Key figures on the American right are currently screaming about socialism to scare the children, so let's hear something about the subject from an American socialist: ::::::::::: BILL MOYERS: So what does a real live Socialist think about all this? We consulted the Endangered Species Act and actually found one, way out to the People's Republic of Southern California. That state's economy has tanked with one of the country's highest number foreclosures and unemployment above 10% and climbing. California is a financial earthquake off the Richter scale. All of this is grist for the socialist writer and historian who is sitting with me now. Once a meat cutter and a long haul truck driver, nowadays, Mike Davis teaches creative writing at the University of California, Riverside. This recipient of a MacArthur Foundation "genius grant" has written so many books we can barely get them on the screen for you. Two of his histories of Los Angeles and Southern California, CITY OF QUARTZ and ECOLOGY OF FEAR were best-sellers. His latest: IN PRAISE OF BARBARIANS: ESSAYS AGAINST EMPIRE. Mike Davis, welcome to the JOURNAL. MIKE DAVIS: My pleasure, Bill. BILL MOYERS: Did you ever in your life imagine that America's financial system would become insolvent or that our way of life would be in such a sudden freefall? MIKE DAVIS: No. And I found myself in the position of, say, a Jehovah's Witness, who, of course, believes the end is nigh but then one morning wakes up, looks out the window, and the stars are falling from heaven. It's actually happened. Of course, people a lot like myself are famous for I think the phrase is we predicted eleven out of the last three depressions. So, no. BILL MOYERS: But I do think this time most everyone would agree with what you how you've described what we're going through as the mother of all fiscal crisis. Do you have a sense of the people you know being frightened right now? MIKE DAVIS: Oh, people are terrified, particularly where I teach in Riverside County. People have no idea you know, where to turn. UC Riverside is the largest percentage of working-class students in the UC system. And their families have scrimped and saved. And they've worked hard to get into courses that pointed toward stable careers and jobs. And now those futures are incinerated. What kind of choice do you make? You know, what do you study? BILL MOYERS: You wrote an essay on one of my favorite websites, TomDispatch.com, in which you asked this question. "Can Obama see the Grand Canyon?" Now, help us understand the use of that metaphor. MIKE DAVIS: Well, the first explorers to visit the Grand Canyon, simply were overwhelmed. They couldn't visualize the Grand Canyon because they had no concept for it. That is, there was no analogue in their cultural experience, no comparable landscape that would allow them to make sense of what they were seeing. It actually took ten years of heroic scientific effort by John Wesley Powell and these great geologists, Clarence Sutton, before he was truly able to see the Grand Canyon in the sense that we see it now as a deep slice in Earth history. Before you just had confused images and, you know, feelings of vertigo. And so the reason I raised this is that do we really have an analogy? Do we have the concepts to understand the nature of the current crisis other than to step back shaking from the brink and say this is profound? Because, you know, we're in this situation where not only do we seem to be having a second depression, but this is occurring in the context of epochal climate change. It's occurring at a time when the two major benchmarks that survived for global social progress, the United Nations millennial goals for relieving poverty and child mortality, on one hand, and the Kyoto goals for reducing greenhouse admissions, both of those sets of goals are clearly not going to be achieved. They slowly failed. This would be a time of fierce urgency in any sense. And now we face a meltdown of a world economy in a way that no one anticipated, truly anticipated the possibility of another recession, even a financial crisis, but no one counted on the ability of this to happen in such a synchronized, almost simultaneous way across the world. BILL MOYERS: You wrote in that essay and we'll link that essay to our own site. "We are looking into an unprecedented abyss of economic and social turmoil that confounds our previous perceptions of historical risk. Our vertigo is intensified by our ignorance of the depth of the crisis or any sense of how far we might ultimately fall." That was five or six months ago. Do you have a sense now of how far we might ultimately fall? MIKE DAVIS: No. And the consensus is that no one does. You can read the financial press. And almost nobody believes that the financial bailout is going to work. Nobody's seen the bottom here. And we're working largely on the basis of hope and faith and crossing our fingers. We've invested in one person, an almost messianic responsibility. BILL MOYERS: And how's he doing? What's Obama done right so far, in your judgment? MIKE DAVIS: Well, I think what he's done most right is to push through the stimulus package, which I argue is primarily a relief bill, because obviously you can't talk about stopping the decline if you're going to allow the public sector, the local public sector, schools and public services on a state and local level to collapse as they are. You have to shore that up. Not that the stimulus is sufficient to address the totality of the fiscal crisis across the span of local governments. But it puts a Band-Aid over it. It slows the results of that. It extends unemployment. It pays. BILL MOYERS: Unemployment compensation for… MIKE DAVIS: Unemployment compensation. BILL MOYERS: Gives a little more money to people who are out of work. MIKE DAVIS: Yeah. Of course, there's a big difference. When my father was on WPA in 1935… BILL MOYERS: Works Progress Administration, I remember it well. MIKE DAVIS: Every dollar he was paid by the federal government, 98, 99 cents of it went on products that were made in the United States or grown in the United States. One of my nephews who's unemployed today, just lost his job in Seattle, he takes his unemployment money down to Wal-Mart or Sam's Club. And probably 40, 45 cents of that money is stimulus to the Chinese or the Korean economies. So it the stimulus in this country, Keynesian stimulus, doesn't necessarily have the multiplier effect. That is, it doesn't create as much jobs or circulate in the extent that it did before. And this is, of course, the huge difference between the situation today and the 1930s, which is that in the 1930s the United States had the largest, most productive industrial machine in the world. It could make almost anything. The question was how to put the workers and machines back at work. Today, so much of our national wealth, so much of our employment is dependent on services linked to the financial role of the U.S. But unlike Roosevelt, who could undertake institutional reforms that would reduce the control of banks over industry, now we're part of an integrated, interlocked system where what we can do on a national scale is ultimately limited by our creditors and by the dollar. And internationally, where every part has become so interdependent that it's hard to think about a general recovery without some kind of simultaneous and coordinated effort. And that seems to be utterly utopian at this moment. BILL MOYERS: So. BILL MOYERS: In that same essay back in October, you asked the question is Obama FDR? Well? MIKE DAVIS: Well, I'm prepared to concede that in terms of his character, his moral beliefs, his empathy and compassion for Americans, but above all in his understanding of the urgency and the unparalleled nature of this situation, yes, I mean, he could be Roosevelt. He could be Lincoln. But, I mean, Bill, the obviously the real heroes of the New Deal were the millions of rank-and-file Americans who sat down in their auto plants or walked on freezing picket lines in front of their factories. They made the New Deal possible. They provided the impetus to turn Washington to the left. We talk very differently about the legacy of Franklin Delano Roosevelt, if it hadn't been for the incredible insurgency of labor and other ordinary Americans in the 1930s. BILL MOYERS: The garment workers, for example, when they left the Socialist Party, so to speak, and went into the Democratic Party, Roosevelt had a real infusion of blood. MIKE DAVIS: Well, a lot of them joined the American Labor Party in New York, because they could not in good conscience ever pull that lever that said Tammany Hall Democrats. But they wanted to support Roosevelt without supporting the Democrats. In the 1930s, of course, you had vigorous third parties often in power on state levels. Farmer Labor Party. The Commonwealth Federation in Washington, the Non-partisan League. And you, of course. BILL MOYERS: The Progressive Party out in Wisconsin and in the Midwest. MIKE DAVIS: Yes. And you had these progressive Republicans, you know, in the tradition of La Follette or, before that, of William Jennings Bryant, who, if they were seated in the Senate today, would be seated to the left of Bernie Sanders and the most progressive Democrat. They were the real hammers on the issue, the concentration of economic power. They were the ones who were exploring military spending in the in the scandals of the First World War. They're the ones who led the investigations on who really owned corporate America? On the role of the banks and the houses of Morgan. And this was of incalculable importance that they opened the books on the American economy for about the first and only time. And one of the things that's hasn't happened yet, is to do that right now on Wall Street. The most fundamental straightforward questions about who are the counterparties who own the credit default swaps? You know, who are the main creditors of these banks? In the midst of bailing them out with tens of billons of dollars of tax money, the public doesn't have any idea who's actually benefiting, who the parties are involved. BILL MOYERS: What's your explanation for why we don't have that pressing inquiry and that demand for accountability that we had in the 1930s? MIKE DAVIS: Well, in the 1930s we had an interesting coalition between a progressive middle class, including at that point still a lot of farmers; a very dynamic labor movement, even though it was divided; and a journalistic culture, literary, you know, culture that was in constant pressure and debate with the Left. The Left was all-important in the '30s. And I'm talking about not just the Communist Party but social Democrats of all kinds, not because they were that significant a force politically. But they were significant intellectually. And they were asking deep and profound questions about the nature of economic power, economic institutions. And in turn, this was leading, if not to sweeping reforms, it leads to an exploration for the first time in American history really looking at who holds power, how does economic power influence political decisions in Washington all the things that most Democrats and most Republicans are probably most afraid to explore. I mean… BILL MOYERS: Why are they afraid? MIKE DAVIS: Because they're the beneficiaries of the system. In some cases I think with the President has come to accept that there's only really one way he can operate. And that's through, you know, accommodating himself to the forces that exist and cutting compromises he sees as inevitable. The fact that they may talk about bank nationalization, but it's nothing more than salvaging the banks for the private sector rather than talking about the possibility of public ownership. But there have to be times in history when it's the necessary, not the possible, that has to come first in public dialogue. I mean, we've lost so much of the reform conscious, this sense of possibility in this country. We treat political positions as they're entirely relative. I mean, we let Rush Limbaugh define what a Liberal or a Socialist is. I believe that Liberalism, New Deal Liberalism has a relatively precise historical benchmark definition. And that… BILL MOYERS: Which is? MIKE DAVIS: FDR's fourth-term election, when he ran on the idea of an economic Bill of Rights for Americans, something that Lyndon Johnson believed in and tried to renew. And if you were to advance any agenda right now for how to get us out of this crisis, it would be to renew this concept of the real social citizenship, an economic Bill of Rights, and also the enormous need to strengthen the power of labor in the economy. The post-war golden age of the '50s and '60s was a period when unions were powerful enough to be major parts of the macro economy, when wages were tied to productivity. And they played a dynamic and incredibly central role in the American economy, which, of course, they lost in the late '70s and under Reagan. It was the strengthening of labor, that is the power of ordinary people in the unions, that made the accomplishments of the New Deal possible. People who almost doubled the size of the American economy during the Second World War.