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A Labor Aristocracy Exists, and It’s Evolving: A Reply to Charlie Post

Charlie Post argues there’s no such thing as a “labor aristocracy” in the United States. But there really is an upper layer of the working class, supported by a thousand kinds of “direct and indirect” benefits flowing from imperialism. Its starkest expression is a massive labor bureaucracy that’s becoming more integrated into the imperialist capitalist machine than ever before. If we’re going to build genuine socialist internationalism, we’re going to need a clear-eyed view of that layer and its developments.

Jason Koslowski

August 5, 2023
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Comrade Charlie Post, at a recent event and in a number of articles, has tried to dispel what he calls the “myth of the labor aristocracy.” The term comes from Lenin, who says countries like the U.S. have a layer of “labor aristocrats” supported by the benefits flowing from a very profitable imperialism. As a result, says Lenin, that upper layer is marked by chauvinist support for the ruling class of its “own” country. That’s how Lenin explained why unions and socialist parties flung their support behind the butchery of World War I.

That aristocracy doesn’t exist, Post argued at a recent event with the Denver Communists on the topic. He first mapped out this position in a pair of earlier articles, here and here, from 2006. Post’s arguments do something very important: they keep alive a key question for the U.S. left today, exploring the relationship between worker struggle in the U.S., the core of the global imperialist machine, and class struggle around the world.

But I deeply disagree with him. Here I’ll argue that comrade Post uses data about foreign investment that’s just too limited, and that throws his analysis off course from the very start. He then misses the existence of a U.S. “labor aristocracy” being supported by the benefits of imperialism. More than this, though, he overlooks how that layer’s starkest expression — the labor bureaucracy — has become more integrated into the imperialist machine than probably ever before. But in addition, I argue, we also have to see that capitalism has spawned a cousin of that aristocracy, one that shares both roots in the benefits of imperialism and influence over class struggle. This is a huge nonprofit bureaucracy, which has been growing at an alarming rate since the 1970s.

The labor aristocracy and the nonprofit bureaucracy complement and reinforce each other, combining to create a radical obstacle to real socialist internationalism. Rather than saying such an obstacle doesn’t exist, we should make it the object of serious, careful strategizing and of a concerted effort to dismantle it.

Is There a “Labor Aristocracy”?

In a recent essay called “Explaining Imperialism Today” in Spectre, Post defines imperialism as the ongoing domination of countries in the Global South by an imperialist group of advanced industrialized nations in the Global North. Those countries in the capitalist “core” constantly re-create their domination of the “periphery” amid a flow of profits from the South to the North (though not only in that direction). Post writes:

Capitalists in the core of the world economy have long enjoyed productive superiority and lower cost-per-unit output than most of their competitors in the periphery. Capitalists in the Global South struggle “to exploit their workers in peace” but “find themselves beset by foreign devils: first their industries are ruined by cheap imports, and then those that survive are taken over by foreign capital.” The Global North’s lower costs of production lead to the creation and replication of the South’s chronic trade deficits and debt. Armed with superior reserves of profits and access to credit as a result of the competition-driven concentration and centralization of capital, northern capitalists constantly deepen their economic dominance over the Global South.

But what Post takes issue with (in his recent event and the pair of articles from a few years ago) is the idea that this creates a “labor aristocracy” in the U.S. In other words, he’s rejecting Lenin’s claim from 1916 that

capitalism has now singled out a handful … of exceptionally rich and powerful states which plunder the whole world. … Out of such enormous superprofits (since they are obtained over and above the profits which capitalists squeeze out of the workers of their “own” country) it is possible to bribe the labour leaders and the upper stratum of the labour aristocracy. … They are bribing them in a thousand different ways, direct and indirect, overt and covert.

According to Post, the profits that the imperialist countries extract from the Global South are vanishingly small, so they can’t support a labor aristocracy. To make this point, he looks at foreign direct investment (FDI). That’s a measure of where capitalists in one country are investing directly and at a high level elsewhere in the world. Measured by FDI, only about 5 percent of the entire world’s investment goes to the Global South, he says. Of this, only 1.25 percent of that is moving from the imperialist core to the Global South. But he says that when North-to-South FDI flows are increasing, we don’t see a real increase in total wages in the U.S.

So for Post, the imperialist core does exploit the Global South. But for him it’s just not enough to fund a well-fed working class in the imperialist core. Capitalists exploit their working class at different levels within each capitalist country, so we should reject the idea that there’s a struggle between privileged workers in the Global North against exploited workers in the Global South.

Plunder, by the Numbers

A few years ago, Post debated these same points with Matias Maiello in the pages of Left Voice (see this, this, and this). There, comrade Maiello pointed out a slippage in Post’s analysis: between the idea that the “labor aristocracy” is the entire working class of an imperialist country like the U.S., and the idea that there could be a labor aristocracy within such a country. Post starts with the latter, but he actually usually attacks the idea that the labor aristocracy is the entire working class of the imperialist “core.” This distorts Lenin’s point, Maiello points out. Lenin’s target was a layer composed of “labor leaders” and an “upper stratum” of the working class, not the entire working class of imperialist countries. Maiello also says the idea of a labor aristocracy was not just about higher wages for some workers. According to Lenin, the imperialist ruling class wins over a stratum of workers “in a thousand different ways, direct and indirect, overt and covert” (I’ll talk about some of those later). Besides, Post says little about those international financial institutions that serve as capital’s economic police force in the Global South, restructuring entire governments for the benefit of the imperialist core.

I’ll add that Post is using a very problematic way of measuring imperialism. It’s a point that Maiello gestures towards when he points out that Post doesn’t give much attention to the $3 trillion that the “developed” world extracted from the “developing” world between 1980 to 2012. 

Even though FDI is one measure of imperialism, it’s not enough to cover the full scope of how “core” economies are deriving profit from the “periphery.” The IMF measures the total amount of investment flowing from one country to another, including but beyond FDI. By the end of 2022, the U.S. alone had a total investment portfolio in the Global South amounting to $7.2 trillion. That’s the equivalent of 28% U.S. GDP flowing into the Global South. During the same period, world GDP as a whole was around $103 trillion. If we look only at U.S. investment in the Global South, then, we’re talking about the equivalent of about 7 percent of the global GDP. This is a far cry from Post’s claim that all imperialist investment in the Global South amounts to just 1.25 percent of the world economy. If Post was talking only about the U.S. there, he’d still be off by 560%. 

These substantial imperialist investments are no marginal element in the U.S. economy. In recent decades, corporations, and even nonprofits like universities, have become more and more financialized. That has meant that, regardless of where a particular commodity might be made or sold, these institutions are increasingly drawing profits from international financial exploitation, including, of course, in the Global South. Here we see an important part of why investment in the Global South is so much larger than Post suggests. As Emmanuel Daniel points out, with low interest rates in recent decades, and meager returns on the “real economy,” corporations were pressured to turn to financial investments. Erik Erlandson tells much the same story in 2017’s Makers and Takers: The Rise of Finance and the Fall of American Business. In other words, we can’t understand the landscape of corporate profits, or even of the funds that buoy up universities, without talking about imperialism.

However, to understand how the benefits of imperialism flow to a layer of the working class, we have to look back to the history of the 20th century. The Ford Motor Company offers a signal example.

The U.S. economy boomed after World War II, underwritten by the imperialist slaughter and destruction of infrastructure in Europe and beyond. That opened up vast new arenas of investment in Europe, but in the Global South, too, as Europe recovered from devastation. But the butchery of World War II also called forth monstrous leaps in the coordination of business and the imperialist state. Stephen Maher writes in 2022’s Corporate Capitalism and the Integral State: General Electric and a Century of American Power:

State investment poured into manufacturing firms at an unbelievable rate, leading to a doubling of output and the development of historically unprecedented science and research capacities within the new “military industrial complex.”

At Ford, the imperialist state was forced to invest unprecedented sums in installing the newest, most productive machinery in the plants. That machinery was needed to create cyclopean stocks of matériel like bombs and planes. Corporations like Ford, though, got to keep that machinery as their own private stock after the war. This led to huge leaps in productivity, and so to the massive profitability of the postwar years. As we will see below, this restructured global economy, and the profits flowing from it, were necessary to the existence of unions providing pensions, healthcare, and so on, and to the very existence of the welfare state. 

Class Struggle and Labor Aristocracy

Who is the labor aristocracy today, then?

I agree with Post that we simply can’t say that the entire working class in the imperialist core — in the U.S., for example — is an aristocracy. The aristocracy should be seen both in terms of the material benefits it receives from imperialism, like how much it is paid, but also in terms of its position in the class struggle and the balance of forces. The ruling class in the U.S. executes its class war not only abroad but also here at “home”: decimating unions, destroying pensions, driving down wages, and so on, and the labor aristocracy is a relative term existing in that class war.

But we’ve already seen that the U.S. ruling class, with the great help of the imperialist state and international bodies like the IMF, invests huge amounts in the Global South and so derives profits from it. We’ve seen, too, that the profits of corporate and finance capital — increasingly entangled — are underwritten by the Global South. In fact, as the examples above suggest, the success of the New Deal and the welfare state which benefitted an important layer of workers, and of corporations (like Ford) able to pay substantially more to a unionized workforce, were built on top of a postwar boom of imperialist capitalism.

We can’t ignore these material conditions fundamentally shaping class struggle in the U.S.

On the basis of everything I said above, we should see the labor aristocracy as that upper layer of the American working class whose living conditions are most closely linked to the imperialist welfare state, broadly speaking. As a general rule, we might say that the aristocracy is that layer of well-remunerated workers — perhaps we can set a benchmark of $60,000 a year? — tapping into substantial benefits like health insurance, life insurance, pensions, paid vacations, and so on. Moreover, such an upper layer of workers have access to what Lenin called “cultural facilities” and “educational institutions” (colleges and universities, for example, and from there, perhaps the entrance of their children into middle class professions) often funded by the state, not to mention unions often paid for out of imperialist plunder.

Unionized auto workers are one example. We saw how the UAW emerged as part of such an upper layer of their class, on the basis of a barbaric imperialism war and the leaps of productivity and profitability that flowed from it. These material pressures create a chauvinist, narrowing tendency inside that layer: to identify with the company itself, with its successes, and with the wider state that it’s attached to. In this way we can explain a bit more fully the fact that a segment of the UAW rank and file are breaking with the Democratic Party in support for the more jingoist and protectionist Trump.

Indeed, the struggle of auto workers in the 1960s and 1970s assumed the relatively higher wages and benefits from corporations that made out handsomely from the war, corporations whose profits were key to the mode of life and work of the workers organizing inside them. That reality helps us understand some of the roadblocks preventing that revolt in the 1970s from linking up with other radical struggles of the period both inside and outside the U.S. 

But all of this suggests the benefits of imperialism don’t come only in the form of higher wages or pensions. They can come in the form of “promises,” as Lenin (and with him, Maiello) notes. To give a recent example: in 2020, the global economy convulsed in its worst crisis in many decades. In the following months and years, the U.S. state was desperate to mitigate the aftershocks and “return to normal.” (That was basically Biden’s campaign promise.) A key part of that project was a relatively lage large set of spending programs (like on infrastructure); these were dubbed “Bidenomics.” That spending was underwritten by, among other things, global profits extracted from the Global South that the state gleans from the international profits of finance and corporate capital, profits made possible by a history of imperialist war and by international bodies of class war like the IMF.

“Bidenomics” was sold to the union bureaucracy (like the leaders of the AFL-CIO) as a set of pro-labor measures. Unions were to get preferential treatment in hiring the labor to work on that infrastructure, for instance. Here we see a promise by the state meant to win loyalty from the upper layers of the union leadership. That served a few purposes. The first was to win over that leadership to help build broad public support for the regime to help tame the Far Right after January 6. The second was to help prevent the extreme danger the state saw facing it. An increasingly battered working class seemed poised to paralyze the economy through strikes, something teachers’ unions explicitly threatened to do during the pandemic, threatening the childcare many workers needed in order to go back to work. Third, “Bidenomics” was also meant to help the U.S. compete in its imperialist competition with China for global hegemony. Those promises were sold to the union leadership, and sold by them to the working class generally, and they were helped along by playing to the chauvinism of a sector of the working class beyond the bureaucracy (I’ll say more about that in a minute). The U.S. had to compete with China, Biden said, or China will “eat our lunch.”

In other words: imperialist profits underwrote the promise made to labor’s leaders to win their support for a program designed to bolster U.S. imperialism. This was, in other words, a concrete expression of the “buying off” of a labor aristocracy that Lenin was describing in 1916, in a new context and in an evolved form.

So we really do find, in the U.S., a layer of the working class that’s predisposed to chauvinism — to care more about protecting its own, narrow interests, to identify those with the interests of the bosses it’s attached to. In other words, it’s predisposed, it feels real material pressures, to identify with parts of its “own” ruling class in the U.S., over international class struggle.

As I’ll say again later, the point isn’t that these layers are hopeless stooges of the masters. They’re a strategic prop for the ruling class. So a key part of our political task today has to be wresting at least some sectors of this aristocracy away from the ruling class, its parties and its imperialist projects, to support real revolutionary struggle.

Aristocracy and Bureaucracy

Blocking our way on the path to that project, though, lies the starkest expression of the labor aristocracy, that part of it with the most political impact and the greatest organizational reach: the union bureaucracy.

Post is sharply critical of union bureaucracy, and rightly so. Upper union bureaucrats are often paid a great deal more than the average worker and they’re far removed from worker struggle in the workplace and the streets. This often makes them roadblocks to rank-and-file militancy. And it predisposes them to think better conditions for unions will come from Democrats, even though those politicians are funded by the ruling class and the state they serve exists to maintain the rule of the bosses. This is all exactly right.

But these bureaucrats are also deeply tied to both the imperialist state and to finance capital, relying on the exploitation of the Global South for maintaining their existence. Actually, the ties between that aristocracy and imperialist profits are becoming both stronger and more direct.

Of course, the chauvinism of U.S. union leaders and their active support for imperialism is hardly news. There’s a great deal of truth to the nickname for the largest union federation in the U.S.: the “AFL-CIA.” The federation’s leaders helped to build up strikes against leftist governments in the postwar period. And the AFL-CIO’s Solidarity Center for overseas support of unions writes checks from the account not just of the State Department but also the National Endowment for Democracy (NED). As Jeff Schuhrke notes, the NED is “known for meddling in the democratic processes of other countries and promoting ‘regime change’ to maintain global dominance” of the U.S.

Today, though, the bureaucracy is becoming even more tightly lashed to the chariot of imperialism. One way is through the integration of unions into the nonprofit system. Legally speaking, unions are 501(c)(5) — or labor — organizations, funded largely (but, as I’ll say later, far from exclusively) by member dues. Over the last few decades, especially in the age of explosive nonprofit growth post-1970s, they’ve developed arms of nonprofit activity registered as 501(c)(3) organizations. These can and do receive funding directly from the imperialist state; this has become more and more necessary as union membership and dues have been dwindling.

Take, for example, the AFL-CIO’s “organizing institutes,” though unions have tended to develop their own training programs too. These are heirs of the George Meany Center, an AFL-CIO “labor college” that recently closed its doors for good. The training institutes are both central as well as more local. Alabama’s AFL-CIO training center, for example, get its funding exclusively from government grants. (Of course, these have to come from that part of the state more interested in winning the support of unions, that is, from parts of the Democratic Party machine, and its wider apparatus in the state, which can approve those funds.)

This means a few things. First, the funding for these training programs comes from an imperialist state that also invests in organizations like the IMF and that receives tax funds from corporations and financial firms extracting profits from the Global South. Second, the organizer training programs depend for their existence on the willingness of the sectors of the Democratic Party that disburse its funds, and so must be seen by the functionaries as either in line with the strategic goals of that party or, at minimum, not at odds with them. Third, and as a result, organizer training has strict parameters. In these training centers, there can be no training in how to build strikes in solidarity with, say, Palestine, let alone of breaking labor law to win concessions from bosses.

Also, the very existence of the union leadership is coming to depend more directly on imperialism. I wrote elsewhere,:

By 1997, the AFL-CIO was the largest non-Jewish holder of Israel State Bonds in the world. Its ISBs added up to $300 million. This is not to mention the bonds held by affiliates within the AFL-CIO. … Israel is not just a brutal colonizer of Palestine. It is also a key component in the U.S.’s imperialist hegemony in the Middle East. The AFL-CIO’s investment in Israel means drawing funds from colonial and imperialist power. It’s hardly an accident, then, that the AFL-CIO leadership … have opposed so completely any concrete acts of solidarity with the people of Palestine, and sit on their hands as Republicans and Democrats alike provide money and weapons for the slaughter of Palestinians.

In addition, the sources of the bureaucracy’s funding are increasingly financial — including, for example, the interest drawn from treasury securities investing in the imperialist U.S. state itself. In other words, part of the overall investment in the Global South tracked by the IMF comes from union leaderships themselves. The financialization of the union leadership has been growing rapidly: from 2000 to 2021, its marketable securities other than Treasury securities jumped 66 percent. In 2000, financial instruments amounted to 31 percent of total assets. By 2021 they were 44 percent of total assets. The example of the UAW shows, these investments include funding venture capital and private equity funds, which almost certainly extract profit out of the Global South. This financialization is also speeding up, increasing far more rapidly from 2010 to 2021 than in the first years of the new millennium. This trend increasingly isolates the bureaucracy from the rank-and-file, since it relies on their dues less and less. 

In fact, financial revenues are helping fund a historic expansion of the bureaucracy relative to members. Writes Chris Bohner

According to the Census Bureau, organized labor employs 24,540 fewer employees in 2021 compared to 2010, a 20% decline in the workforce (with a steep drop in 2020 likely due to the pandemic). However, management positions within organized labor have increased by 64%, with more than 10,000 employees earning a gross salary over $125,000, putting labor leaders and senior management in the top tenth percentile of income in the U.S.

It’s one of the great ironies of the labor movement in the U.S. that, as unions suffered the hammer blows of neoliberalism, the bureaucracy that leads them has become engorged through massive funds at its disposal. In the 1960s, the number of union bureaucrats relative to rank-and-filers (what I call the “bureaucratic composition” of unions) was about 1:300. But since the 1980s, that ratio has been shifting precipitously. The Teamsters’ ratio seems to stand around 1:239; SEIU, 1:184; the UAW, for its part, seems to boast one paid staff member for every 15 active members. 

With these changes, we see the bureaucracy becoming even more firmly ensconced in what Gramsci called the “integral state.” For Gramsci, it’s not enough for the ruling class and state to rule through repressive violence. It also has to win the cooperation and consent of the ruled to make sure the balance of class powers is stable. And so the state must develop its influence and power over the working class and oppressed’s own institutions: over the leadership of unions, for example. U.S. history has no shortage of examples of how the U.S. state has increased its influence over union bureaucracies. A union leadership funded by the successes of imperialist capitalism will scuttle revolt against it and fight to win the union rank-and-file to the political support for imperialist parties, especially the Democrats. And the bigger it becomes relative to members, the more skewed the bureaucratic composition of our unions, the more weight the bureaucracy can throw behind this project.

In that project, of course, the bureaucracy finds its echo and major support precisely in the chauvinism of that upper layer of the working class, an aristocracy predisposed to chauvinism by the benefits flowing to it from imperialism.

Labor Aristocracy and Social Movement Bureaucracy

A pro-imperialist aristocracy is not only a disease afflicting unions, though. In recent decades, a cousin of the labor aristocracy has been growing precipitously: what we might call a “social movement bureaucracy” of nonprofits and NGOs, sharing deep roots in imperialist profits.

Since 1980, the number of nonprofits has been exploding in an unprecedented way. Michael L. Jones points out that “the number of new nonprofits per year was about 20,000 in the late 1960s and thirty years later in the 1990s there were almost 50,000 new nonprofits created each year.” 

The term “nonprofit” is a broad one that includes things like schools and hospitals. But if we focus on “human service organizations” (HSO), we find a rise of nonprofits (alongside NGOs) stepping into areas voided by the state during neoliberal privatization, as well as those spaces once occupied by radical social organizations like the Black Panther Party. 

HSOs increased their number at a rapid clip from 1995 to 2016, and especially since 2013. This is almost certainly because that year brought with it the first wave of Black Lives Matter uprisings, culminating most spectacularly in the huge struggle of 2020. It seems only natural that these HSOs would thrive on revolt: in a country whose organized, radical Left is shattered and weak, nonprofits suck up those sectors of the working class and oppressed activated in struggle.

This “nonprofit industrial complex” receives its funding largely from two institutional sources: finance and corporate capital, on the one hand, and on the other, the state. (Again, HSOs are far more likely to have funds disbursed from parts of the state linked to the Democratic Party, which has a greater stake in winning the support of intersecting working class and BIPOC sectors.) The biggest nonprofit in the U.S. is an arm of financial capital: Fidelity Investments Charitable Gifts, worth about $10 billion and responsible for disbursing a huge amount of funds to other nonprofits. But since finance and corporate capital rely on portfolios that stretch into the Global South — and we’ve already seen how large that investment portfolio is — nonprofits are increasingly inseparable from imperialist profits. 

With these funds support a layer of very well-paid bureaucrats overseeing the activities of social movements and holding their purse strings. The same has to be said of internationally reaching NGOs: they too draw funds directly from corporate and financial capital as well as from local, state, and federal governments.

To be sure, there’s an important difference between union leaders and nonprofit managers. The latter are far more closely tied to corporate America, and even to the Democratic Party. There seems to be something of a revolving door here between the party, the corporate and financial world, and the world of nonprofits and NGOs. (To give one example: Jamie Harrison, the current chair of the Democratic National Committee, is a veteran of both the corporate world and of United Way, one of the biggest nonprofits in the U.S.) But like the upper layer of labor unions, this bureaucracy survives, of necessity, only if it can toe the political lines established by its benefactors, as INCITE has explored in The Revolution Will Not Be Funded. With these limits come political effects. HSOs, that is, actively organize and channel dissent in line with the priorities of a sector of the imperialist state and of the ruling class. That means, at minimum, refusing to support, or outright scuttling, any real displays of international solidarity.

How does this scuttling, this active disorganization, work? We saw the amount of influence the social movement bureaucracy wields — as a key part of the “integral state” — on clear display last year. In early summer, a leaked memo showed that Roe v. Wade was on the verge of being overturned. Between then and the Supreme Court’s decision — a period that would have been key to hold major, disruptive mobilizations to force the Court to back down — no mass mobilizations at all were called by any HSOs. The two most conspicuous were Planned Parenthood and Women’s March. And yet, insofar as they are both registered as 501(c)(3)s, they are legally forbidden from explicit political action. It’s also clear that the funders of both wanted no mass disruption: the economy was reeling from inflation and the chaos of snagged supply lines. To call for mass, disruptive mobilizations would be, too, to challenge a Democrat-controlled federal government. 

How much, then, could HSOs or NGOs organize a militant fight against the U.S.’s backing of war in Ukraine, or disruptive resistance to the apartheid regime in Israel?

Lenin’s idea of a “labor aristocracy,” then, is not just important to understand the nature and structure of labor struggle in the U.S. It also opens up for us a research program helping us see other ways by which working class and oppressed people are actively disorganized, preventing militant international solidarity in the U.S. 

Political Stakes

There are real political stakes to this question of the labor aristocracy.

First, If we recognize the existence of a real labor aristocracy in the U.S., we can better recognize divisions helping hold back class struggle. There really is a layer of the working class that benefits materially — in many different ways that stretch far beyond wages — from imperialism. Its starkest, most politically and organizationally powerful expression is a massive labor bureaucracy: one increasingly draws its funds from imperialism, growing at an alarming rate relative to rank-and-file workers. This bureaucracy consistently disorganizes and resists militant, mass, independent organizing here in the United States, just like it disorganizes and resists real international solidarity. And in this they find their support and echo in the “common sense” chauvinism and narrowness of that upper layer of the working class itself.

But we have to go even further. The labor aristocracy and bureaucracy exist beside what I call their cousin, a social movement bureaucracy that’s also growing at a rapid clip. It bears a strong family resemblance: it, too, draws its funds from an imperialist state and corporate and finance capital living off profits extracted from the Global South. These two function together, interlocking, to hold back the struggle of working-class and oppressed people at work and beyond work. A key task for socialists today, in other words, is fighting to split off as many sectors of the labor aristocracy as we can away from the support for an imperialist state; and split off sectors of social movements, too, away from the program of the social movement bureaucracy, all towards a really revolutionary program.Instead of ignoring the labor aristocracy, we have to trace its material roots and its main political and organizational structures today, including the related or “family” structures that reinforce it. That means recognizing how that aristocracy and its supports have evolved over the last several decades. Only then can we fully strategize against the labor aristocracy and its cousin for real, internationalist class struggle.

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Jason Koslowski

Jason is a contingent college teacher and union organizer who lives in Philadelphia.

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