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Full text of "The American challenge : a Social-Democratic program for the seventies"

The American Challenge 

A SOCIAL-DEMOCRATIC PROGRAM FOR THE SEVENTIES 



Published by 

S.D. U.S.A. and YPSL 

Suit© 802 / 1182 Broadway 

New York, N.Y. 10001 / (212) LE2-1452 



The Renewal of America 

I Introduction 5 

II Social Democrats and the Labor Movement 7 

III Social Democrats and the Democratic Party 11 

IV A Social-Democratic View of the American Economy 15 

V Race and the Urban Crisis 27 

VI Political Democracy 38 

VII Towards Socialized Medicine „,„. 39 

VIII A Program lor Today 41 

An International Program lor Peace With Freedom and Social Justice 

I Introduction 45 

II The Communist World 47 

IN Europe 49 

IV Social Democrats and Detente . 52 

V The Middle East 55 

VI Asia 57 

VII Africa 59 

VIII Latin America 60 

IX Conclusion , 62 



THE RENEWAL OF AMERICA 



The following program was adopted at the Social Democrats, U.S.A. and 
Young People's Socialist League conventions al the end o! December, 1972. 
It represents the olflclial policies ol th&S.D. USA (successor to the Socialist 
Party, USA and the Democratic Socialist Federation of the USA) and the 
YPSL, The SD and YPSL are democratic national membership organizations 
and each have local chapters throughout the United States. The SD and 
YPSL hold biennial and annual national conventions, respectively. 

copyright © Social Democrats, U.S.A. and Young Pooplo'o Socialist Leaguo, 1973 



Ml 






I. Introduction 

Our country must make a new beginning: The curtain has fatten 
on the decade of the sixties. Old slogans and battle- cries grow faint; 
once fashionable radicalisms visibly fade; the tone and texture of 
political discourse perceptibly change. We have entered a new time. 

What does democratic socialism have to offer the American 
people In the 1970s? 

We offer a vision, a movement, and a strategy. 

The Vision . . , 

We offer a vision of a new society in which men are fully and 
democratically in control of their own destinies. We have no blue- 
print for such a society, but we believe it must rest on two funda- 
mental principles: 

The first is that men cannot fully control their destinies so long 
as the basic economic decisions affecting their lives are made pri- 
vately or left to the random forces of the market. As radical as this 
principle may once have seemed, few people today seriously believe 
that private enterprise can eliminate our slums, provide housing for 
low-income families or sustain full employment. Each day, fewer 
people believe that the private sector can provide adequate health 
care. Increasingly, the Amercan peopfe fook to government action 
to meet their needs. 

Yet, the expansion of the public sector— for which socialists 
have fought alongside liberals and the labor movement — is con- 
stantly frustrated by the prforities of the private sector. Thus, the 
government can proclaim the goal of building 26 million housing 
unite In 10 years, but when the banks raise Intorcot rates, tho goal 
is cancelled. So long as the flow of investment capital and the 
allocation of economic resources are overwhelmingly determined 
by the calculus of private profit, the workings of our economic 
system are fn constant conflict with our proclaimed social priorities, 

For these reasons, democratic socialists believe in the exten- 
sion of social control over our economic life. This does not mean 
the occasional, piecemeal or helter-skelter application of public 
remedies to meet emergencies in the private sector — e.g., the bail- 
ing out of Lockheed or Penn Central. It means democratic social 
planning in which goals ar& set and timetables established for 
meeting these goals. To a large extent, such long-term (though not 
democratic) planning exists in the corporate worid. In the public 
sector, however, we do not find it strange to proclaim the need for 
26 million housing units or to define the extent of poverty, or to 
estimate the shortage of classrooms— without then developing plans 
to solve the problems. Much of the public's current disillusionment 
with the functioning of government springs less, we believe, from 
hostility to government intervention per se than from resentment 



toward paying taxes for government programs that are not even 
planned to solve the problems they point to. 

While insisting on the need for centralized democratic planning, 
we reject the notion that nationalization of the means of production 
is in itself a step toward socialism or even that it necessarily 
represents an extension of social control. We have seen ample 
evidence that government control need not be synonymous with 
social! control — and, indeed, can be its opposite. 

The second fundamental principle underlying the democratic 
socialist vision, therefore, is political democracy. We believe that 
democracy is the essence of socialism, and socialism is the ultimate 
extension of democracy. No society that lacks democracy can 
legitimately call itself socialist. 

if the state is the agency of social control — that is, if it has 
nationalized the means of production — the question arises: who 
owns the state? If the state is, in effect, the political property of a 
minority — a totalitarian party, a bureaucratic caste, or an economic 
eJite — then the means of production will be exploited in the interests 
of that minority. Under such circumstances, the abolition of private 
property mereJy effects the transfer of power from one cEass (the 
private owners of the means of production) to another (the political 
elite which owns the state). 

Such a transfer is not a step forward but a step backwards, for 
it eliminates the one means by which a propertyless majority can 
exercise control over a minority which holds the reins of economic 
power — political democracy. It thus eliminates a precondition for 
socialism. 

How is the principle of democracy, which we prize in our 
political life, to be extended into our economic life? The answers are 
not inscribed in any holy socialist text. We offer no panaceas for this 
enormous and complex land. But we are convinced that the answers 
will be uniquely American and that they will emerge from the con- 
crete struggles of the people to realize American ideals. 

The Movement * .. 

We offer a movement. We do not believe that the ideals we 
uphold— although we see them as based on actual tendencies in 
modern society — will spring spontaneously into being without the 
conscious actions of people who share these ideals. 

In the United States, we are hardly a mass movement. But social 
democracy is a mass movement in the rest of the world, where It 
has become the political expression of the working class — an 
expression of opposition to both capitalist exploitation and Com- 
munist totalitarianism. As members of the Socialist International, we 
are a part of that broad, world-wide movement and bring our own 
point of view to bear in its debates. 

If we are not a mass movement here, neither are we a sect, 
contemplating ourselves and our theories. Our members play active 
and often leading roles in all of the democratic movements for social 

6 






change — the trade unions, liberal organizations, civil rights strug- 
gles. In all of these fields, they have made contributions of lasting 
importance, demonstrating the relevance of social democratic ideas 
to the solution of national problems. 

We are not a monolithic movement. We have come to our 
beliefs by different routes, and there are differences among us. 
We debate these differences fully and fraternally. Yet, we are not 
without a focus — and, as in all democratic movements, that focus 
is determined by majority rule, 

The Strategy . . . 

The reconstruction of American society cannot be the work 
of a militant minority. Not only as a matter of tactics, but as a matter 
of principle, we seek to build a majority movement for social change. 
We have no illusions that such a movement will immediately be 
a sociarPst movement— but it can change the face of America and 
improve the lives of millions. 

The basis for such a movement exists in the unions, the minori- 
ties, liberals, senior citizens, environmentalists, and other groupings 
of concerned citizens. We believe that all of these forces are linked 
together by common sets of problems, and that a social democratic 
approach to these problems offers the best prospect for progress 
on all fronts. 

Thus, for example, it became increasingly clear in the 1960s 
that the civil rights revolution would ultimately come up against 
the problem of the slums, of unemployment, of inadequate schools 
— and that unless these problems were solved, the goal of racial 
equality would not be met Legislation outlawing separation and 
discrimination could have only the most limited (though gratifying) 
results in the absence of social and economic planning on a massive 
ocalc. 

Similarly, the issues now being raised by those concerned 
with protecting our environment from pollution also go to the heart 
of the relationship of private economic power to the public good. 

In all of these fields, democratic socialists work to create an 
active awareness of the inter-relatedness of the movements for 
social change. And we contend that their common progress depends 
on common political action. 



II. SOCIAL DEMOCRATS 
AND THE LABOR MOVEMENT 

The liberal coalition of which democratic socialists have been 
a part in the United States is not made up, from our point of view, 
of equal partners. We see the labor movement as by far the single 
most powerful force for social progress in the nation. And it is this 
force above all others with which we seek to ally ourselves and to 
cooperate. 



Our view of the role of the organized working class is not merely 
rooted in traditional dogma but Is based on an analysis of the eco- 
nomic and social conflicts in modern American society. Various 
individuals and groups may from time to time fiercely proclaim 
their opposition to corporate power, but the only substantial counter- 
vailing power comes from the trade unions— at the point of produc- 
tion and at the collective bargaining table. Only the direct and 
indirect power of the labor movement checks the inherent tendency 
of capitalism to distribute income upward. The unions' push for 
higher wages has been the single most important factor in relieving 
poverty, expanding consumer purchasing power and creating new 

^Meanwhile, in the legislative halls, labor has provided the 
muscle behind the drive for civil rights legislation, national health 
security, aid to education, higher minimum wages, environmental 
protection— in short, for the extension of the welfare state. Indeed, 
to the extent that social-democratic ideas can be said to have a 
natural base in any mass institution in America, that institution is 
the labor movement. It is the only institution whose day-to-day 
existence Is founded on the drive toward a more democratic distri- 
bution of income and wealth— that is, to a greater degree of eco- 
nomic equafity. Other forces outside the labor movement may be 
committed in varying degrees to the idea of economic equality— 
indeed they may even be more explicit than union leaders in their 
ideological commitment to economic equality— but, being removed 
from the production process, they are not a direct part of the 
struqqle between labor and capital over the aflocation of socially 
produced wealth. And while government tax policies and other 
factors have an obvious impact on income distribution, the primary 
factor In determining how much economic inequality exists in our 
society is the relationship of wages and salaries to profits and prices. 
Thus from the social-democratic standpoint, the economic and 
political strength of the labor movement is of crucial importance. 

In Defense of Labor 

Consequently we are defenders of the labor movement against 
those on the Right who seek to block union organization and to 
curtail "big union" power by means of "right-to-work" laws com- 
pulsory arbitration, strike bans, or other legislative encroachments 
on the rights of workers freely to organize and bargain collectively. 
Such assaults on the labor movement, while ottered in the guise 
of protecting the "public interest," would have the opposite effect 
of undermining the standard of living of the great majority of the 

18 Similariy°we' reject the supercilious anti-labor attitudes that 
have emerged within the liberal world in the last decade or so and 
which crystaliring in the "New Politics," contributed significantly 
to the re-election of Richard Nixon in 1972. We do not favor sup- 
porting one wing or faction of labor. Indeed, we favor the increased 



i 






unity of the labor movement and the increased political and social 
power that increased solidarity will bring. We regard the rise of 
anti-labor elitism within the liberal community as a major obstacle 
to the reconstruction of the liberal coalition, which is the precondi- 
tion for the political defeat of conservatism in the years to come. 

We do not contend that there is no room for improvement 
within the labor movement— we are, after all, socialists, and the 
American labor movement is not. Social democrats, as loyal sup- 
porters of the labor movement, seek to end any remaining vestiges 
of racial discrimination and to combat any violations of democratic 
practices or corruption. But we do this with the understanding that 
these problems exist in only a very small number of unions. We 
consider ourselves no voice in the wilderness, no "conscience" 
of the labor movement in regard to such problems. We know that 
the overwhelming majority of international and local unions, of 
trade union leaders and rank-and-filers share this commitment to 
racial equality and democratic procedures and are guided by 
democratic principles which are so fundamental to the life and 
objectives of organized labor. 

Further, we consider that the labor movement as a whole is the 
most democratic, racially integrated, and socially responsible and 
responsive of our mass institutions. It is fundamentally representative 
of the interests of the working class. And is its effective instrument 
in the struggle for social progress. 

* * • 
The hostility of many liberal intellectuals toward the labor move- 
ment seems based on a resentment that It has become a mass in- 
stitution—that it has succeeded in its purpose of organizing millions 
of workers and significantly improving their standards of living. The 
unions most favored by such intellectuals are the weakest unions 
or those whose members are the least secure — or those whose 
leaders are most outspoken on non-economic liberal issues. Simi- 
larly, many critics of the left who are for "labor or "the workers" 
as abstractions deny the representative character of the actual labor 
movement because it does not agree with their views or because it 
does not conform with their image of what the labor movement 
should be. What it should be, in their view, is the instrumentality of 

an idea, not of a class. 

The emergence of these attitudes has coincided with the view 
of an increasingly affluent liberal professional class that, except 
for the poor and the black, the major problems facing American 
society have ceased to be economic, quantitative, or even material, 
and have instead become moral, qualitative, or spiritual. This trend 
reached its peak in the politics and culture of a large section of 
upper-middle class youth, who flamboyantly rejected "materialism," 
embraced voluntary "poverty," espoused oriental mysticism or. 
more recently, became "Jesus freaks." Implicit in all of these mani- 
festations of the "counterculture" is a repudiation of the aspirations 



and struggles of ordinary working people for a better standard of 
living. This is, in fact, a repudiation not simply ot the labor move- 
ment, but of trie majority of the American people. 

For in speaking of the working class, we are 9peaking not of a 
shrinking minority, but of the majority of the population. 

In mid-1972 there were 49.5 million nonsupervisory worker? in 
private, non-farm employment. There were another 11 million non- 
supervisory employees working for the federal, state or local gov- 
ernments or as hired farm workers. This group of about 60.5 million 
comprises 74 percent of the total employed labor force — excluding 
executives, supervisors, self-employed businessmen, professionals 
and similar groups. These 60.5 million represent approximately 37 
million families— or about 70 percent of the nation's total of 54 
million families. 

This is the American working class. It i$ vast and variegated— 
blue collar and white collar, skilled and unskilled, "hard-hats" and 
technicians, in factories and offices, in laboratories and classrooms, 
in manufacturing and construction, in services and retail, In finance 
and real estate, in private and public employment. It is the largest 
and most complex working class in the world— which is perhaps one 
reason its very existence is denied by those whose conception of a 
worker is limited to the blue-collar factory hand. 

Within this working class there are, of course, important differ- 
ences — in income, In education, in working conditions, in life-styles, 
and in consciousness of being "a worker." There are continuing 
shifts in the composition of the working class— the inevitable result 
of rapid technological change; and because of such change there 
Is always a "new" working class. Yet what distinguishes and defines 
the working class, from the socialist standpoint, is not Its level of 
income or education but its relationship to the means of production; 
Its income is derived not from ownership of the means of production 
but from the sale of its tabor. And this fact, despite other differences, 
unites all workers to certain common Interests as they seek the best 
terms they can win for the safe of their labor. Indeed, some of the 
most dramatic trade union gains in recent years have occurred 
among educated white collar and government workers who were 
formerly considered impervious to unionization, If not, in fact, out- 
side of the working class. 

Although the majority of the working class, as here defined. Is 
not unionized, their interests are also represented by the labor move- 
ment. Not only do wage Increases negotiated by unions tend to raise 
wages in non-unionized sectors, but they also increase consumer 
purchasing power and, hence, create lobs. At the same time, labor's 
legislative efforts provide the dynamic for the enactment of social 
programs from which all working peoole benefit. 

In orienting toward the labor movement, therefore, we demo- 
cratic socialists seei< to articulate a politics of the people. 



JO 







III. SOCIAL DEMOCRATS 
AND THE DEMOCRATIC PARTY 

In the United States of America, the politics of the people is 
not centered in the socialist movement or even in a labor parly. It is 
centered in the Democratic Party. That is where most of the work- 
ers are, most of the minorities, most of the liberals, most of the poor. 
That is where the most Important political conflicts are being fought 
out, with tremendous implications for national policy. That, there- 
fore, is where sociaf democrats also seek to play a constructive role. 

The Democratic Party is the majority party In the United States. 
According to projections of the Gallop Poll, 68 million Americans 
consider themselves Democrats, 38 million Republicans, and 34 
million independents (including Wallaceites), The AFL-CIO estimates 
that approximately 75 percent of its members are registered Demo- 
crats. In 1968. Hubert Humphrey won 94 percent of the black vote. 
The Democratic vote registration edge among youth is at least two 
to one. In general, the tower down the voter is on the income and 
education scale, the more likely he Is to vote Democratic. 

The Debacle 

Yet, despite the broad electoral base and overwhelming major- 
ity status of the Democratic Party, its 1972 Presidential candidate 
went down to the worst defeat ever suffered by a Democratic Presi- 
dential candidate, carrying only one state. Only two candidates ever 
received fewer than McGovern's seventeen electoral votes — Alf 
Landon who got eight running against Roosevelt in 1936 and the 
Federalist candidate who got four running against James Monroe in 
1820 after the Federalist Party had disbandedl Even the Democrat 
who ran against Lincoln in 1864, while most of his party was seced- 
ing from the union, did better than McGovern, winning 21 electoral 
votes when there were only 233 at stake. 

By contrast, one of the least popular Presidents In American 
history — who had failed in his promise to end an unpopular war, 
who had plunged the country Into a recession with rampant infla- 
tion, whose Administration seemed immersed in scandal, who had 
been elected with a minority vote only four years earlier, and who 
hardly campaigned at all — was re-elected with the biggBst popular 
vote count in American history, becoming only the fourth Presiden- 
tial candidate ever to get more than 60 percent of the vote. 

Among the elements that made up the McGovern debacle were: 

• Union members defected from the Democratic candidates 
in droves — and gave 54 percent of their vote to Nixon. 

• Despite increased registration, black voters turned out in 
smaller numbers than in 1968. 

• Nixon broke even with the big city voters, who ordinarily vote 
overwhelmingly democratic. 

• The under-30 youth vote, which McGovern advisor Fred 

11 



Dutton had predicted would give McGovern an a million majority, 
went to Nixon by 52 percent. 

• The electorate as a whole protested the choice offered them 
by coming out in the smallesl number since 1948; 45 percent of the 
voters, nearly half, stayed home. 

Voter shifts of such massive proportions cannot be explained 
by the Eagleton affair or by the personal deficiencies of McGovern 
as a campaigner — which suddenly became so obvious, after the 
election, to hfs most fervent supporters for the nomination. At the 
heart of the McGovern defeat was the New Politics movement, of 
which he was the proclaimed and a universally perceived symbol. 

Nor can these voter shifts be explained as a move by the elec- 
torate to the right. While overwhelmingly rejecting the top of the 
Democratic ticket, the voters elected a Congress perhaps slightly 
more liberal than before. Two Democratic seats were added to the 
Senate, and while the Republicans gained 13 House seats, these 
were taken mainly from conservative Democrats. In addition, the 
Democrats picked up a governorship. 

Nor can the outcome of the election be attributed to "racism," 
as some have done. Every incumbent Senator identified as a civil 
rights liberal — both Republican and Democrat — won reefection, 
many by margins which approached or surpassed the President's. 
Of 64 congressmen who, according to a study of the Leadership 
Conference on Civil Rights, never voted wrong on a civil rights bill 
during the past session, only one met defeat. And it is generally 
conceded that Abner Mikva, the Illinois Democrat who lost, was 
more the victim of reapportionment than anything else. Also more 
blacks were elected to the congress and to local office, north and 
south, than ever before in the nation's history. 

In contrast to the showing of the New Pontics forces at the top 
of the ticket, the political efforts of the labor movement on the Con- 
gressional and gubernatorial levels were enormously successful. 
Sixteen of the 25 Senate candidates and 217 of the 362 House can- 
didates endorsed by the AFL-CIO COPE were victorious— about 60 
percent. (Eleven of the 17 gubernatorial candidates endorsed by 
COPE also won — about 65 percent.) COPE's Congressional batting 
average in 1972 was about the same as in 1970 and better than its 
score in 1968 (56.4 percent), when it came close to electing Hubert 
Hunrmhrey President. 

Thus, the 1972 elections resulted In a repudiation not of the 
Democratic Party but of the New Politics forces that had seized 
temporary control of the Party at the national level, to the exclusion 
of other elements of the Democratic coalition. 

The Role of tfte "New Pofffr/cs" 

The New Politics movement rs to be judged not simply by its 
slogans but by its actual impact on the possibilities of building a 
majority movement of the democratic left. 

Until the mid-sixties, the conflicts within the Democratic Party 

12 






could be perceived, rather simply, In terms of a struggle between 

the Party's liberal coalition, on the one hand, and its more conserva- 
tive, even reactionary, forces on the other. The liberal coaution 
consisted primarily of the trade unions, the civil rights movement, 
and the middle-class liberals; on the other side were the Southern 
Democrats and the big-city machines. In this struggle, of course, 
democratic socialists of the 60s aligned themselves with the liberal 
coalition and, indeed, saw the victory of that coalition as the dynamic 
force that would produce a realignment of the major political par- 
ties. In such a realignment, the Southern Democrats would move 
into the Republican Party, the big-city machines would be sup- 
planted by more participatory, democratic organizations and the 
"new" Democratic Party that would result woufd become the rough 
American equivalent of a labor party, reflecting the numerical and 
social weight of the Party's major constituency. 

Reality always outstrips theory; even as this perspective was 
being formulated, important changes were taking place in the Demo- 
cratic Party: 

1. The big-city machines virtually disappeared — and in many 
cases were repfaced not by new participatory institutions represent- 
ing the urban ethnic working class but by cliques of narrowly-based 
middle-class "reformers/ 1 

2. Profound changes were taking place in the South, largely 
under the impact of the Voting Rights Act. The monolithically con- 
servative South was breaking down under challenges, often suc- 
cessful, of moderate and liberal politicians, white and black. 

3. The labor movement was becoming more deeply involved 
in political action at all levels and, in the process, was becoming 
more completely Democratic. 

4. Liberalism as it had been known to the American pec-ple- 
as rooted in the Roosevelt New Deal coalition—split under the 
impact of the New Left and the war in Vietnam, giving rise to what 
has come to be called the New Politics. 

The New Left's main political strategy had been to attack the 
"liberal Establishment," the liberal coalition, mindless of the con- 
servative forces at work In American politics. The New Politics, 
being more pragmatic and closer to the mainstream, did not ignore 
the conservatives but developed the idea that the best way to defeat 
the conservatives was ... to attack the liberal Establishment. From 
its inception, therefore, the New Politics movement sought to dis- 
rupt the liberal coalition and to replace it with "new constituencies" 
—e.g., the poor, the black, the young, the women. 

For the New Politics the war In Vietnam became the most 
important— if not the only— political issue, at the expense of civil 
rights, the war on poverty, and other vital domestic issues. Hence, 
it launched the "Dump Johnson" movement and later contributed 
to the defeat of Hubert Humphrey. And while it did not create 
anti-labor sentiment within the liberal world— that goes back to the 
fifties at least — it brought this sentiment to a peak of intensity. In 

13 



his repeated attacks on "the labor bosses," George McGovern was 
but echoing a familiar New Politics theme perhaps best summed up 
by his advisor and New Politics spokesman Fred Dutton who had 
proclaimed that "the labor movement isn't worth the powder to 
blow itself to hell." 

Under the influence of the New Politicians and their pundits, 
the media increasingly came to define the conservative wing of the 
Democratic Party as consisting of "big labor/' the South, and the 
big-city machines, while the "liberal" wing consisted of blacks, 
youth, and anti-war politicians. Senator Henry Jackson, with a 100 
percent COPE voting record was universally described by the media 
as a "conservative," while Senator William Fuibright, with a poor 
record on economic and racial issues, was seen as a "liberal," Thus 
the result of the emergence of the New Politics was not to clarify 
the struggle between liberalism and conservatism but immeasurably 
to confuse and distort it. 

The Unions and the Democratic Party 

In promoting the nomination of George McGovern, the New 
Politics forces assumed that they would receive the more or less 
automatic support of the working class against Richard Nixon. In 
making this assumption, despite the coolness and then outright 
opposition of the bulk of the labor movement, the New Politics 
revealed its deep contempt for the unions as representative and 
democratic institutions. Feeling as they did, it was not surprising 
that the strategists of the New Politics viewed the Democratic Party 
as, at least tn part, a vehicle for the subordination of the labor move- 
ment—indeed, of the working class itself— to their own "enlight- 
ened" middte-class leadership. 

For social democrats, such a virw Is not only disastrous for 
the future of the Democratic Party; it runs counter to fundamental 
principles. We do not wish to see the subordination of the labor 
movement to any political party. We should like to see the Demo- 
cratic Party become more nearly the instrument of working people 
— not the reverse. 

And so we call upon our members and friends to become active 
in the Democratic Party and therein to ally themselves with the 
mainstream of the labor movement We hope that many of the 
activists in the New Politics movement, after reflecting on the events 
of 1972, will join in this effort to build a new and more representative 
Democratic Party. Toward this end, we welcome the formation of 
the Coalition for a Democratic Majority. 




14 






IV. A SOCIAL-DEMOCRATIC VIEW 
OF THE AMERICAN ECONOMY 

We are not socialists because we believe that the spectre Of 
economic collapse haunts American capitalism. We offer our critics 
no such easy target of caricature. 

We do not project a vision of massive catastrophic depression, 
as in the 30s, and of consequent chaos and rebellion. On the con- 
trary, we believe the means do exist, in the various Keynesian 
techniques of economic management, to avert the extreme boom- 
and-bust cycles that characterized captalism in its earlier stages, 
even if these techniques do not as yet seem capable of eliminating 
the cycles altogether. Indeed, we regard the application of Keyne- 
sian techniques as a concession to the socialist argument that left 
to itself, without government intervention, capitalism displays an 
inherent tendency toward disruption and crisis. We see no reason 
to revise this argument; It seems, to us, won. Except on the far right 
of political thought, no one is eager to test the argument by leaving 
capitalism to itself, free of government intervention, to play out its 
own inherent tendencies. 

The widespread acceptance of Keynes ianism— the most spec- 
tacular recent convert being Richard Nixon — reminds us that there 
are different concepts of government intervention. Government inter- 
vention per se is neutral — it can be progressive or reactionary. It can 
stabilize injustice and inequality as well as their opposites. 

The Issue of Equality 

And this brings us to the heart of our opposition to capitalism, 
It breeds inequality. And the essence of socialism is equality. 

This is not to say that socialists demand that every single worker 
earn exactly the same income as every other. Nor is it to say that 
we are prepared, in the abstract, to state what income differentials 
would be aceptable in a society based on the idea of equality. 
Frankly, we see no need to debate whether the differential should 
be five to one or fifty to one in order to convince our fellow Americans 
that something is fundamentally wrong in a society where the differ- 
ential can be a million to one. If we cannot agree with our non- 
socialist friends, or among ourselves, on "how equal is equal" we 
surely can recognize gross inequality when we see it — and the 
terrible harm it does. And surely we can agree to move to reduce 
that level even if we do not know what its irreducible size may be. 

Perhaps no aspect of Karl Marx's analysis of capitalism has 
been more ridiculed than his contention that, under capitalism, the 
workers would become increasingly "immiserated," while economic 
wealth became increasingly concentrated in the hands of the few. 
The theory seems laughable on its face: the American working class 
has not become increasingly impoverished in the last one hundred 
years; it has achieved, under capitalism, a standard of living beyond 
the imagining of the kings of old. 

15 



We are not dogmatists seeking to revive fallen doctrines. Yet 
we believe that Marx's argument, properly understood, provides an 
important insight into the functioning of our economic system. For 
what Marx said was that the trend toward greater inequality was a 
tendency inherent in capitalism; what he did not go on to say was 
that this tendency could be frustrated or checked by countervailing 
forces which would be generated by capitalism but which were 
themselves non-capitalist. The main such force, of course, is the 
organized working class. It is perhaps ironic that Marx, for whom 
the rise of the labor movement was the key to social transformation, 
did not perceive the inhibiting, complicating, even nullifying effect 
this very force could have on the inherent tendency of capitalism 
to make the rich richer and the poor poorer, 



Since the end of World War II, there has been no significant 
change in the distribution of income in the United States. While data 
on the distribution of wealth are harder to come by, some studies 
have indicated that the concentration of wealth at the top is more 
intense today than twenty-five years ago. (A recently issued study, 
focusing on occupational income differentials rather than family in- 
come, suggests that there may have been a change — for the worse — 
owing to rapidly rising income levels for professionals.) 

Knowing only these facts about our society, a visitor from Mars 
might well conclude that there have been no dynamic forces for 
social and economic equality at work in the United States to the 
last quarter century — no labor movement, no war on poverty, no 
civil rights movement, no liberal economic programs, and surely 
no class struggle — or that they were only shams or totally ineffec- 
tual, (Indeed, something like this hypothetical Martian view did 
pass for political analysis in the New Lett.) In reality, of course, there 
have been continuing struggles toward greater equality, with some 
particularly dramatic and impressive examples in the 60s. 

The key to this paradox is the Marxian insight. The pressure for 
a more egalitarian distribution of income — e.g., collective bargain- 
ing for higher wages, social legislation, etc.— are continually coun- 
tered by the inherent tendency within capitalist economics for in- 
come to be redistributed upward. It's like trying to walk down an up 
escalator. One merely comes to a standstill. 

This is not to say that the economic struggles of labor and Its 
allies are for nought. For one thing, without these struggles, the 
maldistribution of income would have been worsened; and for 
another, the success of these struggles, by increasing consumer 
purchasing power, fueled an overall economic expansion which 
made possible an absolute improvement in living standards. If your 
share of the pie Is going to stay the same, the bigger the pie the 
better. 

But the standstill at inequality need not be forever — and we 
believe it will not be. It is not writ in the heavens, or embedded in 

16 



the American character, or decreed by invincible powers. There can 
be new breakthroughs toward equality. But we first have to under- 
stand the economics of inequality— who gets what, and how they 

come by it. 

The Workers' Share 

The great majority of Americans derive their income from wages 
and salaries. There are 49.5 million nonsupervisory wage and salary 
earners in private Industry (non-farm) and another eleven miilion in 
government. They make up the working class. 

In June of 1972, the average worker in private industry earned 
SI 35.39 a week, or $7,040.28 per year. In the autumn of 1971, the 
Department of Labor said that an urban family of four required an 
income of $10,971 to sustain a "modest" standard of living — which 
included amenities but few luxuries. Thus, the average worker fell 
nearly $4,000 short of being able to give his family a modest stan- 
dard of living. He even fell short of the Department of Labor's "lower 
budget" of $7,214, which allows some amenities but no luxuries. 

But more to the point is the trend in workers' real buying power. 
After deducting his federal tax payment, the average worker's buy- 
ing power in June of 1972 was only 5.5 percent greater than in 1965. 
But half of this improvement was; wiped out by increases in state 
and local taxes over this seven year period. 

This seven ^ear period included two years, 1969 and 1970 — the 
low point of the Nixon-engineered recession— when there was an 
actual decline in workers' purchasing power. 

But the inequality of income distribution does not begin with 
the Nixon Administration. Between 1960 and the first half of 1969 
(before the recession), the after-tax cash-flow to corporations (after- 
tax profits plus depreciation allowances) increased by 91 perc&nt. 
By contrast, the after-tax weekly earnings of the average nonsuper- 
visory worker were up only about 34 percent— and in terms of buying 
power, the gain was only about 10 percent. 



What accounts for this disparity? Workers were not getting a 
fair share of their increased productivity. Between 1960 and 1965, 
productivity increased at an average annual rate of 3,8 percent- 
yet real compensation for all employees in the private sector (includ- 
ing executives) increased only 2,7 percent. Unit labor costs rose by 
3 percent in this five year period (less than one percent a year), yet 
prices rose by 6.6 percent (1.3 percent a year). In manufacturing, 
unit labor costs actually declined 1.9 percent, but wholesale prices 
of manufactured goods rose by 1.7 percent 

By 1966, the gap between unit labor cost and industrial prices 
was greater than at any time since mid-1951. To put it simply, the 
corporations were widening their profit margins. In 1960, average 
after-tax profits of corporations stood at 4.4 cents on &very sales 
dollar; by 1965 it had grown to 5.6 cenis— a 25 percent increase. 

17 



If we emphasize that these trends took place under Democratic 
Administrations, it is not to suggest that the Democrats are more 
favorable to big business than the Republicans but to underscore 
the inherent tendency within capitalism to distribute income upward, 
even while relatively liberal programs — e.g., to reduce poverty — are 
being earned out. (We hasten to point out, however, that the profit- 
boom of the 60s was not unaided by the Democratic Administration 
— which in 1962 gave business a 7 percent tax credit for investment 
in new equipment and In 1964 cut the corporate tax-rate by 7.7 
percent. Both steps, urged by prominent liberal economic advisors, 
inadvertently contributed to the capital-goods boom that launched 
the inflationary spiral of the 60s.) 

Economic Balance and Social Justice 

When profits outstrip wages the resulting imabalance con- 
stitutes not only an injustice but an economic problem. Soaring 
profits (certainly when augmented by investment tax credits) Induced 
and upsurge in business investment in new plants and machinery — 
a 55 percent increase In such investment occurred between 1963 
and 1966— the consequence of which is an expansion of productive 
capacity. 

But If consumer purchasing power— which rests mainly on 
wages and salaries — does not also expand, the increased production 
cannot be absorbed. When wages lag behind profits, consumer 
purchasing power lags behind investment, and production lags 
behind industry's ability to produce. The result is underutilized pro- 
ductive capacity and unemployment. 

According to the traditional theories, the problem of undercon- 
sumption Is resolved by a fall in prices. The reduction of prices 
brings more peopie Into the market, and the excess inventories aro 
liquidated. Once that happens, full production is resumed, full em- 
ployment follows, wages are raised, consumer demand grows, and 
prices rise — until the next cycle. According to this model, inflation 
occurs when demand exceeds supply — either because the demand 
is too great or the supply is too short; conversely, deflation occurs 
when supply exceeds demand — either because the supply is too 
great or the demand is too weak. In any case, inflation and unem- 
ployment are not supposed to be chummy bedfellows. The theory 
obviously no longer conforms to the observable reality. 

In 1966 and 1967, as the unions sought to close the wage-profit 
gap of 1960-65 and to keep ahead of the rising cost of living, labor 
costs started to increase and business raised prices at an acceler- 
ated pace— again, with a view toward maintaining or widening profit 
margins. As the rate of Inflation rose from 2.5 In 1966 to 2.8 in 1967 
to 4.2 In 1968, the average worker's buying power was at a standstill. 
In 1969 and 1970, when prices rose 5.4 and 6 percent respectively, 
workers' buying power actually declined. 

The decline of consumer purchasing power, the increasing 
underutlllzation of plant capacity, and the steady increase in tinem- 

18 



ployment that began in 1969 were classic signals for a downturn of 
prices— in response to the so-called laws of supply and demand. 
Yet Inflation continues unabated. 

The Myth of "Free Enterprise" 

What makes the classical theories obsolete is that they are 
based on a model of the competitive free market which no longer 
exists — destroyed not by socialist collectivizers but by capitalist 
competition itself. Our major industries are no longer characterized 
by cut-throat competition, price wars, etc. Competitive pricing does 
not exist in the auto, steel, or home appliance industries— to men- 
tion a few. Rather, these industries are dominated by a small num- 
ber of giant firms that have acquired control of their market, of 
supply sources, etc., and also have replaced competitive pricing 
with administered pricing. These giant corporations and conglomer- 
ates have fong-term growth and investment plans— they believe in 
economic planning, even if our political institutions do not — and 
such long-term planning cannot be vuJnerable to the fluctuations 
and vicissitudes of the free market. They have to be assured of 
predictable levels of cash flow from year to year Thus, corporate 
pricing is geared not to the "laws" of supply and demand, and not 
to market conditions, but to internal needs for growth and develop- 
ment, The largest corporations have built up enormous cash reserves 
so that their investment and expansion plans are not determined by 
fluctuating Interest rates. 

The Concentration of Economic Power 

Practically all of the growing centralization of economic power 
that has occurred in the United States since World War II has been 
the result of corporotc mergers. And the decode of the 1G60s wit- 
nessed one of the most massive waves of corporate mergers in 
American history. 

In 1947 the top 200 manufacturing corporations controlled 42.4 
percent of all U.S. manufacturing. By 1960 their share was 54.1 per- 
cent. By 1969, they controlled 60.9 percent—and of that share, 15.6 
percent was traceable to mergers. This fact indicates that were it 
not for the mergers of the 60s, the share of manufacturing controlled 
by the top 200 would have declined. 

The area of concentration can be even further refined. There 
are more than 198,000 corporations in America. But by the first 
quarter of 1970, an elite ol only 102 corporations, each with assets 
over $1 billion, controlled 48 percent of the assets and 53 percent 
of the profits of all corporations engaged primarily in manufacturing. 

What distinguished the modern wave of mergers from those in 
the early years of this country is that they do not result from large 
successful companies buying out their weaker competitors in the 
same industry. They cannot claim to bring the economic efficiencies 
of consolidation. Rather, these mergers tend to bring together large 
and successful corporations in wholly different fields— a prime 

19 



example being I.T.T., which has acquired business operations In 
life insurance, car rentals, hotels, lumber, baking, and a long list of 
fields unrelated to telecommunications. 

While conglomerate mergers may offer dubious economic or 
production benefits, they do provide large opportunities for the 
manipulation of capital. They can be borrowed from one enterprise 
and transferred to another where opportunities exist for a quick 
return. Enterprises which are doing poorly and should — by the laws 
of capitalist competition— go out of business, can be sustained by 
the conglomerate's more profitable sectors simply in order to punish 
or drive out a competitor. 

It follows, clearly, that the conglomerate can cause serious 
problems for unions. It can wait out a strike on one of its subsidi- 
aries while making money from the others. Or, since it operates In 
different industries and deals with different unions, it can seek to 
play one union off against another, 

New techniques of coordinated multi-union collective bargain- 
ing are being developed by the labor movement to meet this and 
similar problems. Yet, there is no question but that the growth of 
conglomerates— operating not only in the United States but gfobally 
(on which more later} raises some profound questions for public 
policy in a democratic society. 

The Burden of Bigness 

For many critics of corporate mergers, the crucial question Is 
bigness itself; they are opposed to the large corporations because 
of their size. We have noticed that some of these critics take a 
similar attitude toward "big labor." 

This is not the social-democratic position— and we reject It on 
fundamentally the same grounds that we reject the advocates of 
zero economic growth. The socialist society we seek to build is a 
society of abundance, with a productive capacity not less, but 
greater than now exists. Without such a capacity, we cannot satisfy 
mankind's material needs, which we see as the precondition for 
human freedom. 

Accordingly, we ask not simply whether an institution or struc- 
ture is too big, but whether its size is required for the function it 
serves and whether that function contributes to human betterment 
Certainly small unions would not be very effective against big busi- 
ness. Similarly, it seems clear to us that at least In our present stage 
of technological and human development, large-scale economic 
organization is required to produce the means of satisfying our 
material needs. 

It Is not clear, however, that any such benefits accrue from the 
conglomerate mergers of our day. Rather their function appears to 
be the further concentration of economic and. concomitantly, poli- 
tical power at the top. 

The growth of corporate power in America has had many 
political manifestations, not the least outrageous of which, In view 

20 




of our pressing social needs, Is the decline of the corporate share ol 
the national tax burden and the simultaneous increase of the burden 
borne by individual taxpayers. 

In 1960, the corporate share of the federal income tax was 35 
percent; individuals paid the rest. In the latter half of the decade — 
at the very time business price increases were bringing workers' 
purchasing power to a standstill — the corporate tax share began to 
decline sharply. In 19&8 and 1969, when corporate profits reached 
an all-time high, the share dropped below 30 percent. The U.S. 
Treasury estimates that the corporate share of the tax burden will 
hover between 26 and 27 percent for the rest of this decade. 

In short, since 1960, the corporate share of the federal tax bur- 
den has dropped 8 or 9 percent; the burden on individuals has 
Increased by the same amount. A similar trend, but not as dramatic, 
is visible In state and local property taxes. 

The Nixon Administration 

Most of the economic trends discussed so far have been 
described as manifestations of an inherent, usually unconscious 
tendency within capitalism to perpetrate or exacerbate Inequality. 
With the advent of the Nixon Administration in 1969, this automatic, 
unconscious tendency was elevated into con$cious instruments of 
sociaB and economic policy. The actual 1 consequences of that policy 
have been painfully felt by millions. Under his administration: 

• Unemployment rose from 3.3 to 5.9 percent — from 2.7 million 
to 5.1 million Jobless workers. But there Is a multiplier of zVt — 
which means that in 1972, assuming the average unemployment rate 
for the year to be 5.5, over 18 percent of the total labor force experi- 
enced some unemployment during the year. 

• The number of people unemployed 15 weeks or longer more 
than tripled— from 334,000 to 1,224,000. 

• The number of people workinq part-time because they 
couldn't find full-time jobs rose from 1,647,000 to 2.366,000. 

• The number of people living in poverty, which had decreased 
by 15 million in the Kennedy-Johnson years, rose again by 1.2 million 
by Nixon's second year, 

• The number of people on public assistance lounted from 9.9 
million when Nixon took office to 14.7 million by October, 1971 — 
an Increase of 4.8 million. 

The dreary record Is familiar. But these catastrophic conse- 
quences were not merely the result of "mismanaging the economy" 
— as if economic management were merely a matter of technical 
comoetence. The Nixon Administration acted out of a set of prin- 
ciples — or Ideoloalcal preludlces — which were too much In conso- 
nance with the "natural" tendencies of the "free enterprise" system 
to be inclined to reverse or Inhibit those tendencies. 

When Nixon was eFect-pd his approach to inflation was clear; the 
economy was overheated, there was excessive demand, and a reces- 
sion had to be engineered. He and his advisors had to know that 

21 



rising unemployment would be the result. But they preferred thai 
trade-off to a direct assault on rising prices — which, alter all, is the 
deffnition of inflation. To intervene w the pricing power of corpora- 
tions was, in effect, to deny that Ihe free market was the dynamic 
wellspring of our economic system. 

When the Administration finally felt compelled to change game 
plans, in August 1971 — after its engineered recession had failed to 
dampen inflation (prices rose even faster) and after corporate profits 
had been temporarily crimped — it could not apply its new controls 
equitably. It could not control prices, profits, dividends, interest 
rates and other forms of income as rigidly as they controNed wages 
simply because it could not believe that profits, for example, were 
responsible for the economic problem, 

And so, while wages were controlled, 21 percent of Ihe prices 
that make up Ihe cost of living index were exempt. Controls were 
lifted from ¥a of all retail stores and nearly half of the retail units. 

The inherent tendency of the economy to hold down wages 
relative to prices and profits became politicallzed in the Nixon 
Administration — a matter of government policy and enforcement. In 
the first quarter of 1973, wage increases declined sharply, down to 
an average 5.3 percent from 8,2 percent in the comparable quarter 
of 1972, while worker productivity posted substantial gains, rising to 
an annual rate of 4,7 percent compared to the long-term average of 
3 percent over the past two decades. As a result, first quarter (1973) 
corporate earnings zoomed up after taxes. Profits of 655 companies, 
surveyed by the Wall Street Journal soared 27.8 percent. Corporate 
profits, after taxes, amounted to $S3-biirfon in 1972, a record high. 

This is Indeed government intervention with a social purpose 
—and it is not our purpose. 

Socialists favor a national income policy — but not as a euphem- 
ism for one-sided restraints on wages and salaries. We favor govern- 
ment intervention in the private economy — but not to distribute 
income upward. 

Rather we seek Government intervention on behalf of greater 
economic and social equality. Toward these ends we favor demo- 
cratic social planning along the lines of the Freedom Budget con- 
cept developed in 1966 by the A, Philip Randolph Institute and built 
around key national programs of full employment, economic growth, 
and Income distribution, The Freedom Budget, an attack on the root 
causes of poverty and social injustice, differs from previous helter- 
skelter liberal efforts because it fuses general socio-economic 
aspirations with quantitative aspects and imposed time schedules. 
II deals not only with where America must go, but also how fast and 
in what proportions and thus determines feasible priorities. It 
measures costs against resources, and proposes specific legislative 
and executive remedies. It presents not only a call to action, but 
also a schedule to action over a ten year period to end poverty and 
to improve the lot of a majority of Americans. Fundamental to such 
a budget Is planning for increasing the gross national product, a 

22 






full employment economy and social reconstruction. Thus in the 
process of ending poverty, such a program will add enormously to 
our resources and raise the living standards of the great majority 
of Americans. The Freedom Budget concept by serving our urgent 
social needs — in slum clearance and housing, education and train- 
ing, health, agriculture, national resources and regional develop- 
ment, social insurance and welfare programs—can achieve and sus- 
tain a full employment economy (itself the greatest single force 
against poverty) and a higher rate of economic growth while simul- 
taneously tearing down the environment of poverty. 

The U.S. has the wealth, national resources, skilled work force, 
and productive power to solve its pressing socio-economic prob- 
lems. But it can be done only if we democratically plan the allocation 
of resources in accord with our priorities as a nation and a people. 

The development of such a plan has many virtues. As befits a 
democratic society it clearly outlines its social proposals, financial 
priorities and objectives so that the people can Intelligently discuss, 
debate and decide on what our social and economic objectives 
should be. Progress can be measured, specific steps tested and 
evaluated, shortcomings criticized and plans modified in a way that 
was not possible in the ad-hoc measures of the Great Society. The 
Freedom Budget approach also stands in sharp contrast to President 
Nixon's new economic program which encourages socialism for the 
rich and leaves huge economic power to be wielded by private 
hands. Economic decisions which effect everyone in society are 
made behind closed doors in the corporate board rooms, while the 
majority of Americans have no knowledge of, or any influence on 
them. 

The Freedom Budget is not a program to transform America 
into a socialist society. It can be carried out by government inter- 
vention in our present mixed economy. We, of course, want to go 
further toward a social democratic society. 

As we work for this desirable goal we will be guided by two 
fundamental principles: the desire to expand democracy and to end 
the exploitation of man by man. 

Toward this end we favor: 

• A ^distributive tax policy which would abolish Ihe multi- 
billion dollar havens of the rich and work to change the very relation- 
ship of social classes in America. 

• Fundmental change through economic planning aimed to- 
ward new equalizing social conditions, opportunities and incomes. 

Ultimately Social Democrats, U.S.A. supports social control of 
the basic means of production and distribution because we believe 
this will help to create a society where liberty, equality and fraternity 
can prevail. 

Our approach contains within it a conscious bias against ex- 
changing a system of corporate bosses for a managerial bureau- 
cracy. We see the need to develop planning systems built upon demo- 
cratic participation and a countervailing balance of worker and 

23 



con$umer interest, We seek to achieve reforms which alter the very 
structure of social power by substituting democratic decision-making 
for the autocracy of private power. 

This fundamentally democratic outlook combined with a deep 
concern for the urgent needs of the people guides our approach to 
the question of immediate reforms. Social democrats, of course, do 
not sit and wait until Utopia arrives. We work to improve our present 
society and our members are involved in the struggles of the day. 

At the top of today's Social Democrats, U.S.A. agenda is the 
fight against inequitable government controls which distribute wealth 
upwards, thus hurting the working people. And so we Join the labor 
movement in urging congressional action to apply price, profit and 
salary controls equitably on all forms of income. 

Foreign Trade and tha National Economy 

In addition to the trends discussed above, there Is ample evi- 
dence that another factor has contributed to the unconscionably 
high unemployment in the United States — the deterioration of the 
American position in international trade. It has been estimated that 
nearly a million job opportunities have been lost as a result of this 
deterioration. 

We Social Democrats can scarcely be called isolationists. We 
are profoundly internationalist. We are deeply concerned with the 
programs and progress of the social-democratic and labor move- 
ments throughout the worid. And like other internationalists, we have 
traditionally been advocates of "free trade." 

Yet, precisely because we are internationalist in our outlook, 
we have a responsibility to examine and understand the new de- 
velopments and changing positions in international trade. 

In the last two years, the United States has run a trade deficit 
for the first time since 1893 — that is, we are importing more than 
we are exporting. In 1971, the deficit was around $3 billion; in 1972 
it rose to nearly $7 billion. 

An Increasing proportion of the cheaply-produced foreign Im- 
ports now flooding the country are competitive with U.S. products, 
with the result that a number of industries — leather, textile, elec- 
tronics, and shoes, for example — are flostng jobs. 

The concept of "free trade" is based on the theory of compara- 
tive advantage — each country should do what It does best: agri- 
cultural countries should produce food for export; technologically 
advanced countries should produce manufactured goods. 



But since World War l| Important changes have taken place 
which call the concept of "free trade" Into question. Among these 
factors have been the growth of managed national economies; the 
Internationalization of technology; the mushrooming of investments 
by U.S. companies in foreign subsidiaries; and the rise and spread 
of the multinational corporation, 

24 



T 



Social Democrats can hardly object to the growth of managed 
national economies. But while the governments of these countries — 
virtually all of our trading partners — have exerted direct and indirect 
barriers on imports, while aiding exports, the United States remains 
a relatively "free trade" zone. In practical terms this means that 
while some of our trading partners put restrictions on the importing 
of American goods, we have no comparable restrictions on their 
products. As socialists, we are not convinced that the laissez-faire 
principle has any more sanctity in foreign trade than in domestic 
economic matters. 

Technology has become internationalized because it has be- 
come exportable- The theory of comparative advantage assumes that 
the factors of production are not transferred across national boun- 
daries. When American technology can be exported to Taiwan or 
Hong Kong, and low-paid workers in these countries can assemble 
electronic components, the theory of comparative advantage begins 
to fade. 

A major reason for the Internationalization of technology has 
been the skyrocketing rise of foreign investment by U.S. firms— 
from $3.8 billion in 1960 to $10.5 billion in 1969. Along with these 
investments in foreign firms and subsidiaries go licensing arrange- 
ments, patent agreements, and the like. Not only do the products 
of these companies, produced more cheaply abroad than here, 
return to the United States as imports, to compete with American- 
made products; they also compete with American-made exports 
abroad. 

The American-based multinational corporation may have opera- 
tions going in as many as 40 countries. What makes their operations 
so profitable Is that with the internationalization of technology, 
virtually all of the factors of prortu^tiftn can ha transferred across 
national boundaries except one: labor. And here the American 
worker Is at a disadvantage. His high wages — which are. of course, 
the base of American prosperity and domestic markets — rule him 

out of competition. 

* * * 

In effect, what the multinational corporations do is use Amer- 
ican capital (again, derived from our relatively high-wage economy), 
Amerfcan technology (often developed at taxpayers expense) and 
American know-how to produce American products for the American 
market— with foreign labor. As the AFL-CIO has pointed out, such 
multinationals as Ford, GM, IBM, IT&T, Singer, and Standard Oil of 
New Jersey, "can manipulate International production and sales with 
tho advantage of U.S. technology. They can manipulate the location 
of operations, depending on labor costs, taxes and foreign exchange 
rates. And they can juggle exports, Imports, prices and dividends 
among countries within the corporate structure." And, in the words 
of Fortune: "Carrying multinationalism to its logical extreme, a cor- 
poration will concentrate Its production In the area where costs are 
lowest and build up its sales where the market Is most lucrative. 

25 



The multinationals are also able to take advantage of the 
barrieis many countries have eiecteo to American products by buy- 
ing into firms in those countries and providing those firms with the 
technology to produce the same American products. 

The spread of the multinationals presents very serious problems 
aside trom the impact on the American international trade position 
and our domestic economy. For the multinationals can have a signi- 
ficant impact on the political and economic lives of other nations — 
and consequently on American foreign policy. It is not difficult to 
Imagine the political influence that could be wielded by a multi- 
billion dollar multinational conglomerate on relatively poor low-wage 
countries — and there are many such countries that iack the power 
or resources of a large multinational. And what impact will the multi- 
nationals have on wage levels in their host countries? 

The multinationals represent a challenge to the institutional 
solidarity of the labor movement. Perhaps, unwittingly, they are 
presenting new opportunities for International labor cooperation to 
strengthen the trade unions of tow-wage countries and to globalize 
the effort to raise the living standards of all workers— which the 
multinationals have now so dramatically demonstrated to be in the 
interest of America's workers. 

But while this long-term effort must be vigorously pursued, we 
are not so naive as to think that its objectives will be soon accom- 
plished. Meanwhile, the plight of many American workers threatened 
by job loss is real — and immediate. 

We call upon our friends in the liberal and civil rights move- 
ments to reexamine the dogmas of "free trade" In the light of the very 
real changes that have taken place In international patterns, We 
especially urge them to resist the campaign now being waged by 
the Chamber of Commerce to persuade consumers that cheap im- 
ports mean lower prices. (They may be produced with cheap labor 
but they are soldi, for the most part, at high American prices — it's 
not the consumer who gets a mark-down but the company that gets 
a mark-up.) 

Further, we believe, that the tax laws that give special advan- 
tages to corporations that invest abroad — e.g., deferred tax pay- 
ments — should be drastically revised so as to put such companies 
more nearly on a par with domestic corporations {which, as we have 
pointed out elsewhere, should have their taxes increased.) 

Finally, we support the concept that the volume and composi- 
tion of imports and exports should be a matter of social policy. 

As socialists, we look toward a society in which our social 
priorities, democratically arrived at, will guide the production of 
goods and services at home. Obviously, the quality of our economic 
life and the purpose it serves will also be affected by what Is pro- 
duced abroad for consumption here — and how It is produced. It 
would make no sense to place our domestic economy within the 
realm of social responsibility only to leave our International-eco- 
nomic relations In private and privileged hands. 

26 



I 



V. RACE AND THE URBAN CRISIS 

The validity of the socialist point of view on racial equality — 
enunciated from the very beginning of a struggle in which many of 
our members played most honorable roles — has now become emi- 
nently clear. While we advocated total commitment to the fight to 
bring down the legal barriers of racial equality, we also said that 
ultimately blacks would have to confront the same fundamental 
problems of institutional inequality that so many other Americans 
face. 

A Vision tor Victory 

Eight years ago Bayard Rustin, now a Co-Chairman of the Social 
Democrats, U.S.A., posed a basic question to the civil rights move- 
ment and provided a socialist answer: 

What is the value of winning access to public accommodations 
for those who lack money to use them? The minute the move- 
ment faced this question, it was compelled to expand its vision 
beyond race relations to economic relations, including the role 
of education in modern society. And what also became clear Is 
that all these interrelated problems, by their very nature, are 
not soluble by private, voluntary efforts but require govern- 
mental action — or politics. . . ■ 

. . , The Negro struggle has hardly run its course; and it will not 
stop moving until it has been utterly defeated or won substan- 
tial equality. But I fail to see how the movement can be victor- 
ious in the absence of radical programs for full employment, 
abolition of slums, the reconstruction of our educational sys- 
tem, new definitions of work and leisure. Adding up the cost 
of such programs, we can only conclude that we are talking 
about a refashioning of our political economy. 

Clearly such a refashioning has not yet been accomplished. 
Poverty has not yet been abolished, urban schools remain in crisis, 
the condition of life in the slums has grown worse not better, unem- 
ployment for blacks continues at an alarmingly high rate. We have 
greatly increased the access of middle class blacks to a better life, 
but for the mass of American Negroes, and other minorities, there 
is still a long, long way to go. 

The failure to solve these fundamental economic problems has 
led some, out of frustration, to advocate short-cut, diversionary 
solutions, among which the racial quota system Is the leading pan- 
acea. We oppose the quote approach on the basis of socialist 
principles and our analysis of the problem at hand, whether that 
quota approach Is used In the university, the work place or in other 
spheres of American life. It would be ironic and tragic if the oppo- 
nents of racial discrimination had any part In a new effort to lock 
people into racial categories. To the extent that this approach diverts 

27 




energies from attacking the fundamental economic problems, it will 
not work. And to the extent that it is politically divisive and creates 
resentment among while workers, it will set back the political strug- 
gle to restructure American society. 

The Dead End of Black Nationalism 

The past decade has witnessed the rise within the Negro com- 
munity of a black nationalist tendency. It is not a monolithic tend- 
ency; it has competjng leaders and organizations proposing various 
goals; a back-to-Africa segment; advocates of a separate black state 
to be carved out of the present United States; and a third trend 
which vaguely advocates self-determination and separatism within 
the ghetto. 

Whichever form it takes, black nationalism offers nothing but 
a dead-end for American blacks. 

The fcdea of a return to Africa is an old one, which has been 
pursued since the days of sfavery by both white racists and various 
black groups, and sometimes by both in collaboration with each 
other. It was tried during the 19th century, under President Monroe, 
when groups of black slaves were shipped to Liberia, thereto rot 
under the most miserable conditions, In the 1920s it was advocated 
again by Marcus Garvey, whose efforts and whose movement came 
to naught. With it were dashed the hopes and fantasies of millions 
of American Negroes, fantasies which In practice led to a virtual 
abdication of black struggle against Jim Crow and poverty during 
the 1920s, as A. Philip Randolph so perceptively pointed out at the 
time. It was not without significance that during the course of his 
efforts, Garvey engaged in active collaboration with the Ku K'lux 
Klan, a powerful force among American whites at the time, nor that 
he practiced union-busting and strike-breaking. It is similarly sig- 
niffcant that today the American Nazi Party (the National Socialist 
Wh'te Peonies Party) distributes mock "boat tickets" good for a 
on^-wav trip to Africa for black citizens. Before his death in the 
1*60s George Lincoln Rockwell, the American Nazi leader, was an 
honored au^st at a conference of the Black Muslims, where he 
proudly proclaimed the identity of his aims for American Negroes 
with those of El'iah Muhammed. 

Today, black nationalism most often takes the political form 
of an Insistence on separation from white America In every respect 
except the financial. It Is a mark of the bankruptcy of nationalists 
like Lerol Jones (Imarrm Baraks) that his separatist activities have 
enjoyed the generous financial support of guilt-ridden, Illy-white 
Protestant churches, the largess of an Insurance comoanv and fed- 
eral qovernment agencies under the Nivon administration. The fatter, 
It seems, prefers a Policy of underwritlno an on-the-cheap policy of 
ghetto stannatlon In Newark, under black nationalist hegemony, to 
a meaninaful but costly oroaram of renovation for a dvlno city whose 
present state of existence is a blot on the face of America. 

Still another symptom of the emptiness and reactionary char- 
ge 









acter ol black nationalism today is the widespread anti-Semitism 
which characterizes almost all of its leaders and organizations. 
Whether it be Leroi Jones, Ron Karenga, ESnjah Muhammed, Eld- 
ridge Cleaver. Leslie Campbell, Stokely Carmichael or Hassan Jeru- 
Ahmed, virtually every leading black nationalist figure has promoted 
the most vile anti-Semitic bigotry, along with anti-white racism. 



The bankrupt record of black nationalism must be viewed not 
merely as a sign of the faults of its leadership but as the outcome 
of an ideology which offers no constructive solution to the problem 
of race in America today. By opposing interracial cooperation, black 
nationalism denies the possibility of a majority movement for change 
in America. Politically, its program leads to an inevitable cul-de-sac 
from which there is no escape except for those of its spokesmen 
who are bought oft by venal white politicians and business leaders 
or through self-destructive violence whose major victims are the 
ghetto residents themselves. 

Even if this were not the case, black nationalism still offers no 
solutions. If one rejects the course of coalition politics on behalf ol 
socio-economic renovation in America, what remains? Nothing but 
"self help" in the ghetto, i.e. capturing control of the miserable 
tenements, the corner retail stores, the fund-starved schools, hospi- 
tals and welfare institutions. As a result, control is achieved not by 
"the people' 1 but by a group of black entrepreneurs fully as capable 
of exploiting their Negro clients as any whites. Indeed the very fact 
of under-capitalization — an endemic ghetto problem — compels many 
black entrepreneurs to engage in super-exploitation of their tenants, 
workers and consumers. Even then, as the record proves, the rate of 
failure of all-black businesses and welfare institutions la extra- 
ordinarily high. 

Finally, black nationalism not only offers no way out for the 
American Negro, but actively sabotages the constructive, intelligent 
avenues of change. 3t does this in two ways. First, by its active oppo- 
sition to the trade union movement, the major institution to offer 
blacks a means of struggling effectively to better their material 
conditions and to achieve a degree of power in their daily lives. 
Second, by polluting the climate of opinion through its appeals to 
racism and violence, thereby contributing to the break-up of the 
progressive coalition and the rise of white backlash, which leads 
directly to the political triumph of conservatism. 

In helping to close off the avenues of change, black nationalism 
contributes to the mood of despair and defeat in the ghetto which 
cyclically strengthens its own hold on blacks, particularly the young, 
as well as encouraging personal escapism through additictive drugs, 
mystical cults and anti-social behavior of every variety. Nationalism's 
message that there Is no hope in America becomes a self-fulfilling 
prophecy. 

We Social Democrats, for our part, remain strong advocates 

29 



of integration, and we adhere firmly to the belief that the main 
hope for black Americans lies in the success of the American labor 
movement's struggle for an egalitarian society. The recent Urban 
League study which concluded that there is a larger proportion 
of Negroes in policy-making positions in the labor movement than 
in any other American institution is evidence of the progress that 
blacks have already made within the union movement itself. The 
strengthenfng of labor in American society would constitute a major 
step forward in the movement lor racial equality. 

Planning and Social Change 

What we have come to call the "urban crisis" is not simply a 
crisis of our cities. It is also a crisis of our rural and suburban areas. 
Nor is it the result of failure in one or another sphere of social 
responsibility — education, or housing, or transportation. It results, 
rather, from the absence of long range planning and public invest- 
ment in the lace of vast social and economic changes that have 
taken place in the past quarter century. 

The technological revolution in agriculture has driven millions 
of Americans, many of them black, off the farms and Into the cities, 
where they encounter inadequate housing, overcrowded schools, 
and insufficient job opportunities. Another migratory movement of 
middle-class families Jo the suburbs diminishes the urban tax base 
just as cities face a steadily growing demand for social services, iln 
addition, we have witnessed a continuing shift of new job openings 
from the cities to the suburbs, while simultaneously, the technologi- 
cal revolution in industry has wiped out many of the jobs which were 
formerly available to unskilled and uneducated urban workers. 

The resuit is that our cities have been unable to meet the needs 
for low and moderate coct housing, education, welfare, police and 
fire protection, and other public services and facilities. Slums are 
spreading, crime as rising, and congestion is thickening. 

We socialists emphatically deny that these problems are In- 
soluble. Equally emphatically, however, we deny that they can be 
solved through the natural workings of "free enterprise" or through 
piecemeal, particularistic approaches that focus on one or another 
aspect of the problem in isolation. For all of these problems are 
inter-related. 



We cannot talk of new housing without talking of interest rates 
and land use. We cannot talk about school construction without 
talking about tax revenues — and, in fact, about unemployment. If 
we have not solved the urban crisis, it is not because we have tried 
everything and faifed, but because we have not undertaken a 
planned, comprehensive and sustained program of public investment. 

The beginnings of such a program were undertaken by the 
New Deal from 1933 to 1941. But in most of the post-World War II 
period these efforts were terminated or slowed down by conserva- 
tive opposition. In the brief two years following Johnson's landslide 

30 



in 1964, a new effort was made, as Congress authorized substantial 
increases in federal grants-in-aid to state and local governments for 
elementary and secondary school education, model cities, public 
safety, etc. But actual appropriations and outlays for these programs 
fell increasingly behind the planned expansion of their authorized 
funding. Indeed, between 1966 and 1970, the authorized-appropria- 
tions gap widened from 20 percent to 35 percent. In 1970, this gap 
amounted to $6 billion — more than President Nixon had earmarked 
for revenue sharing in 1972. 

Obviously this kind of financing cripples any attempt at long- 
range planning. The essence of planning is the establishment of 
goals and timetables based on inventories of needs and resources. 
A ten year program to abolish slums or meet the nation's housing 
goals is impossible if the funds for such a program must be voted 
every year. 

A step toward such planing would be for the Congress to 
require the President, in his annual message, to present a report 
on the nation's needs— e.g., in housing, schools, sewage treatment 
facilities, etc. — and to propose a timetable and annual level of 
funding to meet those needs. Congress should authorize and appro- 
priate such amounts for long-term periods (say five years) or, failing 
to do so, take responsibility for adjusting the timetable- 
Public disaffection from government is due in large measure, 
we contend, to a justified lack of confidence that government pro- 
grams are seriously intended to meet the problems defined by the 
government itself. Such confidence is not likely to be restored 
unless the haphazard piecemeal approach to public needs is re- 
placed by comprehensive, democratic social and economic planning. 
Even short of planning on this scale, we believe that any serious 
approach to the urban crisis should bo guided by more basic pri- 
orities. 

Priorities and Principles 

1) Slums must not be gilded or strengthened from within, but 
torn down and replaced by new, healthy communities. Otherwise 
the social pathology that thrives in such an environment will con- 
tinue to destroy the small efforts that are regularly made to achieve 
some amelioration of the unbearable conditions. As a step toward 
mobilizing public and private resources, on a planned basis, to 
solve the urban crisis, we propose that She Federal government com- 
mit itself to the construction, on an experimental basis, of a planned 
city of 250,000 people i representing a varied job mix and different 
levels of income. This pilot project could point the way to a means 
to alleviate the crowded conditions and concentration of social 
problems in slum communities. 

2) Public and public-aided housing must be greatly expanded. 
Rising costs cannot be used as a reason for government to slough off 
its obligation to make housing available to those who must be 
rescued from the slums, from over-crowded apartments, and from 

31 



the growing scarcity of housing within the means of wage-earners, 
pensioners, and the poor. As housing is increasingly priced beyond 
the reach of low and moderate incomes, it must be viewed as a kind 
of utility which government must be responsible for furnishing at 
whatever cost. 

Our experience should also teach us not to build any more 
"project" type housing which segregate people along economic 
lines and inevitably become the local point of ali the problems 
associated with poverty. Intelligent social policy requires that low- 
income families have the opportunity to live in good housing of 
mixed-income composition, and to be aided in doing so by means 
of rental subsidies discreetly assigned to such families (a device 
already in use but only in minimal degree). The critical housing 
shortage calls for a massive crash program commensurate with the 
need. The present rate of production of non-luxury housing is so 
little as to progressively aggravate rather than alleviate the shortage. 
America will never be a better community unless it consists of better 
communities with an adequate supply of good homes and salutary 
neighborhoods serviced by decent schools and health institutions, 
and located near job centers. The task is immense, as is the cost, 
but it is basic to our urban and national well-being. Undertaking 
this task also means taking a giant step towards full employment 

3) The Federal government must assume responsibility for the 
financing of public education. The different schemes that are now 
current, from voucher plans to performance contracting, are all 
efforts to avoid the basic issue ot strengthening the public school 
system. The improvement in teacher training, the reduction in class 
size and the assistance of paraprofessionals are all means to improve 
the quality of education for urban children. Busing should also be 
used where it will improve the quality of education. 

A) A full employment economy is essential to any program 
to solve the race and urban crisis. To date, manpower programs 
have been inadequate and have functioned in the context of eco- 
nomic scarcity. Comprehensive social programs, designed to pro- 
vide skills which the economy needs to the unemployed who need 
these skills is the only way the problem of poverty will be attacked 
at its roots. 

The Delusion Of "Community Control" 

The concept of community control as a "radical" solution to 
the problems of the inner city has been fashionable in recent years. 
However, like other half-baked notions that have emanated from 
the New Left and its chic supporters, the frenetic thrust to imple- 
ment it has been short-lived. 

The high point of the community control push occurred during 
the 1968 New York City school teachers' strike, when its advocates 
mobilized all their resources for the purpose of breaking the strike 
and with it the power of New York's United Federation of Teachers. 
The UFT had struck when a large group of its members had been 

32 







arbitrarily dismissed from their teaching posts In the Ocean HiJI- 
Brownsville school district, a local enclave which was practicing 
community control with funds from the Ford Foundation. Utimalely 
the strike was settled and the Ocean Hiil-Brownsville district reor- 
ganized under a compromise school decentralization plan adopted 
by the New York State Legislature. 

However, certain specific lessons regarding community control 
were learned from the Ocean Hill-Brownsville experience, lessons 
which were confirmed by similar ventures elsewhere. Among them 
were the following: 

1. The term "community control" is in actuality a euphemism to 
disguise the fact that wherever it has been implemented, it was not 
"the community" which exercised control, but a relatively small 
group of ambitious self-seekers, frequently allied with ideologues 
seeking to exploit local conflict for larger "revolutionary" goals. Even 
En the few cases where elections have been formally conducted, as 
in Ocean Hill-Brownsville, the percentage of eligible voters who 
actually cast ballots has been negligible. Significantly, the candi- 
dates in these elections, as well as the small group of activists who 
campaigned, were very largely personnel from the local subsidized 
"community action" poverty agencies. Over and over again, careful 
investigation has shown that those who have been loudest in their 
claims to speak for the community have been poverty professionals 
on the payroll of one or another federally funded agency. 

2. The thrust for community control has almost always resutted 
in racial or ethnic conflict which has pitted blacks against hispanic- 
Americans or whites. The outcome, predictably, has been a ripping 
apart of the fabric of interracial understanding and cooperation on 
behalf of the broader goals of better education, housing and 

employment opportunities. There arose a persistent pattern of racial 

violence and fear, out of which came a political atmosphere totally 
inhospitable to social change. The cities .which always have been 
centers of liberal strength, joined the national march backward into 
retrenchment. Even in such normally progressive cities as Minnea- 
polis and Philadelphia, policemen were elected mayor. 

3. Community controf has been an anti-labor movement, epito- 
mized by the effort to destroy the teachers 1 union in New York City 
as well as Newark, New Jersey. Actually, the basic concept of com- 
munity control runs completely counter to trade unionism. Unions, 
especially unions of government employees, seek to establish and 
maintain collective bargaining contracts for all the workers in their 
jurisdiction, thereby preventing one group of workers from being 
pitted against others who do the same kind of work elsewhere in the 
city. A major aim of community control, however, is to balkanize 
control of the budgeting procedures, thereby compelling unions to 
seek to organize workers in each separate community and to sign 
separate contracts for each. In fact, many of the most vocal advo- 
cates of community control have explicity said that the unions are 
their major enemy and have publicly boasted that when they gain 

33 



control of the funds, wages will be cut. They've also threatened 
to get rid of workers who don't live "in the community," which is 
usually a euphemism for purging workers on the basis of race. 

Unions, therefore, tend rightly to see the slogan of community 
control as a threat to their very existence. 

4. Community control has completely failed to demonstrate the 
capacity to improve services as claimed by its supporters. Here, 
too. the Ocean Hill-Brownsville Demonstration District is perhaps 
the best single laboratory test, since it operated for three academic 
years, from the Fall of 1967 until June 1970, with a substantial 
amount of private and public funding. The results, based on official 
statistics of the New York City Board of Education, show that by the 
test of reading scores and attendance records, the experiment was 
a complete failure. Of the eight schools in the district, not one 
recorded a better reading score in 1971 than it had in 1967, and 
most did worse. 

In sum, community control has produced no dsscernable posi- 
tive results, and has proven to be a dismal failure in practice. It has 
contributed to raciai polarization ,anti-labor sentiment and a conser- 
vative poJitical climate. It is part of the problem, not of the solution. 
We are not arguing philosophically the comparative merits of local 
vs. national government. To social democrats the question is which 
forms of government can most democratically and effectively ac- 
complish the specific social functions assigned to it. Our yardstick 
is the fulfillment of social and individual needs. 

"Community Action 3 ' and the War on Poverty 

Closely related to the concept of community control is the 
community action program of the war against poverty. Indeed, to 
the extent that community action programs may be said to have a 
theoretical rationale,, it consists of community control, an idea which 
owfcs its origins largely to Frances Fox Piven and Richard Cloward, 
of Columbia University's School of Social Work. 

The theory that lies behind the community action program is 
that ft is away of empowering the powerless. It Is not enough, the 
theory holds, for the government to distribute funds or services to 
the poor. What is needed is a program through which the poor learn 
to fight for their own rights and gain the strength that comes through 
the acquisition of power over the Institutions that affect their daily 
lives. Thus, the federal government, through the Office of Economic 
Opportunity, has for a decade or more been subsidizing neighbor- 
hood community action organizations in the designated poverty 
areas to the tune of billions of dollars. The current rate of federal 
support is $320 million per annum. Over the years, the program has 
acquired an elaborate structure and a vast bureaucracy of its own. 

What has been achieved as a result of this massive operation 
and the expenditure of these huge sums of money? Very little, if 
anything, of a positive nature. However, a vast amount of mlchief 
has been perpetrated, some of it so counter-productive as to have 

34 






contributed substantially to the rise to power not of the poor, but 
of conservative politicians riding a wave of backlash. 

One major task undertaken by the community action agencies 
has been to load up the welfare rolls with every person whom they 
couJd persuade or coach to apply for welfare. The questionable 
theory underlying this action, as set forth by Cloward and Piven, 
was that when the welfare rolls are bursting at the seems, the 
government would be forced to enact new, revolutionary means of 
aiding the poor. But the actual result was that welfare became 
such a drain on the public treasury as to cause a wave of public 
revulsion against welfare recipients. Politically, the main benefi- 
ciaries of this revulsion have been George C. Wallace and various 
other conservative politicians. The upshot has not been a revolu- 
tionary improvement in welfare, but welfare cutbacks. 



A second, and more important, area of activity has consisted 
of stimulating assauJts against those institutions which provide daily 
services for the poor in their own neighborhoods: the schools, the 
police, the hospitals, churches, etc. Since these are the institutions 
with which the poor come into daily contact, they have been tar- 
geted for community action. The result has been a virtual war against 
teachers, principals, doctors, hospital administrators and police 
authorities with the purpose of forcing them to surrender their 
authority and their functions to "'the community," But "the commu- 
nity' 9 is a nebulous entity; the concrete aim has been to turn them 
over to the control of the community action agencies led by profes- 
sional poverty workers, or to self-appointed "spokesmen" for the 
community. 

As a consequence of these assaults, severaS things have hap- 
pened. 1) Because the teachers and doctors working in the ghettos 
are predominantly white and the city poor are largely black or 
Hispanic, racial and ethnic hostilities have flourished. 2) Educa- 
tional, medical and social services in the poverty areas have 
experienced serious disruption and conflict, resulting from sit-ins, 
demonstrations, picketing and sometimes outright violence. 3) There 
is very little evidence that any of these activities have benefited the 
poor, made it easier for them to rise out of poverty, or made even 
minor improvements in their daily lives, although it is true that a small 
group of articulate activists have managed through the community 
action programs to win a place for themselves on poverty payrolls. 

Fundamentally, what's wrong with community action is the 
theory on which it was based. That theory held that the poor con- 
stitute an organizable class capable of mobilizing itself for an on- 
going struggle In its own behalf. However, the poor do not constitute 
a class, because they perform no function in relation to the means 
of production and distribution. Actually, they constitute an under- 
class, whose refationship to the economy is that of an outcast, and 
who are therefore deprived of those common class Interests which 

35 



constitute the bases of group solidarity. In contrast to the working 
class, the poor have developed no group traditions or institutions 
of struggle, which are the necessary equipment for achieving and 
wielding power in society. Many of the poor are apathetic and Indi- 
vidualistic; their ambitions, when thay have any, are oriented toward 
gambling, hustling or petty crime. On those occasions when they do 
act in unison, it usually takes the form of a momentary, destructive 
outburst of violence (for example; the urban disorders Of the late 
60s) and than an exhausted return to quiescence. 

This condition, of course, has nothing to do with any "heredi- 
tary traits" of the poor. It is a consequence of their rofe in society. 
But it cannot be overcome by the forced, artificial stimulation and 
subsidization from above of community action organizations, regard- 
less of how much public money is pumped into them. 

Further, the notion that the "establishment" which oppresses 
the poor consists of the local teachers! school principals, shop- 
keepers, and hospital administrators is a reactionary doctrine which 
serves only to stimulate conflict between the have-nots and have- 
littles, to the benefit of those forces, remote from the ghetto, which 
enjoy real power in our society. 

The function of a war against poverty — a decidedly positive and 
desirable concept — should be to help the poor to escape from pov- 
erty, to rise up from it into the ranks of the working class, where 
through trade unionism and political action they can actually parti- 
cipate in a real quest for power, not against local teachers and 
doctors, but against the corporations, banks, insurance companies 
and big foundations that constitute the real ruling class in America. 

We therefore favor the dismantling of the community action 
program and the re-direction of the public funds that are spent 
on it towards programs that enable the poor to rise out of poverty, 
such as day care centers for working mothers, job training and 
public works. In the final analysis, the answer to poverty lies in 
lull and over-full employment, so that every available man and 
woman is drawn into a useful and productive role in the economy. 

Crftira 

Crime in America has become a problem of such serious pro- 
portions that it now threatens the survival of our urban civilization. 
Most urban Americans are terrorized by the alarming proliferation 
in recent years of murder and mugging and other violent crimes. 
The result has been the further deterioration of our cities as middle 
income citizens have fled to what they hope will be safer com- 
munities. Another consequence has been the emergence of crime 
as a major political issue. The inadequacy of the liberal response 
to the crime problem is a major reason for the defection of Middle 
Americans from the Democratic Party, 

As socialists, we fully understand the social roots of crime in 
poverty, discrimination and alienation, Yet we reject the idea that 
is common in some liberal circles that the establishment of social 



36 



order and the guarantee of personal safety tor most Americans 
will have to await the solution of our social problems. We aEso 
question the simplistic linking of crime with poverty. Poverty can- 
not explain the rise of suburban crime or the peculiarly sadistic 
kind of thrill-seeking, anti-social crime which has gripped the im- 
magination of some of the affluent young. Aside from being intel- 
lectually inadequate, this analysis of crime dehumanizes the poor. 
By ascribing inherently criminal tendencies to the condition of 
poverty, it disregards and insults those among the poor who fight 
poverty without stealing. 

As socialists, we completely disassociate ourselves from the 
notion that criminality Is a socially progressive form of protest by 
the oopressed or that "law and order" are code words for racism. 
The traditional socialist point of view has been that violent crime 
has been the province of the lumpenproletariat and other patho- 
logical social elements which constitute a menace to any civilized 
social order, whether it be capitalist or socialist. 

Finally, we regard violent crime as a form of exploitation every 
bit as vicious in its consequences as class exploitation. Its victims 
are to be found primarily amonq the blacks, the poor, the young 
and the old — qrouns already suffering from acute social and eco- 
nomic problems. Their vulnerability to criminal assault makes their 
struggle for a decent life immeasurably more difficult. 



Any solution to the problem of crime must focus on the need 
to reverse the breakdown of our svstern of criminal |ustice. A vast 
social effort,. InvoMna broad social plannina and a substantial 
increase in the expenditure of government funds, must be made 
to Improve the efficiency and effectiveness of the apprehension, 
prosecution, and rehabilitation of criminals: 

1> Anpmhpnsforr of criminals; Police forces must be en'aroed, 
and police should receive better training and education. Comouters 
and other advanced forms of technology should be employed to 
imnrove the efficiency of police prpcincts by cuttinq down on paner 
work which ta^es the police off the stress, In addition, a para- 
professional onltae corns should be established whose ma'n func- 
tion will be to deaf with victimless crimes such as alcoholism and 
prostitution. This will sianificantlv reduce the non-essential work 
of the orofessional oolice and nerrntt them to devote much more 
time to the protection of nubirc safety. 

2* Prosecution ol criminals: The over-burdpnlnq of the courts 
rs a scandal which forces those accused of crimes to lannuish in 
jail if they can't afford bail and. in many cases where bail is avail- 
able, to commit further crimes while awaltinq trial. No more than 
60 H«vb should ftln^s© from thp Um» o< arrest tn thfl final disposition 
of the case. Including appeals. For this to be accomplished, 

al there must be more ludnps, and the courts should be 

modernized and run more efficiently; 

37 



b) and caseloads must be reduced. All victimless crimes 
(prostitution, marijuana, alcoholism) should be removed from 
criminal court jurisdiction and placed under the aegis of social 
agencies qualified to deal with them. 

c) and great care must be taken to preserve substantive 
and procedural rights for all persons who may be in jeopardy 
of criminal or quasi-criminal sanctions imposed by any court, 
agency or social service. 

3) Rehabilitation of criminals: The enormous rate of recidivism 
is directly attributable to unenlightened methods of rehabilitation 
and the failure to provide convicts skills and opportunities needed 
to live a productive life once out of prison. The only method of rehabil- 
itation which we feel will have any chance of success is a job-training 
program in which convicts are prepared to assume productive and 
rewarding responsibilities when they return to the real world. An 
effective job-training program will require massive manpower plan- 
ning and a fuJI employment economy capable of absorbing all 
available skilled manpower, 

VI. POLITICAL DEMOCRACY 

The Nixon Administration's use of federal power, including 
government investigative agencies, for partisan political advantage 
is a great threat to democracy. The Watergate scandal, iike the 
problems in the economy, result from the Administration's use of 
the federal government to advance narrow political and economic 
interests at the expense of the majority. The role of top officials 
of the Nixon Administration in the Watergate break-in, bugging and 
cnver-up represents an nutragenus subversion of the democratic 
process. We fully share the views of the AFL^CIO on this dangerous 
development; 

It is indeed a subversion of political democracy when one 
party, because of its access to vast and excessive sums of 
money, can exercise the advantages of wealth and power to 
pervert the Justice Department and the White House itself 
to undermine its opposition and cement its grip on the reins 
of government. 

Anything that twists and distorts the democratic process is a 
threat to organized labor. 

Anything that subordinates voters to dollars, or the rights of 
the many to the manipulations of the few, is against our interest. 
Anything that weakens public confidence in the integrity of gov- 
ernment is hostile to the needs and values of working people. 
The most vigorous and impartial investigation of these criminal 
acts, and the punishment of the guilty parties, no matter how high 
up they may be, is essential to safeguard democracy and restore 
confidence in the workings of the government. 

New legislation is also required to fight subversion of the 

8d 



political process. And to limit the power and influence of money 
on candidates. 

Positive action is also necessary to encourage greater discus- 
sion and participation in the electoral process. A step in that direc- 
tion would be allocation of tree radio and TV time on an equitable 
basis. Another would be reforming the voter registration procedure 
to involve more citizens in the political process, 



VII. TOWARDS SOCIALIZED MEDICINE 

The American health care system is sick^ and the symptoms 
of the disease are all about us. Every year w© spend mors and 
more for health care, yet the quality and availability of medical 
services has not increased accordingly, and in some instances has 
actually declined. Expenditure for health care more than doubled 
over the last decade. Today the annual bill is close to S80 billion- 
well over S300 per person. Yet during the same period we dropped 
from 11th to 21st among the nations of the world in infant mortality 
rates. Our position also deteriorated in terms of the life expectancy 
of adult men and women. 

Blacks suffer most of all under these circumstances (they have 
three times the infant mortality rate of whites and more than five 
years less life expectancy) but whites are also being hurt. One study 
estimated that the infant mortality rate among whites in 49 of 50 
states is higher than the highest provincial rate in Sweden, The 
Swedes get better and more comprehensive medical care but spend 
only 5 percent of their gross national product on health services, 
in contrast to our own 6.7 percent, in recent years an increasing 
number of Americans have reached the conclusion that our health 
care system needs a radical cure. 

Part of the problem, lies in the fee-for-service system which 
characterizes the present relationship of most patients and doctors. 
Under this system the doctor determines both the amount of service 
and the cost, a procedure that has greatly enhanced his earning 
capacity. In 1964 the median income for doctors was a substantial 
$28,380. Five lears later the figure was over $40,000 and has con- 
tinued to increase since then. 

A second problem had to do with the private health insurance 
industry which operates on a cost-plus basis. The hospitals set 
the costs and are guaranteed an income in excess of that from the 
insurance companies. There is thus no incentive either to reduce 
costs or to increase efficiency. The private insurance companies 
have also benefited from present procedures. One report estimates 
that only fifty-six cents over every dollar paid out in premiums goes 
into payment for health services. The rest is overhead and profit. 

The recommendations that President Nixon has made to change 
the present health care system only reinforce some of its worst 
aspects. His plan relies entirelv on private health insurance com- 
panies and, according to Business Week will provide the largest 

39 



company of all, Blue Cross, with "more business, more money." 
The President has called tor "minimum standard health insurance 

protection," which leads one to believe that his plan could consist 
of the least expensive and most limited protection that is now 
provided by private insurance. The cost estimate for the Nixon 
program is only S3 billion, which is a pittance compared with what 
is necessary. 

Other plans now betore Congress for catastrophic health 
Insurance actually discriminate against the poor. One plan would 
have a patient pay a high percentage of all bills up to $2000 and a 
lower percentage of all bills after that. Under this plan, hospital 
and medical expenses for an illness that costs 310,000 would cost 
the patient, whether he be a worker or a wealthy man, close to 
$7,500, an obviously prohibitive expense for any but the very wealthy. 



We support the National Health Security plan now before Con- 
gress as the only effective means to provide quality health care for 
alf Americans. This plan would pay all of a patient's hospital and 
physician blHs — tor every American. It would encourage preventive 
medicine providing doctor and patient alike with an Incentive to 
keep the patient healthy and avoid long, costly hospitalization. It 
would also reduce hospital waste, duplication and Inefficiency by 
requiring hospitals to submit annual budgets In advance for review 
and permitting them to share in cost savings. 

This system would be nationally planned and coordinated, un- 
like our present anarchic medical system. It would establish a Health 
Resources Development Fund which would finance the training of 
new hearth professionals and develop better means of providing 
health caro. 

The svstem would be financed by Social Security taxes at a rate 
of 1 ewcent of a worker's Income up to $15,000 and including a con- 
tribution by the employer of 3.5 percent of oavrolK The self-employed 
would pay 2.5 percent up to $15,000. The Federal qovernment would 
make un the difference between these. This entire system would 
cost $57 billion, more than $20 billion less than what the nation 
currently snends for health care. Most of the savings would coma 
from eHmlnatEna the health insurance company middlemen. A 
Health Security Trust Fund would pay bills directly to the doctor 
and the hospital. 

Socialists prooosed such a plan decades ago, but the nation 
was not readv to accept so radical an idea. To be sure, the National 
Health Security plan is not socialized medicine, but It recognizes 
that health care cannot be left to the "free market" and that govern- 
ment has a responsibility to provide every citizen, regardless of age 
or economic circumstance, with access to quality health care as a 
matter of right. 



40 



VIII. A PROGRAM FOR TODAY 

We want to see a fundamental reorganization of American 
social and economic life. But we do not counterpose this social- 
democratic vision to the reality of today. There are immediate steps 
that can be taken to improve the quality of life for all of our people. 
As we iist some of these specific measures, which we join with 
others in supporting, we emphasize that we do not view each one 
in isolation but view all of them as inter-related. The Social Demo- 
crats, U.S.A. and the Young People's Socialist League therefore favor: 

1) The creation of at feast one million, public service fobs to 
alleviate unemployment. 

2) The definition oi full employment as a Jobless rate not 
exceeding 2.5 percent, 

3) The opening of the Highway Trust Fund to finance mass 
transit and the abolition of fares on all mass transit system In order 
to encourage the use of public transportation and thereby relieve 
traffic congestion and air pollution. We are in agreement with the 
railway brotherhoods that the railroads should be nationalized as 
part of a plan to reorganize the transportation system. We advocate 
the establishment of an effective public agency— which would 
include representatives of consumer groups, labor and management 
—to regulate and coordinate the various means of transportation 
and to plan for the development of a transportation system which 
will provide inexpensive, comfortable, attractive and efficient service. 

4) The substitution of a guaranteed annual income for the 
present demeaning welfare system. 

5} Automatic Increases In the minimum wage to bring it above 
the governments defined poverty lines. 

6) Drastic curtailment of government subsidies to wealthy 
farmers, leading toward the substitution of farm Income maintenance 
programs for the present system of subsidies. 

7) Establishment of a separate iine of government credit for 
home building and an end to government subsidization of com- 
mercial interest rates. 

8) Enactment of the Kennedy-Griffith National Health Security 
Bill. 

9) Greater federal control of the defense Industry. Today while 
the government subsidizes the producers of military equipment, It 
has little effective control to end Inefficiency resulting from cost-plus 
contracts and the boondoggling at tax payers' expense. National 
security is too vital a matter to be left to private enterprise and the 
profit motive. 

10) A Gf Bill of Rights lor veterans of the Vietnam war com- 
mensurate, at least, with that received by returning soldiers after 
World War II. 

11) Programs specifically designed to meet the needs of the 
elderly in housing, transportation, safety and culture. We are par- 
ticularly concerned that our older citizens who have contributed a 

41 



lifetime of productive effort to our entire society, are entitled to live 
out their years, of retirement with the kind of dignity and security 
that requires a decent standard of laving. Social Security benefits 
today do not provide that. Many of our elderly find themselves 
locked up at home out of a fear of being mugged and are forced 
to live out their lives in loneliness and inactivity. Only government 
planning that meets all facets of the needs of our senior citizens 
can deal with this horrendous problem. 

12) Quality-integrated public education. The schools have never 
been adequately financed, but their situation is even more desperate 
now, Direct federal categorical grants to poorer school districts, 
particularly those of our cities, are needed immediately. Public 
schools require all Kinds of special services ranging from health 
and guidance to remedial reading — now. The new awareness of 
the importance of early chifdhood demands that more money be 
spent on pre-schaol and day care programs of all kinds. The federal 
government should immediately assume 36 of the cost of public 
education, a step toward the goal of full and equal federal financing 
of school districts. Federal funding for education must be in the 
form of direct funding to cities and other areas of need, and not 
by way of revenue sharing schemes which easily allow states to 
divert funds to other uses. Locally, new methods of financing the 
schools must be explored. Statewide property tax equalization, 
such as was called for in the recent California Supreme Court deci- 
sion, could be a boon to poorer school districts. 

This country must never lose sight of the goal of integrated 
public education. Integrated schools are not only better educa- 
tionafly, but they promote the racial contact and understanding which 
is essential if racial tensions are to be eased in this country. We 
support busing in situations where it can improve the education 
of all the children concerned. 

13) A comprehensive program to fight pollution and protect 
the environment. It is critical that the American people understand 
the real reason why our environment has been raped; Growing 
corporate profits and the welfare of America's economic elite has 
been placed above the protection of pure air and water and the 
creation of a humane work and residential environment for all 
Americans. The middle-income taxpayer did not destroy our envi- 
ronment and he shouldn't be burdened with the cost of cleaning 
It up. Nixon's administrative program would do precisely this, for 
he would permit corporations to pass the cost of reducing pollution 
on to the consumer in the form of higher prices, and he would offer 
them tax incentives which are simply a government subsidy to 
irresponsible private interests. 

But the question of environment has to do with more than the 
quality of our air and water. It Is also a question of the quality 
of our national life, and thus cannot be adequately dealt with without 
overcoming poverty, urban decay and racial injustice. The problem 
of pollution raises only one aspect of the environment problem. It 

42 






is a critical aspect, but wo must not let it distract us from attacking 
the whole problem. 

Some conservationists, for example, by championing the eco- 
nomic policy of "no growth" are saying, wittingly or not, to minori- 
ties and the working people that the prime beneficiaries of a cleaner 
environment are the already affluent. Solutions to environmental 
problems that force workers to choose between a job in a polluted 
environment and no job at all is a Hobson's choice having no place 
in a democratic society. The fight against pollution requires plan- 
ning which includes a concern for social justice and a commitment 
that the working people will not pay the cost to repair the environ- 
tal damage created by private enterprise. 

14) A federally developed program to Insure a decent home tor 
every American. One major aim must be to wipe out the slum ghettos 
which are both the roots and offshoots of poverty, while their replace- 
ment would also make the greatest single contribution to sustained 
full employment and the rescue of the urban environment from decay. 
The second major aim must be to provide middle-income Americans 
with attractive housing within their means. These two needs must 
be filfed simultaneously lest a situation develop where the govern- 
ment is subsidizing the housing needs of those receiving welfare 
assistance while millions of working Americans can't find adequate 
housing. This could only lead to divisive and debilitating conflicts 
at the bottom of the economic ladder while the slumlords and real 
estate profiteers continue to benefit. 

A comprehensive program requires large increases in public 
outlays for land acquisition, use of federal loans or credit and other 
actions to drive the interest rate downward combined with a long- 
range planned program. Above all, housing starts are required for 
low and middle-income families, with annual subsidies to ensure 
housing costs don't place excessive strains on their budgets. The 
beginnings of a real assault on the problem of ill housing require 
at least 500,000 starts in 1973 that would be continued over a 
decade, compared with less than one-tenth this amount in most 
recent years. With close to thirty million new homes built in this 
decade, almost every American family should enjoy decent housing 
by 1980. 

1 5) Fedderai child care allowances for all families. This program 
would, in effect, be of particular benefit to the disadvantaged while 
at the same time winning the broadest political support because 
of its universality. Child care allowances are provided in Canada 
and most Western European countries where they have been a 
popular and successful aid to family life. 

16) No more Watergat&s: new legislation with teeth in it must 
be adopted which will control campaign spending and practices. 
The Nixon Administration's Watergate scandal demonstrates the 
need for much stricter laws and the establishment of an independent 
agency — one not subject to the manipulation of the party in power — 
to insure compliance and to investigate malpractices. Such legisla- 

43 



tion should set strict limits on campaign spending so that the 
candidates favored and supported by the wealthy will no longer have 
undue advantages in elections as against those of moderate or little 
means. 

17) A national voter registration law which establishes quick 
and easy procedures, such as registration by postcard, to encourage 
the maximum participation of all American citizens in elections. Such 
legislation must end aN archaic and anti-democratic voting proce- 
dures in some parts of the country whose purpose is to limit the 
franchise. 



SUBSCRIBE TO NEW AMERICA 

New America is the twice-monthly newspaper of the Social 
Democrats, U.S.A., and the voice of the democratic left. 

It has received national recognition for its extensive in- 
depth coverage of the civil rights, trade union and youth move- 
ments. Its pungent criticism of the Nixon administration, its anal- 
ysis of developments and conflicts in the Democratic party, its 
reports on the social democratic movements around the world 
and the views of its major figures such as Golda Meir and Willy 
Brandt, and its discussions and debates on international affairs 
mako it a unique American publication. 

New America's columnists include Bayard Rustin, Thomas 
R. Brooks, John Roche and Monsignor George Higgens. 

New America is indispensible for those who are Interested 
in democratic socialist views and the international Social Demo- 
cratic movement and want to keep pace with the action on the 
democratic left In the U.S.A. 

Subscription rate: 

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2 years — 8.00 

3 years — 12.00 
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M 



AN INTERNATIONAL PROGRAM FOR PEACE 
WITH FREEDOM AND SOCIAL JUSTICE 

L Introduction 

America enters the 70s unsatisfied with its past performance 
in foreign policy and uncertain aoouc the future. A mood or pervasive 
euphoria has succeeded the bitter divisions over the war in Vietnam 
and the monotonous predictions that America is doomed. President 
Nixon claims we have achieved "a generation of peace."' The con- 
flict oetneen East and West is presumed over while the foundations 
are being laid ror a new and delicate Balance of power. Liberals wel- 
come tne bnd of "cold war paranoia/ while the conservatives avidly 
emuiace the prospect or aoing ousiness witn Moscow and PeKing. 

ms social uemociats we identity with the longing oi the American 
people tor a auraoie peace. Yet such a peace has not been achieved, 
and we are concerned lest its achievement be undermined by 
illusions aoout the worid situation. The possibilities for peace which 
now exist derive not from peaceful Soviet intentions, nor from the 
passing of the Cold War, but from the more or less successful con- 
tainment of the Soviet Union over the last quarter of a century and 
the growth of polycentrism in the Communist world. Moreover, the 
cause of peace will surfer in the long run if the ideal of international 
freedom is abandoned. 

Only a realistic assessment of the world situation, based upon 
a sustained commitment to democracy, can produce the perspective 
and policies upon which lasting peace can be built 



Thus, while we are aware of the potential for peace today, we 
must also recognize the obstacles which stand in the way of its 
achievement .We are troubled by thesteady growth of Soviet military 
power in Europe, South Asia and the Middle East; by the continued 
political weakness of a divided Europe; by the intensification of 
nationalist conflict In the Third World which has diverted energies 
from economic development; by the limited progress that has been 
made toward democracy in Asia, Africa and Latin America; by the 
rise of international terrorism; and by the failure of the United States 
to harness its enormous power and wealth to the struggle for 
democracy and development 

We are firmly convinced that the success or failure of the strug- 
gle for freedom and equality in the world depends to a large degree 
on what happens in the United States. We base this position on the 
fundamental principle that the primary arena for socialist struggle 
is in the most advanced countries of the world, namely the West; 
and that the United States, as the leader of the West and the world's 
most developed country, must be won to Social Democracy if this 
struggle is to succeed. 

45 



Thus we are distressed at the increase in anti-American and 
anti-Western sentiment in recent years. Antl-Westernism has been 
a recurring phenomenon on the left sine© the time of Bakunin, and 
it has been a permanent fixture since the Russian Revolution. Move- 
ments of this kind invariably employ the rhetoric of socialism, but 
they are fundamentally anti-democratic and anti-working class, often 
looking to totalitarian countries tor inspiration, 

We draw upon our belief in socialist values and concepts in 
thoroughly repudiating this backward tendency. We reject the notion 
that radical anti-Western nationalism is identical with socialism, 
or that the peasantry has become a new proletariat. The effort to 
tranform socialism from a theory of post-capitalist working class 
predominance to pre-capitalist peasant nationalism and populism 
is regressive, to say the least. However grievous the failures of the 
West have been in its relationship with the developing countries 
and no matter how much failures have contributed to the rise of anti- 
Westernism, we will not turn socialist theory upon its head by ascrib- 
ing the vanguard role to the least developed countries of the world. 

We urge American support for all democratic elements within 
anti-colonialist national liberation movements and would like to see 
vastly expanded aid programs for economic and trade union devel- 
opment in Asia, Africa and Latin America. In struggling to realize 
our views we will ally with those forces in America which share our 
commitment to freedom and social justice throughout the world and 
oppose both the conservative elements which are concerned only 
with profit for American business and the new isolationists who have 
cynically abandoned the struggle for democracy. We applaud the 
efforts of the American labor movement to expand Jreo trade union- 
ism in Europe, Asia, Africa and Latin America even as it fights to 
improve tho lot of tho American worker, Until American policy be- 
comes as enlightened, we will constitute a loyal opposition, fighting 
policies we disagree with in ways that do not undermine our demo- 
cratic objectives by strengthening totalitarian forces. 

Our commitment to democracy has no double standards 

We will apply our democratic socialist principles consistently 
and realistically in articulating our international viewpoint. This is 
also to say that we will not indulge in the tendency now current 
among some liberals to apply a double standard in International 
affairs, demanding of non-Communist countries an unblemished 
record of democratic performance while assessing sympathetically 
the "progressive" developments In Communist countries or con- 
cluding that Communism, though undesirable for Americans, Is quite 
all right for Chinese, While in some circles It may now be fashionable 
to praise Maoist China — just as it was fashionable forty years ago to 
praise Stalinist Russia— we will not compromise our opposition to 
totalitarianism, no matter what form It takes, no matter which people 
it enslavos. 

W© baso our world outlook on the propositions thai; 



4e 



a) socialism and democracy aro not simply complementary but 
indivisible; 

b) the primary agents in the fight for socialism remain, as in the 
past, working class movements committed to freedom and equality; 

c) the precondition for socialism is a high level of development 
economically, politically and socially; 

d) the greatest enemy to socialism today is the world Com- 
munist movement, whether united or divided; 

e) and a united and confident West under the leadership of 
social-democratic forces and committed to the preservation and 
extension of democracy, Is potentially the greatest ally of the poorer 
nations in the struggle against poverty and oppression. 

Our confidence and our fierce commitment to freedom and 
equality are today in sharp contrast with the mood of America, We 
share Alexandr Solzhenitsyn's revulsion at the resurgence of the 
spirit of Munich in the West. If it is true, as Sotzhenitsyn says, that 
"The timid civilized world has found nothing with which to oppose 
the onslaught of a sudden revival of barefaced barbarity, other than 
concessions and smiles/' then we are rebels against appeasement. 
We will not abandon the people of the East while we struggle for 
socialism in the West, for to us the struggle for freedom and justice 
is meaningful and practical only if it is an international struggle. 



II. THE COMMUNIST WORLD 

It has become clear to all intelligent observers that the Com- 
munist world is no longer a monolith. The phenomenon of Commu- 
nist polycentrism, the most dramatic example of which is the Sino- 
Soviot conflict, is a development of enormous significance. Not only 
does it frustrate Communist imperialism by forcing the two major 
Communist powers to focus much of their energy and military might 
against each other, but it also threatens the Internal unity of totali- 
tarian systems by providing the context for the development of com- 
peting viewpoints. 

The rise of polycentrism puts America in a pivotal international 
position. Whether the United States uses this position to further the 
goals of peace and freedom will depend upon its understanding of 
the origins and nature of Communist polycentrism and Its commit- 
ment to the struggle for democracy. 

The spread of Soviet power into Eastern Europe and the instal- 
lation of "people's democratic" regimes following the Second World 
War precipitated a crisis in the emergent Soviet empire. Newly invest- 
ed Communist leaders Jn these countries, typified by Tito, tried to 
modify Soviet priorities by seeking adjustments to local pressures 
in order to solve national problems. Stalin's rejoinder in his ruthless 
purge of Tltoism, though falling within Yugoslavia, succeeded In 
throttling this early, hesitant polycentric development elsewhere in 
the Communist bloc. 

47 



Thatpolycentrism proliferated nevertheless disproved the iden- 
tification Of Soviet interests with internationalism. No Communist 
party in power introduced workers' democracy or the elements of a 
socialist economy. Instead, totalitarian and authoritarian regimes 
were established with a bureaucratic-collectivist stamp in forced 
imitation of the Soviet model. The failure of these regimes to win the 
support of their working classes led them to a reliance on national- 
istic sentiments in their search for legitimation. The resultant "na- 
tional Communism" echoed belatedly (and ironically) the Stalinist 
thesis of "constructing socialism in one country." In the years follow- 
ing the Soviet take-over of Eastern Europe, satellite after satellite — 
East Germany in 1953, Hungary and Poland in 1956, Czechoslovakia 
in 1968 and Poland again in 1970 — rebelled against Soviet domina- 
tion. 



Maoist opposition to Soviet predominance in the world Commun- 
nist movement dated back to Moscow's looting of Manchurian indus- 
trial plants in 1945-46 and Stalin's refusal to support the Chinese 
Communist revolution. During the consolidation of the Mao regime 1 
the Kremlin deployed China as a catspaw in the Korean war. When 
Peking was induced to take up arms against American power in 
Asia, Mao had to rely on the Soviet Union, but only temporally. The 
competition for leadership in the Communist camp after the death 
of Stalin, old Chinese- Russian national grievances, and the unwill- 
ingness of Moscow to provide China with desperately needed eco- 
nomic aid were among the factors which deepened the Sino-Soviet 
split. 

The brief review of these polycentric developments demon- 
strates an essential symmetry between national liberation struggles 
against capitalist imperialism and national Comrnunfst opposition 
to Soviet imperialism. Both oppose the center of their respective inter- 
national empires, but in the Communist sphere polycentrisrn threat- 
ens the internal stability of the totalitarian regime itself. 

The existence of separate and conflicting factions stemming 
from polycentrisrn is already recognized in the international Com- 
munist movement- Can the emergence of these factions be prevented 
within a given national party? To what extent will discipline and 
totalitarian control be maintained in a particular party if none exists 
at the international level? As the power of Soviet dictators has 
declined, the virulence of polycentrisrn has increased. 

If unchecked, this polycentric potential holds immense conse- 
quences for all Communist parties. Not merely could there be fac- 
tions competing for power in a particular party, but these factions, 
if they were to persist and become institutionalized, could undermine 
the essential totalitarian character of that party. Perhaps Mao's 
difficulties in restructuring an effective party as an instrument of 
totalitarian rule have been engendered by the presence of a Soviet 
sponsored pro-Moscow faction within Chinese Communism. 



America has contributed to the growth of polycentrisrn by pre- 
venting Russia, China and other Communist nations from contending 
with their internal crises through imperialist expansion. The con- 
tainment of Communist totalitarianism liberates the divisive forces 
within the Communist bloc. If America is to encourage this develop- 
ment, its policy must have a political, as well as a military dimension. 
It must consist of action to reinforce Communist divisions, not as a 
means of facilitating conquest of Communist nations, but as a means 
of inhibiting the totalitarian regimes' freedom of action and even- 
tually undermining their totalitarian structure. Such action should 
entail a policy of firmness towards Communist aggression, of flexi- 
bility in dealing with the opportunities offered by polycentrisrn and 
of stimulating the flow of ideas and information from the West to 
the East 

The chances of implementing a policy of encouraging and rein- 
forcing progress toward liberalization and overthrow of the totali- 
tarian system in the Communist world have improved markedly in 
recent years. To the extent that the permanent fragmentation of the 
international unity of the Communist bloc and the first tentative stir- 
rings of democratic dissidence in the Communist societies can be 
attributed to American policies, such policies should be continued. 
To reverse them now, before the totalitarian structure of the Commu- 
nist world has been fundamentally altered, would destroy ali possi- 
bility of finding a peaceful means of winning the struggle for a dem- 
ocratic world. 



III. EUROPE 

A dominant trend in recent years has been the steady expan- 
sion of Soviet power along the southern and western flanks of 
Eurasia. The USSR has moved outward with characteristic caution 
and persitsence, a pattern that has not changed since the time of 
the Czars. Where vacuums have been created by the withdrawal 
of Western influence, it has filled them. Where divisions have existed, 
it has exploited them. Where divisions have not existed, it has tried 
to encourage them, acting on the principle that political instability 
and tension serve the interests of "socialism" by hastening the 
ultimate Soviet triumph over the West. 

Other factors have slowed Soviet expansion. Where the West has 
shown determination, as America has done recently in the Middle 
East, the Soviet Union has suffered decisive setbacks. The Sino- 
Soviet rift has forced the Russians to seek a lessening of tensions 
with the West while it is preoccupied with what it perceives as a 
threat from the East. Persisting Soviet economic problems, and the 
strain which Soviet expansionist policies have put on the limping 
economies of Eastern Europe, have also contributed to Soviet cau- 
tion. Vast American economic superiority, and the growing depen- 
dence of the USSR on American agricultural and technological assist- 
ance, are major reasons for the current Soviet Interest in detente. 

49 



Bui despite the recent arms limitation agreement and the pre- 
vailing atmosphere of detente, we see little reason to believe that 
the Soviet Union has fundamentally altered its objectives in Europe. 
These objectives include the recognition by the West of Soviet 
domination of Eastern Europe, the elimination of the American 
presence in Western Europe and the undermining of NATO, and ulti- 
mately, the achievement of Soviet predominance in all of Europe. 



The Soviet call for a European Security Conference is designed 
to achieve the first objective — the formal recognition of Communist 
territorial gains made after World War II. The USSR's stated goals are 
peace and "collective security." But if the Soviet Union were inter- 
ested in a genuine relaxation of tensions in Europe, it would not be 
so adamantly opposed to Western proposals for a freer exchange of 
ideas, nor would it be intensifying internal repression. The invasion 
of Czechoslovakia in 1963 and the enunciation of the "Brezhnev 
Doctrine" for the entire Soviet Bloc dearly demonstrated that the 
USSR intends to maintain its domination through brutal force. It 
is highly significant that immediately following the recent West 
German elections, in which Willy Brandt's policy of Ostpolitik gained 
broad approval, East Germany's Erich Honecker publicly declared 
that Germany will never be reunited and that the Berlin Wall will 
remain standing. 

We look in vain for genuine indications of peaceful Soviet inten- 
tions. The Warsaw Pact now spends almost three times more per 
capita on military affairs than NATO. American military forces in 
Europe have decreased by over one-third during the last decade 
while the presence of Soviet divisions in the Warsaw Pact countries 
has increased by one-fifth. The number of American ICBM's re- 
mained constant over the past five years while the USSR quadrupled 
its missiles and now maintains a 3;2 margin over the U.S. Between 
1967 and 1970, NATO military expenditures decreased by $10 bil- 
lion while expenditures of the Warsaw Pact rose by $5 billion. 
During this same period, the Soviet navy was rapidly built up in the 
North Atlantic (where it now has a 5:1 predominance over NATO 
forces) and the Mediterranean, and in the Indian Ocean where it 
now has the decisive naval advantage. 

The Soviet military build-up has been accompanied by stepped 
up repression of dissidents within the USSR and Eastern Europe. 
Under Brezhnev's policy of re-Stalinization, dissidents are being 
sent to jails, insane asylums and labor camps. A head tax has been 
levied on Jews (and non-Jews) seeking to emigrate, a policy which 
recalls the time when Himmler sold exit permits for Jews. Commu- 
nist Party control over all Institutions is being tightened. 



As the mood of detente encourages liberal dissident elements 

within the Communist countries by reducing international tension, 

50 



the Communist Parly leadership becomes fearful and often Intensifies 
repression. The Communist leaders thus have little stake in seeking 
detente as an end in itself. They see it as a potential Trojan horse 
transporting Western political and cultural influence into their 
cEosed totalitarian system, and they fear that their own population 
may interpret the relaxation of external tension as a harbinger of a 
similar internal liberalization. The political and economic factors 
which motivate their current interest in detente, therefore, have little 
to do with a serious interest in peace. Just as war always strains the 
fabric of a democracy, peace undermines totalitarian tyranny. There 
Is a real danger that tt present trends continue, Western Europe will 
fall increasingly under Soviet dominance. It could in. time, be forced 
to recognize the superiority of Soviet power, accomodate to Soviet 
wishes, sever its alliance with America, and ultimately become part 
of the Soviet sphere of influence. 

We fear that a pattern will emerge for all of Europe similar 
to that in Finland where Social Democrats are permitted into the 
cabinet only on the condition that they support Moscow's candidate 
for president ,The Scandinavian countries are now under immense 
Soviet pressure which is backed up by a 5:1 superiority of Warsaw 
Pact forces in the Baltic Sea. Austria has been told not to join the 
Common Market, and the Soviet leaders clearly stated that they 
would regard the failure of the German Bundestag to ratify the 
Soviet-German treaty as a hostile act. 

We believe that a strong, independent, united, free Europe is 
an essential precondition for the maintenance of peace and the 
advancement of social democracy. Consequently we urge: 

1) The strengthening of unity in Western Europe, both politically 
and economically. The European economic revival and the growth of 

the European Economic Community ara among the most important 

developments since World War II, but if this is not matched by a dem- 
ocratic political revival and cooperation it may not be possible to re- 
verse the trend toward Soviet predominance over the European con- 
tinent. 

2) The maintenance of NATO at full strength. Europe must be 
encouraged to take on more and more of the burden of its own 
defense, but until such time as it is in the position to gurantee its 
own security. American assistance will be necessary. The mainten- 
ance of a strong and credible NATO defense, as social-democratic 
leaders such as Willy Brandt and Bruno Kreisky have insisted, re- 
mains a top priority for Western policy in Europe. 

3) The continuation of efforts toward arms control. America 
must make every effort to negotiate strategic arms limitations agree- 
ments with the Soviet Union based upon the principle of equality 
in both offensive and defensive strategic weapons. If America aban- 
dons this principle and resigns itself to strategic inferiority, it will 
tempt the Soviet Union to engage in political blackmail and to exacer- 
bate local conflicts, thus increasing the possibility of a larger war. 

4) Increased concern for the safety of dissidents and the condl- 

51 



tion of all people in Communist countries, in light of the USSR's great 
need for increased trade and technological assistance from the West, 
America is in a position to exercise influence on behalf of the human 
rights of Soviet dissidents. Among these rights is the right to emi- 
grate which the Soviet Union has officially recognized, though it 
continues to violate this right, most notably in the case of Jews. 

5) Democracy for Greece, Spain and Portugal. The reactionary 
Greek junta, the Falangist dictatorship in Spain and the authoritarian 
Caetano regime in Portugal continue a savage reign of terror against 
all political opposition. We urge all efforts, including economic and 
diplomatic pressure, to hasten the return to representative democ- 
racy in Greece and to encourage the democratic forces in Spain 
and Portugal fighting for freedom and justice. 

IV- SOCIAL DEMOCRATS AND DETENTE 

It is in this overall context that we support efforts to achieve de- 
tente, such as Willy Brandt's Ostpoiitik r even as we remain sKeptical 
about Soviet intentions and are apprehensive about the future secur- 
ity of Western Europe. 

Just as the West has sought, largely successfully, to counter 
Communism when it posed a military threat, it should welcome and 
respond positively to a situation where the struggle, at least for a 
time, will be pursued by the Communists largely through political 
rather than military means. Social Democrats, of course, will wel- 
come this struggle for men's minds, for we recognize that socialist 
democracy is a far more attractive idea to the masses ot Eastern 
and Western Europe than either Communist totalitarianism or the 
reactionary systems in countries such as Spain, Portugal and Greece. 
Social Democrats can respond confidently to the political challenge 
offered by the Communists' conception of "Peaceful Coexistence." 
We understand something that other enemies of Communism do 
not: that millions of people united behind an idea can be more 
powerful than military threats or deterrents. Thus we must take up 
the Communist political challenge as well as the military one. 

We advocate political and economic measures that will enhance 
the prospects for a stable peace in Europe, encourage the poly- 
centric devefopment in the Communist camp, aid the freedom strug- 
gle against Communist and other forms of authoritarianism, and 
strengthen the forces in the U.S. which hold a democratic and inter- 
nationalist world outlook. And we offer not only an appealing idea 
but, together with our fellow member parties of the Socialist Inter- 
national, a movement of millions who seek peace and freedom. 

Central to this policy of transforming the struggle from the mili- 
tary to the political realm is the struggle for the multilateral renuncia- 
tion of the use of force. This renunciation provides the foundations 
for the bettering of relationships between East and West. In the proc- 
ess of achieving European security on this basis, it will be possible 
to dismantle the concentration of conventional and nuclear means 

52 



of destruction in Europe, and to put an end to the confrontations on 

the continent. Then it will bo easier to establish a true European 

security system. Social Democrats favor putting forward a wide range 

of proposals for bilateral disarmament which, in the long run, can 

lead to dismantling military alliances such as NATO and the Warsaw 

Pact. 

* # * 

Socialists not only favor initiative for relaxations of tensions In 
Europe, that might otherwise lead to military conflict, but we put for- 
ward a positive program for strengthening democracy and advancing 
its cause where it does not yet exist. While the Communists advocate 
peaceful co-existence, Social Democrats propose cfetente with free- 

dotn. 

Toward this end we favor political, social and cultural exchange 
between Western and Eastern Europe. Democracy has nothing to 
fear from any exchange of ideas. Such initiatives toward normaliza- 
tion of relations between East and West may also provide a measure 
of breathing space for the embryonic anti-totalitarian forces within 
Communism. 

In proposing a normalization of relations, it is not our intention 
to ignore or pretty up the ideological differences between East and 
West in Europe. They are fundamental. Guided by this understand- 
ing, we support the position of the International Confederation of 
Free Trade Unions (ICFTU) In regard to the question of multilateral 
relationships between free trade unions and Communist labor organ- 
izations. The ICFTU recently reaffirmed its position of opposition to 
any joint activity with Eastern Europe's Communist-controlfed "trade 
unions" as the "oblectlves of the international free and democratic 
trade union movement could be best attained through intensification 
of its work within its own institutions." To do otherwise would be to le- 
gitimize Communist totalitarian labor fronts such as that in the USSR 
run by the former head of the GPU, Shelepin. To accept the legiti- 
macy of Communist unions would be to turn our backs on the work- 
ers in Eastern Europe where aspiration for democracy was demon- 
strated during the revolts in East Germany, Poland, Hunaary and 
Czechoslovakia. Furthermore, to equate free trade unions with totali- 
tarian organizations which crush workers' rights would help to 
provide the Communists with new opportunities In Western Europe 
to subvert the objectives of the democratic labor movements. Thus 
we oppose any activities that foster illusions about Communist labor 
fronts and agree with the ICFTU that any proposals for coooeratfon 
on issues of general humanitarian concern should be channeled into 
the U.N. body, the International Labor Organization (ILOl. Relations 
between States or within international bodies is one thing, while 
comon efforts between democratic and totalitarian institutions are 

another. 

In calling for the normalization of relations between East and 
West, we stand opposed to any Communist attemot to make a condi- 
tion of coexistence that democrats end all criticism of totalitarianism. 

53 



In upholding this principle, we Keep faith with the Eastern European 
masses who desire "socialism with a human face," and we also show 
our solidarity with the Eastern European Social Democratic parties 
in exile which seek to advance this noble cause, 

* * a 

American Social Democrats and liberals who desire peace with 
freedom in the world can only look with enthusiasm and hope on the 
growth and success of the social-democratic forces In Western 
Europe. In almost every European country today, mass social-demo- 
cratic movements are in power or exert considerable Influence on 
their governments and in broader European bodies and Institutions, 
We favor support to such institutions as the European Economic 
Community which encourage political, economic and military Inte- 
gration among the democratic states of Western Europe. A united 
West will not have to accept detente on Soviet terms but can nego- 
tiate from strength. 

The integration of a Western Europe heavily influenced by the 
Social Democrats might also weaken or transform Communist move- 
ments in the West. Many Western Communists have tolerated regi- 
mentation during the height of the cold war: they have been kept In 
line by what the leadership pictured as the imminence of the final 
contlict between Communism and capitalism. A Social Democratic 
ascendency changes the entire picture and could pres$ure Western 
Communist parties to differ with the Soviet Union on major issues. 
Such a development can also encourage a desire, among rank-and- 
file Communists, for democratic rights and procedures. 

As a consequence of the detente, the subject of electoral 
alliances and other forms of political cooperation with Communist 
parties and governments has become a source of controversy among 
Democratic Socialists. We take the view that all democratic parties, 
not just socialists, should resist proposals for cooperation with the 
same energy and skill that they used in the past when Communist 
strategy depended more on blatant military force. Different tactics 
may be called for but the principle remains the same. 

Growing social-demcratic power In Europe also gives moral 
support to those denied Ireedom by the Communists in Eastern 
Europe and by the right-wing dictatorships in some Western Euro- 
pean countries. European Social Democrats will be in a position to 
put pressure on the anti-democratic regimes which desire loans and 
a favorable trade policy. In return for these benefits these regimes 
can be pressured to modify their systems and to end their denials 
of human rights. 

On another level, a Western Europe under social-democratic 
leadership can offer economic aid without strings to the developing 
nations looking for an alternative to both Communism and capitalism. 
This will also assist American sociafists and liberals who seek to 
change U.S. foreign policy. In its contest with Communism, the U.S. 
has supported a wide variety of governments, ranging from social- 
democratic 10 reactionary. The American Government has maintained 

54 



that anti-democratic regimes area lesser evil than Communist totali- 
tarianism and that support to thorn (and in some cases independent- 
minded authoritarian Communist ones such as Yugoslavia and 
Rumania)- is consistent with U.S. interests In the Cotd War. An Inde- 
pendent European economic and political policy, guided by the Social 
Democrats, can supporte the embryonic democratic forces in the 
Third World and thereby encourage and aid American socialists and 
liberals who seek to turn the U.S. toward a consistently democratic 

foreign policy. 

• • * 

Social Democrats,. U.S.A. advocates a realistic, not a Utopian, 
course to meet the changing developments in Europe and elsewhere. 
We reafize that we must do more than unmask the false pretensions of 
capitalism and Communism. Even as we work for social democracy, 
we know that the political, economic and military power of capital- 
ism and Communism are not on the verge of collapse. While these 
two exploitive systems exist, while socialists struggle for a humani- 
tarian alternative, we must help foster peaceful co-existence between 
these two systems. We know that neither freedom nor economic 
justice will emerge out of the ruins of war between East and West. 

However, while holding and maintaining a realistic concept of 
coexistence, Social Democrats have more to say about the dangers 
of war than Kissinger or Kosygin. The cause of peace is not furthered 
by a capitalist system that asks mankinds support for freedom but 
denies millions of the Earth's people the means to enjoy freedom. 
Nor. on the other hand, can it be fulfilled by a Communist system 
which exploits the desire of people for economic justice and equal- 
ity in order to imprison them in a brutal dictatorship. Neither capi- 
talism nor Communism deserves mankind's allegiance or sufferance. 

Our view of the way to advance peace and freedom Is not based 
on abstract pacifist ideals or concerns of national honor, but on the 
real needs and aspirations of mankind. Ideologies, their harbingers 
and followers, over and over again disregard the fundamental ethical 
principles of coexistence outlined here because they want to improve 
or sacrifice mankind, to preserve the purity of their doctrines, or 
to get the better of other doctrines. It is not possible to sow the 
seeds of lasting peace between such forces. A policy for peace 
must make it clear that neither states nor ideologies are ends In 
themselves, but they are thereto serve mankind. 



V. THE MIDDLE EAST 

The Middle East is faced with the same threat as Europe — the 
growing presence of the Soviet Union. By exploiting the Arab-Israel 
conflict and other local disputes, the USSR has dramatically In- 
creased its military and political influence in the region. Soviet 
expansionism in the Middle East presents a continuing menace to 
Israel's security and dangerously aggravates international tensions. 
It constitutes an immediate threat to the Independence of Turkey 

55 



and Iran, and a long-range danger for Europe and Japan, both of 
which are dependent on Middle Eastern oil resources and could thus 
be vulnerable to Soviet threats to cut off their energy supply. 

The issues are starkly drawn in the Middle East. Israel, a small 
democracy ruled by a Socialist government based on a vigorous 
labor movement, is menaced by an alliance of terrorists and back- 
ward Arab dictatorships which together receive massive military 
and political support from the Soviet Union. We urge support for 
Israel on moral grounds, and also because such a policy contrib- 
utes to peace in the Middle East by obstructing Arab adventurism 
and Soviet expansionism. The recent Soviet exodus from Egypt is 
attributable to several factors, not the least important of which is the 
American abandonment of the "even-handed 1 ' Rorgers Plan, and the 
adoption of a policy of support for Israel based upon a clear recog- 
nition that the Soviet drive for hegemony is the central problem in 
the Middle East today. The new American determination, combined 
with Israeli military strength and the Soviet preoccupation with 
China, has forced Moscow to be unusually cautious in its support 
for the Arabs. Its reluctance to back Egypt aft the way, and thus 
risk Involvement in a new and costfy war, released latent nationalist 
hostility In Egypt toward the Soviet intruders. The result was Sadat's 
ouster of Soviet troops, Moscow*s quick compliance, and a more sta- 
ble overall situation than has existed for some time in the Middle East. 

We doubt that such stability will be permanent. Arab terrorists 
will stop at nothing to disrupt the situation, Arab governments stllf 
refuse to recognize Israel's existence, and the Soviet Union has not 
withdrawn from the Middle East but only shifted Its Involvement. It is 
now consolldatina its position in Iraq, Syria and the oil rich Persian 
Gulf where the chances of Its being drawn Into the volatile Arab- 
Israel conflict are somewhat reduced. From a lonq-term perspective, 
the Soviet Union has not abandoned its goal of heaemony over the 
Middle East but has only diversified Its tactics. The fundamental 
causes of conflict in the reqlon thus remain unchanged, The inter- 
ests of neace and democracy In the region will be served by; 

1V The continuation of the nollcv of maintaining a balance 
against Soviet expansion in the Middle East. 

2) A oeace aoreement between Israel and the Arabs, achieved 
th'ounh direct nenotiations between them, In which all outstanding 
Issues IncludFnn the establishment of secure and recognized borders 
and the resolution of the refugee question will be settled. 

3) The adontlon of stronq measures to put a stop to international 
terrorism. Such mensures shoufd include economic sanctions com- 
pelMno countries that orovlde a haven for terrorists to withdraw their 
protection: an international treaty providing for sanctions, including 
multilateral air boycotts, against any nation which harbors hijackers 
and refuses to cooperate In their punishment or extradition or In the 
immediate release of hijacked passengers, crews and airplanes; and 
economic boycotts by free trade unions against any nations that 
assist or protect terrorists Fn any way, 

56 



VI ASIA 

Asia has undergone tremendous changes in the past few years. 
The progress towards a cease-fire in Vietnam and the withdrawal 
of American forces offers some hope (or a lasting settlement of the 
bitter Vietnam war. Improved American relations with China, the 
India-Pakistan war and the emergence of Bangla Desh, (which In- 
creased strains in American relations with India and Japan) and the 
growing Soviet military and naval position in South Asia were among 
the other major developments in the changing political life of Asia. 

The people of Indochina, the United States and the entire world 
yearn for peace In Vietnam. Millions around the globe greeted with 
joy and relief the political settlement reached in Paris and pray 
that this will lead to lasting peace. 

The proposals accepted, at the peace table, by the contending 
forces include: an internationally supervised ceasefire; democratic 
elections in which all South Vietnamese political groups can parti- 
cipate, organized by a commission made up of the Saigon govern- 
ment, the National Liberation Front and the neutralists; and the 
withdrawal of U.S. troops from Vietnam and a decrease in the in- 
volvement of North Vietnamese troops In the South. Also being 
considered are proposals for a bilateral reduction of North and South 
Vietnamese military forces; and for a cease fire throughout Indo- 
china and the withdrawal of both North Vietnamese troops and U.S. 
military advisors in Cambodia and Laos, where steps toward negotia- 
tions between the combatants are also under way. 

These are the essential elements in the kind of peaceful and 
democratic settlement of the war which Social Democrats, U.S.A. 
and the Young People's Socialist League have advocated and worked 
tor since the beginning of this tragic conflict. We do not minimize 
the difficulties In Implementing such a sottlcmont. Among the haz- 
ards are the fegitlmate suspicions of the combatants and the prob- 
lems presented by the attempt by both sides to achieve military and 
political advantage. For any lasting settlement there must be assur- 
ances and safeguards for the anti-Communist and neutralist nations 
of Indochina that the North Vietnamese will not use the occasion 
of a U.S. withdrawal to unleash a new military campaign aimed at 
conquest or to step up its terrorism for the purpose of eliminating 
or forcing the political opponents of Communism to surrender. Like- 
wise, the North Vietnamese have a right to assurances that after a 
military settlement which leaves the Saigon government Intact, Presi- 
dent Thleu will not use his military and police power to crush or 
eliminate the Communist political cadres and their sympathizers in 
the South. It Is necessary further that world opinion speak out on 
behalf of the rights of those political forces in South Vietnam not 
represented at the conference table which otherwise might bo ground 
to bits between the two armed camps or allowed no voice in shaping 
the destiny of their country. 

Both sides are obviously still Involved in political and military 

67 



maneuvering to win what they have not won in the war and what 
might be against the wishes of the Vietnamese people II thoy could 
truly express them. 

Social Democrats refused to accept either a surrender to Com- 
munist force disguised in the form of a coalition government imposed 
on the South Vietnamese peopJe nor supported any efforts to bomb 
Hanoi into submission. Thelirst, we maintain, would be an outrage 
to democratic principles and the second could only be accomplished 
by taking a terrible toll of human lives. In the face of propaganda 
destined to confuse the issues in dispute, those seeking peace and 
freedom for South Vietnam must continue to insist on a political and 
democratic solution. This can occur only one way— through an inter- 
nationally supervised cease-fire and democratic elections. Such a 
settlement is necessary to stop a// the kifling and to offer the South 
Vietnamese people an opportunity for true self-determination. This 
is essential in order to create conditions throughout Southeast Asia 
conducive to peace, stability and economic progress and encourage 
detente between the great powers both there and elsewhere. 

One hopeful sign in what appears to be a gloomy situation is 
the recognition by both sides that total victory cannot be achieved, 
as indicated both by the limitations on their present military activities 
and by their present verbal commitment to the conditions and com- 
promises necessary if peace is to be achieved. The job of democratic 
socialists and liberal internationalists is not over. We must continue 
to press on to ensure that both sides abide by the cease-fire and to 
aid democratic forces such as the free labor movement so that the 
South Vietnamese have a tree choice in the elections, and that mas- 
sive economic and technical aid is provided through international 
channels for reconstruction and economic development in all of 

Indochina. 

* * * 

In the rest of Asia, American policy has fallen far short in pro- 
moting the goals of peace, freedom and economic development 
During the recent war between India and Pakistan, the American 
government showed a callous disregard for the principfes of democ- 
racy. At first the Administration tailed to condemn the barbaric re- 
pression of political opposition in East Pakistan. In the war that fol- 
lowed this repression, it showed much greater interest in maintaining 
good relations with the military dictators of Pakistan and their Chi- 
nese Communist allies than In seeking a democratic solution to the 
crisis in East Pakistan or in improving American-Indian relations. 

Since Bangla Desh became an independent state, America has 
provided desperately-needed economic and technical assistance. 
We urge increased aid in order to help that tortured country during 
its recovery from the war and in its future development, Moreover, 
it is especially important that America make every effort to improve 
its relations with India, a democracy of over 550 million people. The 
recent treaty between India and the Soviet Union, which reflected in 

5& 



part the opposition of both countries to China, should not doter 
America from re-establishing a close friendship with India, Our goal 
should be the strengthening of the democratic forces and institutions 
in India, which could succumb to pressure from pro-Soviet elements. 
Renewed U.S.-lndia friendship would improve America's image In 
Asia and would also greatly help India which has received ten times 
more economic aid from America than from Russia over the past 

eigthteen years. 

A democratic American policy in Asia must also be based on 
the maintenance o* close ties with Japan, which is now the third 
largest economic power in the world and far and away the dominant 
economic force in Asia. President Nixon's failure to consult with 
Japanese leaders before announcing his planned visit to China was 
a damaging mistake which alarmed pro-Western elements in Japan. 
In view of Japan's economic strength, it will undoubtedly play an 
increasingly independent role in the years ahead, but our country 
must make every effort to sustain Japanese-American friendship. 
We should encourage the growth of the democratic forces in the 
Japanese labor movement which would be a strong force for free- 
dom and social justice, as well as a means to increase Japan's 
domestic market and thereby protect American workers whose jobs 
are threatened by low-priced Japanese imports. 



VII. AFRICA 

American policy in Africa has erred both by omission and com- 
mission. We have neglected this vast and varied continent which 
today receives less than 10 percent of our total foreign aid and less 
than 4 percent of our investment abroad. Yet even this paltry finan- 
cial contribution has not been made to spur devftlopmant but to 
advance American strategic objectives in northern Africa and to 
gain profits for American corporations in southern Africa. One third 
of American private investment in Africa has been In one country- 
South Africa. Through a special sugar quota, the U.S. pours millions 
of dollars every year into the pockets of South African whites, thereby 
strengthening the apartheid system. The reasons for America's back- 
ward policy are many, not the least important being pressure from 
special interests in America=corporations which have Investments 
in southern Africa and especially segregationists who have great 
influence with an Administration anxious to capture the South for 
the Republican Party. As a result, our policy continues along a reac- 
tionary course, and the consequences could be disastrous. 

America must drastically alter its priorities in dealing with 
Africa, making our central objectives democracy and rapid economic 
development. For the 42 African states, we should expand our aid 
program and reform the methods of assistance, placing special 
emphasis on the need to develop stabilizing democratic institutions 
such as unions, cooperatives and democratic political parties. Only 

59 



policies of this kind can help provide stability and domocracy for 
Africa and reverse the dangerous trend toward tribalism, civil war 
and authoritarianism. 

In southern Africa, America must do all it can to encourage a 
peaceful and democratic resolution of the explosive racial crisis. We 
should give clear indications of our our support for democratic nation- 
alist movements in Angola, Mozambique, Rhodesia and South Africa. 
In addition, we should pressure those corporations which have in- 
vestments in South Africa to upgrade the skills and working condi- 
tions of black workers and to extend to them basic trade union rights. 
We should support the United Nations embargo on Rhodesia and 
register our strong protest against the sale of arms by Britain and 
France to South Africa. Such modern weapons not only defend the 
system of apartheid, but in the event of a conflict they could be used 
to devastate South Africa's black population. 

If America continues to respond to racist and corporate pres- 
sure in determining policy for southern Africa, not only will the peo- 
ple of that region suffer the violent consequences, but America's 
image throughout all of the developing countries will be irreparably 
damaged. 



VIM. LATIN AMERICA 

It Is time that the United States once again has a well defined 
policy in its relations with Latin America. Since the death of Presi- 
dent Kennedy and with that, the death of the Alliance for Progress, 
there have been no clear lines of policy in United States relations 
with the other countries of the hemisphere. As a result powerful inter- 
est groups in both parts of the hemisphere- have been able to deter- 
mine {in accordance with the amount of pressure they havo boon 
able to bring to bear) specific actions by the United States in the area. 

The new basis lor relations between the United States and Latin 
America must take several basic facts into consideration: 

• Since World War If, Latin America has made very substantial 
economic progress, several of the countries have become predomin- 
antly industrial and urban, with integrated manufacturing sectors in 
their economies, Economic development has brought a new self- 
confidence to the Latin American countries, as reflected in the Con- 
sensus of Vina del Mar and other recent pronouncements of the gov- 
ernments of the area, which in effect have stated their willinngess to 
get along without the help of the U.S. if that help was not forthcoming 
on mutually acceptable bases. The era of paternalism and bullying of 
the Latin American countries by the United States is thus at an end. 

• A number of the Latin American countries have reached a 
level of industrialization which now makes It feasible for their manu- 
facturing sector to compete to some degree In International trade, 
However, to a large degree the market in the highly industrialized 
countries, which would be the logical outlet for most of the Industrial 

60 



exports of the Latin American countries are closed by government 
action. In spite of recent economic progress of Latin America, the 
United States does remain tho outside power which has the greatest 
influence in the Latin American area, and particularly in the smaller 
countries of the region. We should seek to use this influence deliber- 
ately to achieve objectives which are in the interest of both parts 
of the hemisphere and not allow it to be prostituted by landed oli- 
garchies and American corporations. 

• In spite of the very substantial progress in economic develop- 
ment which has characterized Latin America since World War II, 
this development has frequently tended to lag behind the "revolution 
of rising expectations" and has been mitigated by the very rapid 
increase in the population of the Latin American economies, which 
can still be substantially helped by aid in the form of capital re- 
sources and technical assistance from the outside. Latin America Is 
going through a profound process of social transformation, amount- 
ing to a social revolution. This process 3s irreversible, and the only 
question at issue is that of what kind of leadership is going to bring 
about this social revolution. 

• The issue of democracy versus dictatorship is still a very 
live one in Latin America. It has merely become more complex, by 
the advent of new kinds of dictatorships, including Communist total- 
itarianism and a new reformist militarism which now exists beside 
the more traditional conservative military tyrannies. 



In light of these factors, United Slates policy towards Latin 
America should be oriented towards the following objectives: 

1) Helping the Latin American countries to continue and expand 
their process of economic development To this end the United 
States should augment its aid program for Latin America, making 
it a cooperative program among the countries of the hemisphere 
and channeling aid as much as possible through the Inter-American 
Bank and technical assistance institutions which are a part of the 
Organization of American States. 

2) Opening United States markets fully to those industrial ex- 
ports which the Latin American countries are in a position to sell us. 
In this connection immediate steps should be taken to fulfill the prom- 
ise made by President Nixon at the beginning of his administration, 
that Latin American countries would be given preference in imports. 

3) Making clear our sympathy for progressive democratic re- 
gimes, parties and organized labor forces in Latin America, that is, 
those which ^re seeking to bring about the needed social transfor- 
mation and economic development of their respective nations within 
the framework of a democratic political system. Similarly, forces of 
the Democratic Left In this country should establish closer and 
stronger relations with their counterparts in Latin America, 

4) Making It clear that it is the position of the United States Gov- 
ernment that United States-based firms which make Investments. In 
Latin America do so at their own risk, and that the U,S. Government 

61 



is not going to sacrifice the broader objectives of Its own policies 

in order to defend such enterprises when they run into difficulties 
with Latin American governments. Specifically, the announced policy 
of blocking loans by international agencies to those governments 
which have expropriated United States firms should be abandoned. 
In addition to these general lines for the Latin American policy 
of the United States, there are some specific measures which we 
think are of great importance in the present relationship between 
the two parts of the hemisphere: 

1) The United States Government should cease harassment of 
the Allende regime \r\ Chile such as its own refusal to grant even 
modest economic aid to that regime, and its blocking of aid projects 
in international agencies. The Government should bring pressure 
on the Kennecolt Copper Company to cease its moves to block sales 
of Chilean copper in Europe. U.S. harassment only strengthens ele- 
ments within the Allende regime which would like to make the U.S. 
a scapegoat for their own gigantic economic problems and which 
wish to use an anti-Yankee campaign as a weapon to impose a 
so-called "dictatorship of the proletariat" on Chile. If the Allende 
government faiBs, it should get full blame for its failures. 

2) The United States shoufd abandon its opposition to the 200 
mile sea frontier claims of the Latin American countries, insofar as 
these concern fishing and mineral rights. Our only insistence should 
be upon the right of passage for ships of all nations outside of a 
much more limited sea frontier. 

3) Although we support negotiations with Cuba for a treaty 
covering airplane hijacking, and favor freedom of travel to and from 
that country, we think that any further moves to change the present 
relations between this country and the Castro regime should involve 
insistence by the United States on a complete abandonment by the 
Castro regime of attempts to overthrow other Latin American gov- 
ernments and some loosening of the bonds of the Castro dictatorship. 

IX. CONCLUSION 

It is our great hope that someday an international institution 
will be established which is capable of preserving peace and pro- 
moting democratic ideals. At one time it was hoped that the United 
Nations would serve this function, but in its current state it has 
proven unequal to the task. In the absence of a strong and effective 
international institution, other methods must be found to achieve 
peace and further the cause of freedom and socfal justice. Thus our 
deep concern with the policies of the United States reflects our view 
that America has an unusually important role to play if progress is 
to be made toward the fulfillment of our internationalist ideate. Our 
knowledge of the far-reaching importance of our country's policies 
fends an added sense of urgency to the struggle for social democ- 
racy in America. 

62