, include but are not limited to: Over 800,000 people with force-placed car insurance at inflated rates. Illegal repossession of active military service members’ cars and homes. $185 million so far in “settlement” money paid for the fake account scandals that will harm people’s consumer credit for years to come. $12 million and counting in violations of fair credit reporting. Violations in the False Claims Act and Securities Act of 1933. Trust fraud, negligence, illegal kickbacks to mortgage brokers for referrals on title insurance. Blackballing appraisers that didn’t inflate values. Millions of phony accounts, forged signatures and credit cards illegally opened in customers’ names. Forged mortgage documents by hired temps, discrimination against minorities, predatory lending, unpaid overtime to employees. Firing of employees who reported fraud regarding the fake accounts. Excessive ATM and overdraft fees. False denials for loan modifications, negligence and harm to mortgage customers inducing them to default on their mortgages. Violations in TILA and RESPA (Truth in Lending Act and Real Estate Procedures). False affidavits, conspiracy, wrongful foreclosures, selling properties that Wells did not have the note or right to sell. Violations of the Fair Debt Practices Act. Lying and cheating to Wells investors. Insider trading on stock, unfair business practices, kicking puppies, and more. I could go on but I don’t want you to hate yourself. Consider this a wake-up call for your future well being. Do you want someone you care about being treated this way? Do you want your kids to have relationships like this? It’s for your own good and that vision board of a happy ending. I know it’s heartbreaking. It’s hard to change, to let go and move on, even from something that hurts us. It’s a sad and rude awakening to...
Categories: Friends of GEO, SE News

Britain Spent ‘Twice As Much On Overseas Fossil Fuels As Renewables’

August 14, 2017 - 7:00am
Above Photo: A vendor weighs coal for a customer in Lucknow, India. The country has been one of the top five beneficiaries of UK energy support this decade. Photograph: Rajesh Kumar Singh/AP Nearly half of £6.1bn energy spending in developing countries from 2010-14 went on oil, coal and gas-fired schemes, data shows The UK has spent more than twice as much overseas support on fossil fuels projects as on renewable ones so far this decade, according to research commissioned by the Catholic aid agency Cafod. The Overseas Development Institute, which analysed the figures, found that 46% of Britain’s £6.1bn energy spending in developing countries between 2010 and 2014 went on oil, coal and gas-fired schemes, compared with 22% for renewable energy projects. Overall, fossil fuel support increased by nearly £1bn this decade compared with the previous five years, with a staggering 99.4% of UK export finance support directed towards “dirty” energy investments. Cafod called on the government to clarify how it would bring public support for overseas projects into line with climate commitments under the Paris agreement. Dr Sarah Wykes, Cafod’s lead energy analyst, said: “To tackle climate change we have to leave fossil fuels in the ground and switch rapidly to renewable sources of energy. “Yet the UK carrying on a business as usual spending pattern overseas in recent years suggests a huge inconsistency in policy and a missed opportunity to promote greater investment in renewable technologies, as the Department for International Development (DfID) has tried to do through its spending.” While UK export finance uses public funds to bolster British exports, DfID’s energy spending – 32% of which went to renewables compared with 22% for fossil fuels – is intended as overseas aid The top five beneficiaries of UK energy support this decade were Brazil, Vietnam, Turkey, India and the Russian Federation, according to the ODI figures. Of the money earmarked for fossil fuels, oil and gas received a total of 87% of UK funds, with 9% going to coal. “It doesn’t make sense for there to still be any public money going into fossil fuels overseas, whether that’s through aid money, loans or export finance to support British companies operating overseas,” Wykes said. Aid agencies see support for small-scale solar and wind projects as vital for connecting poor communities in remote areas to electricity grids. But only 8% of British aid spending aimed to improve energy access for the poor, Cafod said, despite the UK having signed up to a UN sustainable goal of ensuring universal energy access for all by 2030. Twenty-nine per cent of UK energy aid in 2010-14 went to investments using fossil fuels and renewables, or where the energy source could not be identified. One per cent was spent on nuclear power and 2% on energy efficiency.
Categories: Friends of GEO, SE News