Fear and Loathing
On the 17 July 2020, episode of Counterspin, Fair’s Janine Jackson interviewed True North Research’s Lisa Graves about attacks on the US Postal Service. ‘A Combination of Forces Puts Our Postal Service at Grave Risk‘ Jackson leads off talking about the recent appointment of Louis DeJoy, a big Trump donor, to be the new head of the US Postal Service. Upon being appointed, DeJoy promptly issued a series of memos calling for operational changes that many felt were intended to slow down mail delivery. Other recent Trump actions appear to also be intended to sabotage the US Postal Service. In that Trump has made Vote by Mail a big issue, some fear that he might try to nullify his losing the election by claiming that a slow vote count equals an indication of fraud, etc.
Graves’ research into attempts to sabotage the US Postal Service disclosed that for more than 50 years none other than Charles Koch has been funding efforts, at first to abolish, later to privatize, the US Postal Service. In addition to Koch, DeJoy, and Trump; Ronald Reagan, Reagan Administration official James C. Miller, Senators Susan Collins of Maine and Mitch McConnell of Kentucky, and George W. Bush have all taken a hand at this sabotaging and/or privatizing of the US Postal Service. Former Reagan Administration official, former American Enterprise scholar, James Miller, was later appointed to the Postal Board of Governors by George W. Bush with significant help from Senators Collins and McConnell. In 2005, Senators Collins and McConnell both helped push through the prepaid benefits requirement meant to sabotage the Postal Service. To date, some powerful actors have expended a lot of money, time, and effort attempting to abolish, privatize, or sabotage the US Postal Service.
What it means to want to abolish or sabotage something seems clear enough. The wanting doth bespeak an animus. Did these people hate the US Postal Service so much? Or, did they fear that it might succeed?
Herein, privatization refers to the conversion of publicly owned entities to private ownership.
Upon coming to power in the 1930s, Adolf Hitler’s Nazi Party privatized a lot of Germany’s industries. This privatization was, no doubt, much about making alliances with Germany’s social elite, and others considered to be politically and economically powerful; gaining leverage over the banks, steel industry, etc. in anticipation of waging war. Though they used the expression re-privatize, the Nazi privatization could be seen as the origin of the modern concept of privatization as it applies to the converting of publicly owned entities to private ownership.
In 1955, Milton Friedman proposed privatizing public schools; saying that he wanted to bring ‘market forces’ to bear. At that time, he couldn’t quite go there yet on US Social Security, but, in 1981, he did convince Chile’s Augusto Pinochet to give privatization of Social Security a go in Chile.
With Charles Koch, it seems to have been an animus toward any and all public services; one perhaps handed down from his father. In this animus toward public ownership, Koch is allied with the powerful Heritage Foundation and Cato Institute, various political action networks and PACs, and several Koch Brothers endowed Chairs at Major Universities. If publicly-owned services are indeed so bad, why the animus? Surely they will fail on their own or be rejected by the people?
In the 1990s, publicly owned industries in the former USSR were privatized consequent its breakup. Ever since, Americans and the whole world have been witness to the rise of the $billionaire oligarchs, oligarchy, and autocracy in Russia.
Today, sixty-five years after Friedman’s 1955 proposal, powerful actors in the United States are still trying to privatize the US Postal Service, Public Schools, and Social Security.
Why privatize? What’s the impetus? It seems the reasons given for privatization vary from wanting to form strategic alliances to animus toward public ownership; from a belief in the magic of market forces to corruption, graft, and avarice. Even less seemly, the reasons may: include a claim by business to an inherent right to skim, reflect a business first ideology, be seen as a means to better keep labor in its place, involve classism, be intended to serve as a means of preserving capitalism, allow for more control of government services by the private sector, …
If Charles Koch had been successful in abolishing the US Postal Service in 1970, there would have perforce been some form of a replacement postal service. If the US Postal Service had been replaced by Koch Enterprises Postal Service (KEPS), safe to assume that KEPS would have been structured either as a for-profit corporation or as a for-profit Government Contractor. Either way, most people could not have afforded it. Rural Free Delivery would have been replaced by something akin to UPS, meaning that letter delivery would have cost a few dollars each — several dollars per week. Or, the rural customer could pick up their mail the next time they were in town, or ask someone else to pick up their mail and bring it out to them. Still, in town, there would have been a charge at pick up. KEPS may have been able to make a profit delivering to mail to large department/condominium complexes at pre-privatization rates, but most urban and suburban residential mail delivery, too, would have cost patrons a few dollars a week. Delivery to businesses above a certain size would probably have been profitable. To get equivalent service, most postal patrons were going to have to pay more. In 1970, before the internet, almost all billing to, and payment from, residences was by mail. The billing entities might have been willing to pay KEPS for delivery and collection, but they would have added the cost of doing so to their billing. And, there is the matter of personal letters, etc. We would have had either a grossly inadequate postal service, or a too expensive for most, yet inadequate, postal service when a postal service that provided the service needed is what was needed. Like better roads, mail delivery helped move the country forward; too, was an essential service.
If KEPS had contracted with the US Government to provide service akin to that existent in 1970, it would have, no doubt, sought to improve efficiency by way of automation; automation that replaced workers. It almost certainly would have tried to pay less to the employees either by pay cuts, fewer benefits, or by subcontracting out the labor to subcontractors who would pay less, and provide fewer benefits. Markets are, after all, profit-driven. Some services are a necessity. Their delivery should be efficient, but the essential service provided should be the driver. Essential government services will never be made profitable without factoring in the value of the service provided.
While a Postal Service provides the service of delivering mail to all; Public Schools are charged with delivering the service of providing K-12 education to all children. It’s not like that we only give education to those who can afford it; since 1918, all American children are entitled to, indeed required to go to school. How would market forces being brought to bear, education being bought and sold in an open market, improve public schools? A group of teachers could form a business and offer their services for a fixed fee. Those services could be quantified as a promise that a child would graduate from a grade or from high school, etc. Being professionals, the teachers could insist on being paid whether or not the student graduates. Their proffer could be to teach certain subject matter in a manner that most students would be able to assimilate. I doubt that Friedman had a business model owned by teachers in mind. More likely, he envisioned a capitalist start-up, for-profit, private school, hiring teachers and staff at market value and charging local government agencies, school districts, so much per student per year. No doubt, the school district, in turn, would insist that the private school teach all the kids in the district. Friedman must have thought that there was a lot of fat in public schools. In order to make a profit, the private school owner(s) would try to control cost by: paying lower salaries and wages, demanding that each teacher teach more students, subbing out the janitorial services, … there weren’t many other options in 1955.
Today, we have Donald Trump and Betsy DeVos leading the efforts to replace Public Schools with Private Schools. Using sabotage, whatever it takes, they seek to rid us of Public Schools. To rid is to abolish. Very kind of them, but who asked?
The main impetus for privatizing US Social Security seems to have been the hope that to do so would provide significant stimulus to the stock market; again, avarice. It is an awful lot of money.
One thing missing in these calls for privatization is the distinction between goods and services. While it may well be that such goods as shirts and shoes, fruits and vegetables, hats and gloves, telephones and computers, and cars and trucks can be efficiently produced and distributed by market forces; it does not follow that such essential services as the education of the nation’s children, mail delivery, healthcare, and internet services can be efficiently provided and distributed by market forces. Distinctions and differences are important. Goods and services are distinctly different things. The word essential in essential services means that these services are just that, a basic human need, right. Being efficient includes getting the desired results. The only way market forces can be brought to bear on the provision of essential services is if these essential services were put out to bid under the tightest of performance specifications. Those performance specifications would include minimum wage and benefit requirements, and meaningful penalties for failure to meet performance criteria; they must create a level playing field. A government demands a lot from its people; sometimes the risking of their lives. There are some things, such as education, mail delivery, internet services, health care, and a minimum standard of living that a government owes its people. That is what it says in the preamble of the US Constitution, “.. provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, …”
In FDR’s Second Bill of Rights, circa 1944:
- The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;
- The right to earn enough to provide adequate food and clothing and recreation;
- The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;
- The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;
- The right of every family to a decent home;
- The right to adequate medical care and the opportunity to achieve and enjoy good health;
- The right to adequate protection from the economic fears of old age, sickness, accident and unemployment;
- The right to a good education.
Those words were spoken, in the 20th Century, 76 years ago. The US Constitution was ratified, in the 18th Century, 231 years ago. We are now more than 20 years into the 21st Century. Any model wherein: if someone loses their job they lose healthcare; a child is denied an education; millions of people are homeless; and seniors cannot afford housing, medicines, and food is antiquated, immoral, and disgraceful. Ideology and dogma can be no excuse for not providing these essentials; must not be allowed to be used as a means of rationalizing away these obligations.
Welcome to being a Bear.
There is a reason why the GOP has relied more and more on culture wars to remain viable–there simply are not enough selfish pure capitalists who have no moral qualms about returning society to a feudal system. Now that the moron in chief has failed so miserably Biden may have a chance to go big like FDR particularly if the Dems win back the Senate and eliminate the filibuster. Certainly, there may be backlash in 2022 but the thing is people like socialism the more they get of it–that is why the GOP has been so focused in killing social security, medicare, the ACA etc. All have become more popular with more voters as time goes on.
“… people like socialism the more they get of it–…”
[I really doubt that, at least here in the US. People in the US have long appreciated socially and civically responsible representative government, such as the New Deal which was the last time government in the US was able to take one step forwards without tripping over its own feet and taking two steps back. Some quasi-democratic quasi-socialism is much different than true socialism.
That said then I became an ideological socialist growing up with New Deal parents that worshipped FDR second only to Jesus Christ. The more I educated myself on the USSR and Maoist China, then the more I understood the inherent risks in totalitarianism regardless of the supposed ethical underpinnings. Long before I had ever heard of Lord Acton I had realized how unavoidably correct he had been. So my socialist sentiments evolved into anarcho-syndicalism, yet I fully understand that quasi-social quasi-democracy is about as far at the US could reach in any realistic amount of time.
John Emerich Edward Dalberg-Acton, 1st Baron Acton, 13th Marquess of Groppoliis is perhaps best known for the remark, “Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men…”, which he made in a letter to an Anglican bishop.
I think Terry’s formulation implies that the people like the one (cautious) step forward at a time affirmation of social rights you and Ken point to, or have I misunderstood because the Domino Theory is back in warp gear in the news-o-sphere and I’m hearing it everywhere?
Really enjoyed the post, one of my favorites.
A squirmy kid’s hair is harder to cut. Some places in Alaska take far more effort to deliver mail. Learning disabilities make teaching far more difficult. When society makes a moral choice to deliver universal service, it fails to consider the economics of diminishing returns.
Cognitive dissonance allows voters to believe they are choosing universal service and still demand an equal share.
I am sure that you are correct.
For my part though I choose to emphasize such semantical correctness that we do not carelessly throw around loaded words that harm our cause more than help and which also communicate inexactly enough that even among a like-minded group such as we have here at AB, one cannot always be sure with whom or what they find themselves in agreement, or not.
OTOH, right wing travelers know precisely what socialism means when thrown about without strict qualification and they load their guns with ammo made of our own mistakes. I have read several comments by Terry here at AB, from which I might deduce that he is moderately progressive inasmuch as either of us might be likewise considered such. Ideologically we are in effect quite similar, but semantically quite different. Of course if one lives in San Francisco then one need not be so guarded with expression of liberal sentiments as one might need to be if one lives in central Virginia such as I do. When it comes to electoral voodoo, then my sense is that there are more purple regions in the US than there are deep blue. Our blessed Internet creates challenges to accustomed concepts of colloquialism.
Just to further confuse matters then there is often a contradiction between what we actually strive for and what we would want if we were not constrained by the realities of political adversity, ideological diversity, and the darker side of human nature. Note that I separate politics from ideology. Ideology defines what we want. Politics defines what we are willing to do to get others to do what we want. Politically, then since 1968 I have had to settle quite a ways away from my true ideology, which reality has tempered a great deal from socialism to moderately progressive over that same time period. My dad was a communist sympathizer, but he was also illiterate. He could read blueprints and build a bridge, but was quite ignorant of political history.
Enough cynicism for now. I have work to do.
(after careful consideration) Cynicism be damned! As you point out, we are semantically quite different, and I propose we celebrate that rather than let those right wing travelers define them as “mistakes.” I posit we (on an individual basis) shouldn’t pretend that their psychic ammo isn’t full of blanks. The onus is not on me that the person I am speaking to acts in good faith and honestly, it is on them. A person should freely enjoy commenting on these matters for humor, enjoyment, adding insight, and whatever else they enjoy-they should not have to do so with laden with the burden of persuasion weighing down all the speech the right tries to restrict. I accrued a lot of student loans, whose interest ain’t slowing down, getting schooled on persuasion. If you want me to convince one if the burden of proof is met then they can pay me. If you they want to act disingenuously and in bad faith they can have all of that responsibility in personam.
Great examples. You and Run got me thinking about the USPS and the different things they do, one including aiding law enforcement. Do people know how important the USPS is to some police operations? How much have they enjoyed other aspects we have done the slippery slide to private policing and below?
There is time enough for a less cynical thought though.
Even privately owned insurance companies socialize risks among their pool of clients while collecting economic rents for the privilege of doing so. Socializing risk is not some kind of socialism.
More strictly, socialism is public ownership of the means of production. Financialization has convinced us that money is the means of all production. BS that! The sovereign prints money, but it cannot print a car or a steak. The problem is that finance should have never been privatized. Privatization of finance was a privilege granted to loyalists. Privatization of finance has us thinking out our butts. The underlying principle to the privatization of finance is that FIRE markets will practice better judgement if they compete against each other for profits. How well has that been working out for us?
Production and distribution of public goods is similar, but because of infrastructure investment costs there is value to highly regulated monopolies for public utilities. The state need not own public utilities in so long as they are regulated to meet the needs of the public good including little to no economic rents imposed on stuff that everyone needs.
Privatization of public goods creates state sponsored rentiers unless carefully managed. Such arrangements should hardly be considered anti-socialism when, in fact, they can lead to quite the opposite.
“More strictly, socialism is public ownership of the means of production. Financialization has convinced us that money is the means of all production. BS that! The sovereign prints money, but it cannot print a car or a steak.”
IZ- Brilliant. I appreciate the distinction between substantial (in substance, not “large”) socialization-pooling a loss/risk to maintain the development and investment in capital-and procedural socialization where representative government has formal control of the production. Those distinctions often screw me up, the procedure almost always being more impactful than the substance.
“The problem is that finance should have never been privatized. Privatization of finance was a privilege granted to loyalists. Privatization of finance has us thinking out our butts. The underlying principle to the privatization of finance is that FIRE markets will practice better judgement if they compete against each other for profits. How well has that been working out for us?”
IZ- Tis why I am especially concerned whenever the FIRE markets involve police surveillance, use of force, prison sentences, influence on and participation in law enforcement… They close their eyes and ears to the people on the streets’ testimony of the disinterested, utilitarian violence that is the marriage of finance and policing.
Damn you guys are good.
Around 2014, I made the acquaintance of Mark Jamison, a retired Postmaster in North Carolina and Steve Hutkins a Lit. Prof teaching place studies at the Gallatin School, NYU. Steve was writing at “Save The Post Office Blog (his) and Mark was a contributor. Two brilliant people which I managed to talk into allowing me to put their words up at Angry Bear. Mark served with the 101st and I was with the USMC during the same time period in the late sixties early seventies. I thought I would offer you some greater detail on the Post Office.
Steve: Invisible Hands: The Businessmen’s Campaign to Dismantle the Post Office
Mark: When Titans collide: UPS petitions the PRC to change USPS costing methodologies
“A FIRE economy is any economy based primarily on the finance, insurance, and real estate sectors. Finance, insurance, and real estate are United States Census Bureau classifications. Barry Popik describes some early uses as far back as 1982. Since 2008, the term has been commonly used by Michael Hudson and Eric Janszen. It is New York City’s largest industry and a prominent part of the service industry in the United States overall economy and other Western developed countries…”
Lol, there was nothing privatized in Nazi Germany. Everything ran through the Nazi party and when you weren’t getting approval, you were “replaced”.
Easily one of the dumbest quotes ever mentioned on this blog.
The Fire sector was already there during the 19th century, but the poor nature of the economy didn’t allow huge debt run ups. I would argue the 1920’s was its first bubble after 100 years of debt inflated investment into machines was finally creating wealth(Which was the real reason the US civil war happened, the globalist planters were harming the economy, the slave trade was basically dead by the 1850’s in favor of mechanization and colonial debt expansion by the banks).
The New Deal/DOD boom further enhanced wealth this wealth and ending the Inflate/confiscate commodity money for extend and pretend in the 70’s has created the most massive debt bubble in history that needs consistently bailed out.
The real problem is the Jewish commercial capitalism developed around 1000 was based on survival and was a middle ages ponzi scheme.
It is a bit late in the discussion but I thought Ken’s original post was describing the economy which I grew up with and have lived with most of my life although clearly altered by Reagan and to a lesser extent Clinton. I lived a lot of years in Milwaukee where the “sewer socialists” ran local politics for the first half of the 20th century. I am also influenced by Denmark typically ranking first in citizen happiness. Bernie also influenced me before he became a presidential candidate—he was thinking about it, but not declared—when I heard an interview where he pointed out that the word “ socialism “ comes from the word “social” which also is the root of “ society”. I apologize for using these terms loosely, but we have been a “ mixed economy” for my entire life and I do not subscribe to changing that in either direction. I also recognize that I am old and innately more conservative as a result but IMHO we have swung too far in the “free market” direction which is socialism for the rich and the law of the jungle for everybody else. That is not my view of a society or even being social. Again I did not mean to use the term “ socialism” in a technical sense but only to suggest that most people sort of like not having to watch their backs by themselves 24/7.
I remember when the USPS introduced email back in 1980. It was designed to interoperate with paper mail. If your party had an email address, they got email. If they didn’t, they got a paper version the next delivery day. They even had some basic text markup and supported graphical letterheads. Needless to say, the private sector had them shut it down, so we had to wait until the 1990s before email was generally available. As far as technology goes, the private sector follows the public sector, often with a decade or more lag.
June 23, 2020
Saving the Post Office, Defending Black Workers
By HAYLEY BROWN and DEAN BAKER
The Postal Service has historically been an important source of middle-class jobs for Black workers, especially where racial discrimination was strongest in the private sector. This pattern continues to the present.
We previously posted * our findings from an analysis of the Current Population Survey (CPS) that showed Black workers are substantially overrepresented among state and local government employees. The share of Black workers in state and local government jobs is 20 percent higher than in the private sector. If budget shortfalls force state and local governments to cut their workforces, Black workers will be disproportionately victimized by the layoffs. It turns out that the situation is similar with employees of the Postal Service. Postal workers are more than twice as likely to be Black as workers in the private sector. Our analysis of the CPS shows that in the three year period from 2017 to 2019, 26.8 percent of Postal Service workers were Black. This compares to 11.5 percent of the private sector workforce during this time period. As in state and local government, the pay gap between Black and white workers is narrower among those who are employed by the Post Office than among workers in the private sector….
What was written about privatization in Germany was interesting and important:
Lol, there was nothing privatized in…
[ This comment was wrong and with the following comment was malicious. ]