Saturday, February 28, 2009

The Second Rebuild America Rally

February 28, 2009, 10 am
Riehle Plaza, Lafayette, Indiana

Organized by the United Steelworkers of America

Sixty-five workers, students, and peace activists listened to speeches and marched around the Lafayette Courthouse calling for a mass movement to “Rebuild America.”

Harry Targ spoke to the rally:

My excitement with this new year peaked early, seeing my folk singing hero, Pete Seeger leading 500,000 people at the Lincoln Memorial in a great rendition of “This Land is Your Land.” This song was written by Woody Guthrie in the late 1930s in the spirit of labor activism, leftwing politics, and New Deal policies creating jobs, advancing worker rights, and committing government to helping people survive in hard times.

Last February 11, 130 students showed up at an event organized by the Purdue Organization for Labor Equality (POLE) to hear two Honduran workers describe the corporate shut down of their factory because workers had decided to form a union. And these workers were producing products with a Purdue logo on them. Subsequently Purdue University canceled its contract with the company.

The next night February 12, a well-known historian gave a gripping lecture to about 120 people on the life of pro-worker New Deal photographer, Dorothea Lange.

Two days after that, the USW organized the first Rebuild America Rally. Organizers urged all of us to come together to build a movement to rebuild America.

In addition, recently peace activists in the community have been planning panels and films to challenge war policies and military spending. Environmentalists have been working hard to save what is left of the Celery Bog in West Lafayette. Two grassroots groups that worked on the Obama campaign have been building campaigns around volunteerism in the community, democratizing local politics, and one of the groups is discussing co-sponsoring training to support the Employee Free Choice Act. Meanwhile social concerns groups in many of our churches, synagogues, and mosques have been working on social justice issues with renewed vigor.

All these groups work on national, state and local issues. All the different groups are working on parallel and complementary issues: jobs and health care; jobs, healthcare, and peace; green jobs and economic development. Every group is concerned about fairness for workers, women, and people of color.

What we need to do now is join forces, work together on each others’ issues, coordinate our electoral work and maybe some day, all across this country, and this state we will be able to put our hands together and sing ‘This Land is Really Our Land.”

Sunday, February 15, 2009


February 15, 2009

Harry Targ

Seventy-five men and women, steelworkers, delegates from the Northwest Central Labor Council (AFL-CIO), anti-sweatshop student activists, representatives from Purdue’s Graduate Employees Organization, and other peace and justice activists from the community marched to “Rebuild America” on Saturday, February, 14, 2009 in Lafayette, Indiana. Organized by the United Steel Workers of America as part of four rallies around the state, steelworkers are calling on community activists, union and non-union alike, to “Join the Main Street Revolution.”

After two rousing speeches that called on government to marshal resources to rebuild America in the spirit of the New Deal of the 1930s, organizers led marchers from a public plaza to the Lafayette Courthouse. Participants then circled the old Indiana architectural wonder several times chanting for jobs, health care, investments in American industry, and union rights.

Using traditional symbols of the flag, patriotism, and appeals to God, organizers urged people of all parties, religions, and work statuses to join in future mobilizations. Some organizers urged peace, anti-sweatshop, and other activists to bring their placards to the next rally planned for February 28.

Three days earlier, Purdue Students for Labor Equality (POLE), hosted an evening educational event on the university campus to introduce two Honduran workers who were losing their jobs in a textile factory that was in process of organizing a shop floor union. POLE students are demanding that Purdue University honor its commitment to end contracts with companies, such as the one the Hondurans worked in, that produce products with the university logo that are produced in factories that deny workers rights to form unions. The event, a standing room crowd of 130, was largely made up of students. Several indicated that they had not been aware that their university had economic ties with corporations that used low paid sweatshop labor.

Images of the working class figured prominently in an event the next night at Purdue University. Distinguished progressive historian, Linda Gordon, gave a presentation on the life and work of the great documentary photographer, Dorothea Lange. Lange’s portraits of workers, Gordon argued, created in the American mind the reality of the Great Depression and its impacts. While her subjects, workers, women, African-Americans, Latinos, and Asian-Americans, had been primarily victims of the capitalist system, Lange’s subjects were also strong, pensive, proud people. For Lange, these were the people who built the country and cared for it, its families and communities. And while Lange did not take many pictures of demonstrations, protests, and strikes, Gordon said, Lange believed that those she had photographed were the kinds of workers who were on the front-lines of class struggle. They represented the democratic spirit, demanding that a new America be created, one based on principles of economic well- being and justice.

In the end no one can predict what these mobilizations in Indiana for worker rights will create. It does seem that everywhere around the country there is a new consciousness emerging. In North Central Indiana it is appearing among workers and students, on the streets and in the academy. In addition it is rising among local activists around a whole array of peace and justice issues. While these manifestations take different forms in different places, it does seem like people are beginning to make a new history.

We’ll have to stick around and see.

Harry Targ teaches Political Science at Purdue University and is a delegate to the Northwest Central Labor Council, AFL-CIO.

Thursday, February 12, 2009

Ideological Justifications for the Permanent War Economy and the Globalization of Empire

Harry Targ

Constructing and maintaining a permanent war economy was a policy commitment made by virtually every U.S. administration and Congress since the 1940s. It meant that budget decisions would be based on the primacy of military spending. And, military spending served ever since World War II as an economic stimulus to overcome recessionary dynamics in the economy as a whole and to support secure contracts for huge corporations engaging in military production and service.

The permanent war economy paralleled and supported the fifty year development of U.S. capitalism on the world stage. During this time frame global capitalism shifted economic activity from direct investment in goods and services at home and abroad to financial speculation. Those corporations which continued to manufacture goods for domestic and international consumption shifted their productive operations to poor countries where lower wages could be paid. These changing features of the international political economy were extended by globalization, the dramatic increase in cross-national economic, political, and cultural interactions. In short, the global political economy of the last fifty years has been significantly shaped by the building of a permanent war economy, financialization, deindustrialization, and globalization.

While these processes are critical to understanding the U.S. role in the world, scholars, pundits, and most importantly politicians explained the U.S. role in the world in different ways. The American people were told that the U.S. faced diabolical enemies, that our place in world history was special, and that we had an obligation to bring the American experience to the world.

The ideological campaign for the Cold War was articulated in speeches by former British Prime Minister Winston Churchill in 1946 and President Harry Truman in 1947. The former, addressing a college audience in Fulton, Missouri warned that “…from the Stettin in the Baltic to Trieste in the Adriatic, an iron curtain has descended across the continent.” One year later, President Truman in his famous Doctrine speech argued that there were two ways of life in the world, one based on freedom and the other tyranny. The United States, he said must defend the forces of freedom against “totalitarianism.” Of course, the threat came from the Soviet Union.

Three years later, an “in-house” document, National Security Council Document 68 (NSC 68) was drafted and circulated in the Truman administration by Secretary of State Dean Acheson. It recommended that military spending be the number one priority of every administration. And the recommendation was necessary because the Soviet Union constituted a military threat and an economic challenge. When the Korean War started, NSC 68 became publicly articulated policy and vision (even though the document itself remained classified until the 1970s).

The ideological construct, “good versus evil,” “freedom versus totalitarianism,” was rigidly imposed on a frightened public in the 1940s and 1950s as anti-communism pervaded the society. What came to be known as “McCarthyism,” imported images of domestic traitors, subversives, and foreignness into the American cultural stream. The threat was so great at home as well as abroad that state repression was justified to protect the nation.

In addition, academia contributed to the public face of this ideology through its development of “modernization theory.” Economic historian and Kennedy and Johnson foreign policy advisor Walt Rostow described what the world faced: Communism was “…a kind of disease which can befall a transitional society if it fails to organize effectively those elements within it which are prepared to get on with the job of modernization.” The disease must be expunged so that poor countries could develop market-based economies as did Europe and the United States. The ideological ground was laid for Vietnam, the Dominican Republic, Chile, Central America, and Iraq and Afghanistan in our own day.

And, of course, we can reflect on the words of President Reagan who proclaimed shortly before he left office:

“We cannot escape our destiny, nor should we try to do so. The leadership of the free world was thrust upon us two centuries ago in that little hall of Philadelphia. In the days following World War II, when the economic strength and power of America was all that stood between the world and the return to the dark ages, Pope Pius XII said, 'The American people have a great genius for splendid and unselfish actions. Into the hands of America God has placed the destinies of an afflicted mankind.’ We are indeed, and we are today, the last best hope of man on earth.”

And finally in our own day, and when the Soviet “evil empire” was long gone, a new enemy, “international terrorism” was identified. And, like the former Soviet Union, this enemy threatened our being and necessitated a strong military response. President Bush said in 2002 (and again in a similar way just days before he left office):

“But the best way to secure the homeland is to find the enemy wherever they try to hide and bring them to justice. The best way -- make no mistake about it. You should not be confused about the nature of the people we're dealing with. They hate us, because we're free.They hate the thought that Americans welcome all religions. They can't stand that thought. They hate the thought that we educate everybody. They hate our freedoms. They hate the fact that we hold each individual -- we dignify each individual. We believe in the dignity of every person. They can't stand that.

And the only way they know to express themselves is through killing, cold- blooded killing. And so we need to treat them the way they are, as international criminals. And that's why my defense budget is the largest increase in 20 years. You know, the price of freedom is high,but for me it's never too high because we fight for freedom.”

In sum, while American imperialism has its roots in military spending, financialization, deindustrialization, and globalization, it has been explained to the American people in terms of high moral principle, coupled with a sense of the special mission that American brings to the world. For Puritan America, Ronald Reagan, and George Bush, America is “a city on a hill.” While peace activists need to work against military spending, oppose the speculative economy, demand worker rights at home and abroad, and oppose unbridled “free trade,” they must challenge the ideological justifications that have served to mobilize a troubled and pliant citizenry to support US policy for decades.

Thursday, February 5, 2009

The Global Political Economy and US Foreign Policy

(Excerpts from a presentation at the Deerfield Progressive Forum, Deerfield Beach, Florida, January 17, 2009)

“When people do not have sufficient access to income, tools, opportunity and ability to accumulate assets, their fundamental right to work and earn a livelihood is threatened. Around the world and in the United States, systemic injustices, disparities based on gender, race and class, market fundamentalism, reworking of trade agreements and the erosion of labor rights all contribute to the erosion of people’s ability to earn a living wage with dignity.” Unitarian Universalist Service Committee (, 2006.

We would be remiss if we failed to see the connections between the historic development of the permanent war economy and the parallel and connected developments of the global capitalist system. The global economic crisis and attendant war and terrorism in rich and poor countries alike are the direct resultant of years of unbridled, unplanned capitalist expansion on the world stage. We can plot the transformation of the global political economy, that is the parallel and combined development of economic and political institutions since World War II, to understand how and why the crisis of today emerged. And, after reflecting on world history, we can begin to see what needs to be done to overcome the crises that befall us.

Economic Crisis and Shifts Toward Financialization, Deindustrialization, and Globalization

During the period from 1945 and 1968, the so-called “golden age” of the U.S. economy, multinational corporations and banks spread across the globe while domestic consumption soared. Except for short recessions, the US economy grew steadily. The permanent war economy resulted in massive military spending, U.S. troops and bases in dozens of countries, bilateral and multinational military alliances, and deepening wars in Asia and covert operations in Africa, the Persian Gulf, and Latin America.

Underlying the global thrust of the U.S. military was an economic expansion similar in scope to the British empire of the nineteenth century. For example, US invested capital rose from $11 billion in 1950 to about $70 billion in 1969. This was so because profit margins from foreign investments were almost twice those of domestic operations. The year 1969 was illustrative as profit rates were 6.8 percent on domestic investments and 12.5 percent on foreign investments. MacEwan wrote about the significance of enlarging investments around the world when he suggested that “the absolute growth of U.S. business interests abroad is impressive, but it should be seen in the context of the establishment of overwhelming U.S. dominance in the international capitalist economy” ( in Harry R. Targ, Strategy of an Empire in Decline: Cold War II, 1986, p.32.)

The growth of international banking paralleled the growth of private investments on a worldwide basis and the United States was one of the leading financial participants. “In 1960 eight U.S. banks operated 131 overseas branches with overseas assets of $3.5 billion …By 1970 there were seventy-nine banks with 583 branches with $77.4 billion in assets…For comparison’s sake, the total assets of all U.S. commercial banks in 1960 were $255.7 billion; in 1967 $448.9 billion; and in 1974 (June) $872.0 billion. Thus while total domestic assets grew about 3 and one-half times between 1960-74, overseas assets grew about 42 times” (James Hawley in Targ, p. 35).

But, for reasons of military excess and the contradictions of global capitalism, the golden age could not last. The 1970s brought economic crisis around the world: oil shocks; inflation; high unemployment; over production; growing economic competition among the United States, European nations, Japan, and the Socialist camp. To further complicate the picture, third world revolutionary movements and demands for a New International Economic order challenged the global domination of industrial capitalist powers.

From the standpoint of U.S. corporations and banks, the most critical part of the crisis was the squeeze on profits. Public policies were adopted to promote recovery, particularly in profit rates. For example, the Nixon administration withdrew the United States from the Bretton Woods system of fixed exchange rates so that investors could speculate in currencies.

In addition, the rulers of the International Monetary Fund and private banks began a massive campaign to pressure poor countries to borrow money. At that point the debt system as we know it was launched. It opened the doors for wealthy countries, from which corporations and banks came, to impose economic policies on loan recipients. As poor countries found themselves unable to continue to import oil at draconian prices, European and U.S. banks, flush with petrodollars from oil rich countries, made funds available. In exchange, demands grew from powerful countries and leading international institutions such as the International Monetary Fund to force borrowing countries to deregulate and privatize their economies and cut taxes. Poor countries were told that they would receive loans if they transformed their economies in ways to open the doors to foreign capitalist interests. Eventually, the changes demanded of poor countries were instituted in rich countries as well. In sum, the political agenda of imperial powers was to use the economic crises, particularly the oil shocks, to reverse the forty year commitment of the capitalist world to the welfare state.

In this 1970s context of global economic crisis three interconnected components of the capitalist system were set in motion. The first, as has been suggested, was financialization. This involved the dramatic growth over the subsequent years in lending and credit, debt servicing, and speculation (stocks, bonds, hedge funds, private equity funds, and other forms of paper, e.g. “the virtual economy). The second, deindustrialization, constituted a massive movement by investors of capital out of U.S. goods-production, or manufacturing, to more profitable speculative activities or to production overseas where labor costs, wages and benefits, were significantly cheaper. Finally, globalization stimulated a qualitative increase in the integration of the U.S. into the global economy and culture with shifts to overseas production, distribution, lending, and speculation.

The period since the late 1970s and most associated with the “Reagan revolution” represented the culmination of policies relating to financialization, deindustrialization, and globalization. The United States, the international financial institutions, and other capitalist powers, vigorously promoted so-called “neoliberal policies” everywhere. Countries that needed to borrow money to continue to purchase the oil they had become addicted to were forced to downsize their governments, cut back on public services, deregulate their economies, sell-off or privatize their publicly owned enterprises, and shift to producing products for export rather than domestic consumption.

At home, there were significant reductions in government programs relating to health, welfare, and education and radical increases in military spending. Sustained campaigns were initiated to destroy the labor movement. Tax cuts targeted the wealthiest Americans and breaks were given to corporations which shifted their manufacturing facilities to other parts of the world. And foreign policies were instituted to force poor countries to embrace the neoliberal policies described above. With minor variations such policies continued through forty years of Republican and Democratic party rule. Contemporary critics of these historic developments, such as Joseph Stiglitz and Kevin Phillips, refer to the economic program as “market fundamentalism” and the political vision of limited government, “negative government,” (limiting government programs to military spending and domestic police protection).

The Global Political Economy Today

We now can consider the structure of the global economy today, the impacts of these policies, and the reaction to them from those motivated to fulfill the fundamental needs of the world’s people.

Just a few pieces of data will illustrate what this historic process of economic and political transformation has come to:

First, economic concentration at the global level has reached extraordinary proportions. By 1996, the top 200 multinational corporations had combined sales exceeding the value of the Gross National products of all but the nine wealthiest countries and by 2002, these sales equaled 28 percent of the value of all goods and services produced in the world. In 2003, 52 of the world’s largest economies were corporations and 48 were nations. The largest corporation in the world today, Wal Mart, has the 19th largest economy among states, corporations, and banks. As to banks, twenty of them had assets of $425 trillion at the dawn of the new century and only 16 accounted for 60 percent of speculation on foreign exchange markets in 1999. Financial speculative transactions, reached a dollar value of $1.5 trillion a day in the 1990s.

Second, global debt continues to grow and is paralleled by expanding national and personal debt in the United States, thus increasing the vulnerability and precariousness of all peoples. Poor countries owed the international banks, public and private, $2.5 trillion in 2004 and between 1998 and 2002 poor countries paid back interest and principle on the debt $217 billion more than they received in new loans. And in the United States since the 1990s, American indebtedness has exceeded earned income.

Third, the processes of personal remuneration are being radically transformed on a worldwide basis. Over the last 100 years, the major activities workers of all kinds have engaged in to “earn a living,” have shifted from agriculture, (providing basic sustenance), to manufacturing (in many cases earning a livable wage), to service (working for lower and barely survivable wages), to struggling in the informal sector (desperately hustling on the streets, running drugs, prostitution, gambling, and selling commodities in public markets). Almost half those who seek to earn a living in Latin America today are now in the informal sector.

Fourth, inequality is expanding between countries and within countries and economic and political marginalization, or human precariousness is spreading. United Nations and others sources report that gaps between rich and poor people have grown over the last 40 years. Eighty percent of the world’s gross domestic product is controlled by one billion people and the other five billion share the remaining twenty percent of it. Nearly one quarter of humankind lives on $1 a day and almost half, 3 billion people, live on $2 a day. African economist, Samir Amin, has a name for this mal-distribution of income and wealth. He calls it human “precariousness” (Monthly Review, October, 2003). The growing inequality in the global system is paralleled by a similar dynamic within the United States, with at least ¼ of the population poor or working poor. And African American scholar Manning Marable reminds us that the growing precariousness of existence in the United States hits people of color disproportionately (“Globalization and Racialization,”

Resistance to Empire Abroad and at Home

These and other data can be daunting, particularly if we fail to examine the varieties of resistance in global and national politics. Mass movements of workers, farmers, women, indigenous people, environmentalists, and peace activists have been mobilizing increasingly everywhere. One kind of example is the World Social fora, the annual meetings of so-called “anti-globalization” activists who meet and network every year somewhere around the world. Their rallying cry is “Another World is Possible.” For the first time, an annual meeting of the World Social Forum was held in the United States in June, 2007in Atlanta, Georgia. About 10,000 people attended, largely youth, women, people of color, and activists from or in solidarity movements with peoples of the Global South. Their energy, enthusiasm, and vision were inspiring.

At the level of governments, resistance to the global economic and political order that had been established after World War II is being challenged. Opposition is growing to rich country trade demands in the WTO, continued IMF penetration of poor countries, the debt system, and big power interference in the political and economic life of countries of the Global South.

In the United States during the recently concluded election season political interest and participation was high. Young and old became energized by the political process. Candidates were being pressured, by virtue of the mobilizations, to address issues relevant to workers, women, African Americans, and youth. They were forced, however inadequately, to address health care, the environment, racist government policies, and a neoliberal economic policy that privileges corporate and banking interests at the expense of workers in the United States and around the world.

All of these trends and forms of resistance have been highlighted within the last year by the emergence of a national and global financial crisis that has not been seen since the Great Depression of the 1930s. Global capitalism is experiencing over-production, under-consumption, rapidly declining profit rates, unrecoverable indebtedness, and massive unemployment. In addition, the very environment that sustains life is under serious challenge. It is possible that the capitalist development of the late twentieth century, including financialization, deindustrialization, and globalization, and fostered by neo-liberal policies and militarism has reached a moment in which its survival is at risk.

Whatever the future holds for the global capitalist system, progressives must work in the short-run to try to improve the physical, political, cultural, and psychological well being of the world’s citizens. In the twentieth century we saw various political movements and ideologies offering a vision of “positive government,” that is a vision that says that political (and economic) institutions can and should be created by
and for the vast majority of people. While many experiments in positive government failed, for a variety of reasons, the global movements of our own day are saying that we can establish new institutions that represent us all, and not just the rich and powerful. In the face of this deep crisis of capitalism and militarism, that is the continuing challenge of the 21st century.

Harry Targ teaches and writes on United States foreign policy and international political economy at Purdue University. He has a blog at