Archive for the ‘economy/finance’ Category
Self-Publishing Companies, Through a Legal Lens
In my last post, Five Legal Terms Every Author Should Know, I explained that the worst mistake indie authors make is losing control of their work.
After all, the key benefit of self-publishing is controlling the quality and marketing of our books, in other words, wearing the publisher hat. [Read More]
Helen Sedwick Legal Expert July 19, 2016
But too many writers are intimidated by the self-publishing process or simply don’t have time. So they sign on with self-publishing companies (SPCs, also called subsidy publishers, vanity press/publishers), that grab too much control.
An expensive mistake. Typically, these self-publishing companies own the book cover, interior design, and ISBN. So if the author wants to stop working with that SPC, she would have to start all over again. Some self-publishing companies set retail prices too high, killing sales. And some claim exclusive control of audio and translation rights, even though they don’t provide those services.
How is a writer to know whether they are giving up too much control? Unfortunately, you have to read the Terms of Service, the contract.
Daunted? Don’t be. The secret is—don’t start at the beginning of the contract. Go straight to the paragraph that’s titled something like License or Grant of Rights. If that section gives the SPC exclusive rights, particularly if those rights include audio, translations, and formats now known or hereafter devised, you don’t need to read the rest of the contract. I would not work with that SPC
I am something of a zealot about this. All self-publishing contracts should be non-exclusive. That way you may sell print books through CreateSpace, IngramSpark/Lightning Source, and your own website, and sell eBooks via Amazon, Smashwords, iBooks and other vendors, all at the same time. (Note: This is why we at BookWorks always advocate that authors purchase own ISBN’s)
There are exceptions, such as KDP Select where writers agree to sell their eBooks exclusively through Amazon for a 90-day period. In return, authors can offer free or low-cost promotions. But that’s a short-term program and in the author’s control.
Here’s an example of a writer-friendly grant of rights:
Author grants Outskirts Press a NON-EXCLUSIVE, worldwide license to distribute and sell the manuscript in print and/or digital form; author grants Outskirts Press the non-exclusive right to exhibit manuscript in part on websites or promotional materials owned by Outskirts Press; author grants Outskirts Press the non-exclusive right to store and transmit digital versions of manuscript to facilitate production, distribution, and sale of manuscript.
Translation: The author is giving Outskirts Press the right to sell the work in print and eBook only, and the right is non-exclusive, meaning the author may also sell the book through IngramSpark, CreateSpace and his own website. (Note, if you are doing this, be sure to use your own ISBN).
But avoid any contract that has a granting clause that looks like this provision from an Author Solutions’ contract:
Distribution License Granted. Throughout the Term of this Agreement, You grant to Us the exclusive, transferable, worldwide license to manufacture, store, use, display, execute, reproduce (in whole or in part), transmit, modify (including to create derivative works), import, make, have made, offer to sell, print, publish, market, distribute, and sell (individually or as part of compilations of collective works), and license for use via any subscription model, through all distribution channels (now or hereafter known, including online and electronic distribution channels), and otherwise exploit in any language, in print form, digital format, audiobook format, or via any other medium, now known or hereafter devised, the Work.
Translation: The writer is granting to Author Solutions the exclusive right to distribute the book in print, digital, audio and any other format, in any language.
A broad grant of exclusive rights makes sense in a traditional publishing contract because the traditional publisher is investing money into editing, designing, and marketing the author’s work. But even in traditional publishing, you can and should negotiate the granting clause to limit it to markets in which the publisher has a track record.
In contrast, a self-publishing writer is making the financial investments by paying the SPC for its editing, design and distribution services. I see no reason why the self-publishing companies should get exclusive rights. It is not the publisher; it is merely a service provider. The author is the publisher and should maintain control over how and where the book is sold.
A new breed of publishing company has emerged, sometimes called hybrid, assisted, partnership or some other term implying teamwork. The author pays for editing, design, production, and marketing services, and the hybrid publisher provides these services at no or low cost. In return, the hybrid publisher retains a higher percentage of royalties. The license agreements typically run for three to five years and are exclusive.
Hybrid publishing is a developing business model. To me, they look like barely repackaged SPCs, and I don’t see any advantage. Jane Friedman has written an interesting piece on evaluating hybrid publishers.
I do not want to scare writers away from using self-publishing companies. Some companies offer reasonable deals and enjoy solid reputations. They permit you to control the process and the result. They provide services to you, the publisher, the boss.
But do your homework before you commit. To help you sort the good from the bad, check out my post, How To Tell Which Self-Publishing Company is Right for You.
Disclaimer: Helen Sedwick is an attorney licensed to practice in California only.
This information is general in nature and should not be used as a substitute for the advice of an attorney authorized to practice in your jurisdiction.
Remembering Hans Rosling
February 7, 2017
Is the world getting worse every day in every way, as some news media would have you believe? No.
In fact, the most reliable data shows that in meaningful ways — such as child mortality rate, literacy rate, human lifespan — the world is actually, slowly and measurably, getting better.
Hans Rosling dedicated the latter part of his distinguished career to making sure the world knew that.
And in his 10 TED Talks — the most TED Talks by a single person ever posted — he hammered the point home again and again. As he told us once: “You see, it is very easy to be an evidence-based professor lecturing about global theory, because many people get stuck in wrong ideas.”
Using custom software (or sometimes, just using a few rocks), he and his team ingested data from sources like the World Bank (fun story: their data was once locked away until Hans’ efforts helped open it to the world) and turned it into bright, compelling movable graphs that showed the complex story of global progress over time, while tweaking everyone’s expectations and challenging us to think and to learn.
We’re devastated to announce that Hans passed away this morning, surrounded by family.
As his children announced on their shared website, Gapminder: “Across the world, millions of people use our tools and share our vision of a fact-based worldview that everyone can understand.
We know that many will be saddened by this message. Hans is no longer alive, but he will always be with us and his dream of a fact-based worldview, we will never let die!”
Working for free (but working for yourself)
Freelancers, writers, designers, photographers–there’s always an opportunity to work for free.
There are countless websites and causes and clients that will happily take your work in exchange for exposure.
And in some settings, this makes perfect sense. You might be making a contribution to a cause you care about, or, more likely, honing your craft at the same time that you get credibility and attention for your work.
But just because you’re working for free doesn’t mean you should give away all your upsides.
Consider the major publishing platforms that are happy to host your work, but you need to sign away your copyright.
Or get no credit.
Or give the publisher the right to change your work in any way they see fit, or to use your image (in perpetuity) and your reputation for commercial gain without your oversight or participation…
Now, more than ever, you have the power to say “no” to that.
Because they can’t publish you better than you can publish yourself.
It doesn’t matter if these are their standard clauses.
They might be standard for them, but they don’t have to be standard for you and for your career.
Here’s the thing: you’re going to be doing this for a long time.
The clients you get in the future will be the direct result of the clients you take today. The legacy of your work down the road will be related to the quality of the work you do today.
It’s your destiny and you should own it.
Freelancers of all kinds need to be in a hurry. Not a hurry to give in to one-sided deals and lousy clients.
Instead, we need to be in a hurry to share our bravest work, in a hurry to lean into the opportunity, in a hurry to make work that people would miss if it were gone.
Posted by Seth Godin on February 07, 2017
Ways we think about time
I want to share with you some ideas about the secret power of time, in a very short time.
0:17 Video: All right, start the clock please. 30 seconds studio. Keep it quiet please. Settle down. It’s about time. End sequence. Take one. 15 seconds studio. 10, nine, eight, seven, six, five, four, three, two …
Philip Zimbardo: Let’s tune into the conversation of the principals in Adam’s temptation. “Come on Adam, don’t be so wishy-washy. Take a bite.” “I did.” “One bite, Adam. Don’t abandon Eve.” “I don’t know, guys. I don’t want to get in trouble.” “Okay. One bite. What the hell?” (Laughter)
Life is temptation. It’s all about yielding, resisting, yes, no, now, later, impulsive, reflective, present focus and future focus. Promised virtues fall prey to the passions of the moment.
Of teenage girls who pledged sexual abstinence and virginity until marriage — thank you George Bush — the majority, 60 percent, yielded to sexual temptations within one year. And most of them did so without using birth control. So much for promises.
lets tempt 4-year-olds, giving them a treat.
They can have one marshmallow now. But if they wait until the experimenter comes back, they can have two. Of course it pays, if you like marshmallows, to wait. What happens is two-thirds of the kids give in to temptation. They cannot wait. The others, of course, wait. They resist the temptation. They delay the now for later.
Walter Mischel, my colleague at Stanford, went back 14 years later, to try to discover what was different about those kids.
There were enormous differences between kids who resisted and kids who yielded, in many ways. The kids who resisted scored 250 points higher on the SAT. That’s enormous. That’s like a whole set of different IQ points. They didn’t get in as much trouble. They were better students. They were self-confident and determined. And the key for me today, the key for you, is, they were future-focused rather than present-focused.
what is time perspective?
That’s what I’m going to talk about today. Time perspective is the study of how individuals, all of us, divide the flow of your human experience into time zones or time categories. And you do it automatically and non-consciously. They vary between cultures, between nations, between individuals, between social classes, between education levels. And the problem is that they can become biased, because you learn to over-use some of them and under-use the others.
What determines any decision you make?
You make a decision on which you’re going to base an action. For some people it’s only about what is in the immediate situation, what other people are doing and what you’re feeling. And those people, when they make their decisions in that format — we’re going to call them “present-oriented,” because their focus is what is now.
For others, the present is irrelevant. It’s always about “What is this situation like that I’ve experienced in the past?” So that their decisions are based on past memories. And we’re going to call those people “past-oriented,” because they focus on what was.
For others it’s not the past, it’s not the present, it’s only about the future. Their focus is always about anticipated consequences. Cost-benefit analysis. We’re going to call them “future-oriented.” Their focus is on what will be.
the paradox of time perspective, is something that influences every decision you make, you’re totally unaware of. Namely, the extent to which you have one of these biased time perspectives. Well there is actually 6 of them.
There are two ways to be present-oriented. There is two ways to be past-oriented, two ways to be future. You can focus on past-positive, or past-negative. You can be present-hedonistic, namely you focus on the joys of life, or present-fatalist — it doesn’t matter, your life is controlled. You can be future-oriented, setting goals. Or you can be transcendental future: namely, life begins after death. Developing the mental flexibility to shift time perspectives fluidly depending on the demands of the situation, that’s what you’ve got to learn to do.
very quickly, what is the optimal time profile?
High on past-positive. Moderately high on future. And moderate on present-hedonism.
And always low on past-negative and present-fatalism. So the optimal temporal mix is what you get from the past — past-positive gives you roots. You connect your family, identity and your self. What you get from the future is wings to soar to new destinations, new challenges. What you get from the present hedonism is the energy, the energy to explore yourself, places, people, sensuality.
Any time perspective in excess has more negatives than positives. What do futures sacrifice for success? They sacrifice family time. They sacrifice friend time. They sacrifice fun time. They sacrifice personal indulgence. They sacrifice hobbies. And they sacrifice sleep. So it affects their health. And they live for work, achievement and control. I’m sure that resonates with some of the TEDsters. (Laughter)
it resonated for me. I grew up as a poor kid in the South Bronx ghetto, a Sicilian family — everyone lived in the past and present. I’m here as a future-oriented person who went over the top, who did all these sacrifices because teachers intervened, and made me future oriented.
Told me don’t eat that marshmallow, because if you wait you’re going to get two of them, until I learned to balance out. I’ve added present-hedonism, I’ve added a focus on the past-positive, so, at 76 years old, I am more energetic than ever, more productive, and I’m happier than I have ever been.
I just want to say that we are applying this to many world problems: changing the drop-out rates of school kids, combating addictions, enhancing teen health, curing vets’ PTSD with time metaphors — getting miracle cures — promoting sustainability and conservation, reducing physical rehabilitation where there is a 50% drop out rate, altering appeals to suicidal terrorists, and modifying family conflicts as time-zone clashes.
6:06 So I want to end by saying: many of life’s puzzles can be solved by understanding your time perspective and that of others. And the idea is so simple, so obvious, but I think the consequences are really profound. Thank you so much.
What makes certain people so successful? They’re living in the (positive) future:
Alternative economic system? Gar Alperovitz
Our society’s institutions are in crisis — with looming ecological collapse, historic concentration of capital, incarceration rates far beyond those of any other country, the diminishing civil liberties that come along with a permanent “war on terror,” and a political process bought and paid for by the rich and powerful.
The Next System Project, or NSP, hopes to explain how we arrived here, provide competing visions for where we can and should go, and detail specific proposals for how we can begin to go there.
The project, which launched at the start of April, begins with the premise that our long-term political and economic problems require more than policy changes that alleviate symptoms — like those proposed in the newly released liberal agenda, “Rewriting the Rules,” backed by economist Joseph Stiglitz and Sen. Elizabeth Warren — without focusing on root causes.
The NSP will bring together academics and grassroots activists, as well as policy analysts and advocates, to develop and begin to implement genuinely democratic political and economic institutions capable of producing lasting and shared prosperity.
Gar Alperovitz, a political economist and the project’s co-chair, has been focused on developing a new American political economy for a long time. After publishing his early work on the decision to drop the atomic bombs, Alperovitz turned his attention more explicitly to our political economy, believing that our economic and foreign policies are driven by the institutional capitalist requirement for ever-expanding markets and access to raw materials.
Alperovitz has since developed an alternative political-economic model, called the “Pluralist Commonwealth” — different (plural) institutions of democratized (common) wealth — that seeks, rather than growth and expansion, to preserve individual liberty and to sustain communities and the environment. So far, the most successful implementation of the model is the Mondragon Corporation-inspired Evergreen Cooperatives, a network of worker-owned and community-controlled coops that have brought economic development to Cleveland’s impoverished inner city by tapping into the purchasing power of local “anchor institutions,” like hospitals and universities.
I recently had the chance to speak with Alperovitz about the NSP’s inspiration, the types of solutions it plans to promote, and the efforts already underway that it seeks to amplify.
Can you describe the goals of the NSP?
Here’s our starting point: If you don’t like corporate capitalism or state socialism, then what do you want — and how do we get there? Rather than elevating one model or another, we have two broad goals.
First, to begin to raise our conversation beyond projects and elections. Both are important, but we’re trying to say that the problems we face are systemic.
Second, if systemic change is required, which I think it is, then what is the nature of the system that we would actually want to live in that is different from the old state socialist model or the corporate capitalist model. Because if we had that clear vision, it might also inform our strategy for how to get there.
And it has an emphasis on combining research with popular education and grassroots action?
We hope to have a wide range of discourse — conferences, study groups, academic work on pieces of the puzzle that nobody has done yet. This is time to really open the door intellectually and with experiments on the ground that open up new political-economic directions that we can learn something from. And we want to stimulate people to work in this arena.
We want people to realize this is a really important problem and to open this debate far and wide. We were surprised by the broad range of people who were willing to say, yes, we have to deal with the system, not just electing one candidate or another.
What surprised you?
What’s surprising is that more moderates and liberals signed and said it’s time to talk about the systems issue. Well-known liberals like Robert Reich and Jeffery Sachs signed the founding statement, people who would identify as being on the left, but certainly not as radical as Richard Wolff or Noam Chomsky — both of whom also signed. So did Bill McKibben and a broad range of environmentalists. Also, Daniel Ellsberg, the whistleblower.
It is interesting that you identify liberty as a value the current system is unable to fulfill. Can you elaborate on that?
The anarchists and the genuine conservatives pointed out long, long ago that state socialism would develop a power structure that was going to destroy liberty. And people didn’t listen.
You need to take off your hat to both the anarchists and the conservatives who were really way ahead of the socialists and the liberals on that question. The anarchists have urged different forms of representation that preserve communities and individual activity within them.
How is liberty threatened today?
One aspect is time spent at work. Time could become freedom to do whatever you want to do.
Liberty is also connected with stability and security. If we had a guaranteed job system, or if you had a job as long as you were willing to work, no matter what you did or said politically, it gives you enormous degrees of freedom that you don’t have now.
Thirdly, governments with scale happen to be imperial — like the one that rules this continent. Bringing government close to home — cities, states, regions — is another way to get at liberty denied by big government.
Can you explain why you think we need a new system and new institutions rather than new policies?
The traditional model since the New Deal has been that you have major corporate power and agricultural power; people often leave that out, but the farm groups and lobbies have been much more powerful than the population they represent, which is perhaps 2 percent.
Corporate and business power was on one side with labor on the other — the economist John Kenneth Galbraith used to call the institutional strength of the unions “countervailing power.”
But the American labor movement was never that strong. And it’s getting weaker everywhere.
The basic structure that kept American capitalism somewhat stabilized was this model, which had some capacity to repair the damages that the corporate system was building — some social programs, some welfare programs, some unemployment programs. That whole structure is simply decaying before our eyes.
And what role does ideology play in sustaining the current system? Can you speak to your experience opposing President Carter’s austerity approach to inflation with the consumer advocacy group you helped to create, Consumers Opposed to Inflation in the Necessities, or COIN.
In the 1970s, there was an overwhelming and successful conservative attempt to blame the inflation problem on wages or monetary policy and excess spending, when it was almost self evident that it was largely sectoral — energy, health, food and housing costs were the dominant sources of inflation.
So we attempted to challenge that by putting together COIN. There was a lot of success raising the issue. We tried to get the Carter administration to take a different view, but they were obviously not in a position to do anything serious.
The inflation went on, which paved the way for [Federal Reserve Chairman Paul] Volcker’s extreme policy — at one point it raised interest rates to 17 or 18 percent and created massive layoffs and wage cuts.
And why were the lobbying attempts unsuccessful?
Those in the Carter administration had all been brought up on standard traditional economics and did not feel comfortable attacking those interests. They would have had to go after the oil industry and a number of agricultural programs; the housing issue they could have done, but that would have entailed lowering the interest rate, not raising it.
The standard interest groups bolstered the Carter administration’s fear while at the same time the Republicans attacked them ideologically. They were just cornered. Had they been very bold, which they were not, they might have opened up the direction we are talking about.
Aside from the strictly political power questions — which are very real — there are certainly questions about the role of economic ideas and ideology.
You have been writing about alternative political-economic systems for decades. Why launch the NSP now?
It’s been clear to me that we are facing a systemic crisis for a very long time.
The notion that we might have the chance to launch it became evident as we began to see where the trends were going, and the slow build up of the so called “New Economy Movement,” which I’ve been involved with as well. What has become evident — and Occupy Wall Street helped crystalize it — is that the pain levels are so high, and the political system is so hijacked that something is about to break open.
The pain levels have been there all along. What was new with Occupy was the articulation — putting the 1 percent and 99 percent on the table — and it also produced political activism around economic issues for the first time in a long time.
How do you think Occupy, and its symbolic importance regarding political activism around economic issues, has contributed to the countless local economic experiments being conducted around the country, like those associated with the New Economy Coalition?
One of the little told stories of the Occupy movement is the following: People say it disappeared.
People prior to the Occupy events, isolated individuals, did not know other individuals who were equally isolated had these feelings and views. People met each other in Occupy events.
If you look at the basis for activism now in many parts of the country in the new economy movement, those people met others with whom they could form organizational and social bonds in order to act in a new way during the Occupy movement. The New Economy Coalition is one organization.
People are doing projects all around the country. If you peel back, a lot of the people got activated and found each other at the time of the Occupy movement.
So projects are something you have supported and pursued, obviously, through your activism. But you are also critical of what you have called “projectism,” which I will translate as the failure to see beyond individual projects or groups of projects to a strategic systemic approach.
Projects are absolutely critical; you can’t move without them. The question is whether we are building a strategy that aims at a systemic change. A lot of activism is framed as projects, and thinking through whether A leads to B and B to C is a very important kind of thinking that needs to be done by activists.
What strikes me is I think most people haven’t thought seriously about really winning. A lot of activism is, rightly, protesting or trying to fix a problem or correct an injustice. A much larger question is: How do we win? And if we won, what do we want? And I think that’s a critical psychological issue.
And the emphasis on clear analysis that can be understood by mainstream audiences?
It’s important that the project begins to give people, beyond just activists on the left, the sense that we can talk about this. We’re not going to move the ball unless we get a much broader group of people talking about this. I always think about whether I could explain it to the people who I grew up with.
You ought to be able to explain it to citizens. Tolstoy put it this way: If you can’t explain it to your fellow peasant, that’s your problem, not his.
Can you explain your belief in community as the foundational unit of a political system that is actually participatory and democratic?
Like I wrote in “Cold War Essays,” one of the most powerful sources of the problems we face internationally is that systems, like American capitalism, must expand.
Capitalism has an inherent necessity of expanding, seeking markets, investment abroad, outlets, and control of other communities in trade policies. If the system doesn’t expand it collapses.
If you want systems that are peaceful and do not inherently produce conflict, you must alter the nature of the expansionary element. That means you have to move away from capitalism — there’s also an ecological imperative to do this. That leads you to systems that are not entirely based on markets.
The starting point for my whole vision is this need to develop systems that both foster community and are not inherently expansionary.
You consistently return to economic planning as necessary for any system seeking stability, for both the entire economy and for communities. Can you explain our current system of backdoor corporate planning?
Every area you look at, either tax or regulation or loans or loan guarantees or combinations of those strategies bolster or don’t bolster certain directions in the economy. So the idea that we have a free market in the economy and that there is open competition is absolutely absurd. If you look at the oil industry, for example, it’s supported by special tax programs that give it a particular direction.
The way it’s organized, lobbyists have found ways to get these programs out of the government. As you know I worked in both houses of Congress at one point. The way in which the lobby system works — this is very well known and most people close to the political process just take it for granted.
What would democratic planning look like?
You are going to have to have national economic planning for the big areas — for example, energy, climate impact, transportation. Right now we let the free market control where the major air transport goes. What that means is a city like Cincinnati loses its transportation, then it loses its business. The same thing is going to happen to Cleveland, which is ridiculously inefficient, as well as inhumane. A planning system needs to begin to coordinate that.
How can we do this?
Partly we need to build up local experience through participatory budgeting and planning. That is a whole area for activists to work on.
We also need a theory of how to do it at the national level. Making it explicit — for example, if we want to deal with climate change, saying here are all of the implications captured in an economic plan. Similarly, if we want to stabilize communities, and so on. And then we should debate it back and forth.
Given our country’s size, the region becomes an important political unit in your work. Can you explain this?
Most people haven’t faced this question or wanted to face it. The country is almost obviously too big for the government to be a genuinely democratic institution — it’s almost 3,000 miles from corner-to-corner with 318 million people.
Now, most states are too small, economically. The most logical solution is something bigger than a state and smaller than a continent — a region.
Most European societies are radically smaller than the United States. You could drop Germany into Montana. Large scale gives control to elites — and to money and media. So, at some point, any serious model that wants to be democratic is going to have to decentralize where decisions are made.
California, New York, Texas could probably do it on their own — they are regional scale units. That’s a whole set of questions that have to be put on the agenda.
In your writing on democratic planning, you often confront the tension between the need for action and its centralizing tendencies, and participatory democracy and the decentralization needed to make it a reality. How can this apparent contradiction be overcome?
First, you have to have inclusive units that include everybody — community models, not just worker-ownership models.
The second piece is using both planning and markets. Using Cleveland and the Evergreen Cooperatives as an example, you’ll see that the big institutions — hospitals and universities — both of which have a lot of public money, buy from worker-owned companies that are embedded in the community structure.
That’s a planning system, using the purchasing power of these institutions, a lot of which is public money — Medicare, Medicaid — to help stabilize companies that are owned by the community and workers. It’s not just a free market system.
How can markets be used?
You want some sort of mix of planning and markets, because you want to challenge the planning systems, which can get rigid. If you take this model to the national level, then the government, using just one example, would support mass transit and high-speed rail as one element of its transportation system. That would mean there are a lot of public contracts to build that. They could purchase the goods from worker and community-owned companies. You could have several of them that are quasi-competitive, so that the planning system can be efficient.
What are the basic types of alternative political-economic models that could achieve this?
Most of the models have an element of worker-ownership in them. It’s not the only thing, but it does change the ownership of capital. I think it’s a mistake to say that’s the only element — I don’t agree with some theorists who think that the system is going to be just adding up worker-owned companies.
Another model is a city-ownership model. For instance, in Boulder, Colorado, they have municipalized a private electricity utility. So that’s a different strategy that emphasizes a community model at the city level. Now, you can put both together — I believe in a pluralist system that will include several different models.
A third model is neighborhoods. It’s particularly important for the United States, where neighborhoods are often organized around race. The work we’ve done in Cleveland is a combination of neighborhood ownership and worker ownership.
And you write about the problems that come with economic entities that achieve scale, even if they are worker-owned.
When you get to the larger scale and economies of scale become available, even worker coops develop power relationships because they have to. If somebody else is in the game who can cut costs by polluting, even good guys in the coop will lose their jobs and their company if the other group is able to undercut them.
Especially, if you invest in new equipment that can lower your cost, if somebody else does that in another company, you must do the same thing, otherwise you will be out of business. They have to grow; they have a growth dynamic, as well as a cost cutting dynamic, built into the model. So when you get to significant scale — and that changes in different industries — worker coops, in a market economy, have very similar forces operating against them that any company in a private economy has.
How can problems of scale be overcome?
First I want to say that worker coops make sense on a smaller scale and are doable.
One way to address scale is to build a culture of community that internalizes externalities, through, for example, community-wide ownership. That is to say, a community-wide ownership system can decide to pollute, but it pollutes itself. So it must make the choice of what to do.
Whereas a company, worker owned or not, may like to not pollute, but if it pollutes, it’s polluting the community, not just itself, and it might do that because of cost competition.
How can some of these different ownership models begin to be implemented right now?
I think we are going to see a lot of this. We’re already seeing activity at the city government level. Several city governments — New York, Madison — are beginning to pick up on supporting worker ownership. Some states — Vermont and Ohio — have supported worker-owned companies. That’s a step forward.
How can local government be used as a resource for this type of change?
It’s not just funding. People don’t realize, a worker-owned coop is a “business.” In the United States, there are enormous subsidies and laws and national government policies in support of business. For progressives and people on the left, the light bulb needs to come on that almost all of this could be used for worker businesses.
For example, with the Cleveland model, once the city officials realized they wanted to help, they could begin to use all of the existing tools for this direction. And the mayor often looks good if he or she does this. People are often in opposition and they don’t realize there are a lot of opportunities in government where politicians would look very good if they helped.
And what about the role for anchor institutions, like with the Cleveland Model?
The other strategy is big institutions that have a lot of money in them and can’t move — like hospitals and universities. Medicare and Medicaid, educational money, etc. They buy a huge amount of goods and services. They can be requested, or pressed, or organized to help support these new directions. That’s what’s going on in Cleveland, of course. In many cities, actually, but Cleveland has done the most dramatic work.
What kind of potential exists for activists to tap into these resources and to use them to attain much-needed economic development for marginalized communities?
One thing they can do is use city government purchasing power. They have to procure from somewhere. They could buy from a worker coop.
Another area is government housing programs that the city government manages. And they could do it in a way that supports, not only low-income housing, but either cooperative housing, or housing structures focused on land trusts that control housing prices. Using community land or housing trusts, you can get people into housing.
The typical situation is that when housing prices go up, people get priced out. The first owner makes a lot of money, but then the affordable housing disappears. In a land trust situation, the owners can recapture the cost that they put in. It’s happening in different places, but it’s very difficult to do. You have to learn about it and get tough in your organizing strategies.
Tax incentives, tax abatements, loan guarantees, loans, special zoning, public-private ventures, and other economic “tools” to encourage business development. We regularly use taxpayer money to achieve economic goals.
Where can you see this project going?
Many other movements began small — the women’s movement, the anti-war movement during the Vietnam era, the early environmental movement, and certainly with civil rights. The conservatives were absolutely nowhere in the 1940s. Radical conservatives were talking to themselves, but then they got serious about building a movement that could reach well beyond their narrow ranks. I think that’s what we’re talking about.
What might a trade war between America and China look like?
The Economist explains
Punitive American tariffs on China would leave everybody worse off
DONALD TRUMP vilified the Chinese government on the campaign trail, accusing it of manipulating China’s currency, stealing America’s intellectual property and “taking our jobs”.
This hostility was not just posturing for the election season.
In 2012 he had falsely accused the Chinese of inventing the concept of global warming—to make American manufacturing uncompetitive, he said.
Tensions are high: Xi Jinping, the Chinese president, reminded global elites assembled at Davos that “no one will emerge as a winner in a trade war”. If America targets Chinese trade, China will hit back. So what might a trade war between the two economic powers play out?
There are two ways in which talk might translate to action.
Mr Trump might try simply to enforce the rules of global trade in the court rooms of the World Trade Organisation (WTO). Since America has no bilateral trade deal with China, WTO rules define what is and is not allowed.
Mr Trump might, with some justification, accuse China of boosting its economy with subsidies and flooding some American markets with cheap imports.
He will find that the Obama administration had already initiated a number of legal cases against China at the WTO. His underlings have suggested that the Trump administration might go further, for example by launching cases against suspected Chinese dumpers, rather than leaving it to American industry.
Crucially, however, while the Chinese would probably retaliate, perhaps suddenly finding health-and-safety problems with American food exports, this chain of events need not descend into a trade war.
The rules of the WTO are designed specifically to handle this kind of dispute. If it finds that China is indeed not playing by the rules, then there are clear limits on how America can retaliate. If the system works as it should, any recriminations would be contained.
But a rules-based, WTO-sanctioned tit-for-tat is not what economists have in mind when they think of the worst-case scenario for trade between America and China. The big fear is that Trump decides to bypass WTO rules, or ditch them altogether after a decision does not go his way.
A 45% tariff on Chinese imports would effectively act as a tax on electronics and clothes made in China. If prices rise domestically then American shoppers will feel the pinch—particularly poorer ones.
American companies relying on imported inputs from China would suffer too (some companies do not mind having their inputs subsidised by the Chinese government).
A blanket tariff of 45% on Chinese imports would clearly violate WTO rules, and the Chinese would not wait for an official ruling to retaliate. A strategic move would be to curb Chinese imports of American soyabeans—this would rile the American ambassador to China, who comes from Iowa, a farming state.
There would be some winners from a trade war: in the short run the American government might well see more tax revenue, and some American companies would enjoy being sheltered from foreign competition.
The biggest casualty may not even be the American consumer. After the second world war, rich countries coordinated to avoid a race towards higher tariffs, creating the General Agreement on Tariffs and Trade, which in 1995 grew into the WTO.
By clubbing together they recognised the destruction of the 1930s, when countries erected trade barriers to protect their domestic economies but ended up harming themselves as a result. A trade war would mean abandoning an institution that recognises that countries are stronger when they work together.
Donald Trump: The Menace. By Paul Krugman
For the past couple of months, thoughtful people have been quietly worrying that the Trump administration might get us into a foreign policy crisis, maybe even a war.
Partly this worry reflected Donald Trump’s addiction to bombast and swagger, which plays fine in Breitbart and on Fox News but doesn’t go down well with foreign governments.
But it also reflected a cold view of the incentives the new administration would face: as working-class voters began to realize that candidate Trump’s promises about jobs and health care were insincere, foreign distractions would look increasingly attractive.
Paul Krugman FEB. 3, 2017
The most likely flash point seemed to be China, the subject of much Trumpist tough talk, where disputes over islands in the South China Sea could easily turn into shooting incidents.
But the war with China will, it seems, have to wait.
First comes Australia. And Mexico. And Iran. And the European Union. But never Russia (That’s the only good wait)
And while there may be an element of cynical calculation in some of the administration’s crisismongering, this is looking less and less like a political strategy and more and more like a psychological syndrome.
But this is the age of Trump: In a call with Malcolm Turnbull, Australia’s prime minister, the U.S. president boasted about his election victory and complained about an existing agreement to take some of the refugees Australia has been holding, accusing Mr. Turnbull of sending us the “next Boston bombers.” Then he abruptly ended the conversation after only 25 minutes.
Well, at least Mr. Trump didn’t threaten to invade Australia. In his conversation with President Enrique Peña Nieto of Mexico, however, he did just that.
According to The Associated Press, he told our neighbor’s democratically elected leader: “You have a bunch of bad hombres down there. You aren’t doing enough to stop them. I think your military is scared. Our military isn’t, so I just might send them down to take care of it.”
White House sources are now claiming that this threat — remember, the U.S. has in fact invaded Mexico in the past, and the Mexicans have not forgotten — was a lighthearted joke. If you believe that, I have a Mexico-paid-for border wall to sell you.
The blowups with Mexico and Australia have overshadowed a more conventional war of words with Iran, which tested a missile on Sunday. This was definitely a provocation.
But the White House warning that it was “putting Iran on notice” raises the question, notice of what?
Given the way the administration has been alienating our allies, tighter sanctions aren’t going to happen. Are we ready for a war?
There was also a curious contrast between the response to Iran and the response to another, more serious provocation: Russia’s escalation of its proxy war in Ukraine.
Senator John McCain called on the president to help Ukraine. Strangely, however, the White House has said nothing at all about Russia’s actions. This is getting a bit obvious, isn’t it?
Oh, and one more thing: Peter Navarro, head of Mr. Trump’s new National Trade Council, accused Germany of exploiting the United States with an undervalued currency.
There’s an interesting economics discussion to be had here, but government officials aren’t supposed to make that sort of accusation unless they’re prepared to fight a trade war. Are they?
I doubt it. In fact, this administration doesn’t seem prepared on any front.
Mr. Trump’s confrontational phone calls, in particular, don’t sound like the working out of an economic or even political strategy — cunning schemers don’t waste time boasting about their election victories and whining about media reports on crowd sizes.
America and the world can’t take much more of this.
Think about it: If you had an employee behaving this way, you’d immediately remove him from any position of responsibility and strongly suggest that he seek counseling. And this guy is commander in chief of the world’s most powerful military.