Guest Post by William Neil
Part Three: Why The Caged Birds Don’t Sing in Annapolis
And now let me take these musings, and my readings in the history of democracy and the political economy of the United States, and come back and visit the doings in that sleepy, isolated, old colonial town with the remarkably preserved architecture, but no rail connection, Annapolis. What is the nature of the “cage” that prevents those vast Democratic majorities in the Assembly and the Senate, comparable to those that Democrats and FDR enjoyed after 1936 from doing more? Well, we have already seen that the two Maryland Senators led the attack on the Wagner Act, foreshadowing the Southern Democrat-Republican alliance that would become a powerful national force after 1938…and especially after 1964. But I don’t just want to hurl charges against the timid nature of the Democratic Party in Maryland, I want to try to understand the forces operating to construct that cage of ideas, of political economy limits that restrains them.
So my first question is: is Annapolis a unique world, reflective of the not so progressive traditions of Maryland’s’ half slave, half-free character before and during the Civil War? Or is it also, like most of the United States, and the rest of the world, living under the “apparatuses” of “repression” and “justification” that Thomas Piketty hints have lain behind capitalism’s three century’s ability to maintain a rate of return on capital of 4-5%, enough to insure the great inequalities of wealth and income that have been the norm, not the exception, both in Europe and the United States – and which now go under the banner of “neoliberalism,” or, if you would prefer, “free-market capitalism” – and the “managed” democracy that Wolin says now goes with it? And Maryland, it seems to me, is not so unique in the divisions it obviously has between its rural northwest counties, and southeastern ones, those lying outside the economically dominant metropolitan areas close to Washington and Baltimore. You can find the same divisions and tensions in New Jersey, New York too, and as those who follow fracking have come to know, in Pennsylvania, the vast semi-rural areas that lie between Pittsburgh and Philadelphia, and have always lain outside all that was meant by the term “the Main Line.”
I think that the Democrats in Annapolis, like Centrist Democrats everywhere, and even the ostensibly more social democratic socialist parties in Europe, currently live and work inside the intellectual structures of “free-market” capitalism’s cage, and now I’m going to try to empathetically understand how its mechanisms, and justifications, work. First of all, capital, even vast industrial chicken farms, like those of Perdue, are mobile, and they are always threatening to leave if they are not treated right in terms of light regulations, light taxes, and due deference, if not more, in the legislative halls – and pre-legislative “working dinners.” So Maryland, like every other state, is caught up in competitive economic pressures that always operate in a “race to the bottom” of these standards, never towards the top.
Thomas Piketty says they now operate intensively between nations in a vast race to throw off corporate taxes and hide income; the real worries about his data come not from the recent challenge from the Financial Times, he handled that very well; rather, they come from Piketty’s own worry that all governmental data understate wealth inequalities today because there is so much off shored/tax haven buried wealth and income. Yet the warning outcome to these tactics is surely the fate of Ireland, the tax less corporate welcoming state of the 1990’s – with - echoes of Maryland’s and Montgomery County’s obsession with good education - Ireland has the best educated work force in Europe; yet it could not escape the disasters visited upon it by being so deeply enmeshed in the destructive currents that go with “free-market” capitalism today. Do Governor O’Malley, and our two other “famous men,” long serving Senate President Mike Miller and Assembly Speaker Michael Busch, understand what happened in Ireland, the most accommodative and meekly subservient of welcoming states (and isn’t that a twist, a strange turn upon the ancient Irish temperament)? What it suggests to me, and what is suggested by Piketty’s analysis, is that even the fastest and most adaptive “runners” in a race to the bottom, no matter how successful in the short and medium term, cannot “outrun” the logic of the current system’s deepest pathologies, that it has become a predatory economy on the lower half of the population – and upon nature itself. As Karl Polanyi warned us in 1944: no one, left, right or center, can live with a “pure” free market, it is that destructive. And I fully acknowledge here that Maryland is not the worst in these runnings, but rather lives with the constant pressures to move in that direction, never totally giving in but yet never – and who has – coming up with a way to break the vicious cycle.
Let me give two illustrations of these forces at work inside Annapolis, but they are really national and international in scope and force. The Majority Leader of the Maryland House of Delegates, Kumar Barve, from my own District 17, sent out an explanatory letter of his vote in support of the Estate Tax exemptions, the bill to bring Maryland’s law in line with what Congress has done, to raise the exemptions to over 5 million dollars and link them to inflation. It was the multiple out-of-state residences of some of Maryland’s wealthiest families which made it so easy for them to flee, upon the death of a spouse, and take the tax “jurisdiction” over their wealth with them – to friendlier states. The Majority Leader said he knew of several instances personally, and the departing sums were very large, harmful to the revenue of the state if lost. We might ask, more harmful than the estimated loss, in the bill’s fiscal note, of reaching $100 million per year by the time the exemptions fully phase in? Given Maryland’s repeated claim that it has exhausted progressive tax measures, how will it close that gap, especially since the legislative leaders have explicitly ruled out making the sales tax more progressive by taxing a fuller range of the services of the “service” economy?
Second, we were delighted to read the New York Times account of the legislative drama which unfolded over the threat of the makers of the House of Cards Television series to leave Maryland if the state did not kick in with $15 million worth of subsidies to keep them here for their third season’s filming. Apparently, this was in addition to the $26 million they had received in tax credits from an existing state program to lure film makers to Maryland. Here it is at http://www.nytimes.com/2014/04/10/us/in-maryland-a-political-drama-befitting-the-show-at-its-center.html
In particular, one Democratic legislator, Delegate C. William Frick (Dist. 16), was very upset over the lack of manners displayed by what he felt was a too direct threat to leave or postpone filming if the state did not fully accommodate the company’s - Media Rights Capital – request. Frick turned his indignation into an Assembly-Senate battle over competing bills that were still coming up $3.5 million short. The differences were never settled in time, but Governor O’Malley did succeed in finding that sum from other sources, so the “demands” of the company will be fully met, despite their breach of etiquette. And that is the way I read this tale by reporter Trip Gabriel: it was about a breach of good corporate manners, not a principled opposition to shakedowns. The message: don’ t fully embarrass us with public demands, we’ll meet everything you want as long as the subservience and power relationships are kept in the quiet, normal channels of corporate arm twisting and domination. Viewed through another prism, the one of Governor O’Malley’s national political ambitions and his seat at the table of the National Governor’s Association, wouldn’t this have been a great time to call the other governor’s into a national moratorium of sorts, to put an end to the outrageous subsidies to gain or keep the magically evasive good corporate jobs, running to wasted billions annually? Not a chance of that, those invisible cage bars are too strong. In this present political universe, the caged birds do not sing (here noting the death of Maya Angelou, on Wednesday, May 28, 2014).
As I was probing a bit more deeply into the worldview of the Democratic leadership in Annapolis, low and behold, I found a late March, 2014 joint letter by Senate President Miller and Assembly Speaker Busch, which appeared in the Baltimore Sun on the 24th, entitled “A Plan for Building Maryland’s Economy.” It might as well have been signed by Governor O’Malley, because the contents surely bear the stamp of his policy inclinations over the past eight years. Here it is at http://articles.baltimoresun.com/2014-03-24/news/bs-ed-miller-busch-business-20140324_1_maryland-cybersecurity-direct-dimensions
The plan is a remarkably short document, full of bullet point type summaries and program outlines, starting out with the announcement of something that had already happened earlier in this legislative session, the formation of a “transformational economic development commission” to be headed by Norman Augustine, former CEO of Lockheed Martin. The timing of this document’s release looks a bit suspect to me, coming so late in the session, just two weeks before its close. Sounds like this document is meant to balance the likely, but shaky passage of that minimum wage bill, because it never mentions it; this is a corporate and private wealth friendly document, and a further clue, after the descriptions of the business joint ventures with higher education, is that it ends by noting that Maryland acted to reform its estate tax laws, “re-coupling” them to the national law, with the “re-coupling …supported by many foundations and nonprofits in Maryland.” I hadn’t heard that anywhere else, least of all from the non-profits themselves. It sounds like a cover story to me, one needed even before the Piketty phenomenon fully took off, since he says stiff estate taxes are one of the few means to reign in the growth of rampant wealth inequalities. In fairness, citizens and legislators, the truth of my own experience with non-profits, and they are a large sector in the US, is that we look in vain to them to perform any serious countervailing “balance of power” role to offset the rise of the corporate state and managed democracy. It makes some sense, even though I didn’t hear it announced by the non-profits themselves, that their funders and board members would be “all on board” with the generous wealth sheltering contained in this “re-coupling” legislation.
As for the contents in the rest of the document, it is a continuation and perhaps intensification of Maryland’s attempt to become an investment broker itself, adding its own funds to match guided and supervised (how well we will see) investment gambits in research and business ventures undertaken inside the state. It is a curious thing, though, in the nation which supposedly has the “widest and deepest capital markets in the world,” why this would be necessary, this state injection and supervision? Is it confirmation, indirectly, that things are not quite well, that, indeed, the world of capitalist finance is not up to the job, at least not in Maryland, but perhaps more broadly, inside the old boundaries of the 50 states? It is a sign of job desperation, to me at least, that now we will not only have the old urban “enterprise zones” (which couldn’t save Baltimore, Newark or Detroit…to name just a few…) but we will have them extended wherever the current geography of existing university or federal government research “clusters,” exist, often in quite decent surrounding neighborhoods. And I hear the longing, shared by nearly every state with a research university, that the state government should attempt to turn these little green shoots into the vast, hoped for “Silicon Valley effect,” constructing forced feeding greenhouses to push artificially what has not unfolded through the reluctant chemistry of more “natural” business evolution. So Maryland and business and universities and public laboratories will be working not only in the universally longed for “biotech” area, but also in nanotechnology, cyber-security (isn’t that an oxymoron now, post Snowden?) And pure “R&D.” Is the public interest (remember that concept, if it still exists?) and moreover, the public’s money fully protected in these ventures, and are we getting a decent share of the returns? My initial forays into these questions a few years ago never got much beyond the official defenses and statistics which said all is well. Good returns and no rip-offs. But then again, I haven’t exactly sensed that Maryland is home to a vigorous investigative press or too many citizens curious about this direction for our political economy. So I’m not blessing it at all, just saying it needs a vigorous watch-dog function because it has the potential to be abused. And I’m not sure this was exactly the type of “co-operative” venture that Gar Alperovitz was calling for.
I did manage, though, to get a look at the composition of this “transformational economic development commission” announced at the beginning of the “plan.” Amidst all the private sector and educational institution “heavies,” I did manage to find one union member representative, the head of a painters union. I’ve never heard of him, and I have to say his slot looks a bit forlorn amidst the broader biographical landscape.
And that brings me to some further generalizations about the nature of Maryland’s bar less “iron cage” of ideology. Can you find the average citizen, the Maryland portion of the national 28 million working in the service and retail sectors for under $9.89 per hour in this memo-plan? I couldn’t. The underlying message, as with the subsidies to the film makers and the attempts to keep Maryland a comfortable home for all our millionaires, is that “only the private sector” can create jobs; not a new New Deal that we don’t have, and its green CCC or WPA for a new energy economy. We will twist the world of education to meet the ever shifting private sector demand to invent new products, including technologically adept students, but we are clueless, historically memory less, and unable to “innovate” with public jobs themselves, despite not being reluctant at all to have the public supply its capital to the inadequately functioning private sector. And despite the fact that the Federal Reserve used the powers of its magical money creation machinery to keep the large banks afloat, and send them on their merry way to new “carry trades” abroad, where the returns appeared to be much better – for a while, a long while, actually. But being creative and experimental here at home, directly for the unemployed and underemployed, as the New Deal was? Forget about it, it’s ideologically forbidden. In this realm, the millions of the “not yet middle class” birds are not going to be allowed to sing.
May I translate this world of Senator Miller, Speaker Busch and Governor O’Malley, the residence that they have sketched out for us inside this cage of ideology; can I do so by borrowing from Garrison Keillor’s imaginary land of Lake Wobegon? Here we are in Maryland, and Montgomery County, lands where “all the women ‘Lean In,’ the men are hedge fund operators or venture capitalists, and the children have each won ‘early acceptance’ from the Ivy League school of their choice.”
Amen to that, say we of the 90-99% percent, depending on how you slice it. It’s good that we weren’t left out of the arrangements, as we wait for the job creators to work their magic. Is there anything else we can do for them?
Back in reality now, I am reminded of a little quoted passage from De Tocqueville, who wrote about the coming of the French Revolution as well as the meaning of the democracy emerging in Jefferson’s and Jackson’s America. Speaking of the French Revolution, he said “Never was any such event so inevitable yet so completely unforeseen.”
The best to all my readers,
PS Credit for part of the title of this essay, must, of course, be given to James Agee’s difficult but now near canonical work from 1941, Let Us Now Praise Famous Men. It was his account of a stay, on assignment from Fortune magazine, with some of America’s poorest rural families, in the deep South, during the Depression, and was written, in good part, in 1938 while he lived in Frenchtown, NJ, one of the wonderful “river towns” that most people from outside the state don’t know exist. Agee’s text was blended with photographs of the tenant farmers and their surroundings by the noted photographer Walker Evans.
If you’ve never ventured into the book, a sample of Agee’s prose now used as an introduction by the hotel he frequented, can give you an idea of his writing. Here at http://www.americanpublichouse.com/2009.11/national_hotel_frenchtown_new_jersey/index.html The selection is a rendering, as only Agee might attempt to pull off, of the city of New Orleans. I don’t think Mike Miller will like it.
And this recent essay makes the case for his heightened relevance for our times. http://prospect.org/article/agee-he-was-famous