Gar Alperovitz on the Next Economic Tranformation

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Summarized by Neelesh Marik:

Note: Talk starts at 13th minute of video.

Systems thinking in political economics:

1. You know there is a deeper systemic issue if long trends that do not respond to demands, electoral changes and policies: such as no meaningful change in the income of American workers over the last 30 years, all economic gains to the top 1%, rising percentages of people in prisons etc. The first thing to understand that the nature of the crisis is systemic, not political, even though the political crisis exacerbates the systemic crisis.

2. How a system is designed depends on where wealth and power is concentrated

3. Corporate capitalism came as systemic characteristic in 3 ways

a. Pure form without regulatory restraint- 19th century and the turn into the 20th

b. CC in the form of Fascism – allocation coupled with oppression

c. CC under some kind of regulatory regime wherein some kind of social and environmental programming was involved – by the balancing power of Unions, which system is now called Social Democracy. This was much stronger in Europe than N America

4. We are in the terminal stages of the 3rd system. The percentage in America of unionized workforce has gone down from the mid-thirties to low teens.

5. The design of a new system that is loyal to a new set of values: ecological balance, social equality, liberty and community, should thus entail a democratization of capital and ownership. An investigation reveals some structures that espouse those principles

a. Cooperatives and Credit Unions: 1 person 1 vote system

b. Worker owned companies

c. Neighbourhood managed companies or social enterprises

d. State Banks such as in North Dakota

e. Socialized municipality owned Utilities

f. Land Trusts: socialized form of land ownership

g. Single payer system of healthcare at the state level

6. The pertinent observation is whether there are processes operative that can begin to move the needle on what Washington may have to consider different from their current thinking and inclination. America shows historically how grass-root level movements eventually catalyse large scale policy change

a. New Deal in the 1930s was a result of 2 decades of grass-root stirrings

b. The Woman’s movement originated state by state

7. Normally we think that systemic change can happen in one of 2 ways: reform of system by progressive leaders in the traditional Liberal way, or systemic collapse followed by revolution (a la Marxism). We are emerging in a particular historical context where a third possibility is not only possible but also feasible: stalemate, stagnation and decay accompanied by a lot of pain, until democratized innovation takes over."