RAG RADIO / Thorne Dreyer : Interviews with Activist David MacBryde; Author Jan Reid

Berlin-based activist David MacBryde in the KOOP studios in Austin, Texas, Friday, November 9, 2012. Photo by Tracey Schulz / Rag Radio. Inset photo below, from left: Rag Radio's Tracey Schulz and Thorne Dreyer and guest David Macbryde. Photo by Charlie Martin / KOOP.
Rag Radio podcasts:
Our man in Berlin David MacBryde
and Ann Richards biographer Jan Reid

By Rag Radio / The Rag Blog / November 1, 2012

David MacBryde -- a Berlin-based correspondent for The Rag Blog -- offered a progressive perspective on developments in Germany and the Eurozone to the Rag Radio audience on Friday, November 9.

And on Friday, November 2, Ann Richards biographer Jan Reid shared the story of the legendary late Texas governor. He was joined on that show by radio journalist Frieda Werden, who worked with the Ann Richards-initiated Texas Women's History Project.

Listen to Thorne Dreyer's interview with David MacBryde here :


and listen to our interview with Jan Reid and Frieda Werden here :


Rag Radio is a syndicated radio show produced in the studios of KOOP-FM, a cooperatively-run all-volunteer community radio station in Austin, Texas. It is broadcast live Fridays at 2 p.m. (CST) on KOOP, 91.7-FM in Austin, and streamed live on the Internet, and is rebroadcast on WFTE-FM in Mt. Cobb and Scranton, PA., on Sunday mornings at 10 (EST).

David MacBryde, a former Austin peace and justice activist, is a faith- and economics-based social activist with roots in the Quaker church. Much of his work in Germany has involved the “Swords to Plowshares” movement, especially in the work of converting military bases to peaceful civilian use, and with the anti-war American Voices Abroad in Berlin. He discussed the European Occupy Movement and economic justice and environmental activities among other topics.

MacBryde studied physics and mathematics at Yale and philosophy at the University of Texas, was a staffer at The Rag, Austin’s influential ‘60s underground newspaper, and worked with the Students for a Democratic Society (SDS) and with Austin’s Armadillo Press, an IWW union print shop. He was also a UT shuttle bus driver and worked with the drivers' union, ATU Local 1549. David MacBryde moved to Germany in 1981.

David also reported on the October 31-November 2, 2012, conference in Ann Arbor, Michigan, honoring the 50th anniversary of the Port Huron Statement, which he attended, and discussed how the SDS concept of "participatory democracy" influenced his life and his politics.

Author, journalist, and Ann Richards biographer Jan Reid, in the KOOP studios, November 2, 2012. Photo by Tracey Schulz / Rag Radio. Inset photo below, from left: Tracey Schulz and Thorne Dreyer of Rag Radio, Frieda Werden of WINGS, and author Jan Reid. Rag Radio photo.
Jan Reid, the author of Let the People In: The Life and Times of Ann Richards, is a senior writer for Texas Monthly and his writing has appeared in Esquire, GQ, Slate, and The New York Times. His other books include The Improbable Rise of Redneck Rock, The Bullet Meant for Me, Rio Grande, Texas Tornado: The Times and Music of Doug Sahm, and two award-winning novels, Deerinwater and Comanche Sundown.

Also joining us on the show was Frieda Werden of WINGS, the Women's International News Gathering Service. Austin native Werden is also the Spoken Word Coordinator at the Simon Fraser Campus Radio Society near Vancouver, British Columbia.

When Ann Richards delivered the keynote at the 1988 Democratic National Convention (“Poor George, he can’t help it. He was born with a silver foot in his mouth”), she instantly became a media celebrity.

In 1990, Richards became the Governor of Texas. She was the first ardent feminist elected to high office in America; her progressive achievements and the force of her personality created a lasting legacy that far transcends her rise and fall as governor of Texas.

In Let the People In, Jan Reid draws on his long friendship with Ann Richards, interviews with her family and many of her closest associates, her unpublished correspondence with longtime companion Bud Shrake, and extensive research, to tell a very personal and human story of Richards' remarkable rise to power as a liberal Democrat in a conservative Republican state.

Former President Bill Clinton wrote, “Jan Reid gives us new insight into Ann Richards, whose wit filled any room with laughter, whose candor chased away every smoke screen, whose heart was as big as Texas...”

Rag Radio features hour-long in-depth interviews and discussion about issues of progressive politics, culture, and history. The show, which has aired since September 2009, is produced in association with The Rag Blog, a progressive internet newsmagazine, and the New Journalism Project, a Texas 501(c)(3) nonprofit corporation.

The host and producer of Rag Radio is Rag Blog editor and long-time alternative journalist Thorne Dreyer, a pioneer of the Sixties underground press movement. Tracey Schulz is the show's engineer and co-producer.

All Rag Radio shows are posted as podcasts and can be listened to at the Internet Archive.

Rag Radio can be contacted at ragradio@koop.org.

Coming up on Rag Radio:
THIS FRIDAY, November , 2012: Singer-Songwriter -- and multiple Austin Music Awards winner -- Guy Forsyth.

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David MacBryde : In Germany, Power (Grid) to the People!

The German daily Die Tageszeitung humorously splashed on their front page a decades old archive photo of environmental pioneers. The headline: "This is what winners look like."
Power (grid) to the people!
Germany's 'great transformation'

By David MacBryde / The Rag Blog / August 3, 2011

BERLIN -- In Germany the decision has just been made to shut down ALL nuclear power plants by 2022. This is broadly seen here as a major step in the "great transformation" away from economic activity that endangers and depletes future opportunities and towards activities that achieve sustainable energy and value creation.

During the debate in the German Parliament about energy, Renate Kunast (of the German Green Party) began her presentation by thanking a number of persons by name for their pioneer work decades ago.

Before writing about developments in Germany, I too want to express thanks – for decades of hard work -- to Rag Blog contributor Ray Reece, author of The Sun Betrayed, Gail Vittori and Pliny Fisk at the Center for Maximum Potential, Scott Pittman, founder of the Permaculture Institute, recently interviewed by Thorne Dreyer on Rag Radio, and of course many, many others.

The decision just made in Germany will have an effect on physics, economic activity, politics, philosophy, and more.

The main breakthrough here that I want to focus on – and this gets to my headline of "Power to the People" -- is what is called the "Einspeisungsgesetzgebung.” That is a (typically German) very long word which refers to the legislative achievement by Jurgen Trittin (of the German Greens) when he was Minister for the Environment and got -- in coalition with the SPD (the Social Democratic Party) -- majority approval for an energy policy that enables decentrally-produced energy to be fed into the (at the time not-yet-so-smart) grid.

There are several points here:

1. Physical: The legislation enables the transformation of power lines away from one-way transmission and into being a genuine interactive network.
2. Economic: This opens opportunities for decentralized power production. And it is a significant step in the very large scale transformation from using up depletable energy to using sustainable, renewable, energy.
3. The politics of power and power politics: In Germany four energy corporations effectively had (note the past tense) oligopolistic power, both in controlling energy and politically controlling energy policy.
4. Philosophy: (I will focus on this in this article) "Ontology" is a technical philosophical term for the study of what "is" is -- thus raising the question, "What is reality?"

It can be helpful to distinguish between an "impoverished ontology" that only handles a single kind of reality and an "enriched ontology" that can handle a variety of kinds of reality.

In this context we can more specifically ask, What "is" economic growth?

And we can enrich our understanding if we ask, "What kinds of economic growth are helpful, what kinds are harmful? And for whom? And who gets to participate in decisions about that?

The recent decisions made in Germany are part of what here is called the "great transformation" away from "growth" that actually depletes future opportunities to growth that enhances future opportunities.

Mrs. Elanor Ostrom, recent recipient of the Nobel Memorial Prize in Economics, was honored for her work looking at how economic decisions are made. She received a great ovation at her recent talk at the Technical University in Berlin.

Nobel laureate Elinor Ostrom. Photo by Ric Cradick / Indiana Public Media.
Elanor Ostrom is a rather jovial economist. Her main point is that even if the economy is very dismal, it does not have to be so.

Her scientific work focuses less on developing abstract mathematical models of the economy than it does on actually looking at how and by whom decisions are made.

Her main breakthrough -- for which she received the Nobel Prize -- was to point out that what had, in the history of economics, been called "the tragedy of the commons" -- did not have to be tragic.

You can get Ostrom's insight by first imagining a number of people fishing in a river or ocean. If each fisher maximized his or her catch it might well be possible to over-fish and maybe even exterminate the species. That might destroy future opportunities for future generations.

Ostrom does NOT argue that disasters cannot happen. There are plenty of historical examples of unsustainable overuse. She does argue that such disasters are not always "necessary" or absolutely unavoidable. In her research she finds plenty of examples where a number of different people do succeed in getting their acts together for sustainable fishing.

The classical definition of "tragedy" in old Greek plays involves the audience seeing a disaster necessarily, unavoidably, coming. This is contrasted to "comedy,” which refers to a play with a happy, successful, resolution.

Ostrom herself, perhaps wisely, does not in every case presume that a happy ending can be achieved -- she prefers the term "Drama of the Commons.” Situations in which a number of different people do achieve a common solution can involve potential for disaster and considerable drama.

At the present time in the USA there certainly seems to be considerable drama about decision-making.

In Germany decisions on energy policy certainly have involved lots of drama. But the result is a "comedy" in the classical sense of achieving a positive solution. Though it was initiated by the German Greens, in coalition with the SPD (Social Democratic Party), the decision was also supported by a majority of the conservative party (CDU, Christian Democratic Party).

The drama here was intense, especially because of the huge crisis in the capital markets.

There had been lots of hard work over decades (see again the above picture of pioneers) with considerable success, including the breakthrough "Einspeisungsgesetzgebung" for decentralized energy production. Then the man-made capital market crisis hit.

I was very worried, as were many others here, that the reaction to the capital market crisis would derail developments.

Around the September 2008 emergency actions -- such as Paulson's panicky punt with his three-page policy paper -- there were emergency efforts around the world, from Berlin to Brazil and Beijing.

The question was would we get an I V U W or L, or get to an E. (These are shapes of economic "growth" curves. I will write an update to my earlier Rag Blog post on this subject.)

Briefly here: In the capital market crisis Germany did take actions and did not collapse straight down (an "I") and is now booming, relatively speaking -- not improving as rapidly as Latin America or some countries in Africa and Asia, but rather well.

There was considerable worry that Germany might get stuck in an "L" -- a downturn and a long lack of "recovery.”

Now it does look like Germany, especially with the decisions on energy policy, is back on the track to its "great transition" -- to get to an "E."

The core reality of the success here is that a very broad majority of the people and their parliamentarians now see clearly that the large transformation away from environmental depletion and towards environmental viability is crucial to reducing harmful kinds of economic "growth" and to achieving helpful kinds of economic growth.

And it is now broadly clear here, including within the large German Protestant and Catholic churches, that "social fairness" is not hot air but a significant moral compass and, particularly at this time, a prerequisite for domestic economic development. A range of modest but real wage increases have already been achieved and are helping to stabilize and improve domestic demand.

We will see whether these particular decisions succeed in avoiding tragedy and achieving some comedy. In any case it is dramatic. I will try to write more about what I see happening here.

[Rag Blog Berlin correspondent David MacBryde worked with Austin's Sixties underground newspaper, The Rag. See more articles by David MacBryde on The Rag Blog.]

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Berlin : Promoting the General Welfare

Frieze by New Deal sculptor Lenore Thomas at Center School in Greenbelt, Maryland.Photo by Anomalous_A's / Flickr.
Americans in Berlin:
How do we 'promote the general welfare'?

By David MacBryde / The Rag Blog / March 21, 2010

BERLIN -- The Rag Blog has posted a number of articles about health care in other parts of the world, like Victoria Foe's feature exposing myths about the Canadian system, and my earlier article about health care in Germany.

Now I'd like to offer a little background and two comments, a personal and a philosophical one.

American Voices Abroad (AVA)-Berlin occasionally convenes " Café Americain," a political salon. Recently we read and discussed the U.S. Constitution, line by line. A core stated purpose in founding the United States of America was "to promote the general welfare."

Question: How and by whom does that get defined? It can be a difficult process, and has changed over time. Originally, at the time the constitution was written, Indians, slaves, and women had no vote in defining that.

Since then the constitution has been improved some.

When I was a kid in the 1950's "the general welfare" seemed to be defined simply as, "What is good for GM is good for the USA" -- in a corporate led economic boom, with "everything getting better for everybody."

But that boom has been over for a long time now.

GM drove over a cliff. And recently in a spectacular way, with "innovative investment grade products," the capital market made what were not -- shall we say -- efficient investment decisions, misallocating vast sums.

The issue of "the general welfare," of how and by whom that gets defined, has become dramatic indeed. The effort to reform health care in the U.S. certainly provides insight into that process. The process has been messy, and some have compared it to making sausage.

(I will note that I once helped make sausage, literally. One of my best friends when I was a kid invited me to his home when the family pig was turned into sausage. The family knew how to do that well. I found it rather grisly, but do not, just now, want to philosophize about the pros and cons of eating meat or being a vegetarian.)

Now, living in Germany and looking at the health care efforts here and in the USA, I will make a philosophical point. While there are intense issues here, there is a general cultural agreement that promoting a good health care system is an important part of promoting the general welfare -- that there are "common goods" that are worth maintaining and improving upon. And there are processes here to work on that.

A technical term in philosophy is "ontology" -- which humorously put, is the study of what "is" is. What "is" reality? What kinds of "reality" "are" there? What entities exist or can be said to exist. Moving further, are there "common goods," or "the general welfare," and by whom and how are decisions made about "common goods" and "the general welfare"?

What do you think?

I will raise this issue again in a different context by early May when in Berlin there will be a celebration at the historical inner city Tempelhoff airport. Air traffic has been moved to another airport on the edge of town, and the Tempelhoff airfield will be opened to public use. There are some similarities between Tempelhoff airport in Berlin and the Mueller Airport area in Austin, Texas.

Historically, the Tempelhoff airfield has defined a large part of Berlin, especially during the "Berlin Airlift." Now the closing of that field for air traffic has opened it for flights of fantasy about future use.

Practical decisions will be made, over a long period of time. Here those decisions will be made in the context of promoting the general welfare and urban living conditions in Berlin going on into the 21st century.

I will try to report on future developments concerning those efforts.

In the meantime, below is a letter that members of AVA-Berlin wrote about supporting the health care fight in the U.S.

[Editor's note: as we publish this, Congress appears to be in the process of passing President Obama's compromise health care bill.]

Americans in Berlin. Our man David MacBryde, in the hat, is fifth from the right Photo by Karen Axelrad.

Dear AVA-Berliners,

The health care reform bill is still alive and headed for a vote within the next week or so. Although not as far-reaching as many of us had hoped, the bill has real merit. It is expected to cover 34 million uninsured, to eliminate pre-existing condition clauses, close the gap in the Medicare drug program, and eventually control the spiraling costs of health care spending. It will also provide a basis for future changes and improvements.

Passing a health care bill will also affirm and strengthen the Obama administration against a powerful right wing backlash. If health care doesn't pass, the administration is unlikely to be able to be effective in other critical areas such as environmental protection, energy policy and foreign relations, to name but a few.

Many Democrats are moving into the Yes column for this bill, but unfortunately many are afraid that a vote for a health care bill will damage their re-election chances. In the next few days, their offices will be virtually under siege from those who listen to Beck, Hannity, etc. If you would like to counter this onslaught with a powerful positive message to your Senators and Representatives -- emphasizing that health care reform is so important to you that you are calling from Germany -- links to phone numbers are provided below.

Links to numbers

If you have a flat rate for calls to the U.S., great! If not, use one of the special prefixes to make an inexpensive call to the U.S. And remember, this e-mail can be passed along to family and friends, to remind everyone who cares about the state of health care in the U.S. to stand up for it now.

You can check here for up-to-the-minute rates. And again, we urge you to call your people in Congress even if they have a good voting record.

To call your Senators, use www.senate.gov/ , select your state (the state to which you send your absentee vote) and go from there. For your Representative, use www.house.gov/Welcome.shtml , Click on Find Your Representative (by zip code) or Write Your Representative in the top left hand corner.

Carolyn Prescott, member
Ann Wertheimer, chair
American Voices Abroad - Berlin

[David MacBryde worked for The Rag, Austin's Sixties underground newspaper. He sends us the occasional dispatch from Berlin where he now lives.]

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Marc Estrin : Happy Birthday, Bertolt Brecht

Bertolt Brecht, 1948. Photo from Deutsches Bundesarchiv / Wikimedia Commons.
Of Poor B.B.:
Bertolt Brecht speaks from the grave

By Marc Estrin / The Rag Blog / February 11, 2010

[German playwright, poet, and theatrical director Bertolt Brecht was born on February 10, 1898, and died August 14, 1956.]

Bertolt Brecht lies in his grave. The alarm goes off and off. Time to get up again. Evil-doing comes like falling rain. Get up. We need you.

In the grey light before morning the pine trees piss
And their vermin, the birds, raise their twitter and cheep.
At that hour in the city I drain my glass, then throw
My cigar butt away and worriedly go to sleep.

No, up. Not sleep. Get up. It’s time. Fifteen days the rain is falling. The birds have stopped their cheeping. Cheep, BB, cheep at least. Twitter. Piss. Someone will hear. Someone will understand. Here’s my crust of bread. Eat, BB, eat, then speak. Get up and speak.

Like one whose blood flows from a wound and who awaits the doctor: his blood goes on flowing. So do we come forward and report that evil has been done.

Yes! Good. Come forward. Report. Report on the good times that starve the millions and poison the world.

The first time it was reported that our friends were being butchered there was a cry of horror. Then a hundred were butchered. But when a thousand were butchered and there was no end to the butchery, a blanket of silence spread. When evil-doing comes like falling rain, nobody calls out ‘stop!’

Stop! (My voice is small.) Stop!

When crimes begin to pile up they become invisible. When sufferings become unendurable the cries are no longer heard. The cries, too, fall like rain in summer.

And rain also in winter. And the tree limbs snap, and the wires break, and people huddle under what blankets they have, and the circus band blares out its tunes, and some there cackle and others smirk. I am discouraged, BB. What will become of us?

Of those cities will remain what passed through them, the wind!

And then? When it all comes crashing to the ground, what then? What shall we do?

-- Remember:
Hatred, even of baseness
Contorts the features.
Anger, even against injustice
Makes the voice hoarse. Even we,
Who wanted to prepare the ground for friendliness
Could not ourselves be friendly.

Bertolt Brecht wrote poems and essays and plays. He spoke up for the poor. He said, “First, people have to be able to feed their faces -- then they can think about morality.” He was number one on Hitler’s hit list. We need his voice today.

Here -- from the grave -- is what he says:

Nowadays, anyone who wishes to combat lies and ignorance and to write the truth must overcome at least five difficulties. He must have the COURAGE to write the truth when truth is everywhere opposed; the KEENNESS to recognize it, although it is everywhere concealed; the SKILL to manipulate it as a weapon; the JUDGMENT to select those in whose hands it will be effective; and the CUNNING to spread the truth among such persons." - Bertolt Brecht, Five Difficulties in Writing the Truth

[Marc Estrin is a writer and activist, living in Burlington, Vermont. His novels, Insect Dreams, The Half Life of Gregor Samsa, The Education of Arnold Hitler, Golem Song, and The Lamentations of Julius Marantz have won critical acclaim. His memoir, Rehearsing With Gods: Photographs and Essays on the Bread & Puppet Theater (with Ron Simon, photographer) won a 2004 theater book of the year award. He is currently working on a novel about the dead Tchaikovsky.]

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History as Politics : Remembering the Berlin Wall

Man straddles Berlin Wall in 1989. Photo from photosfan.com.
History as politics, Politics as history:
Remembering the Berlin Wall

By Harry Targ / The Rag Blog / November 9, 2009

...you are Americans and are meant to carry liberty and justice and the principles of humanity wherever you go, go out and sell goods that will make the world more comfortable and more happy, and convert them to the principles of America.

-- Woodrow Wilson shortly after the Russian Revolution quoted in L.S. Stavrianos, Global Rift, 1981, 492.

There are two great evils at work in the world today, Absolutism, the power of which is waning, Bolshevism, the power of which is increasing. We have seen the hideous consequences of Bolshevik rule in Russia, and we know that the doctrine is spreading westward. The possibility of proletarian despotism over Central Europe is terrible to contemplate.

-- Secretary of State Robert Lansing shortly after the Russian Revolution in Stavrianos, 494.

Daniel Barenboim, who was in town the night the Berlin Wall came down in 1989,” ... said that “the fall of the wall ‘has changed so much of Europe for the better,’ Barenboim said in an interview at the Berlin Staatsoper, where he is chief conductor. ‘It has given so many thousands, probably millions of people, a better existence’

-- Catherine Hickley, Washington Post, November 8, 2009

Debasing the Socialist vision

Reflections on the anniversary of the tearing down of the Berlin Wall in 1989 should stimulate a reexamination of the pain and suffering of the twentieth century.

It was a century in which over 100 million died in wars all around the globe (60 million alone in the two World Wars). Nazis killed six million Jews and six million others in Europe: liberals, communists, gays, opponents of genocide of every persuasion. And, during the Cold War years (1945 to 1991) approximately six million Vietnamese and Korean peoples died in wars and hundreds of thousands in Central Europe, Latin American, and South Asia.

The great revolutions of the twentieth century promised a different outcome for humankind: peace, justice, and democracy. Perhaps the biggest disappointment, the gap between the dream and the practice, resulted from the failures of the former Soviet Union. Masses of its citizens died in campaigns to collectivize agriculture and the purge of dissidents.

The regime developed an omnipresent dictatorship and following the revelations about Stalinism evolved into an autocratic state driven by top down bureaucracy. In addition, the Soviet Union would not tolerate political independence from the Socialist states of Eastern Europe, invading both Hungary and Czechoslovakia to crush reform movements. So from this vantage point, the tearing down of the Berlin Wall was cause for celebration.

But history is complicated

However, as the sentiments of President Wilson and his Secretary of State suggest, the United States as superpower emerged from World War I to embark on a global campaign to crush the new Soviet Union economically. As we know, the United States, along with a dozen other nations sent troops into the Soviet Union to help counter-revolutionaries overthrow the new Bolshevik regime.

In subsequent years, until 1933, the United States refused to recognize the Soviet Union. Western powers watched as Germany rearmed and expanded its control across the heartland of Europe. Italian fascist armies and German airpower were used to destroy democratic Spain, again with the United States and the British on the sidelines.

After the war, the Truman Administration launched a “cold war,” against the Soviet Union. It transferred resources to Western Europe to rebuild the capitalist part of it. It unleashed covert operators to infiltrate trade unions and political parties in Europe and Latin America and began beaming propaganda and sending operatives into Eastern Europe to undermine Soviet influence.

Germany was the centerpiece of this new global struggle. As the source of military forces that killed 27 million Soviet citizens in World War II, the status of Germany became most critical to the Soviets. And for the United States a reindustrialized, remilitarized Germany would constitute the centerpiece of the campaign to fight Communism and promote capitalism on the world stage.

Ironically, the Cold War started over Germany and could have ended there with a mutually derived agreement to create a neutralized and united Germany (much as was agreed to in Austria). But western diplomats ignored Soviet offers to negotiate the creation of such a Germany.

Without revisiting all the critical points of contestation between the East and the West, it is important to make clear that the Soviet Union, the weaker of the two “superpowers,” was targeted for challenge and defeat by every United States administration from 1917 to 1991. This cost both countries and their allies trillions of dollars in military spending and millions of lives.

The Soviet Union had something to do with social change

There were some positive developments during the Cold War years for which the Soviet Union may have made a contribution.

In 1945 most of Africa was still living under the yoke of colonialism. The British, French, Dutch and others still controlled territories and peoples in Asia. The Chinese were mired in a violent civil war. And all of Latin America was “in the backyard” of the United States. Within thirty years all this had changed. Africa achieved its independence, the Communist movement came to power in China, Indochina was freed from French and then American colonialism, and the Cuban revolution provided a beacon of hope for peoples living in the Western Hemisphere.

The Soviet Union provided arms, economic assistance, technical assistance, and inspiration for those seeking independence and economic development. Further, and this may be the most important point, the Soviet Union served as a check on the unbridled expansion of military and economic power of the United States and the Western alliance.

What if the Soviet Union had not collapsed?

Of course, we can never know what might have happened since 1991 if the Soviet Union, after its Eastern European allies, had not collapsed. But we do know what has happened. And we can make educated guesses about what might have happened in a world in which a power competitive in military, economic, and ideological resources with the West still existed.

First, the Gulf War might not have occurred in the way it did, (While the Soviet Union did collaborate with President George Herbert Walker Bush in the fall, 1990, on Gulf War policy, the collaboration was from a position of considerable marginalization). For sure, the Soviet Union would have waged a propaganda war against the U.S. military operation and the economic embargo of Iraq and bombing campaigns that continued throughout the 1990s and, particularly, the second war on Iraq in 2003.

Probably, in the bipolar world of the Cold War, the United States would not have been able to launch a war on Afghanistan and continue it for eight years.

And what about the global economy? Neoliberal globalization, initiated in the 1980s but expanded to every corner of the globe in the 1990s, would have been checked by Soviet influence and arguments about overweening reliance on the “free market.” The mal-distribution of wealth and income might not have been as grotesque as it has become if there had been a Soviet Union critiquing International Monetary Fund and World Bank policies.

Without exaggerating the influence or good intentions of a surviving Soviet Union, I would argue that the world since 1991 might have been different; particularly given the hundreds of thousands who have died in war since 1991 and the devastating impacts of growing economic inequality.

And back to Germany

Bruni de la Motte in the Guardian, Nov. 8, 2009, reported that the collapse of the former German Democratic Republic and its integration into West Germany led to social breakdown of society, widespread unemployment, “crass materialism,” the privatization of public enterprises, farms and forests, and two million lost homes. Hundreds of thousands of professional workers including teachers and professors lost their jobs and were blacklisted because they had been credentialed in the old regime.

There is no question, as one U.S. trade unionist once said to me, the former Soviet Union and the GDR were not “workers’ paradises” but they provided basic economic security to workers. That has long since been lost most places around the world.

And about history

It is a common place now to repeat the old adage: “History is written by the winners.” Old adage or not, the celebration of the twentieth anniversary of the tearing down of the Berlin Wall is being orchestrated by the same kinds of imperial voices that have been raised for almost one hundred years now.

As contentious as it might be, it is time for progressives to revisit the history of the Cold War in a way that is not chauvinistic and self-serving and does not justify current and future wars.

[Harry Tarq is a professor in American Studies who lives in West Lafayette, Indiana. He blogs at Diary of a Heartland Radical, where this article also appears.]

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Berlin : A Look at Health Care in Germany

Some U.S. Citizens in Germany comparing, contrasting and acting upon health care issues. That's The Rag Blog's David MacBryde hovering in the back and scratching his head (lower picture). Photos by Karen Axelrad / The Rag Blog.
Americans in Germany:
How health care works here

By David MacBryde / The Rag Blog / August 21, 2009

BERLIN -- While health care issues are difficult and can be complicated, there was certainly a shared sense that although health care in Germany can be improved, on the whole it is comparatively better than the current situation in the USA.

There was no controversy about the point that some German beers are great. There was lots of controversy about health care issues, but a common sense that on the whole health care in Germany is better and is worth looking at.

Below is a FAQs about some of the issues. This was written by two Americans in Germany, Carolyn Prescott and Ann Wertheimer, to encourage discussion and robust reform, and to urge Americans here to write home to friends and representatives.

Frequently asked questions about health care coverage in Germany

Question: Why should we as Americans consider features of the German system in crafting our own health care reform?

Answer: In planning our own public health care system, we should investigate the strengths and weaknesses of many other systems. We can then choose the best of some of them and avoid the pitfalls of others.

Question: Does Germany have a single-payer system?

Answer: No, it is a hybrid system: a public plan and private plans. The public option covers about 90% percent of the German population, with most of the rest covered under private insurance.

Question: What does public option mean in Germany?

Answer: Germany has around two hundred nonprofit companies called sickness funds, which comprise the public option. Germans can select from these sickness funds, each of which provides their members with a comprehensive benefit package. The sickness funds are nonprofit entities; there is nevertheless competition for price and quality among them because the funds seek to survive and grow.(1)

Public option sickness funds may not refuse someone on the basis of a pre-existing condition or drop them if they become ill. A centralized agency administers a pool of money to sickness funds to cover their sicker patients; that is, they ensure that sickness funds have the means to cover the health needs of those people they carry who have chronic illnesses such as diabetes or intensive illnesses such as cancer.

Question: Is enrollment in the German system mandated? If so, who pays for people who can't pay?

Answer: Yes, health care coverage is mandatory; you must be covered by some plan, either public or private. Employed persons generally have half of their premiums paid by their employer. Unemployed persons remain members of the sickness funds they were in when employed. Their contributions are paid by federal and local governments. The contributions of retirees are paid by the pensioners themselves and by their pension funds. Thus, the public health insurance program redistributes from higher to lower income groups, from the healthy to the sick, from the young to the old, from the employed to the unemployed, and from those without children to those with children. The idea is that everybody's in it together, and nobody should be without health insurance.(2)

Question: How much does the average German pay for health care under the public option?

Answer: State health insurance contributions are based on your gross income (around 15.5% with an income cap), with employers and employees each paying about half of the premium. The individual’s contribution is 8.2%; the employer pays the remaining 7.3%. In addition, Germans are now required to carry long-term nursing care insurance, which is charged at 2.2% of your gross income, with employers paying half.(3)

The income cap is $62,781, or around $5,232 per month (July 28, 2009 conversion rate). So if you make, for example, $85,000,. per year, your contribution would be the same as that of someone who makes $62,781 per year (4 ), even though that would amount to a lower percentage of your income.

Benefits are commensurate with those of most major medical insurance plans in the U.S. and include basic dental care. There are no deductibles and only minimal copayments.

Again, premiums are set according to earnings rather than risk and are not affected by a member's marital status, family size, or health; they are the same for all members of a particular fund with the same earnings. In a household with two wage earners, each pays the full premium assessed by his or her sickness fund according to his or her income.

Question: How much are health care costs in Germany compared to those in the U.S.?

Answer: Health care costs for an entire country are measured in terms of the percentage of gross national product (GNP). In Germany that percentage is 10.7% of GNP, while in the U.S. it is 15.3% (2008 figures).(5) When the costs for various treatments and procedures are compared, the costs in Germany average about a third of those for the same procedure or medication in the U.S.

Question: Are there waiting lists for surgeries, expensive treatments, etc. in Germany? Are high-tech diagnostic procedures and treatments readily available?

Answer: There is no waiting time in the case of acute illnesses and emergencies. Waiting times to see specialists and to undergo surgeries and treatments tend to be quite similar to those in the U.S. Elective surgeries have an average waiting time of one month. High-tech diagnostic procedures and treatments are readily available.

Question: Do doctors or dentists in Germany bear high costs for their medical education?

Answer: Medical and dental schools, like all other forms of higher education, are virtually free in Germany, requiring only the payment of administrative fees. Of course, medical students, like students in all fields, must pay for their own room and board. Young people who can’t afford their room and board while they are getting an advanced degree are eligible for various kinds of public loans. Repeat: there is no tuition for medical or dental school, or any other advanced degree, in Germany. Tertiary education in Germany is virtually all public.

Germany has more physicians per capita than the United States, and physicians typically make less than in the States. For example, a family doctor in Germany makes about two-thirds as much as he or she would in America.(6)

Question: Do doctors or dentists in Germany bear high costs for malpractice insurance?

Answer: German doctors pay less for malpractice protection through medical protective associations rather than through for-profit medical malpractice insurance companies.

Question: How much are typical deductibles and co-pays for Germans under the public option insurance?

Answer: There are no deductibles. Under the public option, a patient pays 10 euros (about $15 as of this writing) per quarter year; that is, 10 euros are paid for the first doctor’s visit during a quarter of a year. If no visit is made during, let’s say, January 1 through March 31, no payment is required. If there are many visits, the payment is still only 10 euros. The dentist costs another 10 euros for the first visit per quarter. In-patient hospital days now have a co-pay of 10 Euros per day up to 28 days. There are generally no further co-pays except for a few designated treatments; such as dental crowns, for example.

Question: Does public option insurance pay for medication?

Answer: Medications have co-payments of between 5 and 10 euros (around $8 to $15) per prescription.

Question: Do you pay your bills and get reimbursed, or does the insurance pay directly?

Answer: You submit your health insurance identification card to the doctor, dentist or hospital and make your copayment, if there is one. You do not see the bill.

Question: Is there rationing?

Answer: While doctors may feel some pressure to hold down costs, treatment decisions are not generally individually arbitrated through the sickness funds. Some treatment decisions may require evidence of need; for example, a dentist has to show the need for certain types of extensive gum treatments.

Under the law that applies to the German health care system, there is a Joint Federal Committee composed of representatives from associations of physicians, dentists, hospitals and sickness funds. The JFC assesses the effectiveness of traditionally covered services and of new diagnostic and therapeutic procedures. Coverage guidelines are issued after public notice of the subjects under consideration, and comments by interested parties and experts enter into the decision-making. JFC decisions on procedures are made according to evidence-based criteria. Such criteria range from randomized, controlled clinical studies to consensus conferences and expert opinions. Since care under the law must correspond to the generally accepted standard of medical knowledge and the progress of medical science, clinical practice guidelines and prevailing practices are highly relevant for coverage guideline validity. In case of individual sickness fund denials of reimbursement of a treatment not yet addressed by a JFC guideline, patients may appeal to a special court that will consider the evidence; generally one does not need to hire a lawyer to go through this process. Thus there are checks on the power of the JFC to limit clinical autonomy.(7) There is no age rationing for any procedure.

To make this process somewhat more concrete, we offer a few examples of costs refused or limited versus those paid for by one or more sickness funds: Some disallowed treatments under the public option, for example, are homeopathic remedies, Vitamin B injections (except in the case of a proven deficiency), and Viagra (considered a lifestyle drug). In some cases, the sickness funds cover a basic need such as glasses or a hearing aid, but if the patient wants a top-of-the-line, in-the-ear hearing aid or designer glasses, he or she must supplement the basic amount paid by the sickness fund. A few examples of treatments that are fully covered in the German system are very expensive, end-of-life cancer drugs; mental health therapies and medications; and home care hospice services. In addition, some sickness funds pay for preventive measures such as up to 20 yoga sessions per year or Nordic walking courses, both of which have reportedly been shown through clinical trials to be beneficial in preventing certain illnesses or improving health.

Question: Is there a lot of bureaucracy?

Answer: Administration costs of the system, which is another way of referring to and measuring bureaucracy, account for about 6 percent of spending in the public option sickness funds (which again, cover about 90% of the population).(8) Patients experience virtually no bureaucracy; they do not have to deal with any agent or financial paperwork. Among the private insurance companies in Germany, the administrative costs are around 17%. In the U.S. system, administrative costs are estimated at close to one-fifth, or 20%, of total costs. So bureaucracy is actually much less in the public option health care system.

Question: How many Germans go bankrupt in a year because of medical bills?

Answer: In Germany it is impossible to go bankrupt because of medical bills, since even if you declare bankruptcy, the social solidarity system pays for your medical care. The idea is, if you do have financial problems and a lot of worries for other reasons, you do not need to have another burden in not being able to pay medical bills.(9)

Question: If you lose your job or get sick and cannot work, what happens to your health insurance?

Answer: Health insurance continues with no change if you lose a job. Germans simply do not have this worry that they will be without coverage for themselves and their family members.

Question : If the public option is so good, why do some people choose private insurance?

Answer: About 10% of the population is covered under private insurance. Anyone who makes more than $69,187 per year for at least a three-year period has the option of choosing private insurance.(10) People who are civil servants, self-employed or freelance also have this option, even if they do not meet the income requirement. For some people who are still young and healthy and earn high salaries, private health insurance may be (temporarily) cheaper than the public option. Others choose private insurance to ensure that they have certain privileges: a private room in case of hospitalization, payment for homeopathic remedies, or spa cures. Some people also supplement their public insurance with private insurancein order to gain these and other privileges.

Question : What are the problems of the German health care system?

Answer: There is pressure on the health care system because of the relatively high rate of unemployment in Germany. Hospital personnel, including doctors, have demonstrated and lobbied in recent years to get higher allocations (and doctors have just won increases that average out to 7.8%, varying according to specialization and geographic area). Copayments were introduced a few years ago to try to bring more money into the system. Nonetheless, the German health care system dates back to 1883 and has proven to be both flexible and robust. During the last two decades, Germans have tweaked their system, on average, every three years in order to try to address problems and keep costs under control.

------------------------------------------------------------------------
Footnotes:

(1) Interview with Kurt Lauterbach, in Frontline: Sick Around the World: Five Capitalist Democracies and How They Do It, Public Broadcasting System series, April 2008.

(2) "Most Germans Happy with German Health Care,” National Public Radio feature, reported by Richard Knox, produced by Jane Greenhalgh, June, 2008.

(3) Krankenkassentarife, an independent website that provides information (in German) on the German health care laws, 2009:

(4) Krankenkassentarife website.

(5) Frontline: Sick Around the World: Five Capitalist Democracies and How They Do It , Public Broadcasting System series, April 2008. http: www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/etc/graphs.html

(6) Frontline interview with Kurt Lauterbach.

(7) Ursula Weide, “Law and the German Universal Health Care System: A Contemporary Overview,” German Law Journal No. 8 (1 August 2005).

(8) Frontline interview with Kurt Lauterbach.

(9) Frontline interview with Kurt Lauterbach.

(10) Krankenkassentarife website.

[David MacBryde -- our correspondent in Berlin -- was an Austin activist and a contributor to The Rag Blog’s historical precursor, The Rag , a pioneering member of the Sixties underground press.]

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Intrepid Berlin Correspondent MacBryde Reports on the Berlin Dialogue on the Financial Crisis

Heidemarie Wieczorek-Zeul, German Minister for International Economic Cooperation and Development. Photo: © Simone D. McCourtie / World Bank.
Changing the System(s) (Part 1)
By David MacBryde / The Rag Blog / April 1, 2009

Some quick steps in February and March working towards the April 2nd Summit on the International Finance System. And some long-term, medium-term, and immediate work to achieve more democracy with social fairness and ecological viability.

BERLIN -- Economist Joseph Stiglitz, author of Capitalist Fools, visited Berlin in March for a gathering called by Heidemarie Wieczorek-Zeul, the German Minister of International Economic Cooperation and Development.

Stiglitz attended as Chair of the new United Nations Commission of Experts on Reforms of the International Monetary and Financial System. Heidemarie is also a member of that commission which was established by the President of the UN General Assembly with the mandate to reflect on the causes of the crisis, assess impacts on all countries and suggest adequate responses as to avoid its recurrence and restore global economic stability.

The workshop in Berlin served two purposes: It was called to include other experts on the finance crisis also from non-governmental think-tanks and citizens’ groups, and was an occasion for Commission members to meet and work on their recommendations that were then published on March 20th . The Stiglitz Commission Recommendations (18 pages) are available online.

Hasty snapshot of Joseph Stiglitz looking up at Heidemarie Wieczorek-Zeul during the Berlin Dialogue on the Financial Crisis and Changing the International Finance System.

Some background: In February Wieczorek-Zeul had, as earlier mentioned in The Rag Blog, convened an international working group on the international impacts of the breakdown of the financial system. That served to develop the current German position on the issues. Politically active since the mid-1960’s, she has been a Member of the European Parliament, is a Member of the German Parliament (Bundestag) and heads (like a cabinet position) the Federal German Ministry for International Cooperation and Development.

All the above has, as one immediate focus, the April Financial Crisis Summit in London.

Some (A) long-term, (B) medium-term, and (C) immediate work:

(A) Long-term: More democracy: Getting from 0 to 1 to 8 to 20 to 185

Don’t fix it unless it is broken. It is broken.

The March meeting was opened by Heidemarie pointing out the window to where The Berlin Wall had been, and was taken down (by curious East Germans, not by Gorbatchov or Reagan), and noting that current changes are larger.

Background:

(0) An international conference about the international financial system was called, and failed, in the 1930s.

(1) In 1944 at Breton Woods, New Hampshire, a conference did create an international financial system. That was based on a single nation’s currency, the US dollar, pegged to a physical commodity, gold. (An alternative, proposed by Keynes and others, would have been to create an actually international reserve currency.) Also several international institutions were created (“World Bank”, “International Monetary Fund”) with participation and decision-making based on the amount of money put in. The USA was by far the richest country at the end of WW2.

(8) In 1970, at a time of international financial turbulence, US President Nixon called a meeting of the richest countries. (That eventually became the “G8” meetings of heads of governments of the richest 8 countries.) Nixon took the dollar off the gold standard, but the dollar remained the international “reserve currency”.
In the Spring 2007, with growing international financial stresses, the “G8” met in Germany, at Heiligendamm. There were large theatrical blockades outside and a real blockade inside that meeting. The German position, as host and also as chair of the European Union, included putting the financial system on the agenda.
Bush blocked that.

(20) Following Paulson’s panicky punt in September 2008 with a three page bank bailout plan (without any congressional oversight or judicial review) there were numerous crises meetings. The European Union “asked” (some said “insisted”) on an emergency financial summit meeting with Bush in November, with the G20 so as to include countries from all continents. At that meeting Bush agreed to stop his blockade and put the international finance system on the agenda with a meeting of the G20 scheduled for this April, 2009.



(185) The G20 includes Brazil, South Africa, China and others. The recommendation by Stiglitz, Heidemarie and others in the UN Commission on the financial system is to create an architecture that includes all 185 countries.

But as a participant at the March workshop in Berlin put it: the Titanic has hit the iceberg. It is not a matter of rearranging the deck chairs. Some immediate and near-term actions are needed. It is the case that, as the ship is sinking, actions are needed and can not be postponed while building a whole new liner – that is a longer term job. But unlike what actually happened as the Titanic sunk, with few life boats and many people locked below decks, now immediate and near-term actions must include all involved.

One long-term recommendation, also urged by the current German chancellor, is to create an Economic Council at the United Nations parallel to the (old) Security Council. While a global town meeting using the internet and consensus decision making might be imaginable, that is not immediately, if ever, practicable. And the (old) UN Security Council is also no longer a model. The recommendations do include some steps towards reform of the United Nations, in the long-term, as an international forum to handle international economic issues.

(B) medium-term: a philosophical and hard economic question: what is “money”, and what is a “reserve currency”? What is “the financial system”, and what are “banks” and “financial institutions” in that system?

The value and role of the “dollar” is already an issue. One medium-term consideration is NOT to replace all dollars, or replace the dollar as a currency, but maybe to use an already existing economic tool called “special drawing rights” (SDRs) already available among central banks through the International Monetary Fund (IMF):

“The SDR is an international reserve asset, created by the IMF in 1969 to supplement the existing official reserves of member countries. SDRs are allocated to member countries in proportion to their IMF quotas. The SDR also serves as the unit of account of the IMF and some other international organizations. Its value is based on a basket of key international currencies.”

“The International Monetary Fund (IMF) is an organization of 185 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.” (official site)

Facing the disaster of past policies, there have already been some policy changes by staff at the IMF. There will be more changes in the near and medium term.

(C) immediate work: oversight, “regulation”, tax havens and emergency financial actions

Oversight: A core issue that was blocked by Bush at the Spring 2007 G8 summit was the lack of insight and oversight about international financial activities. What is happening? What is “in” the "investment products" in banks and other entities engaging in international economic activities? What are “systemic” dangers? It sure would have helped to have had all of that out on the table in the spring of 2007, before the crisis hit hard in the fall of 2008. But Bush blocked that.

The German position (also widely held by conservatives here) is that while “markets” are a vast improvement over feudal or other forms of tyranny, they are not, by themselves, self-regulating or stable. The standard sports analogy is that to play soccer, or whatever, one needs accepted, legitimate, rules and referees and a fair playing field. One alternative is to have a dog-eat-dog, survival of the nastiest, society. That is certainly possible, but not broadly desirable. Even most dogs do not do that.

One linguistic problem in discussions between Germans and Anglo-Saxons is the term “regulation”. In English that can sound negative, stuffy and authoritarian, a limitation on liberty. And can be. But the word can have a different meaning: "legitimate standard". The usual analogy here involves vehicles used on public roads. Consider someone driving on public roads at night at high speed without breaks or lights, and causing damage. Not a good idea. In Germany, vehicles to be used on public roads need to be registered and inspected to meet safety standards. That is not a tyrannical dictation of where or when one drives the vehicle. It is a precondition for having usable public roads that the vehicles meet legitimate standards when used on public roads.

The Germans and others at the G20 summit will be insisting on improvements in oversight and regulations/standards for international financial activities.

That is the core issue for Germans at the summit. That issue is basically also one of democracy and the ability to have legitimate oversight and standards of international economic activity in the (global) economy. The “markets” are no longer only within nations, and there is now significant economic activity beyond the ability of any individual nation alone to exercise oversight and legitimate regulation.

That requires international agreements. Decisions about vehicle standards can be made for specific geographic areas. Democratic decisions are for the most part made within nation-states. But there is now significant international economic activity across boarders of any one nation, activity that can, and now has, caused vast damage. Recently, with much work, there had been a decline in infant mortality rates. Now they are climbing.

We will see what agreements will be reached at the G20. In any case international oversight and standards are on the agenda. The German position is that there be no geographical exception, and that all internationally active institutions and financial products be included.

An additional immediate agenda point regards international tax evasion problems. Most all governments are, or had better quickly be, concerned with that issue. The Swiss (after some recent legal pressure from the US Securities and Exchange Commission and from Germany) and following them a number of countries with "bank secrecy laws" have already agreed to accept international standards on cross-boarder tax issues.

The German position on emergency financial actions is now also fairly clear. They are taking a number of steps domestically, including with a view to dangers of hyperinflation/deflation. The Germans have a large stimulus package already and have the “automatic” anti-depression features in the social system. They are now watching to see the effects before doing more. There is a strong distinction made here between anti-depression “stimulus” efforts and dealing with the international financial system, including effects on small countries that are innocent by-standers and do not have large currency reserves. The Germans are, and are urging others, to increase the emergency facilities available to innocent countries with small reserves.

Locally in Germany immediate steps also involve changing the banking laws to enable emergency expropriation if necessary, as well as legal steps regarding international tax evasion issues.

Current issues here about getting beyond the financial crisis involve “investment”, the business models of “banks” and “public investment”. What kind of economy can be gotten to “beyond” the crisis? Emergency “stimulus” packages are one thing, but just expanding the money supply another. When is a “stimulus” really an investment that helps create value, and when is it only a transfer of funds from one pocket to another? A financial “system” is one thing, the institutions in a system another.

While some Germans enjoy pointing the finger at the “monstrosity” of Anglo-Saxon fundamentalist market capitalism (to quote the conservative German President Mr. Koehler) there is also a German saying that if you point a finger at someone else several fingers are pointed back at yourself. Along with being very mad at some financial institutions and systems in the USA and Britain (and, formerly, Island), the Germany are intense about "investment processes" here.

Changing the system(s) also involves changing the decision-making processes of the institutions in the system, including processes of investment decisions. Germany already has some public banks. The labor unions have some rights, and have been flexing their muscles and their political planning. There is broad cultural agreement that “investment decisions” can also involve ethical, social and ecological dimensions that need to be “taken into account”, but are not usually "taken into account" as a market price factor. That is, not only is there an internal failure of the capital market, but there is also much more reality beyond the market, beyond the price and cost numbers normally "taken into account" as a market cost.

So the crisis of the capital market is not only a crisis within the market but also crises about realities "external" to the market such as ethics, social fairness and ecological viability. This week in Germany there is both a large conference on education for "sustainable development” that is socially fair and ecologically viable, and an international working meeting preparing for the Copenhagen Climate Summit in the autumn. In both there will be some focus on best practices on the local, regional and international levels that can be scaled up. A lot is on the plate.

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David MacBryde in Berlin : A Look at the Ecomonic Sea Change

Allgemeine Zeitung: 'The World Hanging in the Air.' Photo by David MacBryde / The Rag Blog.
Seeing the Sea-Change in Germany and in the USA

What kind of "growth" is possible and desirable, what is impossible or dangerous on the thin surface of this planet? What do we want to "stimulate", or "invest in" -- and who makes, and in whose interest, "investment" decisions?

By David MacBryde / The Rag Blog / February 12, 2009

Beforehand:

BERLIN -- In Germany on Friday, the sixth of November, 2009, the major conservative newspaper here, the Frankfurter Allgemeine Zeitung, ran a front page picture captioned “The World Hanging in the Air” just prior to, and while waiting for, the US response to the financial crisis and the economic stimulus package.

The paper reported, as a taste of what might come, that the US administration just extended public health coverage for children (SCHIP) “as a down payment on comprehensive reform.”

In the German news, local TV showed school districts in Berlin and around the country where people were working overtime gearing up to implement school building renovations as part of the German economic stimulus plans that had already been agreed upon.

One definite if relatively minor controversy was about accountability. Substantial public funds, borrowed in effect from the future, were being rapidly distributed to local school districts. How would the public school administrations handle the funds in an accountable way? That involves accounting in the bookkeeping sense (where German bookkeeping can be “stuffy” and rigid, not flexible and as fast as needed in the emergency.) The issue is also accountability in terms of appropriate use of public funds borrowed from the future. That sense of accountability, given the flood of funds, is getting lots of attention, including that of the school kids.

The main controversy in the German news came in debates about the crisis in the financial system. There are still many unknowns about conditions in some banks. There are still questions about possible huge hidden obligations, “innovative finance packages,” in the financial sector. And worse (since only relatively few banks here held many “innovative finance packages” bought from the USA -- and there was no housing bubble or sub-prime mortgage problem here), the rapidly deepening recession meant that even “normal” bank assets were of unclear value, or were losing monetary value.

The German government is preparing legislation should it become necessary in the public interest to nationalize, expropriate, banks on a large scale. The government, the taxpayers, already de facto own a few banks on a case by case emergency basis. (And simply "nationalizing" the banks is not in itself here seen as adequate. One of the first banks to face failure here was the Bavarian State Bank, owned by the very conservative state of Bavaria and run by the local equivalent of very conservative Republicans. That is a topic for another blog.)

During:

On Tuesday the 10th of February there was news from the USA about the stimulus package being passed by the Senate. That process is being closely watched and generally greeted with some relief here.

Then the US administration presented the revised action plan about the financial crisis.

Lead by a hefty 10.2% decline in financial stocks, the stock market dropped 4.6%.

One thing is obvious: the announced action plan was NOT seen as making US banks wealthy.

To the contrary, bank stocks dropped.

Historians will have many details to look into. And more decisions will have to be made in order to get beyond the crisis in the financial system. But it is obvious that the plan as announced will NOT hand the banks a blank check from taxpayers as the original three page Bush-Paulson Republican bailout plan tried to do.

Into the future. Working towards April:

In Germany there has been much work on the crisis in the capital market system.

There was a meeting in Berlin about the financial crisis that was initiated by the German Ministry of International Economic Cooperation and that included non-governmental organizations and think tanks. The issue was the impact of the crisis in the financial system on weak states. The bottom line: the crisis, created in the richer countries, appears to be causing the unemployment of an additional 20 million people in poorer countries, with an increase in infant mortality. While over the years there had been some improvement in overcoming poverty and malnutrition, now that progress is being threatened and more kids are starving to death, all because of decisions that were made in banks. The German foreign policy position now includes (a) increasing direct foreign aid and (b) cutting those European and US agricultural subsidies that harm indigenous farming development in poorer countries. It was noted that Obama has explicitly urged the cut of those farm subsidies in the US, but that farm legislation in the US is also a domestic issue and depends on legislative work at the state level.

The German and European Union negotiating position on the financial crisis is being worked out with a view to the next international finance crisis meeting in April. That meeting will now include Brazil and China, and there is intense non-governmental work happening that concerns the inclusion of the interests of weaker states. This process will be one thing to watch.

For one aspect of the sea change that is happening, see the accompanying chart of current bank rankings as of Feb. 6, 2009 (Frankfurter Allgemeine Zeitun).

Chart of rankings of the largest banks as of Feb. 6, 2009. From Allgemeine Zeitung.
What will be happening in the USA regarding the financial system crisis?

There were congressional hearings with bankers on Wednesday, Feb. 11, 2009.

After the panicky punt by Paulson with his three page plan being defeated in Congress, Congress did pass a financial system plan that was supposed to be different -- not a bailout but an investment -- with oversight and accountability for us tax payers.

What has been happening to that? And what will happen next?

Personally, I have long appreciated the work of Elizabeth Warren. She wrote “the Coming Collapse of the Middle Class” and “The Two Income trap” concerning what has been happening economically to middle income families since the early 1970s, in “the mainstream.” She shows the sociological changes in the last 30 years and where we are “now” -- BEFORE the current crisis -- and how mainstream families ware but one accident away from bankruptcy BEFORE the current crisis started. Warren was previously at the University of Texas and now is at Harvard Law where she specializes in bankruptcy law.

If you have time, and cheep broadband access, she has a fine lecture on YouTube.

Warren was appointed chair of the Congressional Oversight Committee on the financial crisis. She is an expert in personal bankruptcy. She is certainly no fan of bankrupting average Americans in the interest of pumping money to bankers. She has heavily criticized both the Bush-Paulson plan and its implementation.

As the capital market crisis continues, she is one person to watch. There will be much controversy and more hearings in Congress.

On the stimulus package, Obama went on the road and encouraged local home meetings about the economy. And supposedly a government website is being set up for accountability, to follow implementation and to keep tabs on who does what with tax payer money for the stimulus.

There will be hearings in Washington on the financial system crisis. How will the controversies and decisions about the finance system crisis proceed?

Looking forward. From afar, one question:

Is there interest outside of Washington, D.C., in holding hearings on the financial crisis, on what happened and what is in the public interest? Might it be of interest, say in Austin, Texas, to encourage, say Congressman Lloyd Doggett with his staff, to set up a local hearing?

Maybe calling on Jim Hightower and perhaps faculty from Austin Community College, maybe Richard Croxdale, and UT journalism professor Robert Jensen, and James Galbraith of the UT Inequality Project, and others?

A start-up working paper to raise questions could be the Dec. 10, 2008, report from the Congressional Oversight Committee.

The focus for a hearing could be the Preamble to the Constitution, specifically one core purpose for the founding the United States, namely for “promoting the general welfare". How do the efforts to solve the crisis in the financial system measure up to the purpose of “promoting the general welfare?”

That is a short term question. The longer term issue is what is meant by getting "beyond" the crises? Four cars in every garage is not the answer. I will write on that in a future blog. What kind of "growth" is possible and desirable, what is impossible or dangerous on the thin surface of this planet? What do we want to "stimulate", or "invest in" -- and who makes, and in whose interest, "investment" decisions?

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Our Correspondent : Germany's Alternative 'Rag' Hopeful About Obama

Die Tageszeitung: 'As Obama so often said: Change is not about me, it is about you. Europeans should feel addressed by that.'
By David MacBryde / The Rag Blog / November 14, 2008

BERLIN -- After the election, the headline of the radical German daily newspaper Die Tageszeitungis a pun: "Gute Wahl" means both "good choice" and "good election.” They were happy that their favorite won, and that the election process worked, was not stolen as some had feared.

Media background information: The Tageszeitung (literally "Daily Newspaper") can be considered, with a little stretch, to be a younger sister of The Rag. How so? The Rag was an "alternative" paper published in Austin, Texas from 1966 to 1977. [The Rag was originally edited by The Rag Blog’s Thorne Dreyer, and Carol Neiman; The Rag Blog is The Rag's spiritual stepchild.] The Tageszeitung was founded in 1979 as an alternative platform in the local media landscape, after others in Germany had tried to start "leftist papers" that were usually sectarian and usually dull, and failed.

Younger, back then, Germans had been impressed by new forms of civic actions in the US civil rights and free speech movements. The alternative papers in the US were seen by some here, and for example the Furry Freak Brothers [Gilbert Shelton’s sixties underground comic strip that originated in The Rag] got laughs, and respect. Now, while the TAZ is radically critical of aspects of US policies and society, there is a lot about the USA that is appreciated and respected.

The front page editorial is titled "Wir sind Obama" -- "We are Obama"

Excerpts (my rough translation/paraphrase):

"So there he is now. The favorite candidate in the world has also been able to convince the US Americans that he is the right guy for the White House. That is good so. A day worthy to be thought about, an historical chance -- not only for the USA. Does anyone still remember that vanguard thinker of the neo-conservatives, Robert Kagan, who announced in 2003 that in strategic and international issues the USA and Europe were so far apart, like coming from the different planets Mars and Venus? If there is any possibility with a politician of getting us down to earth, and together, then it is with Obama. Europeans would be crazy not to use this chance.

“However of course Obama was not elected president of Europe. For many years the European Governments have asked to be listened to. But actually what do they have to say? Now that Obama has been elected, what are the Europeans going to do? For a long time it has been easy for the German government to hypocritically criticize US mistakes and dominance verbally, but often remain passive. It would be better to come up with our own suggestions to put on the table (e.g. Afghanistan). It could be good for the potentially new relations with the USA under President Obama if he could meet with allies who did not duck issues or waited, but thought for themselves. As Obama so often said: ‘Change is not about me, it is about you.’ Europeans should feel addressed by that."

A test of that, and, looking forward, also a tip about something to keep an eye open for: this weekend, Nov. 15, 2008, the "financial summit" meeting in Washington will be "interesting". I do not expect any detailed decisions there, and do not know anyone who does, given the lame duck US administration and their position on issues. But there will be an effort to set up a working agenda and a time frame looking at March to get results. One historical point of reference: A year and a half ago at the "G8" richest country summit in Germany there was a theatrical blockade outside. Inside, the real blockade was by the Bush administration, which blocked the issue of the growing financial crisis from being put on the agenda. Now a broader range of countries intend to take initiative.

For now, and for the future,
David MacBryde
your correspondent in Berlin

The Rag Blog

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