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In my lifetime (1940-so far, so good) the biggest historical question has always been, “Why didn’t the German people stop fascism?”

nazis-people2

Book Review: Erik Larson, “In the Garden of Beasts,” Crown, New York, 2011

When we meet people from Germany, we start looking for the right opportunity to, politely, ask them. When we read the histories, it’s what we want to know. “In the Garden of Beasts” relates the personal histories of the four family members of Professor William E Dodd, Ambassador to Germany 1933-37.

Worldwide attitudes toward the Nazis ranged from admiration to revulsion when Dodd moved to Berlin. Like most people, his family fell somewhere in between. Dodd felt that his role was to be an intermediary without strong bias. That changed over time and the course of this book.

Probably the most detailed account comes from vivacious daughter Martha Dodd. That may be because she wrote the most and lived the longest. It may also have been because she was more involved with more people and with people of more disparate political views. One of her lovers was a communist who worked in the Soviet Embassy; another headed the Gestapo, and there were several in-between.

Hitler had already been elected to high office before the Dodd’s arrived, and his popularity was already rising to fanatic levels. But he didn’t really consolidate all his power until the period that the Dodd’s experienced up close and personally. While they were there, he murdered some of his rivals and outlasted General Hindenberg, the only single person who could have stopped him.

Interestingly, Dodd had his detractors within the State Department all along. Especially after he began to condemn the Nazis, powerful Americans wanted him removed and finally had their way. His successor was still apologizing for Hitler at the end of the book. According to this author’s account, President Roosevelt supported Dodd’s view, but was forced to acquiesce in getting rid of him.

After Dodd returned to the United States, he toured the country to warn about fascism. Martha, too, worked against the fascists, but, like many others, she had to seek exile during the post-war witch hunt.

So, why didn’t the Germans stop Hitler? The best answer I got by asking came from a World War II veteran (their side, not ours) living in Dallas. He said, “The Nazis got people jobs.” Hitler came to power during the great worldwide depression. German unemployment was 25%. That’s why it was so easy for the relatively wealthy National Socialist Party to recruit young men into their Stormtroopers. After they took power, the Nazis started their great military building, which eventually overcame the worst of their unemployment problem. That’s a partial answer to the question, but not a fully satisfying one.

The real answer may never be found by asking individual Germans or reading history books. The real answer has to do with comfort zones, lack of understanding, lack of organization, miseducation, and lack of will. The reasons the German people didn’t stop fascism, even though they could see it, are the same reasons that the people of the United States have not yet stopped the trend toward fascism here. Let’s start asking about that!

–Gene Lantz

I am on KNON radio’s “Workers Beat” program every Saturday at 9 AM Central Time. Podcasts are on Itunes. If you want to know what I really think, check out my personal web site

 

Movie Review:

“Never Going Back,” directed by Augustine Frizzell, 1 hour 26 minutes

“Puzzle,” Directed by Marc Turtletaub, 1 hour 43 minutes

This is the year of the women in movies as well as elections. My movie buddy and I caught two better-than-average films this weekend.

waitresses-stoned

Jessie and Angela are two wild teenaged waitresses in “Never Going Back.” Agnes is a straightlaced housewife in “Puzzle.” There are light moments, but neither movie is a comedy. Both of them ring true as comments on the lives of contemporary American women.

Jessie and Angela are parent- and school- free waifs just about to turn 17. They live with Jessie’s older brother. He is a stoner and aspiring drug dealer. He has even less sense than they do. He tries to borrow money from them while they save up to spend a weekend on the faraway beach in Galveston. The movie, takes place in Garland, Texas,  next to Dallas.

The viewer would probably respect the young women a lot more if they weren’t such zany outlaws, but he/she would probably care for them less. I worried about them all the way through the film.

I wasn’t worried about Agnes in the other movie, but I was pulling for her. As the film begins, she is taking care of men, her husband and two nearly grown sons. Before that, she took care of her father. “You’re the boss,” she cheerfully tells her husband at one point.

But Agnes has a secret. She’s taken up competitive jig saw puzzling with an exotic man in the big city. Agnes guides herself through big changes, but she is never entirely out of control. One admires her all the way through the film.

Both movies are well done. The music is particularly good, and the acting is outstanding.

For moviegoers who are interested in women as victims and women as rebels, these are two pretty good movies.

–Gene Lantz

I am on KNON radio’s “Workers Beat” program every Saturday at 9 AM Central Time. If you want to know what I really think, check out my personal web site

A proposal for Volunteer Organizing Committees in Central Labor Councils.

When unemployment is low and discontent is high, it’s time to organize. The most natural place for effective organizing committees is within Central Labor Councils. Let’s form one here!

org_disorg

Why?

Single-purpose ad hoc committees can win immediate goals. A great example is labor’s effort in turning back the Missouri “Right to Scab” law on August 7, 2018. See President Trumka’s message at:

https://www.facebook.com/TexasAFLCIO/videos/10156423158446153/

But the only way to keep winning is to have a long-term plan, and that means strengthening our progressive organizations, especially our unions, through organizing.

org_organize2

How?

Methods of organizing are on the Dallas AFL-CIO web site. Unfortunately, the site has been changed around so that the page is almost impossible to find without the actual address:

https://www.texasaflcio.org/dallas/get-organized/labor-will-help-you-organize

Where?

The nerve center of labor is the Central Labor Council, and that is where face-to-face meetings need to happen. At the same time, most information is exchanged over the internet today; consequently fewer physical meetings are necessary. Using the internet, it is possible to conveniently share information across long distances.

When?

ASAP

Who?

Unions are no longer constrained to single employers or workplaces. Many unions have associate membership available. The AFL-CIO has a program to allow people to share our political program by joining on-line. More and more, working people’s goals are being accomplished through coalitions with community groups, churches, civil rights organizations, and environmentalists. Our committees can think beyond traditional union organizing drives.

The goal of organizing is not limited to signing up new union members. We can also sign up members for our allies. Furthermore, signing a card is only the beginning of a process of organizing. Signed-up members need to be drawn toward higher levels of participation.

What?

A Central Labor Council Volunteer Organizing Committee can promote the progressive movement. We can gather organizing leads. We can educate and motivate unions and other organizations. Nothing can stop us from organizing. If we organize, nothing can stop us at all!

–Gene Lantz

I am on KNON radio’s “Workers Beat” program every Saturday at 9 AM Central Time. If you want to know what I really think, check out my personal web site

Book Review:

Galbraith, James K “The End of Normal. The Great Crisis and the Future of Growth.” Simon & Schuster, New York, 2014. Dallas library 330.90511 G148E 2014

Some economists, and certainly those dominating the thinking in the labor movement, believe that the period 1945-1973 was “normal” and that our subsequent problems came about because of bad policies. Most notably, we blame Reagan, Reaganomics, and “trickle down” economics. Our intentions are the best, but our economic analysis is way wrong according to the last few economics books I’ve read, especially this one.

The postwar boom was not normal. It was an extremely unusual period of capitalist history during which the United States dominated the economic world. Capitalists reluctantly shared some of their largesse with a powerful and demanding labor movement. By 1973, it was pretty well over. What happened before and what is now happening afterward is normal capitalism: slow growth, rising inequality, international competition, and inevitable crises.

Some economists treat their discipline like a religion. In religion, God has a purpose for everything. He/She tends to restore balance in a world that makes sense. When things seem to go terribly wrong, God is just moving a few things around with balance and purpose His/Her ultimate goal. Religious people think that the universe has some kind of stasis, and everything within it has a natural balance that we will understand someday after we’re dead. “Farther along, we’ll know all about it. Farther along, we’ll understand why” as the song says.

This religious commitment to balance and purpose is contradicted by everything that happens. The universe has no balance: some stars collide with others, planets come and go. Our lives have no balance: we may be growing cancer cells right alongside the healthy ones.

Things aren’t balanced and purposeful. In fact, things aren’t even whatever we think they are. Everything is changing from one type of thing to another. The only “normal” is change. That’s true of economic systems as well. It’s not a religion, and there is no balance and purpose to be “restored.”

galbraithquote

Galbraith seems to know that, and he lashes the many conventional economists whose conclusions are tailored to suit the desires of their employers. You really have to appreciate Galbraith for that.

The author teaches at UT Austin. He’s a wonderful writer. Whether or not he’s a great economist, I suppose, will be revealed over the next few years because, unlike most, he does not believe that America will ever return to the growth period from around 1945 to the 1970s. He recommends that we adjust our policies for an extended period of slow growth. His recommendations are a lot like those of Bernie Sanders.

I wonder what he said two weeks ago when President Trump announced that growth in the 2nd quarter of 2018 had exceeded 4%? If they are able to sustain that kind of growth, then Galbraith was simply wrong, but that one quarter could easily be a fluke. I wrote him an email to ask.

Some of his more contemporary remarks, from January 2018, are on-line:

https://www.marketwatch.com/story/economist-james-k-galbraith-isnt-celebrating-dow-25000-2018-01-08 He correctly predicted that corporations would not invest their ill-gotten gains from the December, 2017 tax giveaway. He says they will just buy back their own stock and drive up stock prices, and that is certainly what happened over the next 8 months.

This is a good book well worth reading.

OTHER REVIEWS:

https://marxandphilosophy.org.uk/reviews/7923_the-end-of-normal-review-by-hans-g-despain/

Reviewed by Hans G Despainent

View comments

James K Galbraith’s The End of Normal, recently published, is a spectacular achievement in political economy generally, as a philosophical critique of the practice of economics and public policy in particular, and for its comprehensive and totalizing explanation of global monopoly-finance capitalism.

…Galbraith contends that not only does financialization generate massive inequality and instability (see Galbraith 2012), but generates opportunities for colossal fraud. Galbraith contends we must “stipulate that the Great Financial Crisis was rooted in a vast scheme of financial fraud”

https://www.goodreads.com/book/show/18144111-the-end-of-normal

Today, four factors impede a return to normal. They are the rising costs of real resources, the now-evident futility of military power, the labor-saving consequences of the digital revolution, and the breakdown of law and ethics in the financial sector.

 

MY NOTES:

Pg10: That bastard Richard Fisher

17 He begins his tale in 1945

21 Effect of communism. At the last chapter, he gives an interesting summary of the economic collapse of the Soviet Union from being a great power to being a total bust

57 Financialization

64 Economists are like monks in a monastery. He handles metaphors very adeptly

67 Capitalism = perfection

68 Stochastic – it means “random”

99 Could this be an error? He says that no gain results from variable costs. Does he think profit comes from fixed costs?

100: Does he think surplus value is produced from energy? Business cycles are caused by technology. Tractors basically caused the great depression by supplanting all the farmers, mules, and horses. Anyway, he thinks resource costs are a big problem. He thinks technology is not going to save us.

164 Explaining the Great Recession: “…fraud took over the financial system because it was expedient to allow it.” The basis for growth ended in the 1970s.

Somewhere in here, he mentions that nobody cares if people move from California to Colorado. I think he’s pointing out that immigration within the Economic Union is a really big problem, but it’s easy within the United States.

222 Cutting Social Security would not help the economy, as they are just transfer payments redistributing wealth but not creating or destroying any

238 There are four obstacles to achieving high growth and full employment:

  1. Energy markets remain high cost and uncertain (this was 2014)
  2. World economy is no longer under the effective financial and military control of the United States and its allies.
  3. Digital technology replaces a lot more jobs than it creates
  4. The private financial sector has ceased to serve as a motor of growth

Pg 241: Why not live in a “no growth” world? He says that our store of capital would not get replenished so productivity would fall continuously

The Soviets were a great powerhouse by the 1960s, but they did not rebuild and replenish their productive abilities and, eventually, lost the technology race. Their production got more and more costly and less and less quality. After the government collapses, the economy really went to hell. GNP dropped by half, life expectancy dropped from 72 down to 58 (pg 259).

He doesn’t think cutting the working hours would be as good as just letting people retire earlier.

Book review:

Piketty, Thomas: Capital in the 21st Century, Belknap Press of Harvard University Press, Cambridge, Massachusetts, London, England, 2014. 332-041 P636C in Dallas Public Library

The library had to renew this book twice before I could finish its 577 pages. Like other books about economics, it is full of Greek symbols, formulas, graphs, and statistics.

inequality

Piketty claims to have accumulated more economic data than any work before him. His facts and numbers go back into the 18th century. His best data is from his home country, France, but he has a lot from U.S., Britain, Germany, Italy. A little data from other countries and a little data from other times going back to the Romans. This book shook the world. His information base is far more comprehensive than anything else I’ve seen or heard of.

It is difficult to argue against someone who has the data, so I won’t argue over facts. But I will argue against his interpretation of the data, and I will argue even more strongly against his suggestions for future action. First, a bit about what he says:

It was very gratifying to see that he doesn’t think that economics can stand as an independent science. It has to be combined with other disciplines, especially politics, to be of any use.

Piketty’s graphs show that the period from roughly 1914 to 1973 was very different from before or after. Inequality was rampant before, it’s rampant now, but it wasn’t so dire during 1914-1973. I’ll call that the abnormal period. Capitalism is now “normal,” that is, it is creating devastating inequality. Piketty asserts strongly that the best solution is a global tax on wealth, not for revenue, but to redistribute wealth and lessen inequality.

During the abnormal period, the author says, there were two world wars and a depression. Governments established strong central banks to deal with the world depression. To pay for their wars, they implemented progressive taxation, especially of income and inheritance. As for the cause of these developments and the subsequent lessening of inequality, Piketty just calls the wars and depression “shocks.”

Were “Shocks” the Cause?

That’s not how I interpret the abnormal period that Piketty revealed. Something else happened 1914-1973 besides a depression and two world wars.

I note that 1914 marked the upsurge of the workers movement worldwide, not just in Russia. In America, for example, socialists were being elected to office, including to the U.S. Congress. I also note that 1973 marked the Sino-Soviet split (Nixon’s trip to China) the beginning of the downturn for the USSR in particular and the worldwide workers’ movement in general. One book I read said that the American labor movement died during Nixon’s campaign for a second term (they didn’t support McGovern). At any rate, the American labor movement’s weakening was certainly visible by 1973.

Inequality was indeed lessened by progressive taxation during the abnormal period, but it wasn’t because of “shocks.” It was because the workers’ movement was waxing strong. During World War I, the Bolsheviks took power and inspired the world movement. During the depression, communists argued that the Soviet Union was the only untouched major economy in the world. After World War II, communists were politically strong because they had led the resistance movements in occupied territories such as France, China and Vietnam; not to mention that the USSR defeated Hitler.

Of course the big capitalist nations raised taxes and granted health care and retirement to workers during the abnormal period! In the face of the threatening workers’ movement, what else could they have done?

But by 1973, the workers’ movement was on the wane in the U.S. and elsewhere. At that point, capitalist nations began to take back what they had allowed, to further undermine the workers, and to drive the Soviets into insolvency.

What drives history?

To put it bluntly: the motor force of history is the class struggle, not various “shocks.”

Now, as for Piketty’s remedy for runaway inequality and eventual disaster: He knows, and says so several times, that his worldwide tax on wealth is not feasible. It would take far more transparency than capitalists will allow to even know who to tax and how much. To think that democracy can impose itself on the capitalist class is to assume that the workers’ democracy movement is strengthening and the capitalist power is diminishing, when Piketty knows the opposite is true.

As inequality increases, and it is increasing greatly, probably far more than Piketty could have predicted when he wrote this great book in 2014, then the power of the wealthy increases as well. They are not just piling up wealth; they are also piling up power. As long as they are in power, they will never allow Piketty’s pipe dream to come true. He knows that.

Disaster Lies Ahead

But Piketty’s assertion that inequality will continue to rise and will become intolerable is irresistible. He must be right. When this certainty becomes clear to everyone, that the rich are getting almost everything and the rest of us are moving close to starvation, the situation will indeed be intolerable. Only three outcomes are possible: devastating world war, fascism or revolution.

–Gene Lantz

I’m on KNON radio 89.3 in Dallas every Saturday at 9 AM Central Time. Podcasts are available through the “events” tab. What I really think is on my personal site.

NOTES:

Uses several Latin and French terms:

A priori – “from before” used to mean that no proof is necessary

“Cadastral” (of a map or survey) showing the extent, value, and ownership of land, especially for taxation.

“Belle Epoque” – Period ending 1914

“a fortiore” used to express a conclusion for which there is stronger evidence than for a previously accepted one.

Pg1 (bottom) He says we need to regain control over capitalism. He’s going to tell us how by the end of this book.

13 Kuznet’s curve says that capitalist growth will even out inequality without any need for anybody to do anything. The market and invisible hand will care for us.

50 Beta = capital/annual income. Usually 6

52 (top) Economics cannot stand alone. Must be combined with politics and other kinds of studies before it yields useful knowledge

52 First law of capitalism Theta = rate of growth times (Capital/annual income)

Theta is capital’s share of national income

r is rate of return on capital

52 Karl Marx quite wrong. My question: Not all capital is invested

Pg86: “They decided to work less” – He ignores class struggle altogether!

87 on consumption. Does he realize that older societies produced and consumed agreat deal that never reached a market? They made their own clothes, for example.

Pg166: Beta = s/g =The 2nd law of capitalism

203 Corporations invented circa 1850

222 Steady rise in Beta and Theta

250: Middle “class” – he means income

270: Measurement is “never neutral.”

275 War & rent control mentioned but not USSR

279 “Income from labor.” I think he is including CEO pay. It’s interesting that he doesn’t seem to know that CEO pay is skyrocketing because CEO’s command the corporate boards that set CEO pay. In other words, CEO pay isn’t “labor,” it’s income from capital.

332 (bottom) CEO Pay

355 Fiscal Competition – nothing so far on class struggle, but I think it explains the first half of 20th century even though he attributes it to “shock.”?

358 Inequality causes political reaction

409 (middle) In the 1970s, people thought that inequality was defeated

423 “rent is not an imperfection”

439 tax on capital

471 “…it was the wars of the twentieth century that, to a large extent, wiped away the past and transformed the structure of inequality.”

why not the class struggle?

471 war, disaster, or Piketty’s global tax on wealth?

473 “The crisis of 2008 was the first crisis of the globalized patrimonial capitalism of the twenty-first century. It is unlikely to be the last.”

474 New instruments needed

475 graph of social spending (class struggle again)

484 Social mobility lower in U.S.

488 Privatizing Social Security?

497 Taxes growing more regressive. Tax competition mentioned over and over. Too bad he wrote this before the Republican tax giveaway of 2017!

500 Bolsheviks. Progressive taxes

509 International competition

514 “No hypocrisy is too great”

518 Capital tax not for revenue but for wealth redistribution

519 Top centile’s growth goes on indefinitely.

Transparency needed

521 How could this be done without a world government? It couldn’t and he knows it

529 Italian was voted out for having invented a wealth tax

534 He is against protectionism and says it creates no value. All this before Trump!

539 “Temptations of defensive nationalism and identity politics…” sounds like he was anticipating Trumpism

541 Public debt solutions: taxes on capital, inflation, austerity

Pg 558 his solution to European public debt is for all the EU to pool their debts and make a common solution. Utopian!

Pg 560 “…the Eurozone cannot do without a genuine parliamentary chamber…” more utopia

560: “Tax competition” used throughout the book. Described here as the various nations lowering their corporate taxes in order to compete with one another. I’ve been calling this “inter-imperialist competition” for years.

His solutions throughout the book are worldwide inter-nation solutions, when he knows that won’t happen. Also, he wrote this before the Brexit vote began a chasm in the EU. He’s assuming more cooperation between nations, not less as we are already seeing.

562: “…without such a European political union, it is highly likely that tax competition will continue to wreak havoc. The race to the bottom continues in regard to corporate taxes…”

566: He agrees with me about bond elections: “…debt often becomes a backhanded form of redistribution of wealth from the poor to the rich…” The wealthy should be taxed instead of allowed to loan money and collect interest.

567 “…debt must be reduced as quickly as possible, ideally by means of a progressive one-time tax on private capital or, failing that, by inflation….”

569: his solution: Economic transparency and democratic control of capital. Neither one of which currently exists.

572: The right solution

574: “Political economy” is the term he prefers

577 (last page) “…economic and political changes are inextricably intertwined and must be studied together.” He prefers “political economy” to “scientific economics.”

The last line of the book: “Refusing to deal with numbers rarely serves the interests of the least well-off.”

OTHER REVIEWS:

Synopsis: https://www.newyorker.com/news/john-cassidy/pikettys-inequality-story-in-six-charts

Piketty’s Inequality Story in Six Charts

By John Cassidy

March 26, 2014

https://www.economist.com/the-economist-explains/2014/05/04/thomas-pikettys-capital-summarised-in-four-paragraphs

The Economist explains Thomas Piketty’s “Capital”, summarized in four paragraphs.

A very brief summary of “Capital in the Twenty-First Century”

http://www.nybooks.com/articles/2014/05/08/thomas-piketty-new-gilded-age/

Why We’re in a New Gilded Age

Paul Krugman

MAY 8, 2014 ISSUE

http://bostonreview.net/class-inequality/marshall-steinbaum-why-are-economists-giving-piketty-cold-shoulder

Boston Review: Why Are Economists Giving Piketty the Cold Shoulder?

MARSHALL STEINBAUM

May 12, 2017

“his work on inequality is an agenda-setting and generation-marking intellectual achievement, potentially as explosive (albeit with a longer fuse) in academia as it has been outside of it.”