{"id":12726,"date":"2024-03-31T23:57:41","date_gmt":"2024-04-01T03:57:41","guid":{"rendered":"https:\/\/www.tempestmag.org\/v01_2020\/staging\/?p=12726"},"modified":"2024-04-09T00:42:38","modified_gmt":"2024-04-09T04:42:38","slug":"dsas-budget-crisis-has-been-a-long-time-coming","status":"publish","type":"post","link":"https:\/\/tempestmag.org\/test02\/2024\/03\/dsas-budget-crisis-has-been-a-long-time-coming\/","title":{"rendered":"DSA\u2019s budget crisis has been a long time coming"},"content":{"rendered":"

T<\/span>he January 14, 2024, meeting of the Democratic Socialists of America (DSA)\u2019s national leadership, the National Political Committee (NPC), must have been a doozy. At that meeting, the NPC was forced to reckon with a budget deficit that threatens to bankrupt the organization. The NPC posted a \u201cTreasury Report & Short Briefing<\/a>\u201d on the DSA Discussion Board outlining the magnitude of the crisis:<\/p>\n

In a worst-case scenario, with all funding requests approved, we could face a critical financial situation as early as August 2024, where meeting our obligations, including those to our staff, becomes a day-to-day challenge, potentially leading to the closure of the organization.<\/p><\/blockquote>\n

Two days later, DSA National Director Maria Svart, in the position since 2011, announced her resignation<\/a>. DSA Operations Director Kristina Sepulveda was Svart\u2019s chosen successor but resigned on January 25, less than two weeks later. Sepulveda desired debate around her candidacy to be confidential<\/a> and quit when minutes were to be published for the membership.<\/p>\n

On January 18, Bread & Roses\u2019 <\/span>The Call<\/span><\/i> explained<\/span> <\/a>that DSA projected \u201c$5 million in income and $7 million in expenses\u201d\u2014a $2 million deficit. They called for a $500,000 cut in staff expenses to begin to address the deficit. That same day, the Socialist Majority Caucus (SMC)<\/span> responded on their blog, <\/span>The Agitator<\/span><\/i><\/a>, with similar details about the particulars of the deficit. They emphatically rejected staff layoffs in favor of other cuts (suspending stipends,<\/span> \u00a0reducing chapter dues-share<\/span><\/a>, cutting travel, printing, and technology, shuttering the national office,and more). On January 20, the Marxist Unity Group <\/span>posted on their website<\/span><\/a> in support of Bread and Roses\u2019 proposals and opposed to SMC\u2019s suggested cuts. On January 21, the Young Democratic Socialists of America, DSA\u2019s youth organization, <\/span>issued a public protest<\/span><\/a> of cuts that would affect them.<\/span><\/p>\n

The ensuing<\/a> Twitter<\/a> battles<\/a> have been brutal. Anyone familiar with DSA will recognize the themes: \u201cposting discipline\u201d (discouraging public discussion of DSA business), accusations of being anti-union in relation to discussing laying off staff, charges of conspiratorial factionalism, and so on.<\/p>\n

\"A<\/p>\n

On February 20, the NPC passed a \u201cResolution to Initiate the Process of Laying Off Staff Positions<\/a>,\u201d pledging to begin layoffs by April 15. On March 8, the Red Star caucus posted an article on their website, \u201cHow Red Star is Thinking About Layoffs<\/a>.\u201d They wrote,<\/p>\n

Our philosophy here is to cut deep and cut once: the org needs to make layoffs, and in our view, the goal is to do so to a level that secures DSA National\u2019s continued solvency through this NPC term and at least 6 months into the next one. This is why Red Star proposed and the NPC passed a target of maintaining sufficient cash reserves through December 2025.<\/p><\/blockquote>\n

The NPC began a process of voting on spending cuts from March 8 through 11, 2024. This included the \u201cResolution to Achieve Fiscal Sustainability Through Staff Layoffs and Union Engagement<\/a>\u201d, which committed to laying off twelve staff members. The resolution cites \u201cthe need to reduce its annual operating expenses by approximately $610,038.90 for 2024 and $1,183,043 for 2025 as part of a comprehensive strategy to address the current budget deficit of $1,240,201.\u201d<\/p>\n

On March 9, in response to the resolutions the DSA\u2019s staff union tweeted<\/a> \u201cFuck 12\u201d \u2013 inappropriately alluding to the phrase used by protestors of racist police murders. The staff union posted on the Discussion Board<\/a> rejecting the layoffs and calling for members to intervene on their behalf via a petition, attendance at NPC meetings, and increasing dues donations.<\/p>\n

Statements that this decision to lay off staff is in response to a democratic mandate or is the only choice of an exhausted budget should not be taken seriously\u2026We encourage our members to let the NPC know how important you believe DSA Staff, and the work we do, is to the success of this organization, and call out their determination to reject so many alternative cuts while they maximize the firing of union staff.<\/p><\/blockquote>\n

\"A<\/p>\n

In sum, over a million dollars of expenses were cut, including twelve of approximately thirty of DSA\u2019s staff. Even still, DSA will continue to run a deficit of somewhere between $800,000 and $925,000 annually.<\/p>\n

Money Talks<\/h4>\n

What is shocking is how DSA has come to the brink of bankruptcy\u2014and how little was done to prevent it. Serious discussion of the loss of tens of thousands of members<\/a> began in 2023, although the organization\u2019s growth had already peaked in 2021. According to that Growth and Development Committee (\u201cGDC\u201d) report, the implications of this loss were such that 2022 \u201cmark[ed] a 14% decrease\u201d in membership dues (income) compared to the previous year, or about $900,000. Despite this, the 2021 NPC budgeted an increase in spending by nearly $2 million: \u201cthe budget anticipated an increase of $700,000 over 2022.\u201d This is rather like poking a second hole in the boat so the water has somewhere to go.<\/p>\n

But dues income did not come back up to recover the loss\u2014it dropped further as more people left DSA. According to the GDC report, \u201cAt the end of 2023, our revenue was approximately $700,000 less than 2022, with spending exceeding the previous year by $1.6 million.\u201d Dues are projected to fall <\/a>by another $240,000 in 2024.<\/p>\n

As this was happening, DSA held its national convention in August 2023. The deficit was acknowledged in the Convention\u2019s Financial Report, but somehow this was not addressed as a priority issue among delegates. Instead, as they had at previous conventions, delegates passed numerous resolutions calling for additional staff and spending. Socialist Majority even went so far as to argue for doubling the staff from 30 to 60.<\/p>\n

In theory, DSA had the information it needed about the situation early enough to respond. Declining membership figures were noted in 2021 and reported again during spring financial reports. DSA had delegated conventions in 2021 and 2023 to have a frank discussion and democratically address the situation before it spiraled out of control. However, the problem was dismissed as something that zealous fundraising<\/a> and gamified membership drives<\/a> could solve<\/a>. The issue was deferred until it was simply impossible to ignore.<\/p>\n

\"A<\/p>\n

Triumphalism and Closed Doors<\/h4>\n

It is worth taking a moment to ask how this happened, particularly in a group that prizes McAlevey-esque \u201cgood organizing\u201d and scientific socialism. How does an organization choose to ramp up its spending year after year even when its own data show declining membership figures and dues income?<\/p>\n

A basic survey in accounting would be enough to know that when your income drops, your expenses generally should too. Going a little deeper, forecasting would give a sense of projected growth or contraction using data points to anticipate possible scenarios for the future. When the numbers keep going down, it stands to reason that this is a trend that will continue absent some major shift.<\/p>\n

And since this is a political organization and not a business, paying attention to political events and factors should be part of this calculation. It was commonly understood that there was a relationship between the Trump election, Sanders\u2019 campaign, and DSA\u2019s ballooning growth. Likewise, when Biden was elected these two external factors ceased to exist and we see membership rolls hit their peak and begin to fall at the beginning of 2021. (This is to say nothing about factors internal to DSA and within its control that would have bearing on membership.) But instead of adjusting, DSA\u2019s leadership doubled down.<\/p>\n

\"A<\/p>\n

When decisions are made in spite of the evidence, some idea or story has to be deployed to allow two incompatible positions to coexist. Basically, DSA\u2019s political leadership believed that (or at least acted as though) the organization was going to continue to grow forever even though the numbers told them they were shrinking and the political situation that propelled them had disappeared. The figures showing decline were either suppressed, hand waived as a temporary setback, or rationalized as evidence that there was insufficient support for the leadership and staff.<\/p>\n

During mid-2023, DSA\u2019s Socialist Forum<\/em> posted an article \u201cIs DSA Really in Crisis?<\/a>\u201d Author Emmett McKenna\u2019s answer unsurprisingly was \u201cNo,\u201d and McKenna articulated the narrative in no uncertain terms:<\/p>\n

Contrary to internal skepticism, DSA is in a much stronger position today than ever before. We are the most influential socialist organization in the United States in nearly a century. Where other US socialist organizations faltered, DSA has succeeded due to a flexibility that has allowed us to participate effectively in mass politics\u2026 These persistent so-called crises do not reflect the actual state of affairs in our organization, but by creating an atmosphere of internal disorder, they threaten to hinder DSA\u2019s ability to grow into a mass movement and to return us to the margins of political life.<\/p><\/blockquote>\n

Let\u2019s call this \u201cDSA Triumphalism\u201d: Claiming to have overcome the historic weakness of the Left, sections of the organization declared DSA\u2019s superiority over other socialist projects, rejected the material dynamics that had led to the marginalization of the Left and which returned in force post-2021-all while policing the bounds of debate within the organization and projecting unlimited growth<\/a>. DSA Triumphalists have no reservations about declaring what is good for the entire \u201cworking class,\u201d particularly as it relates to Democratic Party elections. Somehow, at the same, time DSA is proclaimed to be the best and strongest socialist organization surpassing all others while being so fragile that any real scrutiny of its affairs would destroy the organization. Of course, McKenna was dead wrong \u2013 not only was there a crisis, but it is potentially a terminal one.<\/p>\n