U.S. district judge Shira Scheindlin granted class-action certification to a stop-and-frisk lawsuit against the city of New York, Police Commissioner Raymond Kelly, and Mayor Michael Bloomberg. The plaintiffs allege that the NYPD’s stop-and-frisk policy regularly violates the Constitution by illegally stopping and searching scores of people belonging to a particular demographic — black and Latino. Pending the city’s appeal, the class-action ruling will put stop-and-frisk on trial.

Plaintiffs in Floyd et al. vs City of New York also argue that they were stopped by police who did not have the legally necessary “reasonable suspicion” that they had committed or were going to commit a crime. What’s more, the suit alleges, police often performed frisks, but not because they saw a bulge they suspected to be a weapon, another legal requirement.

In her written decision, Scheindlin said the alleged constitutional violations result not from the actions of rogue officers, but from a policy handed down from the very top. “The stop-and-frisk program is centralized and hierarchical,” said Scheindlin. “Those stops were made pursuant to a policy that is designed, implemented and monitored by the NYPD’s administration.”

Scheindlin’s ruling cites “overwhelming evidence” — a spike in stop-and-frisks and the NYPD’s own words — indicating that at the “highest levels of the department” police are enforcing a policy that leaves behind a trail of daily injustices.

For years, Mayor Bloomberg and Police Commissioner Kelly have used distortions and misinformation to promote and justify a policy that violates the constitutional rights of those who were stopped. Now, the Scheindlin findings have exposed the NYPD game for what it is, an illegal system of quotas and racial profiling imposed on field police from the top of the NYPD.

“Suspicionless stops should never occur,” Scheindlin wrote in her decision, adding that, “Defendants’ cavalier attitude towards the prospect of a ‘widespread practice of suspicionless stops’ displays a deeply troubling apathy towards New Yorkers’ most fundamental constitutional rights.” Stop-and-frisk, which the data shows is a form of racial profiling, violates not only the Fourth Amendment — protection from unreasonable searches — but also the 14th Amendment, which includes the equal protection clause, the plaintiffs charge.

The Scheindlin decision was informative and comprehensive, including a number of important facts and observations. Here are eight important points from the decision.

1. Soaring numbers. The rate of stops has grown exponentially under the Bloomberg administration. Scheindlin’s ruling notes that police conducted 2.8 million documented stops of people between 2004 and 2009, about half of whom were frisked. In contrast, in 1998, Scheindlin explains, NYPD officers made roughly 150,000 stops per year. In 2004 alone, officers recorded more than 313,000 stops, “and since then the number has increased every year except 2007, rising to over 684,000 in 2011.” Scheindlin cites the large increase as evidence of a centralized policy change.

2. No reasonable suspicion. Reasonable suspicion that a person is involved in a crime is necessary for a legal stop. Eighty-eight percent of those stopped, however, are not charged with any crime. As Scheindlin noted, the data shows that “according to their own records and judgment, officers’ ‘suspicions’ were wrong nearly nine times out of ten.”

3. Imaginary bulges. Officers’ suspicions were similarly unsubstantiated when reportedly searching for guns. A “suspicious bulge” was cited as a reason for about 10 percent of all stops, but guns were seized in less than 1 percent. “For every 69 stops that police officers justified specifically on the basis of a suspicious bulge, they found one gun,” the decision notes.

4. Stops for no reason. The absence of a legally necessary, interpretable “suspected crime” cited on official forms grew from 1.1 percent in 2004 to 35.9 percent (more than 200,000 reported stops) in 2009. During those years, “Overall, in more than half a million documented stops — 18.4 percent of the total — officers listed no coherent suspected crime,” Scheindlin wrote, meaning they either ignored the section altogether or did not cite suspected behavior that is indeed illegal.

5. Unlawful stops. Scheindlin writes, “According to their own explanations for their actions, NYPD officers conducted at least 170,000 unlawful stops between 2004 and 2009.” Stops based on nothing more than “furtive movement” or a “high-crime area” were the justifications of at least 100,000 stops, but as Scheindlin says, are illegal due to the Fourth Amendment law protecting Americans from unreasonable search.

6. Racial profiling. The NYPD’s stop-and-frisk program targets blacks and Latinos because of their skin color. Scheindlin admitted the testimony of Columbia University professor Jeffrey Fagan, who found that police stopped blacks and Latinos far more than white residents. Isolated from other factors like crime rates and neighborhood racial composition, racial disparity from racial targeting was statistically significant, strongly underscoring that skin color is the essential factor in determining who gets stopped and throwing weight behind allegations of 14th Amendment violations. Fagan’s research also found that “the search for weapons is (a) unrelated to crime, (b) takes place primarily where weapons offenses are less frequent than other crimes, and (c) is targeted at places where the black and Hispanic populations are highest.” Cops are more likely to list no suspected crime category, or what Scheindlin called “an incoherent one,” like “furtive movements,” when stopping blacks and Latinos than when stopping whites. They also are more likely to use force against people of color.

7. NYPD illegal quotas. Scheindlin links the rising number of stops and the targeting of black and Latinos to NYPD quotas and to Commissioner Kelly’s own admission that the NYPD has a quota policy, albeit disguised. In a recent operations order, Commissioner Kelly explained departmental policy under the euphemism “performance goal.” Kelly said in the order, “Department managers can and must set performance goals,” for “the issuance of summonses, the stopping and questioning of suspicious individuals, and the arrests of criminals.”

The order also explains a weekly review during which a sergeant compares each officer’s monthly “activity” with the “daily assignment,” whereby police who “do not demonstrate activities” — or keep their numbers up — “will be evaluated accordingly and their assignments re-assessed.” In other words, there will be consequences for officers who don’t meet quotas, even though New York labor law says penalizing cops for failing to meet quotas is illegal.

Former NYPD officers turned whistleblowers Adhyl Polanco and Adrian Schoolcraft have collected evidence documenting NYPD quotas in practice. From 2008 to 2009, Polanco, from the 41st Precinct, and Schoolcraft, from the 81st, recorded roll calls revealing supervisors’ and other high-ranking officers’ enforcement of quotas. In Scheindlin’s own words, Schoolcraft’s audio files expose supervisors “repeatedly telling officers to conduct unlawful stops and arrests and explaining that the instructions for higher performance numbers are coming down the chain of command.”

Similarly, Polanco testified that “his commanding officers announced specific quotas for arrests and summons (quotas that rose dramatically between early 2008 and 2009) and for UF-250s” (a term for the forms used in stops), said Scheindlin, “and threatened overtime and undesirable assignments for those who failed to meet them.”

8. Repeat performances. According to the NYCLU, in 2011 the NYPD stopped more young, black men than live in New York; that is, some individuals are stopped and frisked repeatedly. To protect their rights, plaintiffs are seeking “systemic relief” — an end to the unconstitutional practice of stop-and-frisk.

Kristen Gwynne covers drugs at AlterNet. She graduated from New York University with a degree in journalism and psychology.

After the controversy around Florida’s “Stand Your Ground” law and the shooting of Trayvon Martin, ALEC said it was backing off such bills to focus on “business-friendly” legislation, but its business-friendly work does plenty of damage, too. ALEC pushes deregulation, union-busting, privatization, and tax loopholes for big businesses, allowing corporations like AT&T, Koch Industries, and Verizon to essentially write the laws that regulate them.

ALEC-backed telecommunications deregulation bills hit New York, New Jersey, and Connecticut recently, in a one-two-three punch combination designed as a quick knockout blow that consumers and workers would be powerless to fight. But a coalition, including the Communications Workers of America (CWA), the Working Families party, and the AARP, managed to stop the bills, which would’ve resulted in cost hikes, lost jobs, and service cut-offs for “less profitable” customers — disproportionately senior, rural, or low-income customers who use basic phone service.

“We’re up against quite literally armies of lobbyists from the phone companies,” Matt Wood, a policy expert with Free Press, told AlterNet. “That’s the thing about ALEC and their approach, they can push things in so many different states at once, if not with no coverage, certainly with less coverage on the national level.”

Deregulating and Denying Service

Telecom policy is an area in which legislators very often don’t have a lot of expertise and are vulnerable to talk of fancy new technologies — and to big money. Politicians from both parties love to boast of their investment in high-tech, after all, and so when lobbyists are telling them about their fancy new service, throwing around terms like VoIP (Voice over IP, essentially phone service over the Internet, which is what you have if you get your home phone through your cable company or Verizon FIOS), it’s easy enough to convince even those politicians who aren’t predisposed to deregulating everything in sight. Yet deregulating the fancy new technology has an impact even on those who use traditional services.

“Some company comes to you and says this is going to be great for investment. Exactly what will they be investing in?” Bob Master, political and legislative director at CWA District 1, asked. “Being deeply familiar with the industry, there’s no job-creating investment that’s happening in telecommunications. It’s all job-destroying investment. Verizon is contracting out, outsourcing our work, offshoring our work, trying to do everything wirelessly. That’s where the investment is going and no wires means no workers.”

But it’s not just jobs that the telecoms would like to eliminate — it’s service to people who don’t choose to use the fancier products or can’t afford expensive service, or maybe who live in a rural area. In Connecticut and New Jersey, the deregulation plan would have eliminated “carrier of last resort” protections, which require them to provide service to anyone who reasonably requests it in their coverage area. Matt Wood explained, “Phone companies have always had special rights and privileges granted by the state, so they’ve been expected to provide service to everybody. They have taken the true statement that ‘broadband service is different’ to extremes and said that it is so different that you shouldn’t regulate it at all.”

When it comes to VoIP, for instance, Wood pointed out that what sounds like an arcane technology is actually commonplace these days — and the claim that it’s too new to regulate actually just gives companies like AT&T and Verizon an excuse to deregulate their whole network. “That takes away a a lot of protections on services, the reliability of the network,” he said.

And Lindsay Farrell of the Connecticut Working Families Party noted, “To give [telecoms] the ability to say ‘This part of the state isn’t as profitable, we don’t want to serve them, we want to serve people here where they can afford higher rates,’ that leaves a lot of people in silence.”

As always, with ALEC, the narrative behind the push for deregulation is that competition among phone service providers will keep the industry honest and result in benefits for consumers — but like all tall tales about the invisible hand of the marketplace, this one doesn’t come true. “We also look to the results,” Wood said. “Say you do have two, three, four, six competitors, is that resulting in lower prices? No. They’re not competing on price; they compete on the device or other bells and whistles but don’t really feel the need to compete on price.”

Instead, according to a report issued by the nonpartisan think tank Demos [PDF], the bill (specifically in Connecticut, though you can see from the original model bill at ALEC Exposed that they’re all much the same) would send phone rates through the roof, as well as destroy consumer protections and transparency in the industry, preemptively deregulate VoIP as more companies are beginning to use the technology, and of course, let corporations who directly benefit from deregulation write the laws regulating them.

Yet politicians continue to push for deregulation that would hurt their own constituents. Master noted that in New York, it only took a little bit of spending to get normally progressive legislators backing the telecoms’ pet plan. “In what way would the low-income people you represent benefit from this?” he asked.

Stalling the Deregulation Agenda

“We believe that to the extent that phone companies are required by regulation to provide good service on a universal basis, it’s good for the consumer and the workers,” Master said, and so when CWA got wind of a deregulation bill in New Jersey in 2011, they moved quickly.

The bill, titled the “Market Competition and Consumer Choice Act” (you can’t make this stuff up ) swept through the state assembly in short order, passing 66-7. CWA, the AARP, and other allies put together a campaign, including a website “Don’t Hang Up on New Jersey” and calls with AARP members — they managed to generate about 20,000 phone calls in two weeks, and even New Jersey’s famously right-wing, blustering governor Chris Christie (who has a pattern of supporting ALEC’s pet causes himself) took notice. On a conference call, he told 17,000 AARP members that he had “grave concerns” about the bill. From there, they were able to change enough legislators’ minds to keep the bill from moving.

But it’s not just Republicans who like deregulation and are vulnerable to some well-placed donations. New York’s Democratic governor Andrew Cuomo, who values his reputation as a reformer, has also taken a lot of money from telecom companies over his political career. In his race for governor, Cablevision was Cuomo’s top contributor, kicking in $125,600 to his campaign, along with $38,800 from Time Warner — part of $250,516 overall from the industry.

So when VoIP deregulation made it into the governor’s budget, it shouldn’t have been that surprising. Phone companies and cable companies, who both provide broadband internet service and VoIP service, were working together, pressing for New York State to give up its right to regulate VoIP in the future.

“I think there is in the Cuomo administration an inclination to do things that they believe will help to improve the business climate,” Master said. “In this case it was pretty glaring that there’s a lack of awareness or understanding of what the impact on the consumer might be.”

Pressure from a similar coalition, including CWA and the AARP, as well as the Working Families party, got the language dropped from the budget, but not before they noticed legislators whose constituents would clearly be harmed by the policy taking the side of the big telecoms, which Master noted are very powerful in Albany. The state senate subsequently passed deregulation as stand-alone legislation, but so far it hasn’t moved in the assembly. “We’re being vigilant,” Master said.

But just when one bill dies, another appears. In the beginning of April, SB 447 appeared in Connecticut — another bit of deregulation, based on ALEC model legislation. ALEC’s co-chair in Connecticut is John Emra, Executive Director of External Affairs for AT&T’s Connecticut operations.

One of the upsides, though, to these model bills being pushed in multiple states is that organizers know what worked and who is willing to join the fight. Again, CWA, AARP, and the Working Families Party led the charge, but this time the coalition included groups like the Sierra Club, motivated by a provision in the bill that would allow cell phone towers to be placed in public parks.

Farrell noted that as they knocked on doors and made phone calls about the bill in Connecticut, they found people already wary of companies like AT&T. After Hurricane Irene and this fall’s series of storms, utility companies and phone and cable companies took several days to restore service, leading to hearings by the state legislature. Canvassers found that citizens didn’t trust utilities to take care of them, and understood the need for regulations to hold them accountable.

The ALEC connection helped in New York and Connecticut — in New York, radio advertising linked telecom deregulation to ALEC, and Farrell noticed a difference with legislators as ALEC’s activities were held up to public scrutiny. But, she said, the broad coalition that defeated the bill wasn’t solely motivated by beating ALEC. “AARP doesn’t care about the ALEC aspect,” she said. “They’re just worried about seniors who don’t use VoIP, who don’t have cell phones that they use frequently or at all, being cut off.”

The biggest lesson, perhaps, from the deregulation fights in these states is that organized people can, in fact, beat big money — that a ground campaign involving phone calls and door-to-door canvassing can actually motivate everyday people to take action on an issue that seems complex and hard to understand. Whether people had heard of ALEC and understand that there’s an institution pushing for laws that will benefit big corporations and hurt workers and consumers, or whether they were just tired of watching their phone and cable bills creep upward each month and of having to pay for services they didn’t need just to get a basic phone line, people didn’t want corporate utilities without government oversight.

Corporations can and will spend millions on lobbyists, blanketing statehouses and capitol buildings with their paid advocates, but in this case, it wasn’t enough. Farrell is awaiting information on how much was spent lobbying in Connecticut, to compare with what the coalition was able to accomplish for a fraction of the cost.

Still, ALEC and its corporate backers aren’t going to give up easily — AT&T and Verizon, Time Warner and Cablevision, and many others still want deregulation and are willing to pay for it. The bills in the three states have stalled, but the fight is on in California right now. Master noted, “These people have infinitely deep pockets and they never stop.”

Power for the People

The central idea is simple: people join together through some form of public, community or employee-owned business to meet local needs and thereby regain a measure of local economic democracy and control. Partly self-help, partly community mobilization, and partly sketches for future system-wide expansion, community wealth-building efforts can be found in virtually every region of the country. The range of efforts is vast. Community wealth-building institutions include community development corporations, community development financial institutions, social enterprises, community land trusts, employee-owned enterprises, and cooperatives. All pool capital in ways that create new jobs and anchor jobs in communities.

The efforts also define a new approach to challenging corporate power— a strategy that changes who owns, controls and benefits from the underlying economic wealth of the system. It involves not merely replacing private capital, but displacing it through developing community ownership of business. In other words, profits should flow to workers, consumers or the community—rather than outside investors. And these businesses need to succeed! Increasingly, too, ecological concerns are structured into the very core of many models.

Transformation Everywhere

Examples of the new approach are evident around the world, including worker-cooperatives in Argentina; the Grameen Bank of Bangladesh (which, with its founder, Muhammad Yunus, won the 2006 Nobel Peace Prize); and the Mondragón cooperative network in northern Spain, which employs nearly 85,000.

Non-profit social enterprise is a community wealth building strategy through which nonprofits independently secure resources to meet their missions in the absence of adequate government support. In San Francisco, a group known as REDF (formerly the Roberts Enterprise Development Fund) has helped boost the business activity of 50 social enterprises that have employed 6,500 people and earned revenues of more than $115 million. Three-fourths (77 percent) of social enterprise employees interviewed two years later were still working. Average employee wages had increased by nearly one-third (31 percent) and monthly incomes had almost doubled (90 percent). One of the enterprises in REDF’s portfolio is Buckelew Programs, a mental health agency with 220 employees that provides a continuum of services to roughly 7,000 clients each year and operates three social enterprises, including a green café and a green cleaning service, as well as a staffing service. This year, it intends to open a fourth social enterprise, a fresh-cut produce processing business.

In Grayland, Washington, Coastal Community Action—a nonprofit agency that operates a range of housing, food, healthcare, and employment programs—has built a 6 MW wind farm consisting of four wind turbines. The wind farm, which sells energy to the electrical grid, generates enough power to satisfy the energy needs of more than 1,500 households. The nonprofit estimates that its ownership of the $14-million wind turbine project generates $720,000 in unrestricted income each year, enabling it to increase service delivery options, lessen its local dependence on outside funding, and supplement the community’s ongoing projects and to meet more of the community’s needs.

In Seattle, Pioneer Human Services, founded in 1963, offers drug- and alcohol-free housing, employment, job training, counseling, and education to recovering alcoholics and drug addicts. It employs a total of 1,000 people and finances 99 percent of its $70 million budget through fees for services and earnings generated in the manufacture, distribution and sale of products. Businesses include retail cafés, sheet metal fabrication, aerospace precision machining (it’s a contractor for Boeing), wholesale food distribution, and contract packaging. Not only do these enterprises build community wealth and provide independent resources that finance social services, the businesses themselves are central to Pioneer’s mission of helping “people on the margins of society” stay out of prison and off the streets, enabling Pioneer to employ more than 700 men and women drawn from the ex-offender, homeless and drug-recovery populations it serves.

Community development corporations (CDCs), formed initially in the 1960s in a crucible of urban riots and rural neglect, now perform important community wealth-building and planning roles in cities and counties across the United States. CDCs can be found in virtually every major city. A Massachusetts study found that between 2003 and 2011, Massachusetts-based CDCs created or preserved over 9,000 homes and 14,000 jobs, while supporting more than 8,000 businesses and 160,000 families, generating nearly $2 billion of economic activity. A 2005 survey found that nationwide an estimated 4,600 CDCs help create 75,000 jobs per year.

Community development financial institutions (CDFIs), first given federal recognition in the 1990s, have the explicit aim of building wealth in low-income communities through providing financing where conventional lenders fear to tread. Even in the face of contracting conventional finance, assets in community investing institutions rose more than 60 percent–from $25.0 billion in 2007 to $41.7 billion–in 2010. In 2008 alone, credit unions financed and assisted businesses and microenterprises that created or maintained 35,624 jobs, financed the construction or renovation of 60,205 units of affordable housing, and provided 16,405 responsible mortgages to first-time and other homebuyers.

Community land trusts provide still another powerful illustration of community wealth building. Beginning in the 1960s and 1970s, pioneers like Bob Swann in western Massachusetts and Charles Sherrod in Georgia struggled against huge odds to develop modest land trusts efforts, often also involving other concerns, like respect for environmentally sound land use practices and rural community development. Today hundreds exist; in Irvine, California, the city’s strategic plan calls for 5,000 units of housing to be developed using land trust strategies.

Trusts of this kind keep the ownership of land underlying housing in non-profit or public ownership. Appreciation in land values is split via a formula between the homeowner and the trust, thereby avoiding gentrification. A study of a community land trust in Burlington, Vermont — the nation’s largest — also found that during its first two decades, 61.9 percent of residents who sold their land trust home after an average residency of six years were able to “step up” to traditional homeownership. Meanwhile the equity gain that the trust retains enables it to continue providing affordable housing to future generations. In a down market, community land trusts are even more important. Simply put, community land trusts keep people in their homes. A 2011 study found that land trust homeowners were 10 times less likely to be in foreclosure proceedings than conventional homeowners.

Employee ownership is another powerful community wealth-building strategy. The National Center on Employee Ownership (NCEO) estimates that in 2009 there were 9,800 companies owned in whole or part by workers through their pension contributions through a form of ownership known as an employee stock ownership plan or ESOP. As of 2009, there are 10.3 million employee-owners of companies own in whole or part by ESOPs, with net assets of $869 billion. In other words, the average ESOP employee-owner has an ownership stake of over $84,000. NCEO estimates that since 2009 the number of ESOPs has climbed over 10 percent to 10,900 companies.

Employee ownership also has powerful economic stabilizing effects: between 2000 and 2008, while the number of manufacturing jobs fell 29 percent in the state of Ohio, employee-owned manufacturing jobs held steady, dropping only 1 percent. Nationally, in 2010, 12.1 percent of all workers—nearly one in eight—had faced a lay-off in the previous 12 months; by contrast, only 2.6 percent of workers who were employee-owners were laid off.

Sharing the Wealth

Perhaps the most visible form of a community wealth building is the cooperative. More than 130 million Americans are currently members of a co-op or credit union. Because many Americans own shares in more than one co-op or credit union, the total number of co-op memberships in the United States exceeds 350 million. Overall, a 2009 University of Wisconsin study found that nearly 30,000 cooperatives in the U.S. account for more than $3 trillion in assets, $514 billion in total annual revenue, and provide 856,000 jobs.

Credit unions are governed by the core cooperative principle of one-member, one-vote. Importantly, they make their loans directly to their members – member-owners of credit unions can be confident that their deposits will be reemployed productively through loans that help finance local consumer purchases, create jobs and build wealth at home.

Another powerful community wealth-building mechanism is the state-owned bank. In North Dakota, a state-owned bank has operated since 1918, earning the state more than $300 million over the past decade, while helping support local banks and local community investment. Legislation exploring or creating such banks has been introduced this past year in more than a dozen states, including Arizona, California, Hawaii, Illinois, Louisiana, Maine, Maryland, Massachusetts, Montana, New Mexico, New York, Oregon, Virginia, and Washington.

As experience with the various democratized forms has become increasingly enriched over time, innovative strategies of collaboration among enterprises and/or with local governments have also begun to emerge. In California, a comprehensive, community-owned development project consciously links individual and collective wealth building in the diverse working-class Diamond neighborhood in southeast San Diego. With the support of the Jacobs Family Foundation, the community raised philanthropic and government funding to develop a commercial and cultural complex, anchored by a shopping center. A key element was the community public offering, which provided community residents and employees an exclusive opportunity to buy shares (valued at $200 and capped at $10,000) for a total 20 percent ownership stake in the project. As one community owner noted, “That we own stock, and that we have an opportunity to make a difference in what type of business goes in the community [is unbelievable]. We have some say-so in the community environment.”

The Neighborhood Unity Foundation also has a 20 percent ownership share that provides it with a sustainable source of funding for its community wealth building efforts. The Jacobs Family Foundation, which retains 60 percent ownership, intends to turn over its share to community owners by 2018. Ultimately, area residents will own 50 percent of the project and the neighborhood foundation the other 50 percent, retaining the profits generated to benefit the community rather than outside investors.

In Cleveland, Ohio, an integrated group of worker-owned companies, supported in part by the directed purchasing power of large hospitals and universities, has opened a major new vector of urban strategy. The first of Cleveland’s planned network of cooperatives opened its doors for business in September 2009. The co-op industrial scale laundry is a state-of-the-art, ecologically green, commercial facility capable of handling 10 million pounds of healthcare linen a year. Its sophisticated business plan provides all employee-owners a living wage and health benefits. If current projections are realized after seven years on the job each employee will have a $65,000 equity stake in the enterprise.

In October 2009 a second employee-owned, community-based energy company began large-scale installations of solar panels for the city’s largest nonprofit health, education and municipal buildings. (Additionally, it provides home weatherization services.) A third business scheduled to start operations this year is a year-round hydroponic food production greenhouse capable of producing three million head of lettuce and approximately 300,000 pounds of basil and other herbs a year.

More to Come

Many other enterprises are in the planning stage. Cleveland mayor Frank Jackson praised the co-ops for being “a model for how we can put our people back to work and rebuild our community.” A growing number of economic development officials, tired of chasing corporations with public subsidy dollars, like the idea of creating anchored, community-owned enterprises that won’t get up and move. Already, the Cleveland co-ops have inspired efforts in other cities to develop similar networks, including Amarillo, Texas; Atlanta, Georgia; Pittsburgh, Pennsylvania; and Washington, DC.

Community wealth-building strategies offer powerful possibilities for longer-term change. First, in most instances, the new wealth-democratizing approaches provide responses (or suggestive directions of response) to economic dislocation and social pain where traditional political approaches have failed. Second, in many instances, they involve quite unusual local alliances, frequently including small business and religious leader support. Third, often the institutional trajectories have also begun to define (and secure) new supportive measures from local, state and national policy makers, thereby also beginning to define new directions for potential ongoing and more expansive policy and political action. Finally, that they are based in local, everyday experience may also lead to changes in the foundations of political and democratic cultural development over time.

Together the above suggest a long, slow developmental arc left in the wake of the failure of conventional politics and economics. And already, a growing number of Occupy activists are looking to worker-owned cooperatives as a way to self-fund the movement, displace corporate economic space, and develop an economic base that can support alternative economic and political formations. The path to building a truly democratic economy may be long, but the growing base of community wealth building institutions provide some building blocks that, over time, suggests the quiet development, potentially, of the basis for a community-sustaining economy that serves the interest of all Americans, rather than our current system which disproportionately benefits the wealthiest at the expense of the 99 percent.

Steve Dubb is research director of the Democracy Collaborative at the University of Maryland.

Today, the massive too-big-to-fail banks are hardly doing George Bailey-style loans at all. They are not interested in community lending. They are doing their own proprietary trading—trading for their own accounts—which generally means speculating against local interests. They engage in high-frequency program trading that creams profits off the top-of-stock market trades; speculation in commodities that drives up commodity prices; leveraged buyouts with borrowed money that can result in mass layoffs and factory closures; and investment in foreign companies that compete against our local companies.

We can’t do much to stop them. They’ve got the power, especially at the federal level. But we can quietly set up an alternative model, and that’s what is happening on various local fronts.

Most visible are the Move Your Money and Occupy Wall Street movements. According to the Web site of the Move Your Money campaign, an estimated 10 million accounts have left the largest banks since 2010. Credit unions have enjoyed a surge in business as a result. The Credit Union National Association reported that in 2012, for the first time ever, credit union assets rose above $1 trillion. Credit unions are non-profit, community-minded organizations with fewer fees and less fine print than the big risk-taking banks, and their patrons are not just customers but owners, sharing partnership in a cooperative business.

Move “Our” Money: The Public Bank Movement

The Move Your Money campaign has been wildly successful in mobilizing people and raising awareness of the issues, but it has not made much of a dent in the reserves of Wall Street banks, which already had $1.6 trillion sitting in reserve accounts as a result of the Fed’s second round of quantitative easing in 2010. What might make a louder statement would be for local governments to divest their funds from Wall Street, and some local governments are now doing this. Local governments collectively have well over a trillion dollars deposited in Wall Street banks.

A major problem with the divestment process is finding local banks large enough to take the deposits. One proposed solution is for states, counties and cities to establish their own banks, capitalized with their own rainy day funds and funded with their own revenues as a deposit base.

Today only one state actually does this: North Dakota. North Dakota is also the only state to have escaped the credit crisis of 2008, sporting a sizeable budget surplus every year since. It has the lowest unemployment rate in the country, the lowest default rate on credit card debt, and no state government debt at all. The Bank of North Dakota (BND) has an excellent credit rating and returns a hefty dividend to the state every year.

The BND model hasn’t yet been duplicated in other states, but a movement is afoot. Since 2010, 18 states have introduced legislation of one sort or another for a state-owned bank.

Values-based Banking: Too Sustainable to Fail

Meanwhile, there is a strong movement at the local level for sustainable, “values-based” banking—conventional banks committed to responsible lending and service to the local community. These are George Bailey-style banks, which base their decisions first and foremost on the needs of people and the environment.

One of the leaders internationally is Triodos Bank, which has local offices in the Netherlands, Belgium, the United Kingdom, Spain, and Germany. Its Web site says that it makes socially responsible investments that are selected according to strict sustainability criteria and overseen by an international panel of “stakeholder” representatives representing various community, environmental, and worker interest groups. Investments include the financing of more than 1,000 organic and sustainable food production projects, more than 300 renewable energy projects, 33 fair trade agricultural exporters in 22 different countries, 85 microfinance institutions in 43 countries, and 398 cultural and arts projects.

Two U.S. banks exemplifying the model are One PacificCoast Bank and New Resource Bank. Operating in California, Oregon and Washington, One PacificCoast is comprised of a sustainable community development bank with around $300 million in assets and a non-profit foundation (One PacificCoast Foundation). Its commercial lending business focuses on such sectors as specialty agriculture, renewable energy, green building, and low-income housing. Foundation activities include programs to “help eliminate discrimination, encourage affordable housing, alleviate economic distress, stimulate community development and increase financial literacy.”

New Resource Bank is a California based B-corporation (“Benefit”) with $171 million in assets, which focuses its lending and banking services on local green and sustainable businesses. New Resource was recognized in 2012 as one of the “Best for the World” businesses, being in the top 10 percent of all certified B-Corporations and scoring more than 50 percent higher than 2,000 other sustainable businesses in overall positive social and environmental impact.

All this might be good for the world, but isn’t investing locally in a values-based bank riskier and less profitable than putting your money on Wall Street? Not according to a study commissioned by the Global Alliance for Banking on Values (GABV). The 2012 study compared the financial profiles between 2007 and 2010 of 17 values-based banks with 27 Globally Systemically Important Financial Institutions (GSIFIs)—basically the too-big-to-fail banks, including Bank of America, JPMorgan, Barclays, Citicorp and Deutsche Bank. According to the GABV report, values-based banks delivered higher financial returns than some of the world’s largest financial institutions, with a return on assets averaging above 0.50 percent, compared to just 0.33 percent for the GSIFIs; and returns on equity averaging 7.1 percent, compared to 6.6 percent for the GSIFIs. They appeared to be stronger financially, with both higher levels of and better quality capital; and they were twice as likely to invest their assets in loans.

CDFIs

Along with the values-based banks, community investment is undertaken in the United States by Community Development Financial Institutions (CDFIs), including community development banks, community development credit unions, community development loan funds, community development venture capital funds, and microenterprise loan funds. According to the CDFI Coalition, there are over 800 CDFIs certified by the CDFI Fund, operating in every state in the nation and the District of Columbia. In 2008 (the last year for which a report is available), CDFIs invested $5.53 billion “to create economic opportunity in the form of new jobs, affordable housing units, community facilities, and financial services for low-income citizens.”

Two of many interesting examples are the Alternatives Federal Credit Union and Boston Community Capital. Alternatives FCU, located in Ithaca, New York, is committed to community development and social change and is part of the Alternatives Group, which includes a non-profit corporation (Alternatives Community Ventures); a 40-year old trade association of community groups, cooperatives, worker-owned businesses and individuals (Alternatives Fund); and a not-for-profit organization that facilitates secondary capital investment in the credit union (Tomkins County Friends of Alternatives, Inc.). The credit union has over $70 million in assets and offers many innovative financial products, including individual development accounts—special savings accounts for low-income residents that offer matching deposits of two to one up to a certain amount—in addition to more traditional services such as loans for minority and women-owned businesses, and affordable mortgages. The credit union also offers small business development (classes, seminars, consultation, and networking programs), free tax preparation, and a student credit union.

Although its lending programs focus on lower-income borrowers, Alternatives FCU has had lower delinquency and charge-off rates than many major banks that avoid these types of customers. Boston Community Capital (BCC) is a CDFI that is not actually a bank but invests in projects that provide affordable housing and jobs in lower-income neighborhoods. BCC includes a loan fund, a venture fund, a mortgage lender, a real estate consultation organization, a solar energy fund, and a federal New Markets Tax Credit investment vehicle. Since 1985, it has invested over $700 million in local organizations and businesses. These funds have helped build or preserve more than 12,800 affordable housing units, as well as child care facilities for almost 9,000 children and healthcare facilities that reach 56,000 people. Their investments have helped renovate 850,000 square feet of commercial real estate, generate 5.9 million KW hours of solar energy capacity, and create more than 1,500 jobs.

Less Money for Banks and More for Workers: The Models of Germany and Japan

Values-based banks and CDFIs are a move in the right direction, but their market share in the U.S. remains small. To see the possibilities of a banking system with a mandate to serve the public, we need to look abroad.

Germany and Japan are export powerhouses, in second and third place globally for net exports. (The U.S. trails at 192nd.) One competitive advantage for both of these countries is that their companies have ready access to low-cost funding from cooperatively owned banks.

In Germany, about half the total assets of the banking system are in the public sector, while another substantial chunk is in cooperative savings banks. Germany’s strong public banking system includes 11 regional public banks (Landesbanken) and thousands of municipally owned savings banks (Sparkassen). After the Second World War, it was the publicly owned Landesbanks that helped family-run provincial companies get a foothold in world markets. The Landesbanks are key tools of German industrial policy, specializing in loans to the Mittelstand, the small-to-medium size businesses that drive the country’s export engine.

Because of the Landesbanks, small firms in Germany have as much access to capital as large firms. Workers in the small business sector earn the same wages as those in big corporations, have the same skills and training, and are just as productive. In January 2011, the net value of Germany’s exports over its imports was 7 percent of GDP, the highest of any nation. But it hasn’t had to outsource its labor force to get that result. The average hourly compensation (wages plus benefits) of German manufacturing workers is $48—a full 50 percent more than the $32 hourly average for their American counterparts.

In Japan, the banks are principally owned not by shareholders but by other companies in the same keiretsu or industrial group, in a circular arrangement in which the companies basically own each other. Even when there are nominal outside owners, corporations are managed so that the bulk of the wealth generated by the corporation flows either to the workers as income or to investment in the company, making the workers and the company the beneficial owners.

Since the 1980s, U.S. companies have focused on maximizing short-term profits at the expense of workers and longer-term goals. This trend stems in part from the fact that they are now funded largely by capital from shareholders who own the company and want simply to grow their returns. According to a 2005 report from the Center for European Policy Studies in Brussels, equity financing is more than twice as important in the U.S. as in Europe, accounting for 116 percent of GDP compared with 62 percent in Japan and 54 percent in the eurozone countries. In both Europe and Japan, the majority of corporate funding comes not from investors but from borrowing, either from banks or from the bond market.

Funding with low-interest loans from cooperatively owned banks leaves greater control of the company in the hands of employees who either own it or have much more say in its operation. Access to low-interest loans can also slash production costs. According to German researcher Margrit Kennedy, when interest charges are added up at every level of production, 40 percent of the cost of goods, on average, comes from interest.

Globally, the burgeoning movement for local, cooperatively owned and community-oriented banks is blazing the trail toward a new, sustainable form of banking. The results may not yet qualify as the Golden Age prophesied by Hindu cosmology, but they are a major step in that direction.

Ellen Brown is an attorney, author, and president of the Public Banking Institute. Her latest book is Web of Debt.

From coast to coast, the incidents are as heartbreaking as they are shocking:

• In Brooklyn, NY, G.R., a 5-year-old autistic student, was traumatized when police were called to his school because he was having a temper tantrum. He was physically removed from the school by police and strapped to a stretcher, and when his family members tried to advocate for him, they were allegedly handcuffed. His grandmother’s ribs were broken in the altercation.
• In Albuquerque, a 7-year-old with autism was handcuffed by police officers called to restrain him. His “offenses” included calling other children names, knocking over chairs, spitting, and shooting rubber bands at a police officer.
• Tony Smith, a disabled student suing the Atlanta Police Department and his former school district, claims he was handcuffed to a filing cabinet for seven hours when the school investigated a crime that had taken place on campus. The officers involved, his suit argues, violated department policy and his civil rights.
• In 2010, autistic student Evelyn Towry made national headlines when she was arrested after becoming agitated because her teacher wouldn’t let her wear her favorite cow hoodie. Her Individualized Education Plan (IEP), which detailed her needs and how they should be met specifically, included a clause allowing the school to contact law enforcement in the event of disruptive behavior, though her parents report they neither saw nor approved the document.

Cases like these, of students trapped by school policies rarely designed to deal with the nuances of their diagnoses, are growing – and the situation is further clouded by race, class and social factors. These factors can determine what kinds of evaluations, interventions and treatments are provided to students with disabilities or suspected disabilities, and they ultimately decide whether children are able to successfully complete their educations or fall by the wayside.

Race, Disability, and Discipline in Public Schools

The increased use of law enforcement to deal with behavioral issues in schools gained heightened attention this year when Salecia Johnson, age 6, had a temper tantrum in her principal’s office and was handcuffed and detained by local police as a result. She was so traumatized by the experience that she has trouble sleeping at night – and she’s not the only one.

Such situations are growing extremely common across the United States, with school districts calling on police to handle routine disciplinary infractions rather than dealing with them on their own. Many have adopted harsh zero-tolerance policies, where infractions are handled with a one-size-fits-all model, regardless of age, ability or the larger context in which the infractions took place. These policies can effectively set some students on the path of what the Florida ACLU calls a school to prison pipeline – and, notably, many of the victims of this system, such as Salecia, are minorities.

Racial disparities when it comes to school discipline are well-established in the United States; students of color are twice as likely as their white peers to be subject to out-of-school suspensions, according to the Department of Education’s 2012 Civil Rights Data Collection. Yet often, there’s more to these cases than meets the eye, because many of the minority students who find themselves harshly penalized also happen to be students with disabilities, many of them undiagnosed.

Annie Linden is a former teacher who taught in districts primarily composed of low-income students of color, and she still participates in the preparation of Individualized Education Programs. In an interview with AlterNet, she noted that many of her former students showed signs of cognitive disabilities that went undiagnosed, sometimes due to parental fears about deportation or concerns that their children might be removed from school. The data suggest that these parents were right to be afraid: Students of color are already at a higher risk of expulsion, and disability can compound that risk.

Studies in individual states lend support to the critical importance of discussing race and disability together in the context of school discipline; this is particularly important given the considerable funding disparities between white and nonwhite children when it comes to disabilities like autism. Students of color are generally less likely to be diagnosed with disorders of these kinds, making it still harder to provide them with the support they need in educational settings.

When Disability Meets District Policy

Even without counting the many children with undiagnosed disabilities in schools today, we know that the overall number of disabled students in our public school system is on the rise. Increasingly, school districts are tasked with educating students with a wide range of intellectual, cognitive and emotional disabilities, rather than physical disabilities, as in prior decades. In theory, our ability to identify these disorders earlier than we could in the past should ensure that students get the support and access they need to succeed in school, including individualized education when it is appropriate. But in practice, the rise in disabled students is crunching school districts terribly, as funding for these students has not at all kept pace with the rise in diagnoses. As a result, many schools are now hard pressed to serve their students’ educational needs and deal with disciplinary issues.

As funding for special education drops and available staff members dwindle – and as disabled students with behavioral problems are increasingly mainstreamed in response to changing thinking on disability education – discipline is becoming a large problem in a growing number of mainstream classrooms. In response, some districts have decided to bring out the heavy guns for handling disruptions associated with disabled students; from outbursts in class to tantrums in the hall, the new go-to solution in many districts is to call the police.

In addition to calling on law enforcement, Disability Rights Oregon notes that there has been an uptick in the use of restraint and seclusion in schools, as well. The organization points out that these practices appear to disproportionately target disabled students and can be fatal in some cases.

Last month, 16-year-old Corey Foster died after police were called to restrain him. Though Foster’s disability status is unclear, he was attending a school for at-risk youth that included a number of students with disabilities, and his fellow students say restraint is a common disciplinary tactic.

In Jackson, Mississippi, students at an alternative school are routinely handcuffed for discipline infractions, and many of them have emotional or intellectual disabilities. Such treatment of disabled students is not uncommon; the Judge Rotenberg Center, for example, has been under media scrutiny for years due to practices like shocking autistic students. And a study on the use of restraint in Texas schools has indicated a looming “crisis in special education” as growing numbers of disabled students are restrained by their teachers, sometimes unsafely because these teachers had never been trained to perform such techniques appropriately. These cases involved school staff, not law enforcement, but they are part of a larger pattern of criminalizing disabled students that has been criticized by disability rights organizations.

In response to these reports, the National Disability Rights Network has called for an end to restraint and seclusion in US schools, and along with that comes a radical need to rethink the use of law enforcement in the management of disabled students. Police officers are typically not provided with specific training in working with disabled children, let alone handling the de-escalation of a situation where a disabled child is frightened and potentially reactive. As public safety officers, their primary professional goal is not to provide disciplinary support in schools except in special circumstances – and routine discipline is not a special circumstance.

Clearly, the use of police officers to assist with school discipline is out of proportion to the need, and yet it persists. Some school districts, such as Evelyn Towry’s, mandate a law enforcement provision in IEPs, which allows the school to call police officers to assist with discipline problems, often under a vague mandate that could involve anything from an episode of extreme violence to stubbornness in the classroom. Others districts may strongly advocate for it, or push for frequent review of disabled students to determine if such a clause should be added. Rather than focusing on handling behavior before it gets out of control, districts are handing their students over to third parties when the going gets rough – and disabled students are the ones paying the price for those decisions, often finding themselves suspended for extended periods of time over behavior they cannot be expected to control.

Teachers Struggling in Understaffed Environments

So why the push to outsource discipline? Blame austerity measures again, which, on top of poor disability funding, have hit a number of districts hard. That’s a recipe for frustration, and sometimes danger, when it comes to providing a safe and educational environment for disabled students. Teacher Alicia Maude Wein from Guildeland High School in New York explained to AlterNet via email how her classroom support had radically decreased:

[Before], it was me, a co-teacher with a literacy/special ed degree, and three additional adults providing support — 5 adults every day to the 18 kids. This year, after 2 rounds of deep budget cuts (in a relatively affluent suburban district), it’s just me.

Overwhelmed by conditions like this, teachers struggle to keep order, and Wein says she understands why districts might be tempted to turn to outside options:

I think similar circumstances (or worse) could be lending to the desperation that would sway some districts to call in outside supports like law enforcement (as grim, disrespectful and embarrassing as that notion is) when things get out of control in the classroom.

She noted that her district is generally supportive, promotes mainstreaming of disabled students, and works with students, staff and parents to create a productive environment, even under the stress of budget cuts. The same can’t be said of all districts, though, and in some cases the various pressures can create an explosive mixture: When staff without training for handling disabled students encounter autistic students mid-meltdown, for example, they may not know how to respond, and they could end up traumatizing students in an attempt to impose order.

This lack of teacher and staff training is a serious matter for both teachers and students; Wein herself pointed out that she’d taken just three credits in Special Education 15 years ago – and yet today she is faced with teaching and managing a classroom of disabled students. As the Michigan Education Association warns :

Because school personnel are not trained to work with children whose violent behavior stems from a disability and where the possibility of injury is discounted by the District, they daily face a situation they are ill-suited to handle without suffering injury, both physical and psychological.

Without the support they need to deal with disabled students and the training they need to effectively and humanely handle their behavior, there should be little surprise that so many teachers and administrators are allowing law enforcement to deal with these issues instead. But as Vicki Soloniuk, a pediatrician who works with disabled children and helps their parents to advocate on their behalf, pointed out in a conversation with AlterNet, the turn to these punitive measures can actually enflame a disabled student’s behavior rather than defuse it.

She explained that children with cognitive disabilities often have difficulty adjusting to new situations and strangers, so when an outside party like a police officer is called in, these children may experience extreme emotional distress. This can manifest in kicking, hitting and screaming – a fairly typical response among cognitively impaired children, but certainly unnerving if you have no training in dealing with such behavior.

“We tell our children to stay away from strangers,” Soloniuk said, “and then we don’t understand why they react poorly when the school calls in an outsider, someone a student has never met.” Like many school districts in the United States, the district Soloniuk works in responds to incidents like these by isolating the child involved, a mistake which can create even more behavioral problems. Soloniuk notes: ”The school hides a 7-year-old with autism alone in a classroom all day, and when they bring him out once a day, he starts flapping and stimming, because he sees all these kids around. So the school responds by saying, ‘He can’t handle it’ and locks him up again.”

She views such isolation as tantamount to torture and points out that it’s also ideally suited for creating further difficulties in the future because the student never has an opportunity to socialize. One way to address the issue, she says, is to get teachers and support staff fully trained; two working sessions a year, for instance, would allow everyone in a school to learn how to interact with disabled students so they can mainstream more successfully and be supported outside the special education classroom.

More Training, More Support Needed

After years of experience in the school system, Alicia Wein says she has come to feel comfortable with her disabled students, and she invests energy in interacting with them and their parents to learn more about their personalities and learning styles before entering the classroom. But not all teachers have this level of experience or the time required to give high-level individual focus to disabled students.

To begin to address these discrepancies, districts such as Wein’s are demanding that their teachers pursue more professional development, particularly when it comes to dealing with students with autism. Congress is also tackling the issue; lawmakers are currently pushing for better teacher training to help educators handle students with autism more effectively. Such training undoubtedly will be beneficial for both teachers and their students, but it certainly won’t solve the problem we’re facing entirely; even an experienced teacher with additional professional development can’t be expected to keep order all alone in a classroom of 12 students with severe disabilities.

Simply put, districts also need more trained staff on hand. Teachers handling mainstreamed classes require support to balance the needs of their disabled and nondisabled students and to make sure that every student is provided with the educational material and assistance he or she needs. Without staff support, students inevitably begin to fall through the cracks, and one consequence of that can be an increase in disruptive behavior. Overburdened instructors may fail to identify the warning signs of a tantrum or meltdown, for instance, making it difficult for them to intervene early on – before things have escalated beyond their capacity to deal with them. And even if they do spot a troubled student who needs more personalized attention, that level of engagement can often be impossible to provide in a classroom with 25 or more additional students vying for their attention. Trained staff can help mediate situations like these.

Another issue that came up again and again with educators who spoke to AlterNet was the impact of our increasing reliance on standardized testing to measure performance in the classroom. High-stakes testing creates a highly pressured environment for teachers, who are forced to focus on the tests rather than on their students’ learning needs – especially if the teachers don’t have tenure or secure positions in their districts. All students, regardless of disability status, suffer in this environment, where teachers are asked to view students not as individuals, but as aggregate test scores.

Bottom-up educational reform often focuses on teachers and blames them for the failures of the educational system. But this approach largely ignores the structural issues plaguing many districts as they fight for funding, cut student and staff services, and live in fear of the latest test results and what they mean for the school’s future. For students with disabilities, these issues are further complicated by the need to access a functional educational environment where they will be safe from harm and not at risk of run-ins with the police. In this educational landscape, it’s hard for disabled students to learn, let alone realize their full potential.

Poor training, funding cuts and increased pressure to teach to the test don’t add up to much for the most vulnerable students in our schools – or many of the other students, for that matter. “Sadly,” Vicki Soloniuk points out, “we don’t seem to care very much about our kids in this country.”

s.e. smith is a writer and editor whose work has appeared in Bitch, Feministe, Global Comment, the Sun Herald, the Guardian, and other publications. Follow smith on Twitter: @sesmithwrites.