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Why Saul Alinsky Is Still Scaring Conservatives

Peter Dreier

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In the 1960s and ’70s, Saul Alinsky, often considered the founder of community organizing, was a popular figure among liberal activists, based primarily on his how-to manuals, Reveille for Radicals and Rules for Radicals, and his reputation as a tough-talking, street-smart agitator who helped poor and working-class Americans gain a voice in battles with politicians and corporations. Now the Republican Party and its right-wing echo chamber are trying to make Alinsky, who died at 63 in 1972, famous all over again, by linking him to Barack Obama and demonizing the president as a dangerous radical.

During his primary campaign, Newt Gingrich constantly invoked Alinsky’s ghost. “The centerpiece of this campaign, I believe, is American exceptionalism versus the radicalism of Saul Alinsky,” he said in stump speeches and television appearances. Or variously: “If you believe as we do in the Declaration of Independence and you think that’s a better source than Saul Alinsky, welcome to the team.” “The president believes in a kind of Saul Alinsky radicalism which would lead to a secular European socialist model.”

The right-wing blogosphere and punditocracy picked up on Gingrich’s fixation. In the last article he wrote before dying of a heart attack in March, right-wing blogger Andrew Breitbart claimed that “the media does not want you to know that the president is a radical’s radical whose presidency itself is a love song to a socialist ‘community organizer.'” The organizer in question was Alinsky. In 1998, according to the Breitbart’s website, Obama, then an Illinois state senator, agreed to participate in a panel discussion following a performance of a play called “The Love Song of Saul Alinsky.” The other panelists, according to Breitbart, included someone who “worked with secret Communist and Soviet spy Lee Pressman to support strikers at Republic Steel in Chicago in 1937” and another who “worked closely with the Socialist Party in the 1950s, becoming president of the local chapter of the Negro American Labor Council, an organization founded by Socialist Party leader A. Phillip Randolph.” Although this event occurred twenty years before Obama was elected president, Breitbart argued that it foreshadowed the covert socialist goals he is now advancing through his presidency.

Gingrich’s rants and Breitbart’s conspiracy theory went viral within the right-wing blogosphere and fed the belief that Obama is a socialist and radical whose administration is guided by Alinsky’s ideas. Breitbart, wrote another conservative blogger, had caught “the president with his hand in the communist cookie jar.” A columnist for the conservative Washington Times claimed that in Chicago, Obama was exposed to “the ruthless tactics and contempt for truth expounded by his guiding light, Saul Alinsky.” The race-obsessed blog site WorldNetDaily (WND) claimed that Alinsky was Obama’s “mentor” and that Obama was Alinsky’s “star student” — ignoring the fact that Obama was 11 years old when Alinsky died. In February, John Fund wrote in the conservative National Review that Obama’s administration was following the “Alinsky playbook.”

Even in 2008, invoking Alinsky had been part of the Republicans’ strategy. In the late 1960s, while a student at Wellesley College, Hillary Clinton had interviewed Alinsky and written her senior thesis about him. During the presidential campaign four years ago, conservatives mined that thesis to tarnish Clinton as a radical. They took bigger swipes, however, at Obama, who had been a community organizer for three years in the 1980s in Chicago and had acknowledged being influenced by Alinsky’s writings and ideas. In her September, 2008 speech at the Republican convention, Sarah Palin mockingly said, “I guess a small-town mayor is sort of like a community organizer, except that you have actual responsibilities.” A few days later, Rudy Giuliani claimed on the television talk show Meet the Press that Obama had been recruited to Chicago by “a Saul Alinsky group” with “a very core Saul Alinsky kind of almost socialist notion that [government] should be used for redistribution of wealth.”

After Obama entered the White House, Fox News’ Glenn Beck constantly linked him to Alinsky, whom Beck viewed as a Marxist Machiavelli whose ideas for radical change had infiltrated the Democratic Party and mainstream liberalism. After Beck left Fox News last year, his former colleagues continued the campaign. Bill O’Reilly told his audience that Alinsky “is in the great tradition of Karl Marx [and] Lenin.” Commentator Monica Crowley said, “This is the very essence of socialism… The tactics of Saul Alinsky and Barack Obama are geared toward wealth redistribution.” Sean Hannity invited Andrew Breitbart’s editor-in-chief Ben Shapiro for a special FOX segment about the Obama-Alinsky connection. During a press briefing in January, Ed Henry, the network’s chief White House correspondent, said to White House press secretary Jay Carney: “Newt Gingrich keeps saying on the campaign trail that the president’s vision comes from Saul Alinsky, the community organizer. I haven’t heard you asked about that.”

Ironically, Mitt Romney’s father George, the one-time governor of Michigan, met with Alinsky in 1967 to ask his advice about addressing the racial turmoil following that summer’s Detroit riots. “I think you ought to listen to Alinsky,” the liberal Republican advised his political allies (see T. George Harris’ Romney’s Way, 1968). “It seems to me that we are always talking to the same people. Maybe the time has come to hear new voices.” When this anecdote surfaced earlier this year on the right-wing blogosphere, conspiracy-minded extremists used it as evidence that Mitt Romney had also, like Obama, been infected by Alinsky’s influence.

Given this tenuous connection to Alinsky, it is unlikely that Mitt Romney will utter the organizer’s name during his campaign to evict Obama from the White House. But Republican conservatives, through Super PAC-sponsored ads and other media conduits and spokespeople, will make sure that voters regularly hear Alinsky’s name tied to Obama, and that Alinsky’s name plays into all the subliminal messages and code words that the GOP will use against the president.

The conservative pundits and Republican strategists count on the fact that most Americans have never heard of Alinsky. He’s a mysterious figure, with a vaguely foreign- (and Jewish-) sounding name, whom they can describe as a radical and a socialist. Yet Alinsky’s story is hardly a mystery. He’s been the subject of one major biography (Sanford Horwitt’s Let Them Call Me Rebel) and one full-length documentary film (The Democratic Promise, narrated by Alec Baldwin).

Born in 1909 to Orthodox Jewish parents who divorced when he was 13, Alinsky grew up in a Chicago slum. At the University of Chicago, he took courses in the school’s famed sociology department and then attended graduate courses in criminology and law. Leaving graduate school without a degree, he joined Chicago’s Institute for Juvenile Research (IJR), which was developing community projects based on the then-novel theory that crime was the result of poverty and social turmoil in neighborhoods. Alinsky developed a talent for building trusting relationships with community residents, criminals, and prisoners.

In 1938, IJR assigned Alinsky to study Chicago’s Back of the Yards area, the immigrant neighborhood of about ninety thousand made famous in Upton Sinclair’s novel, The Jungle. Alinsky spent most of his time with leaders of the Packinghouse Workers union, who were trying to organize employees of the major meat-packing firms that dominated the area. The union understood that it would be difficult to win a victory in the workplaces without community support, so they embraced Alinsky’s efforts to build a neighborhood organization.

Alinsky reshaped activism in America by transferring some grassroots organizing tactics from shop floors and factories to urban neighborhoods and religious congregations. In Back of the Yards, he sought out local leaders involved in churches, sports leagues, neighborhood businesses, and other networks. One was Joseph Meegan, a supervisor of recreation at Davis Park. He and Alinsky gained the confidence of Chicago’s auxiliary Catholic Bishop Bernard Sheil, who founded the Catholic Youth Organization. Sheil helped them recruit young priests and parish leaders, and to overcome the tensions between Catholics from different ethnic backgrounds. They persuaded Sheil to speak at the 1939 founding meeting of the Back of the Yards Neighborhood Council (BYNC), comprising about 75 organizations, including unions, neighborhood groups, churches, sports clubs, small businesses, and others. The next day, Sheil shared the stage with Congress of Industrial Organizations president John L. Lewis at a rally of 10,000.

The alliance between the church and the union guaranteed that the BYNC would be taken seriously by the city’s political and corporate power brokers. BYNC pressured city officials to provide the neighborhood with school lunch and milk programs, fluoridated drinking water, an infant-health clinic, and a baseball field with floodlights. BYNC got the city to clean up vacant lots, and it sold garbage cans to the community at a fraction of the market cost. BYNC started a credit union to provide local residents and businesses with low-interest loans, and pressured the federal Works Progress Administration and the National Youth Administration programs to provide jobs for neighborhood residents. These successes marked the beginning of modern community organizing.

BYNC also caught the attention of important patrons. Bishop Sheil and Marshall Field III (a newspaper publisher and heir to the Marshall Field family fortune) helped fund Alinsky’s new organization, the Industrial Areas Foundation (IAF), designed to train community organizers and build community organizations in other cities. In 1946, Alinsky published Reveille for Radicals, a bestseller that described the nuts and bolts of effective organizing. The book became the Bible of community organizing until he wrote his next book, Rules for Radicals, in 1971.

Alinsky’s books not only provided organizers with a tool-kit of principles and tactics, but also offered a vision for a renewed democracy. Alinsky was scornful of social workers, whom he thought viewed poor people as “clients” to be served by beneficent experts. He felt similarly about government anti-poverty programs, which he called “political pornography” because he believed they distributed crumbs that kept people pacified. In his view, an empowered citizen actively questions the decisions made by those in power. The organizer’s job, he said, is to agitate people to recognize their own self-interest and then help them mobilize to challenge the bastions of power and privilege. Organizers have to show people that many problems they view as personal troubles can only be solved through collective action.

Alinsky taught that confrontation and conflict were often necessary to change power relations. One way to achieve that, he believed, was to “personalize” an issue — to identify the person who has the power and authority to make a decision that will change institutional practices. Alinsky believed it was necessary to “rub raw the resentments of the people in the community.” That meant getting people involved in small-scale battles (against unscrupulous merchants or realtors, for example) so they could experience winning, gain self-confidence, and then tackle larger targets and issues. Community organizing, he believed, taught people how to win concrete victories through creative tactics that were fun and morale-building.

Yet he realized that compromise was the heart of democracy. “To the organizer,” he wrote in Rules for Radicals, “compromise is a key and beautiful word. It is always present in the pragmatics of operation… If you start with nothing, demand 100 percent, then compromise for 30 percent, you’re 30 percent ahead.”

Alinsky viewed his success in Chicago as a first step in building a network of “people’s organizations” around the country. He envisioned these groups, along with unions, forming the basis of a progressive movement for social justice. In 1947, Alinsky hired Fred Ross, an experienced organizer among California’s migrant farmworkers. Ross built the Community Service Organization (CSO) in several cities, mostly among Latinos, recruiting new members and identifying potential leaders through house meetings and one-on-one conversations. In San Jose, California, one of the people Ross recruited was César Chávez, whom Ross hired and trained as an organizer. Chávez would later adopt these organizing ideas in starting the United Farm Workers union.

In the mid-1960s, Alinsky began training organizers and overseeing campaigns in Buffalo, Rochester, New York City, St. Paul, Kansas City, and Chicago. He worked closely with African-American groups in major cities, hoping to build stable organizations that could battle segregation and wield influence on a variety of issues.

After riots erupted in the black ghetto in Rochester in the summer of 1964, an interracial group of clergy approached Alinsky to help them build a power base among low-income African Americans and challenge the influence of the city’s dominant employer, Eastman Kodak, which employed only 750 blacks out of 40,000 employees. (Alinsky quipped that “the only thing Kodak has done on the race issue in America is to introduce color film.”) After several months of meetings, local residents founded Freedom, Integration, God, Honor, Today (FIGHT), a community organizing group, to take on Kodak. When the company refused to create a training and hiring program for black residents, FIGHT upped the ante. A number of FIGHT members and their churches purchased Kodak stock and pledged to attend the company’s annual shareholder meeting. Kodak tried to keep protesters at a distance by holding the meeting in Flemington, New Jersey, but FIGHT brought a thousand people more than three hundred miles to the meeting. Their action gained national media attention.

Following this, Alinsky threatened to bring a hundred black people to a Rochester Philharmonic Orchestra concert after treating them to a banquet of nothing but huge portions of baked beans. The idea was to conduct the nation’s first “fart-in” to embarrass Kodak, a major Philharmonic sponsor. Fortunately for the Philharmonic, FIGHT did not have to resort to that tactic, because Kodak agreed to implement the jobs program.

The battle in Rochester was typical of Alinsky’s approach, which was to employ any tactic that would work to bring powerful politicians and corporations to the negotiating table with ordinary people. As he wrote in Rules for Radicals, “The Prince was written by Machiavelli for the Haves on how to hold power. Rules for Radicals is written for the Have-Nots on how to take it away.”

During the 1960s, Alinsky was particularly scornful of the student New Left and the campus anti-war movement. He believed that they relied too much on protests, demonstrations, and media celebrities and did not understand the importance of building organizations. He also considered their sometimes-revolutionary rhetoric silly, utopian, dogmatic, and alienating to their potential working-class base.

Alinsky’s ideas took hold and influenced organizers and activists around the country. His books and colorful campaigns brought him a great deal of attention (including a glowing profile in Time magazine in 1970), and he became an iconic figure among organizers. Beginning in the 1970s, America experienced an upsurge of community organizing, what writer Harry Boyte called a “backyard revolution.” Many community groups emerged and adopted Alinsky’s ideas. They organized with some success around slum housing and tenants’ rights, public safety, and racial discrimination by banks (red-lining). Environmental organizations drew on Alinsky’s ideas, too, especially groups opposed to the construction of nuclear power plants and fighting the industrial poisoning of their neighborhoods, as in the battle in the polluted Love Canal neighborhood in Niagara Falls, New York.

Alinsky was hardly the subversive, however, that Gingrich and other conservatives have portrayed. During the Depression, some of the key leaders of the industrial labor movement were members of or close to the Communist Party, and Alinsky worked alongside them in building an alliance between the neighborhood, the church, and the unions — but he was neither a Communist nor a socialist himself. He was fond of quoting Madison, Jefferson, and Tom Paine. He considered himself a patriotic American. He eschewed ideology. His closest political ties were with the Catholic Church. He frequently spoke at seminaries advising future priests to express their faith by putting Catholic social teachings into practice by helping to organize their parishioners rather than doling out charity. In 1969, a coalition of Catholic groups in Iowa gave Alinsky its Pacem in Terris Peace and Freedom Award, named after Pope John XXIII’s encyclical on war, peace, and social justice. Today, many of the community organizing groups that follow Alinsky’s ideas are rooted in religious congregations that constitute a progressive counterpart to the upsurge of right-wing activism among evangelicals.

Tens of thousands of organizers and activists have been directly or indirectly influenced by Alinsky’s ideas about organizing. Most of them — like the young Barack Obama, who did not work for Alinsky’s Industrial Areas Foundation but for another church-based community organizing group in Chicago’s poor neighborhoods from 1985 to 1988 — have been progressives, following Alinsky’s instincts to challenge the rich and powerful.

The left, however, has no monopoly on using Alinsky’s techniques. After Obama took office in 2009, even as the Tea Party and conservatives like Beck attacked Obama for being an Alinsky-ite and a “socialist,” they began recommending Alinsky’s books as training tools for building a right-wing movement. Freedom Works, a corporate-funded conservative group started by former Republican congressman Dick Armey, has used Rules for Radicals as a primer for its training of Tea Party activists. One Tea Party leader explained, “Alinsky’s book is important because there really is no equivalent book for conservatives. There’s no ‘Rules for Counter-Radicals.'”

(This post first appeared on Huffington Post and is reposted here by permission.)

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Rick Scott Super PAC Donations Challenge Federal Anti-Corruption Rule

Co-published by Fast Company
The Florida governor led a group that raked in cash from Wall Street firms after Scott’s administration gave them pension deals.

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Rick Scott photo by Gage Skidmore

Co-published by Fast Company

A super PAC led by Florida Gov. Rick Scott raked in donations from two private equity executives after Scott’s administration directed lucrative state pension investments to their firms, according to government records reviewed by MapLight and Capital & Main.

The donations were made to a committee that’s now supporting Scott’s U.S. Senate bid, despite a federal rule designed to prevent financial firms from bankrolling the election campaigns of public officials who oversee state pension investments.

Scott, a Republican, began chairing the New Republican PAC in May 2017 and announced his former campaign manager would serve as its executive director. Soon after, the group received $5,000 from New Mountain Capital Chief Executive Officer Steve Klinsky and $50,000 from Energy Capital Partners founder Douglas Kimmelman.

The contributions flowed to the super PAC after New Mountain Capital and Energy Capital Partners received a combined $250 million worth of new investment commitments from Florida’s state pension system in 2014 and 2015. Scott is one of three state officials who oversee the $160 billion pension system. During the most recent fiscal year, the Florida investments generated more than $3 million in fees for the firms.

A 2010 Securities and Exchange Commission (SEC) rule prohibits firms from receiving investment fees from public pension systems if their executives donate campaign cash to pension overseers like Scott. SEC officials aimed to prevent investment decisions from being shaped by political influence.

But the commission didn’t explicitly bar donations to “independent” political groups, unless the donations were deliberately designed to circumvent the restrictions. And it hasn’t addressed whether a state official can lead a super PAC that received donations from firms with pension business and later be supported by the super PAC.

John Kuczwanski, a spokesperson for the Florida State Board of Administration, told MapLight/Capital & Main that Florida’s first investments in the two private equity firms happened in 2005 and 2009, and he said Scott had nothing to do with new investments during his governorship, which started in 2011.

“The [state’s] initial relationships with both managers predate Governor Scott’s time in office,” said Kuczwanski, whose agency manages the day-to-day operations of the pension system. “Neither the trustees, nor their appointed investment advisory council members are involved in the investment manager/fund selection process.”

Scott’s campaign and the super PAC did not respond to questions from MapLight/Capital & Main. New Mountain Capital and Energy Capital Partners did not return requests for comment.

Energy Capital recently completed the purchase of Calpine, whose natural gas power plant near Tampa is regulated by Scott’s appointees at the Florida Public Service Commission. Kimmelman, who is now a director of Calpine, also donated $35,000 in 2017 to the National Republican Senatorial Committee, which is backing Scott’s Senate campaign.

“A Very Clear Case”

Under the SEC rule — which GOP state parties have tried to overturn — investment executives are not prohibited from donating to independent political groups. But the rule allows regulators to apply restrictions to donations that are deliberately routed through third parties in order to support public officials — a situation that critics argue is happening with Scott and his super PAC.

After the governor announced his Senate bid last week, New Republican PAC’s website began promoting his candidacy. End Citizens United, a Democratic-leaning political action committee based in Washington, DC, filed a complaint alleging that Scott has violated Federal Election Commission rules and is using the super PAC, which can accept unlimited donations, to evade contribution limits. Scott’s campaign says he stepped down as New Republican PAC’s chair in February.

In writing the original rule, SEC officials noted that while they could not restrict all donations to political action committees, contributions to third parties “may effectively operate as a funnel to the campaigns of the government officials.” They said the final rule “prohibits acts done indirectly, which, if done directly, would violate the rule.”

One ethics expert said that those anti-circumvention provisions should apply to the donations to Scott’s super PAC.

“This appears to be a very clear case of close coordination and circumvention of the pay-to-play rule,” said Craig Holman, an ethics lobbyist at the government watchdog group Public Citizen. “This is something that I’d like the SEC to pay attention to.”

“No Loopholes”

The SEC has only occasionally enforced the pay-to-play rule, and the agency hasn’t applied the provisions dealing with third parties to donations to super PACs. Because Scott is a sitting governor who can influence pension investments, he is covered by the rule, which has hampered the fundraising of past governors who tried to run for federal office.

A spokesman for former Texas Gov. Rick Perry’s presidential campaign said the rule prevented him from raising enough money to be competitive in the 2012 race. Bloomberg reported that during the same election cycle, then-New Jersey Gov. Chris Christie was rejected as the vice presidential nominee, partly because Republicans feared the rule would prevent them from raising money from Wall Street firms that do business with his state’s pension system.

“There is no way around it, and there are no loopholes,” said Bill Palatucci, Christie’s longtime advisor.

Even so, in recent years the rule has not deterred financial executives from donating to groups that help lawmakers who can influence pension investments. Financial executives whose firms received New Jersey and New Mexico investments continued to donate to the Republican Governors Association (RGA) when Christie and New Mexico Gov. Susana Martinez led the group. During the 2016 election cycle, executives at firms managing state pension money donated nearly $1.3 million to the GOP association, even as the group boosted the campaigns of Republican governors with power over state pension investments.

Last year, U.S. Sen. Tom Udall, D-N.M., called for the SEC to apply the pay-to-play rule to outside groups “to ensure that no one is able to circumvent these laws by using super PACs, dark money groups or other campaign spending vehicles.” The RGA has argued that because it funds multiple candidates and does not allow donors to earmark contributions for particular races, it can accept donations from firms with investment business that can be influenced by individual governors. The SEC said in 2016 that donations to outside political groups “are independent expenditures that do not trigger” the rule.

“So long as the PAC faithfully observes the requirement to operate independently of candidates, a contribution to a super PAC will not trigger the [rule], even if the super PAC supports a covered official,” Sam Brown, a former advisor to Federal Election Commissioner Ellen Weintraub, wrote in 2016. “Super PACs are increasingly being used in novel ways, and it remains to be seen whether these changes will result in increased circumvention risks.”


This story is a collaboration between MapLight and Capital & Main.

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Politics & Government

Policymakers Seek Healthier, More Prosperous California

A summary of legislative proposals discussed at Policy Insights 2018, from gender equality to expanding health-care coverage.

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Seth Sandronsky

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Photo: Program for Environmental and Regional Equity

Over 300 state policymakers, researchers, advocates and service providers explored driving a progressive political agenda to expand economic opportunity and financial security at the Policy Insights 2018 conference held last week in Sacramento. Facts and ideas presented at the event “could help form the basis of a new, future-oriented economic agenda for California in areas like tax policy, health coverage and family supports,” California Budget & Policy Center executive director Chris Hoene told participants as he reviewed the state landscape within Trump World. “It’s about bringing more prosperity to more people and to deepening their well-being.” The nonprofit, nonpartisan Budget Center, which says it engages in independent fiscal and policy analysis to improve “the well-being of low- and middle-income Californians,” hosts the gathering every year. A summary of some of the panels’ discussions follows below.


Despite growth and low unemployment, labor’s share of the economic pie is paltry, Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities in Washington, DC, said in the morning’s keynote address. He detailed many connections between economics and politics, linking workers’ pay and productivity, unions’ difficulties, fiscal and monetary policies, and state and federal budgets. The best progressive policies are the most direct, Bernstein said during a Q&A. “We need to think about direct job creation for folks left behind in rural and urban communities,” he told a panel moderated by Los Angeles Times staff writer John Myers. Such a jobs policy should find a home in the upcoming election season, Bernstein added.

State Senator Holly Mitchell (Photo: Joanne Kim)

Advancing Gender Justice: Boosting Women’s Well-Being Through Economic Security, Employment and Earnings

In a gender equity and justice workshop, Mary Ignatius, statewide organizer of Parent Voices, a grassroots group advocating better childcare policies, stressed the importance of a public platform for the voices of struggling, low-income women. Such a platform can and does help to dispel myths that blame working females for their plight, she said. These women often have no option other than to seek costly and scarce childcare while working outside the home, she said.

Heather McCulloch, founder and director of Closing the Women’s Wealth Gap, said research shows women experience this shortfall as a group. Therefore, organizing with a “strength in numbers” focus to build coalitions is a useful tool to improve women’s investment and savings, McCulloch said.

In blue-collar occupations such as those in the building trades, women’s sexual harassment is rampant, said Jessica Stender, an attorney at Equal Rights Advocates, which describes itself as a national civil rights organization dedicated to protecting and expanding economic and educational access, and opportunities for women and girls. This harassment makes the goal of females “getting in and staying in” such high-paying blue-collar jobs critical, Stender said. She also discussed exploitation of low-wage women workers, saying remedies for occupations such as janitors and restaurant servers range from individual to class-action litigation.

California Budget Prospects for 2018-19 and Beyond

KQED-FM reporter Marisa Lagos moderated a panel on current state budget and policy proposals for the 2018 legislative session, and which featured state Senator Holly J. Mitchell (D-Los Angeles) and Assemblyman Phil Ting (D-San Francisco).

The two legislators focused on new priorities for the criminal justice system. Mitchell urged reforming policies that criminalize poverty and addiction. This change is underway, she said, with more work required. The recent legalization of marijuana for recreational use is a case in point — people are behind bars for crimes that no longer exist. Ting noted that the state prison population is down, but spending for it is up. Both urged fellow lawmakers to support bills that shift spending from prisons to meet the social needs of low-income Californians — such as child nutrition and early childhood education. A related means of improving low-income Californians’ lives is to increase the CalWORKs cash grant, Mitchell said.

She also stressed that closing the education equity gap requires sufficient funding to ensure that all kids who enter kindergarten are prepared to learn. Ting noted that at the local K-12 school district level, better budgetary transparency is necessary to track spending and student results.

Mitchell and Ting said it is vital to continue state laws and policies that deal with the impacts of climate change. They also urged lawmakers on both sides of the aisle to continue to work to improve immigrants’ lives — which they said the Trump White House opposes.

Building on Health Care Reform: Next Steps in State Health Policy

The University of California, Berkeley’s Laurel Lucia noted that despite the Affordable Care Act cutting the number of Californians without health care insurance (from 17 percent in 2012 to seven percent in mid-2017), three million remain uninsured. Undocumented adults (10 percent of the labor force and 58 percent of the uninsured), do not have access to the ACA and Medi-Cal, said Lucia, director of the health care program at the university’s Labor Center. She backed policy options such as Senate Bill 974, introduced by Sen. Ricardo Lara (D-Bell Gardens), to address that.

Anthony Wright, head of Health Access California, a nonprofit advocacy group, focused on policy steps the state could take without federal help, given what he called the national GOP’s and President Trump’s antipathy. Wright announced the launch of Care4All, a new campaign to achieve universal health care coverage in California. A step toward that goal is to expand the affordability of the ACA in the individual market and Covered California marketplace. In this way, he said, consumers would spend less of their income on premiums, copays and deductibles. Wright mentioned SB 910, authored by Senate Health Committee Chair Sen. Ed Hernandez (D-West Covina), that would ban the sale of short-term health and substandard insurance policies that Trumpcare’s ACA overhaul favors, beginning in 2019.

Michelle Cabrera, health care director of the Service Employees International Union, State Council, detailed the causes and effects of high medical prices, including the upward spiral of those costs created by health-plan mergers. As an antidote, she cited Assembly Bill 595, introduced by Assemblymember Jim Wood (D-Healdsburg), to boost the Department of Managed Health Care’s oversight of such mergers. These mergers hike consumers’ prices, she said, and are partly why the U.S. spends more per person on health care than all other nations, yet delivers high-priced and low-quality coverage. Measures such as AB 595 could shed light on the hidden negotiated prices between health plans and providers — the kind of transparency that is now unavailable. Price transparency could expand an overdue discussion of the proprietary forces driving high health care prices, according to Cabrera.

Crafting a New Economic Agenda for California

The conference ended with a plenary discussion of building a new state economic agenda, moderated by the Budget & Policy Center’s Hoene. University of Southern California sociologist Manuel Pastor looked at what worked in California’s postwar economy before its boom ended and social inequality grew to its present extremes. Pastor, director of the USC Program for Environmental and Regional Equity and the USC Center for the Study of Immigrant Integration, urged state politicians to approve a new Master Plan for Higher Education to ensure low-cost access for students, and to increase investment in affordable housing. Such policies, given the state’s changing demographics to a nonwhite majority, can cut the impacts of structural racism, he said.

Hoene described California’s corporate-friendly economy as one that puts employers first and workers last. Alma Hernández, executive director, SEIU California, urged politicians to back better labor standards, which she said would empower working people in their fight to weaken current corporate power over politics and policies. Employers who fracture work into precarious, non-union jobs, for example, harms workers’ lives on and off the job, she said. Natalie Foster, co-chair of the Economic Security Project, pondered the role of political narratives. Who tells whose stories matters in overcoming current social divisions, symptoms of rising income and wealth gaps. “Big ideas matter,” she said, adding that one example is a wealth tax that could generate more revenues for progressive policies.


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Labor & Economy

Historian: Why Economic Libertarianism Is an Overwhelmingly White Cause

While the eyes of most journalists and citizens have been fixed on Washington and Donald Trump, a Duke University professor warns, Charles Koch-funded groups and politicians are quietly lining up the state authorizations needed for a new constitutional convention.

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Nancy MacLean is a historian in a hurry. Leaning forward, hands pressed on the table in front of her, she is telling a room full of activists that an assault on democratic institutions has created an “all-hands-on-deck emergency” on a scale that “we have not seen in our lifetime.” MacLean has a dramatic flair in her writing and in her personal presentations. She speaks with the urgency of someone who recognizes a pivotal historical moment when she see one.

Seated in the windowless basement of a union hall that is shared with a local economic justice non-profit, she is dressed in a white blouse and blazer.

Those assembled take turns expressing dismay over a divided country, over the daily attack on immigrants, and over the legendary discipline of an extreme right-wing political movement that has advanced all the way to the White House.

“Economic libertarianism produces a kind of social Darwinism — the idea that anyone who is not thriving in the economy must have something wrong with them.”

The Duke University professor says she discovered the intellectual underpinnings of the country’s rightward tilt while digging through the archive of a Southern economist named James McGill Buchanan. She laid out her argument in her impassioned and highly readable 2017 book, “Democracy in Chains: The Deep History of the Radical Right’s Stealth Plan for America. That history holds important lessons for those resisting the right’s ascendance, she tells the group.

The “days of silos are over,” says MacLean. Whereas the left has been focused on discrete campaigns and issues, the extreme right, she warns, has undertaken “an audacious bid that has been six decades in the making to fundamentally change the relationship between the government and the people — and to do so permanently.”

Buchanan, who was 93 when he died in 2013, provided a key set of anti-democratic ideas that propelled the libertarian right’s effort to dismantle the liberal state, while giving plutocrats free rein, according to MacLean. Part of his agenda, MacLean says, included shielding the “makers” from the “takers” by eroding the public’s faith in government as a means to protect the rights of the property-owning class.

Buchanan, a Nobel Prize winner, favored requiring supermajority votes to approve tax increases, making it more difficult for public officials to meet the needs of ordinary citizens. In a long and varied career, he advocated dismantling Social Security, counseled the government of Chilean dictator Augusto Pinochet and nurtured generations of scholars at Southern universities, including at a center he founded at George Mason University with the help of $10 million from the right-wing billionaire Charles Koch.

One of her book’s insights is how conservative legal scholars and economists have understood the degree to which the devil lay in the mind-numbing detail of policy.

“The wicked genius of Buchanan’s approach to binding popular self-government was that he did it with detailed rules that made most people’s eyes glaze over. In the boring fine print, he understood transformations can be achieved by increments that few will notice, because most people have no patience for minutiae,” she writes.

That passage refers to the advice he gave Pinochet’s government, which she argues has hampered Chile’s current president, Michelle Bachelet, from enacting social programs in spite of a strong popular mandate.

Now MacLean is warning progressive activists that the Republican tax bill and its projected $1.5 trillion deficit could help fuel a growing right-wing clamor for a state-led constitutional convention, whose first order of business would be a balanced budget amendment to curtail future government spending.

“While the eyes of most journalists and citizens have been fixed on Washington” and Trump, she warns, “scores of organizations and elected officials funded by Charles Koch and his donor network” have been “quietly lining up the state authorizations” needed for a constitutional convention that will curtail legislators’ ability to serve the needs of the governed. “They now have 28 of the 34 states needed to call such a constitutional convention under Article 5 [of the U.S. Constitution].”

Such a move, she adds, would put the country further down the path toward the “glorious period of liberty” favored by Koch and Buchanan — a place in which workers have “no legal right to organize for collective voice and power” and where corporations are “all but free of democratic accountability” — and where privatization had eliminated Social Security, Medicaid, and Medicare.

Nobody is immune from the right-wing attack on government, says MacLean. “Every civil rights activist, every feminist, every environmentalist, every queer and every retirees’ group who goes to government to move a public agenda is a target for this and will suffer if it goes through,” she says.

Yet this creates a “perverse source of strength,” she says. “Our common need for government can potentially unite all these constituencies across groups to protect and expand democracy.”

MacLean’s fifth book has received a slew of positive reviews from major publications and a National Book Award nomination. Not surprisingly, Democracy in Chains has also drawn an avalanche of attacks from the very right-wing think tank networks that she critiques, as well as complaints from some left academics.

MacLean’s claim of Buchanan’s centrality to the rise of libertarianism, wrote political scientists Henry Farrell and Steven Teles, could be misleading to a progressive movement “liable to overestimate the extent to which the right is operating by a single plan. The most serious danger is that the left might look to this mistaken understanding of the right’s success as a model for how it should organize itself.”

Speaking to Capital & Main, MacLean actually gives some credit to Buchanan, who in spite of his deeply reactionary politics, was “probably the most original thinker about democracy in the last 50 years,” she said.

But Buchanan’s “very, very reductionist analysis” was deployed to erode popular trust in government, she argues.

“He sought to build a case that government could not do what it promised because politicians were not really seeking to advance the public interests as they claimed. They were just trying to get themselves elected using other people’s money. The same was true of all public actors, according to Buchanan,” as she told the union-hall gathering.

MacLean’s book anchors Buchanan’s thinking in the South’s troubled history of segregation and slavery. He advocated for state-funded voucher systems for private schools in the late 1950s, after local officials had closed public schools as part of massive resistance against court-ordered desegregation.

MacLean is careful to say her research found no evidence that Buchanan operated on the basis of racial animus — although he must have understood the context of his proposal for school privatization. MacLean joins conservative scholars in connecting Buchanan’s ideas to those of antebellum South Carolina Senator and plantation owner John C. Calhoun, who thought democracy needed to be curbed because it failed to preserve the liberty of the slave-owning elite.

And what about today’s libertarians? She believes there is a reason libertarianism has remained an overwhelmingly white cause.

“Economic libertarianism,” she told this website, “produces a kind of social Darwinism — the idea that anyone who is not thriving in the economy must have something wrong with them. There’s always this slippage between [economic libertarianism] and the really ugly white-supremacist right,” she says.

MacLean’s fundamental message is that Buchanan – and the extreme right – have an Achilles heel. Their ideas are extremely unpopular and so they have had to proceed by stealth – whether through voter suppression laws, gerrymandering or other means.

“We’ve had the most radical gerrymandering in American history,” MacLean told Capital & Main. “And they’re trying to destroy labor unions without actually saying that they don’t want working people to have a collective voice.”

“However much they may offer bromides to freedom or liberty in the abstract,” she added about the far right, “what they’re really talking about is freeing corporations, and the wealthiest taxpayers, who don’t support what the majority of their fellow citizens do.”


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David Cay Johnston on the Trump We Don’t Know

A Pulitzer Prize-winning journalist tells of his encounters with Donald Trump, a man he calls a “Potemkin president.”

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Original Photo: Shealah Craighead/White House

“There’s no good ending to Trump’s presidency.”


 

Investigative journalist David Cay Johnston has been reporting on Donald Trump since 1988, and admits that he has long been fascinated with a figure he calls “the greatest con artist in the history of the world.” Johnston first met Trump while reporting on casinos for the Philadelphia Inquirer, and has since served as a one-man fact-checking operation on Trump’s claims. His new book, It’s Even Worse Than You Think: What the Trump Administration is Doing to America, tracks the first 250 days of the administration. Johnston spoke to Capital & Main about what he’s learned while on the Trump beat, and why the mainstream media, despite incessant coverage of Trump, still tends to miss the big story.


Gabriel Thompson:  The title of your new book is It’s Even Worse Than You Think. It seems pretty bad already — what are we missing?

David Cay Johnston:  Journalists have done a very good job of covering Donald’s tweets and the nutty things that have gone on —the palace intrigues. A lot of journalists are not equipped to cover the government, because to do that, you have to understand regulations, budgets and accounting. Most journalists have not trained in those things. They’ve trained in how to accurately tell you the official version of events, and the official criticisms of the official version of events. I’m in the unofficial business.

What’s an example of a story that is being missed or is not receiving the attention it deserves?

David Cay Johnston

Johnston:  Throughout the campaign, Trump talked about how he is all for the veterans. One of the most important things he did was use the word love. He would say to his audience, “We love you. We love our police. We love our veterans.” I think that was a very powerful motivating word. And yet, his first budget proposal sought to cut the benefits for many disabled veterans when they reach retirement age. You’re unable to work because you served your country and you paid a terrible physical price, and you’re currently getting about $35,000 a year. Trump proposed to cut that amount to $13,000. That tells you that he doesn’t care about the vets.

The only area that some Trump critics might give him some credit is on his knowledge of taxes. But you push back on this as well.

Johnston:  Donald testified under oath that he knows nothing about accounting. Well if you don’t know accounting, you cannot know taxes. That’s like saying I’m an expert in flying jet fighters, but I don’t know what lift is. I tried to give Donald tax advice in 1990—my purpose wasn’t to save him money, it was to find out if he really understood taxes. We had lunch in Trump’s Castle [a hotel and casino in Atlantic City], and he couldn’t follow my basic, simple advice. At the time, Donald was in deep financial trouble, and I was going over the terms of his ownership, but he didn’t even understand his own deal. When I say Donald doesn’t know anything, I literally mean that.

Of course, it’s not just taxes.

Johnston:  He’s appallingly ignorant. In my previous book, I tell the story of the primary debate, in December 2015, when Hugh Hewitt asked Trump about our nuclear triad and what his priorities would be if we had to make cuts for budgetary reasons. And Trump goes on about how he learned everything there is about nuclear energy from his Uncle John at MIT, a super genius. Hewitt asked again what his priority would be, and Trump mentioned how nuclear is so massive.

“Most journalists have trained in how to accurately tell you the official version of events, and the official criticisms of the official version of events. I’m in the unofficial business.”

Then the question goes to Senator Marco Rubio, not exactly known as a heavyweight. Rubio explained that the nuclear triad is the capacity to deliver nuclear bombs from jet airplanes, land-based missiles, or submarines. This story is important because four months earlier, on his radio show, Hewitt had asked Trump the exact same question. I ran into Hewitt, and I asked him about this, and he said, “Yeah, isn’t that something. He had four months to learn about this and obviously made no effort whatsoever.”

What stood out to you in his recent State of the Union address?

There were of course tons of factual errors and claims that don’t stand up. It was a pretty banal speech, and he applauded himself. Good God! But Donald has some skills. He’s the greatest con artist in the history of the world, and he knows how to craft a line to appeal to people. He knows, when he’s being interviewed, where to have the lighting and camera stationed. The man has significant skills in self-promotion and creating his image. But he’s a Potemkin president. There’s no substance there.

You write in the conclusion that Trump is a symptom of our country’s problems, not the cause. Looking at all the terrible things he’s done, what gives you hope?

Johnston:  There’s no good ending to Trump’s presidency. Whether he’s voted out or impeached, he will go around the country claiming he was robbed and will foment violence. Nothing will hold him back. But we will get through this. We got through the Civil War, through the burning of the capital in the War of 1812, through the Great Depression. Some of the damage we can fix, and some will cause lasting problems. They are approving judges left and right, many of whom are ideologues and marginally qualified. We’ll be dealing with that long after I am gone.

Here’s what gives me hope. The day after he took office, six million Americans turned out in the biggest demonstrations in the history of this country. If that energy can be translated into votes in November, and we can get people to realize that it is our government and we need to act like owners instead of like we’re powerless, then we can move our country in the direction of progress.


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Scenes From Los Angeles’ Women’s March

Photojournalist Joanne Kim captures the sights of Saturday’s Women’s March in downtown L.A.

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Approximately 300,000 people gathered in and around downtown Los Angeles’ Pershing Square Saturday for the 2018 Women’s March. Their signs and banners spoke to a variety of issues that also included climate change and immigrants’ rights. From Pershing Square protesters took to Olive and Hill streets, Broadway and Spring Street towards Grand Park and City Hall. Many held signs focused on encouraging women to vote and run for office.

Many young women and girls took to the streets with their mothers and grandmothers. One young girl sat on her mother’s shoulders holding a sign with a woman’s fist in the air declaring, “We Rise.” Kimberly Castro, from South Gate, California held a sign in support of Planned Parenthood. “Being around everyone makes me feel powerful to make a change, and that all together we do have a voice,” she said.

Across from City Hall, a group of Trump supporters gathered in a small counter-protest. “Go back to Mexico!” screamed one of the Trump supporters. Wendy Rodriguez, whose mother is from El Salvador and father is from Honduras, shouted back, “Go back to your country!” Another young woman waved a sign at the Trump supporters that read, “Anything you can do I can do bleeding.”

All photos by Joanne Kim


































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Erwin Chemerinsky and the Case Against Trump

The constitutional scholar discusses Donald Trump’s tumultuous first year, and what may lie ahead. “It’s very frightening to me,” Chemerinsky tells Capital & Main.

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Danny Feingold

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Erwin Chemerinsky photo by Rpogge

Since Donald Trump took office once year ago, perhaps no American has called into question the legal and ethical behavior of the president with more persistence and authority than Erwin Chemerinsky. One of the country’s preeminent constitutional scholars, and the dean of the University of California, Berkeley’s law school, Chemerinsky has sounded the alarm from day one of Trump’s administration – most strenuously over the president’s alleged daily violation of the emoluments clause of the Constitution. Those provisions bar the president from receiving any form of payment from a foreign government, and also from receiving any payments beyond the salary of the chief executive. Last month, a federal court dismissed a lawsuit that Chemerinsky and other leading legal authorities had helped prepare seeking to stop the president from accepting any further payments – that decision is currently being appealed.

Capital & Main sat down with Chemerinsky at his UC Berkeley office to discuss Trump’s tumultuous first year, and what may lie ahead.


Capital & Main  How would you assess Trump’s first year in office?

Chemerinsky  It’s so much worse than I could have ever feared. I don’t think that we’ve ever had a president who has less respect for the Constitution. It’s reflected in what he expresses with regard to freedom of the press, it’s reflected in the fact that on a daily basis he’s violating the emoluments clause of the Constitution by receiving benefits from foreign governments, benefits from the United States government beyond his salary. It’s reflected in his immigration policies, his travel ban, his efforts against sanctuary cities. It’s very frightening to me.

What does it say about the rule of law in this country that we have a sitting president who, in your view, has been in violation of the Constitution every single day that he’s been in office?

Chemerinsky  Before taking office the president-elect said that he was going to take steps to try to comply with the emoluments clause. None of that ever happened. What’s troubling to me is Congress seems largely unconcerned about it and so far the courts haven’t stepped in.

Is there evidence that any of the president’s decisions have in fact been influenced by payments that his business interests have received?

Chemerinsky  China gave to President Trump some very valuable licenses on trademarks. He’d been trying to get them from China for years before being elected as president. He received them and then he changed his policy with regard to China. Maybe it was a coincidence, but certainly one followed the other.

Some critics observed that the countries that were selected for the immigrant and refugee travel ban did not include any countries where President Trump’s business organization had properties and interests.

Chemerinsky  It’s at least ironic that when you look at the seven countries initially listed in the travel ban, none had Trump interests there. Of course there was also no linkage between terrorists of any of those countries and yet the countries where you could link past terrorist acts to people from those nations, like Saudi Arabia or Indonesia, were not on the list, and those are places where Trump had investments. The travel ban has gone through two more iterations and that continues to be so — Trump doesn’t have any interests in North Korea or Chad, and they find themselves on the list, but the countries where Trump does have interests don’t find themselves on the list.

One other example that is just astounding: The Trump administration has allowed offshore drilling now in all states that have coastal areas except for one — Florida. Of course that’s where Trump has coastal property. Maybe it’s a coincidence, but doesn’t this show exactly the kind of self-dealing that the Constitution’s emoluments clauses were meant to prevent?

Is there a case to be made against President Trump on obstruction of justice?

Chemerinsky  I think that there is significant evidence that President Trump engaged in obstruction of justice. He told the Russians that he fired James Comey for purposes of trying to end the investigation with regard to Russia.

If anybody tries to interfere with an ongoing federal investigation, that’s obstruction of justice. The crime that Richard Nixon would have been impeached for, if he didn’t resign, was telling the FBI not to investigate Watergate because it was a CIA matter. Well, that’s exactly what President Trump apparently tried to do — keep the FBI from investigating.

We also have more evidence that President Trump tried to interfere with the investigation of Russian interference in the election. All of this is the basis for strong concern with regards to obstruction of justice. My prediction is what we’ll see next is the implication of Donald Trump Jr. and Jared Kushner. The question is, will it reach to the president? Will it reach to the vice president?

Do you believe that there is a credible case to be made for invoking the 25th Amendment based on concerns about Trump’s mental health?

Chemerinsky  I think that Donald Trump’s engaged in erratic behavior. I don’t think that he’s shown himself to be mentally ill or physically ill in a way that would justify the 25th Amendment to this point in time. There’s a thing called narcissistic personality disorder — maybe it’s that. But I don’t know if all politicians don’t fall into that to a greater or lesser extent.

Are there any other grounds for legal or constitutional concern about the president?

Chemerinsky  My greatest concern for the next three years of the Trump presidency is whether there’s going to be a moment where a court issues an order and Trump says, “We’re going to ignore it.” When the courts first enjoined the initial version of the travel ban, there were rumblings from Trump that maybe the administration would just ignore the court order. My worry is once the president takes that position, if he does, then there’s nothing to stop him from locking up you or me or anybody else. Once the president says I’m going to ignore a court order then there’s nothing left of the rule of law.

Does Trump’s pardon of former Arizona Sheriff Joe Arpaio lay the groundwork for him to pardon anyone who’s indicted and convicted as a result of the Mueller investigation?

Chemerinsky  The president is allowed to pardon anyone accused or convicted of a federal crime. I think the pardon of Joe Arpaio shows that President Trump has no shame, that he’s not hesitant to use it even in an instance where there was a violation of law. Joe Arpaio was ordered by a court to stop racial profiling. He ignores that court order and continues to engage in it. A judge finds him in criminal contempt, and before the judge even sentences, President Trump says, “I regard Joe Arpaio as a hero, I’m going to pardon him.” Will he do it with regard to the Mueller investigation? We don’t know.

How do you assess Neil Gorsuch’s performance on the Supreme Court?

Chemerinsky  Since coming on to the court on April 6, 2017, Gorsuch has voted together with Clarence Thomas a hundred percent of the time. To put this in context, the last year Justice Scalia and Justice Thomas were on the court together, they voted together 87 percent of the time. Gorsuch so far has been at the farthest right part of the court. Maybe he’ll be different as months and years go by, but for the first nine months of his time on the court, no one has been more conservative.

Do you have concerns that the standards for what is legal and ethical behavior by a president have been damaged by this president in just one year?

Chemerinsky  It’s impossible to know what the long term consequences of that are going to be. Is Trump going to lose to a mainstream Democrat or Republican in 2020 and we’ll regard this as a blip? Or is this the start of something much more apocalyptic?

The United States form of government isn’t going to be here forever. Every form of government is here until it’s not. I believe that the institutions of government can withstand the Trump presidency, but I know many are afraid that this is the start of something that is very different than we’ve ever seen before.


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Study: California Economy Unhurt by Progressive Policies

A new report shows that California, with its higher minimum wage, Medicaid expansion and ambitious climate policy, has done better than 19 Republican-led states with lower taxes and fewer regulations.

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A California worker installing solar panels. (Photo: Danita Delimont/Alamy)

Reducing carbon emissions, raising low-wage workers’ incomes and increasing access to health insurance have not, as critics warned, led to job stagnation and lower GDP.


 

In a direct rebuke to anyone using the term “job-killing regulations,” a recent study shows that a group of progressive policies enacted since 2011 have had no negative impact on the California economy. If anything, the report, “California is Working: The Effects of California’s Public Policy on Jobs and the Economy since 2011,” shows that California has done better than several states that have lower taxes and fewer regulations.

The report’s author, University of California, Berkeley Labor Center researcher Ian Perry, examined 51 progressive policy measures – including environment, safety net, taxation, infrastructure and housing – that Perry coins the “California Policy Model,” or CPM. These policies include laws that provide a path to a higher minimum wage, expand Medicaid as part of the Affordable Care Act, raise taxes on corporations and promote California’s comprehensive and ambitious climate policy.

Perry chose 2011 as a starting point because that’s when Democrats captured majorities in the legislature as well as the governor’s office. Also that year, Proposition 25, which let Democrats approve a state budget with a simple majority vote rather than a two-thirds requirement, went into effect. That opened the floodgates to a wave of progressive policies that have been scorned by conservative politicians, pundits and think tanks.

Perry told Capital & Main that he set out to see whether critics of California’s progressive policies were correct — that, for example, California’s higher minimum wage would increase unemployment, or whether the state’s strict regulations on carbon would send businesses to other states in droves.

To do so, Perry compared wage growth and employment growth in California with statistics from 19 Republican-controlled states. But he also had to create a legitimate control group to weight factors like California’s tech boom, which might have skewed economic results, or a Republican-controlled state’s downturn, which may not have been due to conservative policies. To combat an apples-to-avocados comparison, Perry used a “synthetic control” method to weight data from Republican states to create an alternate California (or alt-California) in which CPM had not been enacted.

Perry found that California – the real California with its CPM – enjoyed higher total employment, private sector employment and GDP than the 19 Republican states and alt-California.

The study, by design, looked at the cumulative impact of policies instead of evaluating specific policies. “Still, one policy stood out to me,” Perry said. “My study found that the expansion of Medicaid through the ACA was one of the more pro-growth policies because it led to a greater demand in health care services and a growth in health industry jobs.”

The biggest takeaway from the study, Perry said, was that policies that make up the CPM – reducing carbon emissions, improving income for low-wage workers and helping more people access health insurance – have not, as critics warned, led to negative economic effects like job stagnation and lower GDP.

“There are warnings from conservatives that [progressive policies] will slow down economic growth, but California is a big piece of evidence that the fears are unwarranted,” Perry said.

Kansas, which went all in on supply side economics under Governor Sam Brownback, showed that the converse is true, that cutting taxes can sometimes kill growth, Perry said.

In a Washington Post op-ed, Jared Bernstein, chief economist to former Vice President Joe Biden, praised the study. He said that, while it didn’t convince him that there’s a direct line between progressive laws and job growth (a relationship Perry did not set out to prove), the study did, “in tandem with tons of other research, convince me that these progressive interventions do not hurt growth.”

The Berkeley study was released as Republicans on Capitol Hill pushed a tax bill heavily weighted to tax cuts for corporations and wealthy individuals, legislation that a majority of Americans are firmly against.

Despite the report’s generally rosy economic picture, Perry points out that some issues threaten California’s prosperity. First, progressive labor standards need to be enforced to combat rampant wage theft in California’s low-wage industries. Second, the effect of very high housing prices in much of the state could undermine some economic gains.

“High housing prices and lack of supply could force more people to live farther away from their jobs, which would increase carbon emissions and make it harder for [businesses] to attract workers,” he said.

And the possible repeal, or undermining of, the Affordable Care Act, could undo some of the economic benefits of the past seven years, Perry said. Another study from the UC Berkeley Labor Center earlier this year showed that California would have lost more than half a million jobs if the Graham-Cassidy repeal-and-replace legislation had passed.


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2017’s Greatest Hits (and Misses)

The political journey between good intentions and the statute book was twisted even by Sacramento standards in 2017. But there was more — much more.

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Bill Raden

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Photo by Bruno Sanchez-Andrade Nuño

Working Californians’ biggest hope during Trump Year One: Sacramento’s Democratic supermajorities:

With a Democrat as governor and a legislature controlled by true-blue supermajorities, it seemed only logical for Sacramento to spearhead the Trump resistance. State Senate President pro Tem Kevin de León (D-Los Angeles) and Assembly Speaker Anthony Rendon (D-Paramount) said as much the day after Donald Trump’s 2016 election, vowing to “set an example for other states to follow.” Twelve months later, a modest raft of new laws aimed at blunting the brazen bigotry of Trump immigration policies — including Senate Bill 54, de León’s hard-won sanctuary state bill — and checking the administration’s planet-killing orgy of climate deregulation.

Working Californians’ biggest disillusionment during Trump year one: Sacramento’s Democratic supermajorities:

The political journey between good intentions and the statute book was twisted even by Sacramento standards in 2017. Of the 2,980 bills introduced by state lawmakers, roughly 35 were drafted as “Trump resistance” measures. But by the time the dozen-plus resistance bills made it to the governor’s desk, they tended to be anodyne wisps of their original forms. Senate Bill 6, San Diego Democrat Ben Hueso’s effort to create a legal defense fund for undocumented workers scooped up in ICE raids, became so toothless that Hueso retitled his “Due Process for All Act” as the “Expanding Due Process Act.” A no-brainer by state senators Mike McGuire (D-Healdsburg) and Scott Wiener (D-San Francisco) designed to force Trump to release his tax returns before getting on the state’s 2020 ballot earned a Brown veto. Most controversially, perhaps, Rendon tabled SB 520, a sweeping Medicare for All-styled measure by state senators Ricardo Lara (D-Bell Gardens) and Toni Atkins (D-San Diego), before it even received a hearing.

2017’s wannest excuse for a sanctuary state act:

It once virtually banned all state and local law enforcement cooperation with ICE agents. But the bill signed into law by Jerry Brown, which had promised to be the sharpest state rebuke yet to Trump’s mass deportations, now looked strangely familiar. That’s because to get the governor’s signature, the California Values Act had to first pass muster with the powerful California Sheriffs’ Association. The compromise gives ICE full access to prisons and jails, allows police and sheriffs to share databases and to detain and transfer people to ICE if they have been convicted of any crime from a risibly broad list of 800 “hold offenses” recycled from 2014’s California Trust Act. Those include the very serious offenses of “intentionally processing a milk product that is required to be pasteurized without pasteurization, manufacturing a milk product in an unlicensed plant, providing milk product for manufacture or resale to an unlicensed person, or falsifying records required.”

2017’s most unsurprising (if most ignored) Rx for national and California Dems:

Just over 46 percent of California’s registered Democrats turned out for Bernie Sanders in the 2016 presidential primary. That’s nearly the same percentage that pre-election polling for the November vote indicated was motivated by anti-Hillary feelings — presumably disgust over four more years of the romance between Clinton-Obama “New Democrats” and Wall Street — rather than anything remotely pro-Trump. Unfortunately, that lesson was lost on state Democrats when they gathered in May and selected Los Angeles County Democratic chair Eric Bauman as state party leader — in spite of Bauman’s financial ties to Big Pharma. Progressive challenger Kimberly Ellis, who narrowly lost a vote plagued by irregularities, charged that a “clear conflict“ had developed among “those nestled in power.” That diagnosis was echoed in postmortems that urged the disentangling of Democrats — “ideologically and financially — from Wall Street, the military-industrial complex and other corporate interests that put profits ahead of public needs.”

California’s most badly bungled headline of 2017:

The news in November was all about the great Silicon Valley sigh of relief that blew down from Palo Alto like a laissez faire Santa Ana wind: California’s Department of Motor Vehicles had issued its long-delayed driverless vehicle testing regulations that would allow autonomous vehicles on California highways. A potential global market of at least $42 billion by 2025, panted the L.A. Times business pages. But for 3.1 million U.S. truckers (who represent represent two percent of total employment), there was little to cheer. In May, Goldman Sachs became the latest to predict that autonomous vehicle technology will disrupt trucking jobs — one of the last middle-class occupations that doesn’t require a high school diploma — into obsolescence at a rate of 25,000 a month, or 300,000 a year. A far more apropos headline would have been, “Just Say No.”

2017’s poster child for neoliberalism: Elon Musk. Again.

Everything that’s wrong with Silicon Valley’s virulently anti-communitarian, anti-regulatory ethos seems to eventually get uttered by California’s favorite South African-born billionaire bad boy, Elon Musk. And in 2017, Musk did not disappoint. In February, the entrepreneur announced the creation of a new tunnel boring company and its first for-profit venture — digging an express tunnel that will bypass L.A.’s legendarily impenetrable rush hour traffic by connecting Musk’s Bel-Air home with his Space X headquarters in Hawthorne. Those lucky enough to be Elon Musk could see their morning hour commute cut to six minutes. Lest there be any confusion about who the free market best serves, this month Musk tweeted his Marie Antoinette-esque distaste for public transit and its twin aims of affordability and accessibility.

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How a Reporter Got a Corker of a Scoop About the GOP’s Tax Bill

At first David Sirota thought there was no hidden story behind the Republican tax bill. Then a tax lawyer called — it turned out there was plenty to reveal, thanks to the last-minute addition of a special loophole.

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Photo: U.S. Senator Bob Corker (R-TN)

Senator Corker’s defense was, “I didn’t know about the provision because I didn’t read the bill that I’m voting for.”


As the House and Senate moved toward approving the final version of the GOP tax bill, the International Business Times (IBT) revealed in an explosive story Friday that a loophole slipped into the bill in the final minutes will directly enrich President Donald Trump and his son-in-law Jared Kushner, as well as wealthy senators and key members of Congress, including the provision’s writers.

Controversy swirled around the timing of the measure and the fact that deficit hawk Senator Bob Corker of Tennessee abruptly switched his vote in favor of the bill, whose tax cuts the Congressional Budget Office estimated will add $1.4 trillion to the deficit by 2027. Corker had been the lone Republican holdout in the Senate and had previously voted with Democrats against the bill. He has millions of dollars invested in real estate-related limited liability companies (LLCs) that could see a $1.1 million payday from the loophole. David Sirota’s IBT reporting quickly went viral as Corker’s apparent cushy accommodation was splashed across social media under the hashtag #CorkerKickback.

Capital & Main spoke to Sirota for a blow-by-blow account of the developing story, its implications and its consequences.

IBT had been closely following the debate over how the tax measure would treat income passed through a tax shelter known as an LLC, a “pass-through” tax entity because profits pass through to its owners who report them on their personal tax returns. The Senate version had limited tax cuts to pass through LLCs that actually employ people — the “job creators.” The House version has been far broader.

“We took a look at the key tax writers on committees that oversaw the bill as well as leadership,” Sirota said. “And we got a list of their real estate-related LLCs, and a day before the final bill came out, we put together this story about who could benefit. We found that between the conference committee, the Ways and Means Committee, the Finance Committee and the two leaders of the House and Senate, there were 13 members of Congress who owned and were earning income from real estate or from real estate-related LLCs. And depending on whether the final tax bill adopts the House version or the Senate version, they would stand to make a lot of money.”

IBT reported that the members of Congress — including House Speaker Paul Ryan — have between $36 million and $163 million invested in real estate-related LLCs. Between $2.6 million and $16 million in “pass through” income from those investments would benefit from the new provision.

Which version of the pass through would end up in the final tax bill would be determined by the joint House and Senate conference committee. At 5:30 p.m. on Friday, the committee released a final version that appeared to follow the Senate approach, the more rational version, according to tax experts Sirota spoke to.

“At 5:45 we were sort of like, ‘Okay, I don’t think there’s much to really write,’” Sirota said. “‘It looks like they kind of got it out.’ But I said, ‘I’ll talk to a couple of tax lawyers who have been following this.’ And what do you know? One of them comes back to me at 6:15 and is like, ‘You know, they added this one extra line that’s not in either of the bills. It talks about depreciable assets. This is the loophole.’ He said something along the lines of, ‘It’s narrow enough that it shows intent for a specific kind of investment vehicle.’”

Senator “John Cornyn on his Twitter feed is promoting a lobbyist’s talking points to defend this bill.”

The original House tax cut on pass-throughs, Sirota explained, was broad enough to argue that it was merely an ideological, across-the-board tax cut rather than something that picked specific winners and losers. But the additional line was included with one intent in mind. That line carved out a particular tax windfall for owners of rental-income generators like apartment buildings or commercial office complexes, depreciable property with few or no employees.

“That’s when we realized this is an absolutely enormous story,” Sirota said.

The real estate-specific windfall immediately raised the question of whether the LLC pass-through had been part of a deal aimed at influencing Corker to switch. When asked to comment on the pass-through for a followup story, Corker didn’t seem to be familiar with it, Sirota said.

“He called it ‘ridiculous,’” Sirota said. “But then he called back — he must have talked to somebody — and he said, ‘You know, I’m not sure I want to criticize it that way. You know, I need more information. I haven’t really read it. I’ve only read a summary of the bill. I haven’t read the bill.’ Which is, of course, another story: You’re the key vote on a $1.5 trillion [deficit] bill, and you’re announcing your support for it, admitting that you didn’t even read it. So your defense is, ‘I didn’t know about the provision because I didn’t read the bill that I’m voting for.’ That became another sort of huge story about how [Republicans] are rushing the bill through without even the pivotal vote having read it.”

What followed Sirota’s story was a firestorm of public outrage on social media. Under mounting pressure, Corker wrote a letter to Utah Republican Orin Hatch, the head of the Senate’s tax-writing committee, supporting the narrative that he didn’t know anything about the pass-through by asking for clarification of the provision, where it came from and how it got in the bill. To take the heat off Corker, Hatch replied on Monday, insisting that he had authored the loophole. Hatch added that Corker and his staff never contacted the tax-writing committee about the bill, in effect publicly admitting that a key swing vote on the tax bill wasn’t even communicating with the staff or the members of the panel writing it.

However, the Hatch alibi could not withstand new reporting that revealed Corker’s chief of staff, Todd Womack, had been investing heavily in a real estate LLC in the run-up to the bill and also stood to profit from the provision. Worse, Texas Republican Senator John Cornyn, in a Sunday appearance on ABC’s This Week, admitted that the decision to include the pass-through came from an effort to “cobble together the votes we need to get this bill passed.” With Cornyn suddenly under attack himself, his office aggressively tried to backpedal.

“They were upset that anybody viewed it that way,” Sirota noted, “but you can read the transcript. It was very clear that’s exactly what he said. It’s incredible: Cornyn is now defending the provision on his Twitter feed — I swear to god, you cannot make this up — by sending out an article written by a bank lobbyist who is lobbying on this provision. So John Cornyn on his Twitter feed is promoting a lobbyist’s talking points to defend this bill.”

But Sirota noted that the neither self-enrichment nor massive, deficit-hiking tax giveaways to corporations and the richest Americans are new. Republicans have been redistributing the country’s wealth upwards since the days of Ronald Reagan. What actually is precedent-setting about this tax bill, he said, is how explicit it is.

“There’s no pretense in this bill,” Sirota said. “There was a thing the Republicans put out in their summary when the bill came out. I tweeted out the graphic. It was sort of in a section about trying to prevent people from using their LLCs to put their wage income into their LLCs. They called it ‘safeguards’ — and I’m paraphrasing here — ‘We have put safeguards in to make sure that the business income taxes not go to wage earners.’ They are very crystal-clear that this is a tax bill not for workers. This is a tax bill for corporations and business owners. That is the ideology. They’re actually open about that. They want the public to know.”


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State Senator Predicts “Sledgehammer Time” If GOP Tax Bill Passes

Holly Mitchell, a leading legislative advocate for children and low-income Californians, says the state may return to the days of budget cutting if the current Congressional Republican tax plan becomes law.

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State Senator Holly Mitchell (All photos by Joanne Kim)

Holly Mitchell, the state Senator who represents Los Angeles’ heavily blue-collar 30th District, has been called by one colleague the “social conscience of the entire Senate.” A personable policy wonk whose career included a stint as chief executive of Crystal Stairs, a child development nonprofit, Mitchell chairs the Senate Budget Committee — the first African-American woman to do so. She recently sat down in Pico-Fairfax with Capital & Main at the Paper and Plastik Cafe to talk about the possible effects of the Republican tax bill on California’s poor.


Capital & Main: Taking the temperature between now and New Year’s, what’s your prognosis for the House and Senate tax bills?

Senator Mitchell: The GOP tax plan is a redistribution of wealth from the poor to the rich or semi-rich. It gambles away the health care of poor people and this is unacceptable.

I’m so disappointed with the work of the [U.S.] Senate Budget Committee. I can’t imagine being a legislator, getting a report from the Congressional Budget Office that says the things it says about these bills — and voting to pass it. Did they ignore it? Did they not care?

One Senator, when interviewed, expressed concern about the bill’s potential to make the deficit skyrocket. When asked if that was enough to make him not vote for it he said, “I’m not sure. I’m still working on it.”

Senator Mitchell: The whole point of having the support of fiscal analysts and the Congressional Budget Office, with their independent status, is to provide you with critical data to help you make a decision. How can you say, “Oh yeah, that’s bad, but I’m not sure if I’m going to go forward on this or not”? Politics is continuing to trump — lowercase T—what’s best.

Is Sacramento concerned?

Senator Mitchell: Am I concerned? Yes! But I think what I’m more concerned about now is the Healthy Families Program.

This is the entitlement for California families who aren’t poor enough for Medi-Cal — but don’t earn enough to have private insurance.

Senator Mitchell: It provides care for about two million kids [and] requires federal reauthorization. And [Congress] has not reauthorized it. That could have immediate impacts on California’s budget. It’s a separate process [from the federal tax bills] but they have already missed the deadline.

It’s also been said that the tax proposals could undermine affordable housing construction in California because they would affect the credits and tax breaks that developers receive.

Senator Mitchell: Yes, which are critical for developments to pencil out. Given how far behind we are in terms of our housing-unit need, it would be devastating. L.A. County has done amazing things — voters have said yes to Prop M, yes to Prop HHH. All of that could be compromised — this delicate balance where developers can come in, get these credits to build affordable units. We’re already behind the eight ball in terms of our need. This would be yet another blow.

Defenders of the tax bill say everybody will get their taxes cut initially. Then by 2027, according to the Congressional Budget Office, middle- and low-income people will experience a net loss.

Senator Mitchell: They claim that they’re protecting “the middle class” — folks who make $100,000 and over. But that’s not how we define the middle class in California—here the salary threshold is much lower. What they claim is good news, I think, masks the bad news. And they’re rushing it through the process.

What steps are needed to analyze and create a response for a new federal tax plan’s effect on California?

Senator Mitchell: It will be a process. Unlike [the U.S. Senate], I will rely on our Department of Finance, the Legislative Analyst’s Office, the Senate Budget Committee staff to have discussions, to have a full budget hearing.

What’s your sense of the tax proposals’ potential effect on the state’s economic health?

Senator Mitchell: How we earn income as a state government could be severely impacted. We are socking money away into rainy-day funds to try to prepare for the time at which our recovery will slow down — [but] we couldn’t save enough to prepare for these [federal] proposals and the kind of hole they could blow in the state’s general fund.

What’s your plan if California does take a financial hit?

Senator Mitchell: As budget chair, I would be forced, as painful as that would be, to go back to the days of cutting. We may not be able to use a scalpel. It may be sledgehammer time — it would be devastating. In terms of the trend we’ve experienced with investments in K through 12, early education, the investments we have made in the last couple of years in the University of California and Cal State University systems — all these investments that we’ve made to expand access to services, would be impacted.

We fund Opti-Cal and Dental-Cal [for eye and dental care] — those are the kinds of core, basic human services that we could potentially have to roll back again. Medi-Cal funding helps undergird and support our overall health-care delivery system. If that went away, everything would be compromised.


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