by Garda Ghista
World Prout Assembly
January 1, 2007

Continued from Part One

Conclusions
While scholars and politicians find various causes of Kentucky poverty, including those enumerated herein, they overlook the fundamental cause, which is exploitation by capitalists, particularly external corporations, based in the United States or elsewhere, such as Germany and Australia, as is evidenced by coal mine ownership. Billings and Blee write of the exodus of millions from Appalachia after World War II with the increasing mechanization of coal mining. Due to strong kinship and reciprocity among the people, land was divided over generations until at present the descendants have small parcels of not more than 160 acres. Billings and Blee put the poverty rate in eastern Kentucky at 42 percent, three times the national rate; 54 percent of the children in Clay, Owsley, Perry and Leslie Counties are living below poverty level. While poverty has decreased to some extent, in 1990 one-fourth of the people in Appalachian Kentucky were poor.

While Billings and Blee elaborate on multiple causes of poverty, including familism, traditionalism, cultural legacies, yet they emphasize above all else the predatory capitalism via economic exploitation and political domination that took place from the very early days of the 19th century and stands in sharp contrast to the “culture-of-poverty” theory of Appalachia. The deep culture and kinship helped the people to survive the onslaught of capitalist exploitation that arrived in tandem with racial oppression to establish the salt mines and later coke manufacturing. While the official rate of (structural) unemployment in 1989 was about 9 percent, the “real” rate of unemployment, which includes those who have given up looking for work, came to more than 54 percent of the population. Along with capitalist exploitation, the concurrent crime in Appalachia is the continuous lack of public investment by state and federal governments to build up health care and educational facilities along with cultural activities, environmental programs and the building of other public goods such as more roads, libraries, theaters, colleges, etc., leading one to speculate on the inherent bias of political structures against the subordinate, poor and neglected segments of society. Despite the severe exploitation, the poorest of the poor in Appalachia have resisted and survived by “making ends meet the Kentucky way,” as has been described earlier. In addition, there is today a strong people’s movement for social, economic and environmental justice, indicating that, aided by close relationships with neighbours and kin, the people of Appalachia may soon lead the nation in creating a political and socio-economic revolution in the United States.

The solution to removal of Appalachian impoverization is to adopt the principles outlined earlier that will support economic decentralization, namely: (1) All resources in a socio-economic unit should be controlled by the local people. (2) Production must be based on consumption and not on profit. (3) Production and distribution of all natural resources and finished products must be carried out by cooperatives. (4) Local people must be employed in local business enterprises, and (5) All goods that are not produced locally should be removed from local stores. In addition to these five principles for creating and maintaining a decentralized economy, Sarkar has provided requirements for the implementation of economic democracy, as follows: (1) The minimum requirements of a particular age – food, clothing, housing, education and health care – must be guaranteed to all citizens; (2) Increasing purchasing capacity must be guaranteed to all citizens. In fact, adequate purchasing capacity of every person must be guaranteed in the national constitution; (3) The power of making economic decisions must lie entirely with the local people; and (4) Outsiders, non-local people, must in no way be allowed to interfere in local economies. This will stop the outflow of local capital, the present cause of local impoverization. These four requirements if implemented along with the principles necessary to create a decentralized economy will lead people closer to economic democracy, because the power to control the economy will lie with the people. When outside ownership of local land and resources is prohibited, and when local lands and resources are owned collectively by local people, at that point in time poverty in Kentucky will cease to exist, and will become a relic in the history museum.

Notes

1 Jake Karlyle, “A Cooperative Economy – What Might it Look Like?” Paper presented at the Conference: Community, Economy and the Environment: Exploring Tasmania’s Future, Hobart, Tasmania, October 15, 2005.
2 Prabhat Ranjan Sarkar, Proutist Economics: Discourses on Economic Liberation, Kolkata, AM Publications, 1992., p. 212.
3 Colin Hines, Localization: A Global Manifesto, Earthscan, 2000, p. 10.
4 In Kentucky the largest cash crop is tobacco. However, corn and soybeans are also sold outside the state.
5 Colin Hines, p. 11.
6 Ibid, p. 13.
7 This new U.S. militarization around the globe is amply elaborated upon by Chalmers Johnson in his book Sorrows of Empire, Owl Books (NY), 2005..
8 Colin Hines, p. ix.
9 Numerous articles are available in the Frontline magazine published by The Hindu newspapers.
10 Vandana Shiva, Stolen Harvest: The Hijacking of the Global Food Supply, South End Press, 2000.
11 Colin Hines, p. 6.
12 Ibid, p. 6.
13 In his book The Myth of Free Trade, Professor Ravi Batra documents how since the beginning of the free trade era in the early 1970s real wages have steadily declined. This has led to the necessity of both parents working, which prior to the 1970s was not an economic necessity in the majority of families.
14 Absolute poverty can be economically defined as missing one of the five minimum necessities of life, i.e., food-water, clothing, shelter, health care and education.
15 Colin Hines, Localization.
16 Numerous articles in Frontline magazine, The Hindu, and Zmag.
17 In fact, many more countries are involved, such as Turkey, Malaysia, Indonesia, Mexico and Guatemala to name a few.
18 David Korten, When Corporations Rule the World, Berrett-Koehler Publishers, 2001.
19 Colin Hines, p. x.
20 Ibid, p. ix.
21 Ibid, p. 28
22 Ibid.
23 Prabhat R. Sarkar, Proutist Economics, p. 213.
24 Ibid, p. 214.
25 Ibid.
26 As is mentioned later in this paper, the Mondragon Cooperative conglomerate in the Basque region of Spain has set salary gradations of from 1 to 6. That is, the highest salary in any cooperative will not be more than six times the lowest salary. Economics professor Ravi Batra, who is a lifelong student of Prout economic model, has stipulated that the wage differential not be more than a ratio of 1 to 10.
27 Prabhat R. Sarkar, Proutist Economics, p. 216.
28 Ibid, p. 217.
29 Ibid.
30 Ibid. p. 218.
31 James Peter Warbasse, Co-operative Democracy: Attained Through Voluntary Association of the people as Consumers – A Discussion of the Co-operative Movement, Its Philosophy, Methods, Accomplishments, and Possibilities, and its Relation to the State, to Science, Art, and Commerce, and to Other Systems of Economic Organization, New York: The MacMillan Company, 1923, p. ix.
32 Northern Kentucky University is an example.
33 In Betsy Bowman and Bob Stone, “Cooperativization As Alternative to Globalizing Capitalism,” it is mentioned that this same cooperative in Rochdale founded in 1844 degenerated when in 1859 it took on investment members to get the requisite funds to purchase a new mill. The investor members outvoted the co-operative members steadily and within three years converted the cooperative to a capitalist business.
34 International Co-operative Alliance. http://www.coop.org/ica/ica-rules.pdf.
35 Betsy Bowman and Bob Stone, “Cooperativization as Alternative to Globalizing Capitalism,” http://www.geo.coop
36 Ibid.
37 Ibid.
38 Ibid.
39 Ibid.
40 James Warbasse, Co-operative Democracy, p. 480.
41 Prabhat Sarkar, Proutist Economics, p. 105-121.
42 Garda Ghista, “The Fall of the American Empire – and the Rise of a New Economy,” at Prout World, http://www.proutworld.org.
43 Ralph J. Ramsey, “Forms and Scope of Poverty in Kentucky.” Resource Development Series 10. 1967. 50 pp.
44 2003 Fact Sheet, Kentucky Commission on Women. www.women.ky.gov
45 Ibid.
46 “Poverty despite work: Many working families with children in Kentucky remain poor,” in the report Poverty Despite Work in Kentucky, published by the Center on Budget and Policy Priorities and Kentucky Youth Advocates, April 7, 1999. http://www.cbpp.org/4-7-99sfp.htm.
47 Barbara Ehrenreich, Nickel and Dimed: On (Not) Getting By in America. Owl Books, 2002.
48 Two simple solutions to both these issues is to raise the minimum wage to $14.00 per hour, as calculated by Ehrenreich , and to remove all income tax obligations to persons earning less than $30,000. These steps would immediately bring thousands of Kentuckians out of poverty. One more essential step is to provide universal health care to all Kentuckians and all Americans, to remove a major source of mental tension amongst the poor and the middle class who face bankruptcy in the present medical system.
49 State Fact Sheets: Kentucky. USDA – United States Department of Agriculture, Economic Research Service. Data updated August 31, 2006.
50 Ibid.
51 Laura Ungar, “Poverty fuels medical crisis: Access to care is difficult for rural residents,” The Courier Journal, Louisville, Kentucky, September 25, 2005.
52 Ibid.
53 Ibid.
54 Ibid.
55 Dwight B. Billings and Kathleen M. Blee, “Agriculture and poverty in the Kentucky mountains: Beech Creek and Clay County, 1850-1910,” Paper provided by University of Wisconsin Institute for Research on Poverty in its series Institute for Research on Poverty Discussion Papers with number 1064-95. March, 1995, 50 pp.
56 Ibid, p. 4.
57 Ibid, p. 6.
58 Ibid. p. 28.
59 Ibid, p. 30
60 By the early 1920s Tennessee farmers had succumbed to similar impoverishment.
61 Ibid, p. 1.
62 Ibid, p. 2.
63 “Coal follow-up,” Oligopoly Watch, November 20, 2004,
http://www.oligopolywatch.com/2004/11/20.html.
64 International Coal Group, Inc. http://www.intlcoal.com.
65 Oligopoly Watch. The latest maneuvers of the new oligopolies and what they mean.
http://www.oligopolywatch.com.
66 This figure is based on September, 2003 data. Most likely there has been greater consolidation in the past three years up to the present - November, 2006.
67 Oligopoly Watch. http://www.oligopolywatch.com
68 Ibid.
69 Celia W.Dugger, “Supermarket Giants Crush Central American Farmers,” New York Times, December 28, 2004.
70 Felicity Lawrence, John Vidal and Steven Morris, “Unfair trade winds,” The Guardian, May 17, 2003. As the article is three years old, it is likely that the interim period has seen further consolidation.
71 Oligopoly Watch. http://www.oligopolywatch.com
72 Ibid.
73 Interview with Appalachian writer-activist Scott Goebbels on November 9, 2006.
74 Florence Cope Bush, Dorie: Woman of the Mountains, Knoxville, University of Tennessee Press, 1992. The author has written the story of her mother and father’s life in the Appalachian mountains during the period 1898-1942.
75 Ibid, p. 15-16.
76 Phone interview on November 2, 2006, with Peggy King, Library Specialist, Steely Library, who with her husband originates from the Appalachian region.
77 Richard Ulack, Karl Raitz and Gyula Pauer (Eds.) Atlas of Kentucky, Lexington: The University Press of Kentucky, 2000, p. 133.
78 Ibid, p. 135.
79 Ibid, p. 145.
80 Ibid, p. 146.
81 Ibid, p. 149.
82 Ibid, p. 181.
83 Ibid, p. 183.
84 State Fact Sheets, Kentucky, USDA – U.S. Dept of Agriculture, Economic research Service.
85 Ibid.
86 Dwight B. Billings and Kathleen M. Blee, The Road to Poverty: The Making of Wealth and Hardship in Appalachia, Cambridge: Cambridge University Press, 2000, p. 318.
87 Billings and Blee, p. 319.
88 Ibid, p. 321.
89 Ibid, p. 325
_____________________

Garda Ghista is a freelance journalist, author of The Gujarat Genocide: A Case Study in Fundamendalist Cleansing, and Founding Director of World Prout Assembly.