The End of Neoliberalism and the House of Saud? Some Hopeful Signs

"If It Owns a Well or a Mine, It’s Probably in Trouble," by Clifford Krauss and Ian Austen is worth reading:

“The world of commodities has been turned upside down,” said Daniel Yergin, the energy historian and vice chairman of IHS, a consultant firm. “Instead of tight supply and strong demand, we have tepid demand and oversupply and overcapacity for commodity production. It’s the end of an era that is not going to come back soon.” 

The pressure on prices has been significant.

Prices for iron ore, the crucial steelmaking ingredient, have fallen by about 40 percent this year. The Brent crude oil benchmark is now hovering around $40 a barrel, down from more than a $110 since the summer of 2014.

What caught my eye was the tail end of the quote from Establishment analyst Yergin, "It's the end of an era that is not going to come back soon." And what era would that be? Depending on how one looks at it, Yergin could be talking about neoliberalism. Having recently read Varoufakis' The Global Minotaur, I am inclined to agree with the Greek economist that the era of neoliberalism, what Varoufakis names the "Global Minotaur," began when the Nixon administration removed the dollar from its gold peg and let it float freely against other currencies. The result was a sharp increase in commodity prices.

Later on in the Krauss/Austen piece there is this gem:

Others are facing a period of prolonged problems. 

Some energy experts are even beginning to express concerns that sovereign wealth funds of Saudi Arabia and other wealthy Persian Gulf and oil-producing countries will redeem their money from investment firms in the coming year to shore up their balance sheets. If they do, the moves could initiate more instability in global equity and debt markets.

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Some good news to report locally. In November I mentioned in "Election Day: Emerging Class Consciousness in West Coast Tech Cities":

Locally the race to watch is in District 1. If Lisa Herbold can defeat Shannon Braddock, surmounting the largest independent expenditure campaign in the history of Seattle, we can pronounce with some certainty that there is blossoming old-school "Which Side Are You On?" class consciousness in one the West Coast tech hubs.

After a recount was completed this week, Herbold was officially declared the winner, overcoming a six-point election-night deficit. As she said in an email to her supporters yesterday,

Of course early in the campaign these values became an even bigger focus because an Independent Expenditure (IE) campaign made a record-busting investment against me. Their donations were not subject to financial limits like our donations are. This District 1 $230,000 IE was more than all IEs combined in citywide Council races in the last 3 election cycles combined. 

But maybe now we can ensure that the influence of IEs will not become the new "politics as usual. It's not everyday that a candidate outspent 3-1 wins her election. Hasn't this election proven to us that if we continue to work together like we have over the last 10 months we can make sure that all voices are represented and that we can challenge those who would maintain the status quo?

Developers tried to take out Herbold because they fear she will work to enact rent control citywide. "Change we can believe in" seems to be coming our way.

Sawant's Got Her Mojo Working; Cage Fight in District 1; Some Thoughts on Rent Control

As anticipated, socialist firebrand Kshama Sawant rolled to victory in Tuesday's primary for city council racking up 50% of the votes in Seattle District 3. My guess is that total will increase as ballots continue to be tallied until the election is certified on August 18.

The conventional wisdom is that conservative ballots show up first. So initial counts usually skew anti-progressive. As the count proceeds the votes tend to be more working-class. No better example of this is Sawant's successful 2013 campaign against city council incumbent Richard Conlin. Conlin led by more than 6,000 votes on election night, but Kshama kept chipping away at his lead until she ended up winning by 1%.

Sawant's faux-progressive opponent Pamela Banks, who has garnered a solid 35% of the primary vote so far, will advance to the general election. But come November even if Banks were to grab all the votes of the other candidates in District 3, the chances of her beating Sawant are tiny. The reason? The Seattle Times reports that as of election night 21% of Seattle voters had returned their ballots. Summer primaries are low-turnout affairs that favor the propertied class. General elections, which usually feature a hot-button statewide ballot measure or two, bring the "unwashed" to the polls in greater numbers. If Banks can only manage to get within 15 points of Kshama in the Richie Rich primary, she has little hope to prevail in the general election.

This message I am sure has registered loud and clear in the downtown corporate suites. What will be interesting going forward to the general is if the developers, landlords and business moguls continue to bankroll the phony Banks. The smart play clearly at this point would be for local plutocrats to back off and pour their dough into other districts to make sure Kshama doesn't have like-minded allies on the council. Dumping more money into Banks' campaign is just going to bring more Sawant voters to the polls.

As a District 3 resident I saw many Banks yard signs. She clearly won the yard signs primary. Kshama didn't invest in traditional yard signs, the kind that are staked into a lawn. Instead, the Sawant campaign used handbills the size of a small poster with messages like "TAX THE RICH!" or "SUPPORT RENT CONTROL" and then "RE-ELECT KSHAMA SAWANT." These handbills are then taped to a utility poll or put up in apartment window (which is what I did). Also, I saw no one displaying support for Banks by wearing a Banks campaign t-shirt, whereas I made sure every weekend in the lead up to the primary to wear my fire-engine socialist red "Re-Elect Sawant" t-shirt whenever I went out running. On Sunday drenched in sweat on the back end of a long run one guy saw my Sawant shirt and gave me a high five.

Kshama can't be beat. Her support is deep and real. Pamela Banks' campaign is a fiction fabricated by corporate cash.

The race in District 1 is going to be a cage fight. A single percentage point separates the corporate candidate Shannon Braddock from the people's tribune Lisa Herbold. I would imagine the plutocrats are going to inundate this race with cash in order to prevent longtime Licata-aide Herbold from joining Sawant on the council.

The tangible fear on the part of the power elite is that there will be a ground swell to enact rent control. Stories are rife on both coasts about the spike in predatory rent increases; in fact, the anti-Sawant Seattle Times concluded its main primary election recap with the following two paragraphs:

Robin Orona, 50, also stopped by the drop box. Orona said she was thinking about her own housing crisis as she filled in a ballot bubble beside Sawant’s name. 

The Capitol Hill mother of two said her family’s rent is set to increase by hundreds of dollars next month because the building was recently sold. Sawant has been pushing for more protections for tenants, including rent control.

I have lived in two cities -- Berkeley and New York -- that had rent-control laws. Rent control is like a form of catastrophic health insurance. It doesn't prevent your rent from increasing; in fact, rent control pretty much guarantees that your landlord will increase your rent each year by the maximum amount allowed (based on whatever formula that is). In Berkeley and New York City, I can't recall what it was; but I don't think it was more than 5% per year. What rent control prevents is the gigantic increases, the Dickensian horror stories which are becoming all to familiar where a new owner comes in and overnight doubles the rent basically forcing the tenants out onto the street.

Let's not bullshit each other. This is a form of terrorism. Most people live where they live because it has some relation to where they earn a living. You take that away from them overnight, and you are threatening their livelihood. You are threatening their lives.