By Frank Henry-Reyes and James Anderson  

Watching Senator Elizabeth Warren grill the chief executive of Wells Fargo, John Stumpf, as he testified before the Senate Banking Committee last week was a little satisfying, sure, but it hardly suffices in terms of addressing what is really at issue. 

As has been well documented, Wells Fargo agreed to a $185 million settlement with the Consumer Financial Protection Bureau in early September when it came to light that the bank’s employees had for several years created fake bank accounts to pad sales numbers, which resulted in customers nationwide paying overdraft and late fees on credit cards and accounts they did not even know they had. 

Stumpf, whose pay was the highest among top bank executives in the US the last five years, told the Senate Banking Committee the 5,300 employees – many of whom earned only $12 an hour – deserved to be fired for what they did. 

Dozens of Wells Fargo workers might have gathered for a two-day ethics conference in San Diego back in 2014, but the sales goals demanded of low-level employees by higher-ups at the bank left those at the bottom little choice if they wanted to keep their jobs. Having squeezed his employees “to the breaking point,” coercing them into cheating customers, as Warren put it, Stumpf, who in addition to acting as CEO is also chairman of the Wells Fargo board of directors, could drive up the value of his stock and make millions of dollars. 

Since Stumpf seemed reluctant to answer a question Warren asked about just how much value his holdings in Wells Fargo stock increased while the scam – which he admitted knowing about since 2013 – was underway, the firebrand senator from Massachusetts informed him the overwork and extralegal efforts of his bank’s low-wage employees helped him pocket more than $200 million in personal gains. 

Warren proceeded to tell the multimillionaire executive he should resign, and she called for him to be criminally investigated. She said the misdeeds of Wall Street – like nearly crashing the world economy in 2008, contributing to a housing crisis that saw several million in the US face home foreclosures – would continue until mega-banks and top-level officers at these financial institutions are held accountable.

Please pardon us if we won’t hold our breath waiting for that to happen. The problem is not simply that Wall Street money undermines the function of formal democracy in the US political system. Rather, the root of the problem has to do with deeper systemic trends and the narrow definition of democracy that dominates society. 

More than holding the feet of banksters to the fire or even breaking up the big banks, beyond regulations and taxes on financial speculation, what we need is economic democracy.

The specter of real democracy has haunted the US since the anarchist-socialists set up an encampment in New York’s Zuccotti Park and started the Occupy Wall Street movement in September 2011. 

Focusing on the economic dimensions of our lives, public intellectual and heterodox economist Richard Wolff, penned “Occupy the Economy: Challenging Capitalism” in the wake of OWS. Wolff also authored “Democracy at Work: A Cure for Capitalism,” in which he diagnoses the intrinsic problems of the existing economic system and outlines democratic alternatives capable of displacing the dominant arrangements that have stopped delivering the goods for the vast majority of us. 

To understand why, Wolff suggests, requires a little history. As he explained in a piece published this September on the contradictions of finance capital, major changes occurred in the capitalist world economy starting in the 1970s. New developments in computerization enabled corporations to relocate production abroad where they could pay lower wages and empowered big business to otherwise replace – or threaten to replace – workers with automation. 

Capitalist arrangements constantly spur that sort of technological innovation and the contradictions that come with it. Firms competing for market share feel pressure to grow and increase profits, which frequently entails applying new technologies to lower production costs. This often eliminates the need for handfuls of workers who, as living human beings, still require wages to acquire what is needed to survive. Short of layoffs, technological progress under capitalism has historically translated into regression at the workplace as electronic innovations are increasingly used for surveillance of workers to better ensure obedience or are utilized to more easily plug workers with no job security in and out of the gig economy. 

Businesses also, of course, utilize new technologies to offer new electronic gadgets to consumers. 

As working people’s real wages stagnated after the 1970s, for reasons alluded to above, the American working class had to rely on other means to acquire those goods and services we all need to get by, including the new electronic devices now made necessary for work and to function in a changing society. 

People started debt-financing what previous generations could pay for with wages, taking out loans to pay for everything from higher education to basic expenses covered by credit. The corporate-financial class – represented by morally upright characters like the John Stumpfs of this world – could start sticking it to working people twice.

Shareholders and business executives  could increase profits by paying workers low wages – like the $12 many Wells Fargo employees made before being terminated – that do not keep up with the rising prices of the goods and services people need to reproduce themselves and society, and the same class profiting from the lower wages could squeeze even more out of working people by charging them interest on loans so many of us are now coerced into taking out to compensate for our grossly inadequate incomes. 

Coupled with fancy forms of digitized paperwork – from credit default swaps to collateralized debt obligations – and new financial instruments also enabled by advances in capitalist technologies, it should come as no surprise that inequalities in wealth have reached Medieval proportions. 

The share of the nation’s wealth owned by the top one percent went from under an admittedly still egregious 35 percent at the end of the 1970s to some 42 percent today, while the wealth of the approximately 145 million Americans occupying the bottom 90 percent declined from its high of 36.4 in 1984 to just 22.8 percent today. 

These disparities undermine formal electoral democracy insofar as money after Citizens United and McCutcheon almost reflexively yields political power in the nation-state. Equally troubling about our state of rampant inequality, though, is that it means most people have even less say over the major decisions affecting their lives, including and especially on the job. The case of low-wage Wells Fargo workers pressured by way of their precarious conditions to create fake accounts and then still forced to take all the heat for the scandal is a case in point. 

What we need is authentic economic democracy – real democracy at work. Since Occupy, Wolff, who is Professor of Economic Emeritus at the University of Massachusetts in Amherst, has helped the Democracy at Work organization get off the ground. Sharing the same title as his 2012 book, the d@w movement similarly touts a cure for capitalism. By promoting a cooperative economy, the d@w ethos advances democratic principles in the oft-neglected space where we spend most of our lives – at work. 

Wolff and d@w advocate worker self-directed enterprises, or WSDEs.

In WSDEs, those who work to produce the surplus that normally gets realized as profit for a business are also the ones who get to democratically decide how to organize the production of that surplus – how to organize their own work. What is more, workers in WSDEs also decide collectively what to do with the surplus they together produce – how much to distribute among themselves, how much to reinvest in their cooperative enterprise and how much to allocate to the broader community of which they are all an integral part.

This is a far cry from the largely unaccountable ownership and control exercised by and within most corporations whose shareholders have no qualms about laying people off and decimating deindustrialized communities by offshoring production. 

While we are certainly picking up what Wolff is putting down, we think this is only the beginning. The d@w movement is hardly a blueprint. That’s why the d@w organization has been calling for “action groups” to form across the country and perhaps even internationally, not unlike the uprisings and Occupy encampments from a few years back. We have to figure out how best to translate, refine and even rework some of the aforementioned ideas if we want real democracy at work and beyond. 

For this reason, we have formed the North County Democracy at Work Action Group. The group meets for the first time on Wednesday, September 28 at 7 p.m. in SBSB 2240 on the California State University San Marcos campus. We’re hoping the greater San Diego community joins us as we take turns reading aloud parts of Wolff’s book “Democracy at Work,” discussing the ideas as we go along. If democracy at work and elsewhere is a collaborative process, this can be an important first step we can take together in that direction. 

Frank Henry-Reyes is a graduate of California State University, San Marcos, having earned a Bachelors Degree in History. He is currently pursuing the Single Subject Teaching Credential at CSU San Marcos and plans to teach history at the high school level. 

James K. Anderson, PhD, is a déclassé writer, journalist, scholar and social theorist. He was born and raised in the Midwest but now struggles to live in Southern California. He will be teaching classes at Mt. San Jacinto College and California State University San Marcos during the fall 2016 semester.