Renowned political theorist and writer Noam Chomsky spoke to Occupy Boston on October 22. Below is an abridged transcript of his comments.
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It’s pretty hard to give a talk for the Howard Zinn memorial lecture at an Occupy meeting. There are mixed feelings that necessarily go along with it.
First of all regret that Howard is not here to take part in, and invigorate in his inimitable way, something that would have been the dream of his life.
Secondly, excitement that the dream is actually being fulfilled. It’s a dream for which he laid a lot of the groundwork. It would have been a fulfillment of a dream for him to have been here with you.
It is an extremely exciting development. In fact, its kind of spectacular and unprecedented — there’s never been anything like it that I can think of.
If the bonds and associations that are being established in these remarkable events can be sustained through a long, hard period ahead (because victories don’t come quickly) it could turn out to be a really historic and significant moment in American history.
The fact that the Occupy movement is unprecedented is quite appropriate: it’s an unprecedented era, not just at this moment but since the 1970s.
In the 1970s, there began a major turning point in American history. Since the country began, it had been a developing society: not in very pretty ways, but it was a developing society with ups and downs but with general progress towards wealth, industrialisation and development.
I’m just old enough to remember the Great Depression. After the first few years, but the mid-30s, although the situation was objectively much harsher than it is today nevertheless the spirit was quite different. There was a sense that we were going to get out of it, even among unemployed people.
There was a militant labour movement organising, the Congress of Industrial Organizations, which was getting to the point of sit-down strikes, which really were very frightening to the business world. Because a sit-down strike is just a step before taking over the factory and running it yourself: something which, incidently, is very much on the agenda today.
It’s quite different now. Now there is a pervasive sense of hopelessness and, at times, despair. And I think it’s quite new in American history and it has an objective basis.
In the 1930s, unemployed working people could anticipate realistically that the jobs were going to come back. If you are a working in manufacturing today, and the level of unemployment in manufacturing is approximately like the Depression, if current tendencies persist then those jobs aren’t going to come back.
The change took place in the ’70s. There are a lot of reasons for it. One of the underlying reasons discussed by economic historian Robert Brenner is the falling rate of profit. There are other factors that led to major changes in the economy.
[There has been] a reversal of the several hundred years of progress towards industrialisation and development and a turn to a process of de-industrialisation and de-development.
Of course, manufacturing production continued, but overseas. That’s very profitable but no good for the workforce.
Along with that came a significant shift in the economy from productive enterprise — producing things that we need and we could use — to financial manipulation. The financialisation of the economy really took off at that time.
Before the ’70s, banks were banks. They did what banks are supposed to do in a state capitalist economy: they collected unused funds like, say, your bank account and transferred them towards some potentially useful purpose.
Then, there were no financial crises. It was a period of enormous growth, the highest growth in American history, in the ’50s and ’60s. And it was egalitarian. So the lowest quintile did about as well as the highest quintile.
A lot of people moved into reasonable lifestyles: what’s called here “middle class” but is called “working class” in other countries. But it was real and the activism in the ’60s, after a pretty dismal decade, really civilised the country in lots of ways that are permanent. They’re not changing, they’re staying on.
The ’70s came along. There was a sharp change: de-industrialisation, offshoring of production, and shifting to financial institutions (which grew enormously).
I should say that in the ’50s and ’60s, there was also the development of what several decades later became the high-tech economy: computers, internet [and] the IT revolution were mostly developed in the ’50s and ’60s, substantially in the state sector. It took a couple of decades until it took off, but it was developed there.
The developments that took place in the 1970s set off a kind of vicious cycle. It led to the concentration of wealth, increasingly in the hands of the financial sector, which doesn’t benefit the economy — it probably harms it and harms society.
The concentration of wealth yields the concentration of political power, which in turn gives rise to legislation that accelerates the cycle — the fiscal policies, the tax changes, the rules of corporate governance, deregulation.
Alongside this began the very sharp rise in the costs of elections, which drives the political parties — even deeper than before — into the pockets of the corporate sector.
[There’s been] a tremendous concentration of wealth, mainly in the top one-tenth of one percent of the population. Meanwhile, for the general population there opened a period of stagnation or even decline [in wealth] for the majority.
People got by, but by pretty artificial means. A lot of borrowing, and so a lot of debt. A longer working day, which was pretty soon much higher than in other industrial countries.
There has always been a gap between policy and the public will, but it just grew astronomically.
For the general population — the 99% in the imagery of the Occupy movement — it’s been pretty harsh and it could get worse. This could be a period of irreversible decline.
For the 1%, and more so the one-tenth of the 1%, it’s just fine. They are richer than ever. They are more powerful than ever. They are controlling the political system. They are disregarding the public.
Take Citigroup. A couple of years ago they came out with a brochure for investors. They urged investors to put their money into what they called the “plutonomy index”. They said the world is dividing into a plutonomy [an economy controlled by the very rich] and that’s where the action is.
They said their plutonomy index was way outperforming the stockmarket, so put your money into it.
And as for the rest, we set them adrift. We don’t care about them. We don’t need them. They have to be around to provide a powerful state to protect us and bail us out when we get into trouble, but other than that they essentially have no function.
They are sometimes called these days the “precariat” — people who live a precarious existence on the periphery of society. But it’s not a periphery any more, it’s becoming a substantial part of the economy in the United States and elsewhere.
And this is considered a good thing. For example, [former US Federal Reserve chairperson] Alan Greenspan , when he was still hailed by the economic profession as one of the greatest economists of all time, before the crash for which he was substantially responsible, he was testifying to Congress in the Clinton years explaining the wonders of the great economy that he was supervising.
And he said a lot of the success of this economy was based on what he called “growing worker insecurity”. If working people are insecure, if they are part of what we now call the “precariat” and live precarious existences, then they are not going to make demands, they are not going to try to get higher wages, they won’t get benefits, we can kick them out if we don’t like them, and he said that’s good for the health of the economy.
And [Greenspan] was very highly praised for this.
And now the world is indeed splitting into a plutonomy and precariat — in the imagery of the Occupy movement, it’s the 1% and the 99%. That’s not literal numbers, but it’s the right picture.
It could continue like this. And if it does continue [then] this historic reversal that began in the 1970s could become irreversible. That’s where we’re heading.
And the Occupy movements are the first, real, major popular reaction that could avert this. But as I said, it’s going to be necessary to face the fact that it’s a long, hard struggle. You don’t win victories tomorrow.
You have to go on. You have to form structures that can be sustained, that will go on through hard times, and can win major victories.
In many ways the most exciting aspect of the Occupy movement is just the construction of these associations, bonds, linkages and others that are taking place all over. And out of that, if it can be sustained, it can come to be expanded to a large part of the population.