Tracking the Meltdown: Sweating the Small Stuff [updated]

The big economic news is all over the place—lately the truly dire unemployment figures which have administration officials suddenly hemming and hawing instead of bragging about “green shoots.”

But the unfolding depression is making its mark in a thousand pinpricks of pain as well. A newspaper that will flesh this point out a bit just rose to the top of one of the piles here at Casa FotM. It’s an issue from last month of The Millbrook Independent—a six page weekly whose masthead proclaims “Serving Millbrook and Stanfordville and the Greater Millbrook Region” in Dutchess County, New York.

Along with coverage of wetlands regulations and high school math scores were two articles that illuminated unexpected aspects of the crunch.

One, on the front page, plugged a new “state of the art” storage facility opening in a former bowling alley in Mabbetsville. It struck me as perhaps an unfortunate business to be starting in this climate, but the owner had a quote which led me to reconsider: “With the huge advent of home offices, people now need to store what was once in that room.”

And damned if the NYC exurbs aren’t fuller than ever of folks freelancing after losing their jobs. And one woman of my acquaintance is working most of the week at home on the computer for the big name financial firm she used to commute to every day.

The other story in The Millbrook Independent, on page 5, celebrated a local dairy cow, judged the #2 Holstein in the US. The owner, Stephen Van Tassell, explained that this ranking had permitted him to keep the farm’s finances above water by the sale of Sheray’s embryos. Otherwise things didn’t look so good with bulk milk selling for $11.70 a hundredweight “about as low as it’s been in the past, but our costs are higher, around $19 cwt, so the damage is greater.”

Even more significant, this little seven paragraph piece includes striking evidence of neoliberalism’s effects on US agriculture, combined with the impact of the contraction of global trade since the credit crisis broke:

What happened to getting milk prices pegged to regional production costs?

"It’s gone exactly the other way,” Stephen explained. “Now our prices are based on national and international supply and demand. Last year, we [the American dairy industry] exported about 15 percent of our US production. This year we are down to two or three percent. China seems to be importing less."

UPDATE:

A whole other angle on this from my sweetie, Dody. She points out in Cornwall, CT, the nearby small town where she lives, there are now three small dairies which pasture their cows year round and bottle their own milk—two selling raw milk and one pasteurized but not homogenized—and all three are doing well. One guy I know with a largely Jersey herd mentioned that demand for his milk was so great that that he was 20 gallons short on a store order last week.

This may be one of the positive effects of the crisis—accelerating the trend of people turning to healthier, locally-produced foods, including stuff they raise themselves, and in doing so, making smaller scale, environmentally sound agriculture economically feasible again

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Building & Winning: Left Response to the Economic Crisis

[Ever look at the right hand column here at FotM? There are two Key Links there. One is for the Freedom Road Socialist Organization/Organización Socialista del Camino para la Libertad. Fire on the Mountain just wants to pull everybody's coattail to some changes at the Freedom Road website. There's a snappy redesign, still ongoing and including easier navigation.

More important, there's been an increase in the frequency with which new articles are posted, and some damn interesting ones have gone up. This is one of them, reposted here because in reporting on one city, Portland, OR, it sketches some of the tasks as the New Depression deepens. So, please check out the Road's new improved website--and bookmark it. More good stuff coming right up, we understand.]


Written by Patrick Ryan
Saturday, 07 March 2009

“The Master's Tools Will Never Dismantle the Master's House.” - Audre Lorde

It has been credited to the life of Oregon activist Tom Bernard, who not only thought it up, but provided the initial sketches for his idea: a local “town hall” style meeting of the Left in Oregon, bringing together the dispersed and diffuse groups to coordinate effective responses to the economic crisis. Tom unfortunately did not live to see his idea manifest on January 31st, 2009, when a mass gathering of 900 activists and community members was held in Portland, Oregon, to learn, discuss and organize a response from the Left.

The guiding principle of the town hall was that “getting back to some pre-meltdown state is inadequate,” and that allowing people to wait and see how the government would respond would not win any real victories. Organized initially by the local Jobs with Justice, the town hall brought participants from unions, churches, and antiwar groups. Teachers, students, parents and activists got together to complain about the state of things but also to equip themselves with the tools and organization to change it.

Martin Hart-Landsberg, a noted professor of economics and writer for Monthly Review, gave a succinct breakdown of the events leading up to the crisis, and insisted that economic democracy is as much of a right as political democracy, and that it is ours to win. Local labor leaders demanded that working people defend the rights of immigrant brothers and sisters. Jo Ann Bowman from Oregon Action explained how people of color in the Northwest were “never the problem, but those who paid for [the problem].” In what can only be described as an electric feeling from the audience, respected veteran activist and Teamster Tom Leedham said, “If workers wage an aggressive fight, we can win. Now is the time to go on the offensive!”

Town Hall

Participants then worked in groups to discuss issues on various topics such as better wages, accessible health care, affordable housing, local environmental sustainability, democratic unions, and strengthening local democracy. Affordable housing, for example, is blocked by state exemptions that prevent measures like rent control. Unemployment stands officially at 9.9%, which ranks Oregon among the highest in the country. Hundreds of homes have already been foreclosed on, and the hardest hit have been the neighborhoods of color. After learning the stark reality, groups then learned what organizations and resources were already available to help, and how to strengthen them or build new resources.

Activists around the country will be mobilizing to fight for the improved conditions for the people and not more wealth and power for the absurdly wealthy, who, with capitalism, caused this problem in the first place. This is the point we need to promote among our friends and families. Capitalism got us here and the people organized and mobilized to win will be the ones who solve it.

Firmly understanding that this crisis will be different than past ones, possibly even worse, will be the basis for organizing a strong and effective Left resistance. We are already watching this crisis produce suffering for working people, especially those of color: massive layoffs, rising unemployment, cutbacks in state and local budgets, and millions of foreclosed and lost homes.
All of those are only the immediate problems, which overlook the larger looming ecological crisis.

The town hall saw itself as a beginning of something larger. Organizers invited participants to problem solve in an open and democratic way and got the message out on local listservs and mailing lists and the local independent media. The town hall ended with a message of inspired activism that works to sprout many more teach-ins, church meetings, protests and demonstrations that put the tremendous opportunities for the Left up for grabs. It was the beginning of a dialogue “toward building an economy good for all working people.” The energy and motivation was followed by a meeting a few weeks later to sum up the town hall and determine focus areas of struggle. They expected about fifty people to come, but over a hundred did, and they brought friends. The primary focus that emerged from those discussions was the need for local democratic control of city and state budgets, and the people-power to struggle against attempts to privatize resources.

What activists and community members took from this event was the knowledge that we are facing historic challenges and unimaginable difficulties, but also profound and equally historic opportunities. Basic people are questioning this whole system and its legitimacy. They wonder why their children receive no health care or slashed food stamps when the ruling rich are taking million dollar vacations. They say we're all “in this together.” The word “socialism” is being used again in popular discourse, of course with the tired old rhetoric and equations claiming that socialism is some kind of safety net for the rich. We know that isn't socialism.

The corporate media have us believe that we all have to tighten our belts. But our communities have been tightening our belts for a long time and we say it's time for the rich rulers to tighten their belts by ending their wars of aggression, and providing us with real health care, living wages, and livable housing. We will not allow the mess the capitalists have gotten us into to scapegoat immigrant workers, deepen their racist programs, and strengthen their privatization efforts. Going “back to the way things were,” as the town hall said, is completely inadequate. We want a better world, and we will win.

Patrick Ryan is a member of FRSO/OSCL and student activist in the Portland, Oregon area who has worked with a number of labor and community organizations.

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Afraid?

The following leaflet offers a short, sharp approach to the deepening depression, leaning heavily on militant local actions--asap. It is from the NY/NJ district of the Freedom Road Socialist Organization/Organización Socialista del Camino para la Libertad. It was distributed at the big union demonstration (circa 25,000, though it's hard to tell with police "crowd control" tactics) near City Hall on Thursday.

AFRAID?

It's hardly surprising if you are. Fear is a rational response to an economy crumbling more visibly every single day. Fear strikes when we see friends and family members laid off or losing their homes. What's bad is when fear becomes paralysis and not a spur to action.

Thousands and thousands of us are here today to stop the gutting of our already underfunded public education system. Unprecedented cutbacks and layoffs are already underway. As the economic meltdown deepens, even more brutal attacks on public services are in the offing.

Everyone hopes that this disaster will be staved off by President Obama's budget and stimulus package. It does offer important programs to mitigate the damage, and those programs are under fire from the banksters and Wall Street bigshots. But it also includes $150 billion more for the banks that drove the economy over a cliff in the first place, on top of the trillions already thrown away on them.

We need to face facts: the capitalist financial system is broken. The banks themselves are broke, hopelessly insolvent. They are beyond the point of rescue. The banks may wind up nationalized soon--which means we, the taxpayers of this country, will own their huge debts and toxic "investments." It would probably be better to let them go under. Use those trillions insetting up new smaller banks and a new financial system, to rescue homeowners and to invest in infrastructure and productive businesses.

Our cities and towns, our people need every dime of those trillions. And we don't have much time to lay claim to them. The old saying goes:

"Use what you've got to get what you need."

We don't have money, and we don't have direct access to the corridors of power. What we've got is anger. And numbers.

The banksters and politicians are afraid of the future, too, as their system collapses. The problem is that they are not afraid of us. We need to use our anger and our numbers to strike fear, cold terror, into the hearts of the politicians and policy makers as they plan more cuts, more layoffs, more giveaways to Wall Street and the banks.

Sparks of struggle have been spreading in recent weeks:

ACORN is training "Home Defense" teams to resist foreclosures.

Students at the New School and NYU seized buildings to stop tuition hikes and demand financial transparency.

Young folks in Block Movement use Unlimited Ride MetroCards to let people in poor communities ride free as transit fare hikes loom.

Right to the City, a coalition of community-based groups, disrupted Mayor Bloomberg's "Future of NY" dog and pony show.

We need more of this angry, militant resistance, lots more. And the sooner, the better. It's the only thing they'll listen to.

When the people resist, it is the perpetrators who fear US!

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When the chickens get privatized,

it's vultures that come home to roost.

The subprime mortgage crisis isn't over. Neither is the global credit freeze it sparked. The stock market crash that followed hasn't hit bottom yet either. But the main thing to worry about now, and for a long time to come, is the depression we are rolling and tumbling into.

The media has started reporting on one increasingly visible aspect of the depression: the budget crunch facing states and municipalities, and the resulting cutbacks in public services. News stories have detailed the end of the shuttle program Phoenix, AZ ran to take seniors grocery shopping, Mayor Daley's elimination of 2250 Chicago city jobs--900 by layoffs, warnings of unsalted roads in rural Wisconsin this winter, and on and on. And it's early days yet.

The service cuts I want to highlight today are a little different. Let me direct your attention briefly to the Los Angeles County Metropolitan Transportation Authority, which serves 1.5 million rail and bus passengers every day. Yep, even in auto-centric L.A., a lot of folks, especially poor folks, can't make it without public transportation.

Terry Matsamuto, the MTA's chief financial officer is predicting massive service cuts soon. It seems that like many local governments around the country, L.A. County went for the okey-doke. They sold much of their system to private investors in "lease-back" deals. Companies like Wells Fargo and Philip Morris bought the rail system, 1000 buses and parking and maintenance facilities. The Tranist Authority gets a one shot injection of needed cash, the financiers get a steady annual cash flow bled out of the system.

The rail cars and locomotives of the Metrolink commuter rail system were also sold, and guess who financed and insured these deals?

American International Group.

Yep, AIG. And when AIG started going into cardiac arrest, their credit ratings were revised downwards before the Fed even applied the paddles.

The lower credit ratings triggered a clause in the lease-back agreements that require the MTA to either find a new firm to guarantee the deals or reimburse investors for their down payments and lost tax benefits, a scenario that could cost the transit agency between $100 million and $300 million.

For one thing, forget about finding a replacement lender--credit is still frozen, static. Second, once other clauses in the deal kick in, the MTA could be on the hook for $1.8 billion this year, more than half its total annual budget.

All those investors have to be made good somehow. So the service cuts commence.

I can't wait to see what L.A.'s Bus Riders Union does about this...

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