Blog Post

Race to Washington Part 1

Graphics by Michelle Jia : Image Flickr ( III 

Neither individuals nor the private sector of the economy has [taken], or can take responsibility for full employment in American society. This is the responsibility of all segments of the society and thus, finally, of the government.

—Bayard Rustin, “The Anatomy of Frustration” (May 1968)

Mike Brown, Tamir Rice, Eric Garner, Freddie Gray, Sandra Bland: from Ferguson to Cleveland to New York to Baltimore to Waller County, the effects of systemic racism and racialized violence have once again become acutely visible in the United States. Those with a sense of history know that unchecked police violence against communities of color is nothing new but, rather, comprises a permanent feature of American society from its inception to today. With the rise of digital recording technologies and social media networks, however, such incidents become increasingly impossible to ignore. It is now possible, for instance, to witness a police shooting and its aftermath almost as it unfolds, and do so without establishment figures pretending that the struggle for civil rights ended in the 1960s.

The more present media technologies make racialized violence perceptible, the more we are able to address it. Yet the question remains: beyond expressions of collective outrage, beyond calls to end racial discrimination and brutality, what can be done?

Ferguson, Missouri crystallizes both the direct brutality of contemporary racism and the far less visible systemic violence that conditions it. A recent Justice Department report showed that the city leadership uses the court system as a major source of revenue for the municipality. And Ferguson is not alone. As The New York Times has found, “Ferguson does not even rank among the top 20 municipalities in St. Louis County in the percentage of its budget drawn from court fines and fees.” Effectively, the county and its municipalities are using the courts to finance their operations, while imposing financial and regulatory obligations on its poorest, overwhelmingly Black citizens. Moreover, because of persistently high unemployment, residents are unable to pay the fines. This in turn leads to more fines, warrants and confrontational encounters with the police—encounters that can easily turn lethal. Courts may also directly send people to jail because of failure to pay fines.

In response to the public outcry, Missouri’s governor, Jay Nixon, has signed legislation that is intended to curb revenue-raising and private-profit-making from traffic tickets. While the new legislation will eliminate charges for failure to appear in court, it simply lowers the percentage of revenue most cities can collect in this manner by a mere 10 percent. Missouri municipalities will continue to be allowed to fund their operations by criminalizing, fining, prosecuting, and jailing their poorest and least politically powerful citizens. This is the tiniest of victories and one that leaves the structural core of systemic racism in America firmly in place, as the ongoing confrontations between Ferguson residents and the police visibly demonstrate.

The crux of this order, we wish to suggest, is the Liberal understanding of money that organizes modern political economy and social life. The Liberal conception of money holds that it is a private and finite resource, a commodity like gold, silver or oil. As a limited, non-renewable, not producible resource, commodity money provides one answer to the problem of how a society allocates its goods. Essentially, it substitutes private competition over an artificially scarce ‘thing’ for what should be democratic dialogue and contestation over an unlimited public balance sheet. Imagining government as a revenue-constrained and bankruptable market actor, commodity money's zero-sum metaphysics not only occlude the hidden and often racist policies that coordinate economic life, but also obscure the true possibilities for treating injustice: they accept that the state is powerless over the money form.

Under this view, struggling municipalities have no choice but to find a “recession-proof revenue generator” since cities have few or no businesses from which to draw tax revenue. Local elected officials complain that criticism of the fee-extraction regime is “blaming the police officer or you’re blaming the municipality or blaming the judge for enforcing the law.” By contrast, the critique of commodity money concerns the law itself as a sociopolitical regime and the way this regime's bogus specters of scarcity condition such problems to begin with.

Liberal money asks us to accept that a heavily-armed gang (what Ta-Nehisi Coates calls the police in such instances) sweeping into a community to enforce exploitation and suffering is the only alternative on offer. Smart phones and social media are important tools that have allowed people to expose the sharp end of anti-Black state violence that results from this regime. What is needed, however, is a tool to expose and demystify the fundamental mechanics of money itself.

Modern Monetary Theory (MMT), we claim, is precisely such a tool. MMT economists reveal that money is an essentially limitless public instrument. They argue that government is constrained, not by its ability to borrow from the private sector or earn revenue through taxation, but only by the real resources and capacities that characterize a society and its environment at a given moment. This is a technical point, but one with profound political consequences. It allows us to trace the hidden ways that the Liberal conception of money as a finite commodity both structures and naturalizes the racialized oppressions of neoliberal financial capitalism. But it also radically expands the sorts of political transformations we can imagine and the types of changes we can demand from government.

The most important of these transformative ideas, and the one that goes furthest in immediately addressing racial injustice today, is MMT’s proposal for a federally-funded and locally-administered Job Guarantee. Ensuring that everyone has the opportunity to participate in meaningful work and be compensated with a living-wage and health care, the Job Guarantee promises to enfranchise those who have been systematically subordinated by and excluded from the formal employment market, to actively shape and repair damaged communities, and to raise the foundations of economic life from the bottom up.

MMT economist and Black Studies scholar Mathew Forstater argues that the Job Guarantee answers the racialized, if not outright racist, logics that have long structured unemployment in the United States. Since Reconstruction, unemployment in the Black community has remained stubbornly high. “[It] is well-known,” Forstater explains, “that in the United States the Black unemployment rate is always double the white rate, regardless of whether the economy is performing well or not.” The results not only impoverish the Black community and undermine Black rights. They also reverberate throughout society and damage all social relations in ways that are not always directly apparent. But what is most hidden from view, Forstater shows, is that structural unemployment is a policy choice (not a natural effect of a money economy), that in the United States this choice has been deeply shaped by racial discrimination, and that looking ahead we both can and must choose otherwise. Put another way, MMTers such as Forstater insist that what Friedrich Engels famously called the “reserve army” of the unemployed is, in truth, not a necessary feature of a monetary economy as both Marxist critics and their mainstream interlocutors maintain. It is, rather, an ideological myth perpetuated by the dominant classes to discipline and disenfranchise labor that capitalism’s critics can no longer afford to perpetuate as such.

Understanding Black un- and underemployment as a political decision rather than a market outcome also enables Forstater to throw new light on seemingly intractable problems, such as the growing crisis of state imprisonment, which disproportionately affects racial minorities. First, Forstater contends that “certain kinds of criminal activity are directly related to unemployment,” particularly since those who have been excluded from the formal economy often turn to illegal sources of income in order to survive. Next, he observes that the “official unemployment rate refers to the civilian noninstitutional population, which means that it also does not include… those in prison or jail.” Indeed, a study by Beckett and Western he cites indicates that “the official unemployment rate in the United States during the 1990s economic boom . . . would have been considerably higher if it had been adjusted for the . . . inmate population [which had] . . . surged to more than two million during the previous two decades.” If one extends Forstater’s analysis further, it then appears that prisons and jails become means to warehouse this discounted population, who are often compelled to work for far below minimum-wage.

As a consequence, we have a situation in which the state implements a racist policy of structural unemployment and then creates below minimum-wage work camps to contain and exploit the social fallout. To make matters worse, when prisoners re-enter civil society, their criminal record radically reduces their job prospects, they are typically strapped with private debt accrued both before and during incarceration and, without anywhere to turn, they are the most likely group to be fined by cash-poor municipalities like Ferguson. 

This is the sort of vicious cycle that a public Job Guarantee can play an integral role in reversing. Such a program will not instantly purge American society of racist feelings and practices. It alone will not eliminate wide-spread discrimination and brutality. The legal system must be restructured and the carceral state dismantled. Yet MMT's Job Guarantee would introduce a reparative and potentially revolutionary mode of valuation into present circumstances by involving historically disenfranchised persons in socially meaningful forms of world-making and ensuring their rights to dignified compensation and adequate healthcare.  

MMT’s heterodox understanding of money points the way to a new era of critique and contestation. When we begin to envision money as a public and truly boundless social technology that can be made to serve all, it becomes clear that government’s failure to provide full employment for the Black community (and American society as a whole) is the primary crime looming behind today's viral videos of police brutality. It is a crime of triple exploitation. The first is the creation of structural unemployment. The second is the management of low-wage prison labor that contains and profits from the social repercussions of this unemployment. And the third is the targeting of the unemployed and formerly incarcerated as a source of revenue for local government operations.

Digital cameras and networks are vital for making visible and fighting against directly physical acts of state violence. Still, MMT offers an additional and indispensable conceptual tool for addressing the invisible violence of structural unemployment that variously conditions these more readily graspable acts of brutality.

Coda

The Black Lives Matter movement is now actively exploiting the power of contemporary media technology to aggressively confront political leaders. As a recent article in The Nation has characterized it, BLM chapters are demanding that Americans value Black life and that they place this value “above the property rights of Ferguson and Baltimore residents, above the rituals of holiday commerce, and, yes, above the inspiring surge of a socialist presidential candidate.” Given the historical oppression exerted by white supremacy, the BLM intervention is both urgent and necessary.

As part of this intervention, BLM has created a comparatively less publicized list of demands for change wherein full employment features prominently. “Every individual has the human right to employment and a living wage,” states BLM’s “Vision for a New America.” “Inability to access employment and fair pay continues to marginalize our communities, ready us for imprisonment, and deny us of our right to a life with dignity.”

Regrettably, and for reasons that are in part out of the movement’s control, BLM’s demands for full employment have not yet been adequately heard and the Black employment crisis remains largely unknown outside of the Black community and those who make it their business to know. One cannot help but wonder what BLM and other avowedly leftist movements might accomplish with a tool like Modern Monetary Theory and what a revolutionary weapon MMT stands to become in their hands.

Moving forward, it shall be crucial to revisit the historical struggle for a public Job Guarantee waged by Dr. Martin Luther King, Jr. and the Civil Rights Movement, as well as to draw upon recent scholarship regarding race and full employment carried out by economist William A. Darity and his colleagues. But in an era defined by myths of insufficient taxation and falsehoods about government debt and “affordability,” addressing the invisible violence of systemic unemployment that undergirds today’s spectacles of police brutality will only be possible if we are willing to expand our imagination regarding what money is and what it can be made to accomplish.

If one believes that full employment is vital to liberation, then Modern Monetary Theory's radical departure from orthodox political economy provides a roadmap for actualizing it.

Assistant Professor / Adjunct Lecturer

Scott Ferguson holds a Ph.D. in Rhetoric and Film Studies from UC Berkeley and is presently co-director of the Film & New Media Studies Track in the Department of Humanities & Cultural Studies at the University of South Florida. His current research and pedagogy focus on Modern Monetary Theory and the problem of aesthetics; the history of digital animation and visual effects; and essayistic writing across media platforms. He has published in Screen, Qui Parle, and Liminalities, and has an article forthcoming in Discourse.

Mark L is an adjunct lecturer at the Invisible University.