The Foreclosure Crisis: At the Movies

If you haven’t seen The Big Short, the movie version of Michael Lewis’s fascinating book about the explosion of the housing bubble,you should see it for the entertainment value alone. The film tells an important story with humor, relative accuracy and strong acting.  It is so good that it has been nominated for an Academy Award for best picture. But the film largely ignores the experiences of the homeowners who signed notes and mortgages that backed the securities and derivatives that the film describes.  A decade later, millions of working-class homeowners are still suffering from results of the greed and recklessness so well documented by the movie.

Another recent film about the housing crisis, 99 Homes, released last spring to far less acclaim, details the pain and humiliation many suffered as their lives unraveled trying to make the payments on the predatory mortgage loans that backed those bonds. Payments on loans that never made sense became even more unsustainable when the Wall Street bubble caused housing values to crash, leaving many people with “under water” mortgages in which they owe more on their homes than they were now worth In my law practice, I try to help under water borrowers as they painstakingly work to piece their financial lives back together, stabilize their housing situation, and create a better future for their families.

The next time you walk your dog around the block in Las Vegas, Cleveland, Chicago, Daytona Beach, Toledo, or Jacksonville, keep in mind that it’s likely that the owner of every fourth house you pass probably owes more than the house is worth. Realty Trac reports that, as of the third quarter of 2015, 6,917,673 American homeowners owners are under water. In the Cleveland area, where I live and practice law, 27.2% of homes are worth less than the balance of the mortgage, the third highest rate in the U.S.  Nationally, among homes in the foreclosure process, over 50% of distressed and delinquent properties are significantly under water. With wages stagnant (the Economic Policy Institute pegs wage rate increase at 1.8% since 2000) and no home equity, many homeowners who are not already in default are just one furnace repair or roof replacement away from foreclosure.

Ironically, federal government policymakers have contributed to the lingering problem of under water mortgages. The Federal Housing Finance Agency (which was created by Congress to regulate Fannie Mae and Freddie Mac after taxpayers bailed them out) still prohibits those two quasi-governmental agencies, which hold many of these mortgages, from reducing principal when they modify delinquent loans. Principal reductions are also prohibited on loans insured by the Federal Housing Agency (FHA), a division of the Department of Housing and Urban Development, or those insured by the Veterans Administration or the United States Department of Agriculture. If homeowners can’t renegotiate these loans as the value of their houses decreases, they are even more likely to end out under water.

The Federal Government’s latest solution is to allow Fannie Mae, Freddie Mac, and FHA to sell pools of seriously defaulted loans to hedge funds at a discount. While the new policy would allow the hedge funds to reduce the principal on loans that they acquire, the servicers working for these investors have shown little enthusiasm for these potentially lucrative but logistically challenging loan modifications.  Instead, they have insisted on liquidating the properties that secure the mortgages.

Working-class homeowners seeking to modify their home loans have been further impaired by the shift of loan servicing rights from the major banks who agreed to clean up their business practices in the 2012 National Mortgage Settlement to smaller hedge fund backed loan servicers like Ocwen, Nationstar, Selene Finance, Fay Servicing, BSI, and others. These mortgage loan servicers operate on smaller margins with an often under-trained offshore workforce who fail miserably at properly re-underwriting distressed loans.

New regulations to the Real Estate Settlement Procedures Act ( RESPA and the Truth in Lending Act (TILA) promulgated by the Consumer Finance Protection Bureau set standards for mortgage loan servicing and create a private right of action for homeowners, and these policies may force servicers to become more responsive.  So far, though, there’s little evidence that servicers will change their practices. Rather, the industry seems to treat the prospect of paying money to persistent homeowners and their lawyers just a cost of doing business.

For those who have been forced from their homes by foreclosure over the past decade, the prospect of being pursued for a deficiency judgment remains. Reuters reported in 2014 that Fannie Mae was among the most aggressive investors in suing former homeowners for the difference between the balance on their loans and the price obtained by selling the property at auction.

The bottom line for working-class homeowners is that the real life consequences of the Wall Street fraud and avarice exposed in the Big Short and poignantly portrayed in 99 Homes will be with us for years to come.

Marc Dann

Marc Dann is Managing Partner of the Dann Law Firm. He specializes in representing clients who have been harmed by banks, debt buyers, debt collectors, and other financial predators,  including a case that he recently argued before the Ohio Supreme Court. He has fought for the rights of thousands of consumers and brought class action lawsuits in both private practice and as Ohio’s Attorney General.

 

 

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Organizing Miracles

The problem with collective action is you can’t do it on your own. Massive popular collective action emerges from mysterious movements in the Zeitgeist, but it also requires dedicated organizing that often seems not just unlikely but almost miraculous. When it happens, however, popular collective action can upend immutable social realities, make the impossible probable, and achieve an historic jerk toward freedom and democracy in the most hopeless of circumstances.

I was reminded of this when I visited St. Nicholas Church (Nikolaikirche) in Leipzig last St Nicholas Churchsummer. 26 years ago, the city was part of East Germany, the most thoroughly organized system of repression in the string of East European “people’s republics.” A simple 8-panel pamphlet provided by the church takes 2 panels to explain the building’s cobbled-together character as pieces were added, restored, or redone in different architectural styles since the church was founded in the 12th century. In passing, those 2 panels also mention that Johann Sebastian Bach was once the organist and choir director there. The other 6 panels, however, are devoted to explaining the central role the church played as a gathering place for nonviolent protesters in the 1980s, leading to the night of October 9, 1989 when, according to the pamphlet, a “miracle” happened.

For most of the 1980s the church had held Monday evening “prayer meetings” that had initially included a few dozen people focused on planning anti-nuclear protests. Over time the meetings began to attract hundreds as the church welcomed East German dissidents of all kinds, “Christians and Non-Christians alike.” By 1989 Nikolaikirche was filling its 2,000 seats with people unified around both open borders and democratic reform but divided between “We want to leave” and “We’re staying here.”   Against the background of ongoing peaceful revolutions in Communist Eastern Europe in 1989, East Germany was seen as the place where both the peace and the revolutionary processes would end. By September, head of government Erich Honecker was openly threatening “the Chinese solution,” referring to the massacre of protesters in Tiananmen Square that May. The evening of October 9 in Leipzig was supposed to be the German Tiananmen.

The “Monday prayers” had become protest demonstrations disrupting traffic on the 10-lane ring road surrounding central Leipzig. These had started with a thousand or so demonstrators, but in the two weeks prior to October 9 they had attracted first six thousand and then ten thousand. Organizers hoped for double or even triple that on October 9. Orders from Honecker were to stop the march at the “Eastern Knot” using “all measures necessary” and to “fight them with no compromises.”

While organizers preached the gospel (and the tactics and mechanics) of nonviolence, they did not gainsay the expectation that violence would be used against them, and government media did more than hint that October 9 would be a final showdown. By mid-afternoon Nikolaikirche had filled its pews for its 5 pm prayer, and thousands more were gathering outside and at other churches nearby. It was a quiet, fearful crowd, by most accounts, punctuated more by nervous chatter than by joy at seeing the numbers gathering inside the ring. Organizers had hoped for 20 or 30 thousand, the government had prepared for “as many as 50 thousand.”   At 6:30, as the crowds pushed onto the ring road off Karl Marx Square and headed north for the “Eastern Knot,” local government officials told East Berlin headquarters that “there are 100 thousand, if not more.” This massive number paralyzed the central government for 45 minutes, leaving the final order to impose the Chinese solution to local officials. They decided not to.

As Honecker planned aerial bombing of the ring road for the following Monday’s demonstration, he was deposed in an internal government coup. A month later the Berlin Wall fell. Shortly after that the Velvet Revolution began in Czechoslovakia, followed by others in the Eastern Bloc and eventually in the Soviet Union itself.

The “miracle” of October 9 in Leipzig is not only that the government did not massacre thousands and disperse the crowd, or that the protestors remained nonviolent. To me, the greater miracle is the tens of thousands of individual decisions by those who showed up that night, especially those not previously active, despite the Great Fear the government had tried to instill – or possibly because of it. Why did people not crawl deeper into the repressive holes of their private lives and instead show up to be shot or imprisoned? Was it simply wits-end desperation or a new sense of possibility? Was it a principled decision to stand up for one’s own and others’ humanity come what may or was it simply a desire to be part of the action with plans to run if things went bad?

In Civil Resistance and Power Politics: The Experience of Non-violent Action from Gandhi to the Present, contributors analyze Leipzig and 18 other experiences of non-violent “revolutionary crowds” from India and the U.S. civil rights movement to Ukraine (in 2004) and Burma. Co-editor Timothy Garton Ash discerns “an international learning chain” in these experiences, with organizers and activists learning from each other’s successes and failures.  But these studies cannot adequately account for why so many people show up when they do. “I have spent many hours of my life standing in revolutionary crowds,” Ash comments, “and they remain gloriously mysterious. What is it that sways them one way or another? Who is that comes up with the chants that erupt, apparently spontaneously, as the crowd speaks back to the speaker as if it were itself one person?” He calls these “pentecostal moments, when ordinary men and women speak as if inspired.”

EasternKnotMuralOn my visit, I walked the Leipzig ring road and was amazed to see a huge commemorative mural splashed across the Leipzig Marriott Hotel overlooking a ring-road parking lot and facing “the Eastern Knot.”

This crazy mural shows one-eyed expressionless cartoon characters massing on two sides of a broken wall, some escaping in a hot-air balloon, but most are gathered around banners reading “Freedom,” “Democracy Now,” and “We’re staying here.” The more I looked at that mass of cartoonish humanity, the more I was struck by how “gloriously mysterious” such “pentecostal moments” are. The artist, Michael Fischer-Art, must have realized that any interpretation of what people were thinking or feeling during that moment could not have been accurate and would have dissipated the mystery.

What is not mysterious is the “international learning chain” that today’s organizers, professional and volunteer, are employing and advancing to create these moments – or rather to create the conditions that, when circumstances align, can bring masses of people into action to jerk the arc of history toward justice. I’ve been fortunate to be organized by some of them in my time, and they’re a bit of a mystery, too. What keeps them motivated day in and day out to pursue the smallish efforts that might win small victories that just might lead to larger ones? Some are crazy optimists who see possibilities where I see only obstacles, but many are severely realistic with a certain “pessimism of the intellect and optimism of the will” that seems thoroughly unnatural to me.

As I begin a new year with more worried Weltschmerz than I’m used to, I’m glad I spent a few days last summer as a tourist in Leipzig. It reminds me of all those young organizers I know (some now middle-aged) who persist in small groups in hopes of creating larger ones. It reminds me that sometimes their persistence results in pentecostal moments and new links in the learning chain – and sometimes even miracles.

Jack Metzgar

Chicago Working-Class Studies

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Estate Life: Working-Class Communities and Social Housing

Recently, the British Prime Minister, David Cameron, announced that his government plans to demolish problem council estates due to their concentration of social problems and related crime. The scheme will include rebuilding projects, and current tenants will hold on to their homes (albeit in a redevelopment).  Cameron’s current Tory government do not have a good track record on the provision of public housing, and it is difficult not to be cynical about this announcement. But there are other reasons to be concerned, including the language Cameron has used to describe estates: – ‘sink’ estates, full of ‘anti-social behaviour’, and havens for gangs and other criminal behaviour. I see a different side to council estate life – one that includes rich diversity, community, and strong local connections.

Council estates are social housing projects and part of the fabric of life in Britain. Council estates, whether low-density houses built on urban fringes or high-density inner-city apartment towers, have provided secure homes for millions of low-income working-class people for decades. Many working-class people have been raised on council estates, where they have grown up with a sense of community not often found in other neighbourhoods. Despite the negative stereotypes of council estate residents as welfare-dependent, criminal, and dysfunctional (stereotypes reinforced by television characters such as Little Britain’s Vicky Pollard), council estates have traditionally been close-knit communities whose residents are ready to help each other when times are tough. Because of secure council tenancies, low-income people have been able to enjoy the stability of a home during times of hardship.

This was my experience. In the late 1960s my parents were moved from a two-room privately rented dwelling with no inside toilet or hot water to a new council apartment. They had a baby (me) and a toddler, and the three-bedroom apartment with inside bathroom and central heating was luxury. Our block consisted of young families, with some retired people in the single bedroom apartments. A small supermarket, a newsagent, a laundromat and a pub soon became a hub for the estate. There was also a school, a community centre, and an adventure playground (the estate was built of concrete, including a number of playgrounds, but the adventure playground had real dirt to play in). Life on the estate for children was pretty good – we had plenty of space to roam around, and the elevated concrete walkways and playgrounds kept us away from cars. We had no shortage of playmates, and no one was lonely.

Things changed in the 1980s. Many of us were directly affected by the policies of Margaret Thatcher’s Tory government. By this time, we were a single parent family reliant on social security. It was harder to make ends meet as cuts were made and services squeezed. The estate began to fall into disrepair, and there was a general sense of pessimism as unemployment rose and young people left school without much hope of finding decent jobs. Things became gloomy as hardships increased. Poverty led to dysfunction. But despite the decline in services and the increasing dilapidation of the physical surroundings, the community spirit survived and neighbours could be called on to help when needed. Eventually, in the mid-1990s, the crumbling tower blocks were demolished and new dwellings built. The tenants were able to stay due to a staged ten-year redevelopment process and the community remained intact.

This kind of life is currently under attack from Cameron’s Tory government (despite the rhetoric about improving life on some estates). Thatcher had eroded some aspects of council estate life when she introduced the ‘Right to Buy’ legislation in the early 1980s, which expanded the already existing option for tenants to buy their council properties. While the move was popular with tenants who could afford to buy their homes (at a large discount), it led to a significant reduction in council housing stock and despite some restrictions, investors were able to buy council houses and sell them later at high prices or charge high rents in the private market. The reduction of council housing stock has been blamed for increased homelessness.

Along with expanding the ‘Right to Buy’ scheme, the current Tory government has recently presented a Housing and Planning Bill to the British Parliament that will see the eventual demise of council housing if passed. Among other things, the bill includes an end to secure tenancies, with councils being forced to review tenancies after two to five years. This will lead to insecurity, anxiety, and homelessness. Tenants could be moved to properties many miles from their existing communities, support networks, schools, and workplaces.

The bill has drawn opposition and commentary on the potential devastating effects. Many working-class people are likely to feel terrified at the prospect of these changes. I don’t live in a council home now, but my mother still does (not on our original estate, but in council accommodation designed for elderly people). Although the bill won’t affect current secure tenants, I can’t help but think about elderly working-class people, like my mother, who have relied on council housing for a decent home and the dignity that comes with it. Will they live in fear of their tenancy being taken from them? Where will they go? What kind of impact will this have on physical and mental wellbeing? Will families with children be forced to leave the local school area, unable to set down roots and support networks? How will this affect young people using their parents’ council home as a secure base while they look for work or continue their education? The bill will affect the most vulnerable and fracture working-class communities.

The loss of council estates will likely increase homelessness and return working-class families to the pre-council estate era of cramped and squalid privately rented accommodation. My family was able to escape that world and found security, community, and friendship on the council estate. That this won’t be afforded to future generations is heartbreaking. The end of council estates and their diverse communities will be a huge loss for the country. I hope many people will speak up in opposition and defeat this bill.

Sarah Attfield

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Master of None Lacks Class

I’m a big fan of Aziz Ansari. He was great on Parks & Rec. His stand-up is smart and entertaining. And he co-wrote a book (“Modern Romance”) with sociologist Eric Klinenberg, which takes a sociological, and engaging, perspective towards understanding how dating has changed as a result of new technology and shifts in culture.

Ansari’s new show Master of None debuted on Netflix this fall to rave reviews, and I was excited to watch it for several reasons. The show has been celebrated for, among other things, capturing the dilemma’s of being the child of immigrants in the US, the diversity of its cast, challenging expectations around race in the entertainment industry, and exposing sexism. Indeed, Master of None has been described as “the new definitive millennial comedy,” and is said to be capturing “the tropes of urban millennials to an almost pitch-perfect degree.”

Almost. The successes of this show are many, and they should be celebrated. But with all of its successes, a problem with Master of None, especially with using it as a proxy for the reality of the millennial generation, is the way it glosses over social class and the economic precariousness many people of this generation struggle with every day. The characters live in beautiful, spacious apartments. School and loan debt is hardly mentioned. We never hear concerns about bills, or even the cost of drinks at the hip bars where the characters meet. In a show that addresses racism, sexism, diversity, and the immigrant-family experience so head on, the lack of attention to economic inequality or classism is striking.

Take the episode where Dev and his girlfriend move in with each other: as we follow the couple through the move-in and some of the ups and downs of the next year of the relationship, they never discuss their financial arrangements. How do they handle rent? Who pays for food? These financial concerns can be the trickiest issues to navigate in a relationship, especially in a place where rent costs are so high. But Master of None ignores them entirely.

Instead of showing characters making tough decisions about money, the series highlights their difficulty making minor choices: choosing a place to get tacos or which romantic interest to invite on a date. The characters are often paralyzed by a fear that as soon as they choose one thing, a better possibility will emerge. The show adeptly illuminates how the glut of online reviews and the wide variety of dating websites allow people to gather an almost endless amount of information about a restaurant or a person before making a choice. Perhaps this highlights the freedoms and opportunities available to millennials (and others who use the internet), but consumer choice does not alleviate poverty. Too much choice is only a problem for those with the resources to choose.

The series does acknowledge the uncertainty many millennials face on the employment front, but here, too, it ignores the real financial issues involved. Dev (the protagonist, played by Ansari) spends most of the season frustrated about his inconsistent acting career, but he doesn’t seem concerned about being paid or paying bills. When he learns that his part was cut from a movie he had been working on for several months, a friend assures him, “Dude, look on the bright side – at least you got paid pretty well.” Dev’s response, “Not really. I was mainly doing it for the exposure.” Dev is clearly searching for work he can be passionate about, not about making a living. When his career flounders and a relationship ends, he books a flight to Italy to explore his passion for pasta., the wisdom of Dev’s choice is tough to evaluate, since we have no sense of his financial situation. How is he paying for the “pasta making school” he enrolled in? When the woman sitting beside him on the plane asks him if he decided to make this big move, “just like that,“ Dev confirms, “Just like that.” For many millennials, making these kinds of choices is not so simple and any pursuit of passion at work often must be balanced by practical financial concerns.
In one episode, Dev’s father does reprimand him. “You realize fun is a new thing, right? Fun is a luxury only your generation really has,” his father reminds him. In interviews, Ansari recognizes that he and his peers often take for granted the sacrifices made by their parents, though the series offers little reflection on the privileges afforded by Dev’s apparent financial situation. But the “fun” he pursues and even the choices he struggles to make represent luxuries that are not at all universal for his generation. In a show that has been noted for its social awareness in representing the lives and dilemmas of today’s young adults, the lack of attention to the economic precariousness of millennials is disappointing.

In reality, financial insecurity is a primary concern for many millennials, especially those from the working class who can’t rely on assistance from their parents. They worry about student loan debt, since many have taken on large debt obligations to pay for college.  As per student rates of state and local spending on public higher education have decreased and the average cost of a public college degree has about doubled in the last 15 years, the perception of public higher education as an affordable means of social mobility is fading. According to the Institute for College Access and Success, “Seven in Ten seniors (69%) who graduated from public and nonprofit colleges in 2014 had student loan debt, with an average of $28,950 per borrower.

Millennials are also having trouble finding work as the labor market they enter is increasingly competitive and demanding, while also less stable. As a result, many millennials will spend at least some time laboring as members of the precariat, in underpaid jobs in service work and the sharing economy, which has a variety of negative social implications. For example, many are not heading their own households, and as has been written about here, many are opting in to a “politics of resentment.”

These dilemmas are built into the structure of our economy and are the reality millennials encounter every day. Despite all of the good work in Master of None, the series ignores these issues. If we are going to have a conversation about the circumstances of millennials, we have to acknowledge the very real struggles around student debt and economic insecurity they face. These struggles impact their opportunities and choices, and they ripple throughout wider society.

Colby King

Colby King is an Assistant Professor of Sociology at Bridgewater State University who teaches and studies urban sociology and inequality with an emphasis on understanding place as a social structure shaping opportunities.

Posted in Class and the Media, Class at the Intersections, Contributors, Guest Bloggers, Issues | Tagged , , | 3 Comments

Trump, Sanders, and the Precariat

 

While the white working class is shrinking in the US, it remains the largest voting block in the country. That may be why leaders of both parties are concerned that white working-class voters, especially in the Midwest and South, are supporting populist candidates like Donald Trump and Bernie Sanders. They don’t understand that many of these voters blame Wall Street, corporate leaders, and politicians – the East Coast establishment –for destroying their jobs and communities over the past few decades.

Recent polls suggest that almost 60% of Americans, both Democrats and Republicans, “don’t identify with what America has become.” According to Cliff Young and Chris Jackson, these “nativist” Americans are older, whiter, and less educated than the rest of the population – more working-class, in other words. For some middle-class professionals, this “nativism,” exemplified in support for Donald Trump’s racial comments, simply reinforces the assumption that the white working class is inherently racist and foolish. They conveniently ignore the way racism is resurfacing among the middle class as they, too, feel resentment over their economic displacement. As Barbara Ehrenreich warns, “Whole professions have fallen on hard times, from college teaching to journalism and the law. One of the worst mistakes this relative elite could make is to try to pump up its own pride by hating on those — of any color or ethnicity — who are falling even faster.”

The focus on racism and xenophobia ignores an essential reality: precarity is bringing working-class and middle-class voters together politically. As Guy Standing has argued, the emerging precariat is a political class in the making. We see this in the “Fight for $15.” The struggle to increase the minimum wage seeks economic improvement for both the non-college and college educated.

This growing political block not only shares economic resentment but also the underlying racism that has been baked into American culture. No doubt, many college-educated whites looking for work have blamed multiculturalism and affirmative action for their current economic position, and they are just as likely as working-class people to respond to Trump’s racist rhetoric.

As Dan Bolz has suggested, “Trump’s appeal . . . underscores the resistance to the changes the country’s transition have brought forward.” Paul Krugman has suggested that “moderate Republicans and Third Way Democrats” who had tried to explain inequality in terms of skill-biased technological change are now lamenting the rise of Democratic populism. At the same time, progressive Democrats have complained that Sanders has ignored racial inequality while pandering to those facing economic inequality.

Leading Republican pundits like David Brooks and George Will have tried to dismiss Trump, a sure sign of conservative establishment fear. This has led to a squabble with Will calling Trump a “bloviating ignoramus” and Trump responding that Will is the “dumbest and most overrated political columnist of all time.” Some would say that Trump’s attack on political correctness and emphasis on “hot button” issues offer just type of mud fight the white working-class base wants. But more thoughtful moderate Republican pundits understand that such battles will not secure that base. For example, writers like Ross Douthat and Michael Gerson have been ignored and marginalized by the Republican establishment. A decade ago, Douthat and Rahein Salem tried to solidify working-class support by developing sound policy proposals that would appeal to what they called “Sam’s Club” Republicans. The Republican establishment trashed their ideas, and these writers have been reduced to rehashing the social values debate of an earlier era. E.J. Dionne has said Republicans are having trouble taking on Trump not only because “they have delivered next to nothing to their loyal white, working-class supporters.”

The Democratic Party establishment has its own set of fears — about Bernie Sanders. With significant contributions from Elizabeth Warren, Sanders has tried to move the party to embrace policies that are consistent with its New Deal roots. In a speech at Georgetown University, Sanders stressed the disappearance of the middle class, noting that productivity gains and income have been going to 1% of Americans. According to Sanders, a handful of oligarchs now control economic and political life in the U.S. He reminded the audience of the fight over New Deal reforms and types of security it brought to working Americans. Sanders’s takeaway was that “True freedom does not occur without economic security.”

Hillary Clinton has much less appeal for many working-class and minority Democratic voters. While she has sidestepped her past support for her husband’s policies on crime, drugs, welfare, and trade, these voters have not forgotten his legacy. In commenting on these issues, Clinton tends to pander to voters, as when she says that she opposes the Trans Pacific Partnership (TPP “at this time.” No wonder polls consistently show that the American public doesn’t trust her (though polls suggest they do trust Hillary more than the current crop of Republican candidates on some issues).

The Democratic establishment doesn’t worry about Clinton’s occasional forays in populism, which they see as political maneuvering. As Politico has reported, “None of them think she really means her populism.” But Sanders’s populist talk makes them cringe, because he connects with working-class resentment. His speeches appeal to the deep sense of injustice, unfairness, and inequality that many in the new precariat, especially millennials and African Americans, feel toward the East Coast establishment that took away their jobs, houses, and community and now even threatens their Social Security.

Clinton’s wealthy donor base recognizes Sanders’s appeal as a threat to their interests. Democratic Party leaders and their Wall Street backers hope that the Sanders fever will pass quickly and their adherents will then fall in line and embrace Clinton as the only viable option.

If Clinton and her advisors can’t connect with the new populism, voters may well heed the implication from Republicans that nothing will change no matter who is elected. They’re wrong, of course. With a fragile and deeply unequal economy and an aging Supreme Court, the stakes are too high.   But if Democrats are to win this year, they must understand that the populism that drives support for Trump is also central to Sanders’s appeal. Winning the 2016 election will require the kind of grassroots support that helped elect President Obama twice, but to build that support Democrats will have to address the disaffection and resentment of the new precariat.

John Russo

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Deindustrialization, Depopulation, and the Refugee Crisis

The refugee crisis facing Western nations has begun to peak both demographically and politically. The United Nations has reported that more than 6.5 million Syrians have fled to neighboring countries and Europe, and even nations that until recently welcomed refugees are frantically trying to change immigration policy or protect borders. In contrast, as migration has swelled the population in some places, in others, like the Rust Belt of the United States, depopulation undermines future economic development. Some have begun to ask whether population trends can or should determine policy. The answer is yes.

To understand the significance of depopulation in the Rust Belt, imagine that a plague hit the Midwest and four million people had vanished. What would be the economic consequences for the region, its institutions and for individuals? Deindustrialization has operated much like a plague, and just as with a plague, the long term social and economic costs are substantial. The region can’t “just get over it.” Deindustrialization, and the depopulation associated with it, continues to be a drag on the region both economically and socially.

For example, in Youngstown, Ohio, steel mills began closing almost 40 years ago. The city’s population is now around 62,000, a decline of more than 50 percent since the 1970s. A community once known at the “City of Homes” now has more than 4000 vacant properties. Youngstown’s economic redevelopment program has largely failed. Attempts at economic redevelopment around prisons, fracking, 3-D printing and  casinos have had only limited success, at best. They seem more like examples of the economics of desperation than serious efforts to revitalize the local economy. Appeals by business and government leaders to redefine this as a “shrinking city” and exhortations for the community to exhibit “adaptive resilience” have proven shallow. With little economic growth, such approaches feel too much like cruel optimism.

Youngstown mayor John McNally has said that his most important task is to stop the depopulation. A city like Youngstown needs to stop the hemorrhaging and get an infusion of energy. Would the city gain by encouraging refugees to move to Youngstown? Other communities have tried this approach, encouraging immigrants to move to depopulated areas and gaining new economic activity in the process. Weather-challenged Winnipeg, the capital of Manitoba, has taken advantage of the Manitoba Provincial Nominee Program, which “selects applicants who demonstrate they have the potential and the desire to immigrate and settle themselves and their families in the Canadian province of Manitoba.” Immigrants may apply through different categories such as General, Family Support, International Student, Employer, Strategic Initiative, or Business Immigration. An Economic Development study reports that Winnipeg’s metropolitan population has grown to 780,000, 100,000 higher than earlier projections. The population increase includes about 85,000 immigrants. Between 2009-2014, the local economy stabilized with unemployment below the national average and higher labor force participation and wage growth. In 2014, the city was touted by KPMG as the No. 1 low cost manufacturing location in aerospace, chemical, electronics assembly, pharmaceuticals and telecommunications equipment in North America.

On a smaller scale, some locations have also stemmed depopulation through the employment of existing ethnic enclaves as portal communities. Even in places like deindustrialized metro Detroit, depopulation was offset by an influx of Mexican and Middle Eastern immigrants into existing enclaves, transforming areas that were thought of as ghost towns. While traditional immigrant/refugee communities, like those in the Detroit Metro region were quite large, much of the new resettlement has been more geographically diverse and dispersed than it once was. For example, over 70,000 Bosnian refugees have resettled in St. Louis within the region over the last 20 years.

The New York Times reported in 2014 that new immigrants are more often to be found in midsize cities, like Dayton, Ohio than in New York, Chicago, and other large cities.  Like Youngstown, Dayton had lost over 40% of its population. But city officials embraced immigration by establishing a “Welcoming Dayton” plan in 2011. The plan encouraged new immigrants and refugees to relocate in this Southwestern Ohio community and developed support groups to help newcomers adjust to their new community. Most of the new growth in Dayton has been the result of the relocations and the city is in the process of accelerating the plan.

Another example is Utica, New York. In 2002, this deindustrialized city established the Mohawk Valley Resource Center for Refugees (MVRCR). Over 10,000 immigrants, largely from Bosnia and Vietnam, relocated to the Utica Area. The 2012 U.S. census reports that 17.6 percent of Utica’s population was foreign born and 26.6 could speak a language other than English. NPR reported that the resettlement succeeded in part because Utica had low housing costs and many low-skilled jobs that were unfilled as result of depopulation. Refugees found jobs as meat cutters, greenhouse workers, and nursing home attendants. Some saved enough money to go into business themselves. They bought low-priced homes and rehabbed them, began to pay taxes, and purchased goods and services. No doubt, the refugees initially generated costs to taxpayers in terms of housing subsidies, Medicaid, Welfare, and education, but over time, repopulation stemmed depopulation and provided a glimmer of hope for economic revitalization.

Winnipeg, Dayton, and Utica are examples of small-scale attempts at repopulation using relatively small-scale government initiatives and ethnic portal communities. But the scale of today’s refugee crisis suggests the need for larger scale efforts, including, perhaps, a national program. For example, the German government uses an administrative formula for distributing refugees and asylum seekers among the 16 German states. The percentage that states will receive reflects the combination of their tax base (two thirds) and their population (one third). Other administrative formulas are then used to distribute people within the states. Relocated refugees are accommodated in small centers or apartments; have access to medical, educational, and other social services; and may receive work permits for up to two years. While the details of the distribution formula are not clear, many refugees have been assigned to the depopulated parts of East Germany, and the hope is that they will develop their own micro-economies that will contribute to the revitalization of the region.

No doubt, the surge in refugees in Germany has caused resentment toward the policy and government in the short term, especially in those areas where unemployment is already high. Yet the German government has announced its willingness to accept 800,000 new refugees, largely from the Syrian war, promised greater economic aid to state and local communities, and enlisted German companies to cope with the influx of refugees. While these efforts reflect ethical and moral commitment, there is more to the story. The population of Germany has been dropping for some time, and it has become older while birth rates are among the lowest in the world. The German government and business leaders understand that “demographics are destiny,” and if it is to be a leader in economic growth it needs not only more people but also younger people – like the refugees.

Will any large immigration/refugee repopulation policy be considered in the US? It does not appear so given some recent attempts – by localities, states, and even the U.S. Congress — to discourage immigration and refugees. But the Federal government has final authority over immigration policy matters. If the US were to follow Germany’s approach and offer relocation incentives, Rust Belt communities have the infrastructure and housing to accommodate many refugees. In turn, the new immigrants could establish microeconomic communities, compliment established markets, invest earnings and consume in the local economy and become a source for new tax revenue.

No doubt, this will be a political challenge given the current zeitgeist. But such a policy would be moral and ethical and in the best traditions of America. It could also help boost the economies of cities that are still struggling to recover from deindustrialization. One thing that is for certain, if St. Louis can resettle 70,000 Bosnians in a15 year period, the US can certainly accommodate more than the 10,000 Syrian refugees currently slated for resettlement, especially in the deindustrialized and depopulated in the Rust Belt.

John Russo

An earlier version of this piece appeared in Newgeography.

Posted in Contributors, Issues, John Russo, The Working Class and the Economy | Tagged , , | 2 Comments

Dressing Up Class

Kennington Box Boy unknown 1955

London Transport Signal Cabin ‘box boy’, Kennington South London, c1955, photo by permission of Owen Smithers.

Last week a friend of mine forwarded a photo of an unnamed teenage London Underground worker from the mid-1950s. My friend sent it to a group of current and former workers, asking – six decades on –for the kid’s name. The picture is a kind of time capsule from an early post-war London now long gone. The boy wears a style of uniform that lasted for decades, a variation on military clothing with its the orange piping, silver buttons, and his union badge. The photo informally preserves an important piece of working-class heritage.

Working-class workwear, including uniforms like this, evoke interesting ideas. For those who have to wear them, they can be a really mixed blessing. They can serve as a source of pride, the signifier of a respectable, secure steady job with pensions and prospects. This was certainly true of the Victorian and Edwardian uniformed working class. A railway worker I once interviewed told me that on his first day at work in the late 1960s he begged, borrowed, and stole various bits of uniform so that he could walk home as an ‘adult worker’. Uniforms can also be sites of contestation and discipline. When I worked on the Underground three decades ago, managers could pull you up for relatively minor clothing infractions. Also, y plastering their lapels with union badges and other political pins, workers could display their oppositional intent.

But the uniform could be a sign of stigma, too. Often the clothes given to workers were ill fitting and made of poor quality material. I remember one workmate once telling me that if the uniform fitted, there was something wrong with you! Uniforms weren’t stylish, either. My first uniform issue in 1983 had me wearing flared trousers years after they had gone out of fashion, topped off with a rubberised rain coat designed in the 1960s — not something I wanted to be seen in by my friends

London Transport Signal Cabin ‘box boy’, Kennington South London, c1955, photo by permission of Owen Smithers. Contemporary uniformed workers may think slightly differently about their company provided clothing. Often, as in the past, it is poorly fitting and unflattering, but it is increasingly likely to feature advertising slogans promoting a brand or the latest offer. Like the billboard men of the depression era, workers today are mobile hoardings promoting their companies.

But there are other ways to think about working-class clothing, including especially now that some items of workwear have become objects of desire that the middle class want to wrap themselves in. This is most apparent when politicians go to visit the latest economic success story, be it a successful factory or a construction project. Chancellor George Osbourne(educated at Eton College and Oxford University) regularly dons a hard hat and high-vis jacket when outside Westminster in order to associate himself with ‘hard working people’. Osbourne is rarely pictured in any other form of clothing, while in interviews and speeches he extolls the virtues of the entrepreneurial ‘builders’ and the ‘makers’ in refashioning the nation’s industrial past. To be fair, Osborne did wear a uniform of sorts while at University as part of his membership of the infamous Bullingdon Club, an elite and exclusive Oxford University dining club.

Recently, a number of manufacturers have stolen clothing styles usually associated with the working class, resurrecting heritage patterns and designs of long forgotten industrial clothing. Often the cut is improved and undoubtedly the cloth is of a far higher standard than the originals, but these are unmistakably the designs that used to grace working-class bodies. One example of fashion crossover can be seen in Carhartt’s presence on either side of the Atlantic – traditional workwear in its North American heartland, cutting edge youth wear in Europe. In my local town, an expensive menswear shop has a range of industrially inspired French workwear, such as dust jackets.

So what are we to make of this trend? On one level it could be seen as a harmless tribute to the uniformed working class, perhaps reflecting a desire to be associated with the virtue of hard work. But another, less benign reading would see it as the appropriation of a vacated identity and thus akin to the gentrification of former industrial buildings. Just as with redundant factories and warehouse buildings, where a decent interval is required before they are fit for habitation by more middle-class inhabitants, the same is true for discarded industrial clothing. In both the instance of the high-vis vest and refashioned workwear, the new bearer of the clothes wants to signal that he (or she, though the trend appears more in men’s clothing) is not really working class. So when politicians such as Osbourne wear freshly minted clean tabards and hard hats atop their Savile Row suits, they signal that they are only temporarily ‘on the shop floor’. Likewise, middle-class people who wear trendy crossover industrial designs would run a mile if someone suggested that they were blue-collar workers.

Somehow working-class life and culture still has a currency, dare I say a chic, which others outside that class want to buy in to. Like the gentrified loft building it must first be sanitised and packaged in the right way. Perhaps the trend draws on nostalgia for good solid dependable jobs of the past an era when working-class identity was more mainstream and more positively portrayed in the media. Now that both that era and the respected working-class that went with it have supposedly disappeared, it’s now safe to pull on their abandoned clothing.

Tim Strangleman

Posted in Contributors, Issues, Tim Strangleman, Work, Working-Class Culture | Tagged , , | 3 Comments