You’re mad. I know it because that’s all I hear or read about in the news. They say that every time a person hears "AIG" and "bonuses" used together he or she gets so angry they could spit. It turns out that the politicians on Capitol Hill are mad too. They make comments such as the executives should either "resign or go commit suicide" (Sen. Charles Grassley later said that he really didn’t mean they should kill themselves). The problem with all of this outrage is that it redirects us from the real source of the problem much in the same way that a magician redirects our eyes as he does his magic trick.
My readers over the years know that I often use analogies in my postings. A while ago I wrote about the attempt to control malaria during the construction of the Panama Canal. ("Draining the Swamp" 10/14/2007) This horrible disease can also serve as an analogy for AIG and the "retention bonuses."
According to Wikipedia malaria gets its name from Medieval Italian mala aria, which means "bad air." At one time malaria was thought to be caused by miasma, or "pollution", which was defined as a poisonous vapor of particles consisting of decomposed matter. It was thought that one could identify this miasma by the presences of foul odors. Of course the real cause of malaria is not some particulate cloud but is actually a virus carried by the mosquitoes that flourish in unclean conditions and that live in stagnate water and swamps.
Limiting ourselves to being angry about the bonuses is like limiting ourselves to bad odors while being blind to the underlying cause of disease. We can scream in anger, jump up and down, and tax the bonuses but it won’t get to the source of the problem because it isn’t the greed of just a few executives. The source is an economic system based on capital.
As an example of historical irony the answer can be found in the works of Adam Smith, who most consider to be the father of capitalism. Of corporations ("joint stock companies") in his classic An Inquiry into the Nature And Causes of the Wealth of Nations he wrote, "The directors of such companies, however, being the managers rather of other people's money than of their own, it cannot well be expected that they should watch over it with the same anxious vigilance with which the partners in a private copartnery frequently watch over their own. Like the stewards of a rich man, they are apt to consider attention to small matters as not for their master's honour, and very easily give themselves a dispensation from having it. Negligence and profusion, therefore, must always prevail, more or less, in the management of the affairs of such a company."
Smith showed us years ago that it was inevitable that the executives of corporations should develop this culture of greed because it goes to heart of capitalism. Centering on the bonuses and not removing the source, capital and the investor-owned firms, is like spraying perfume to try to prevent malaria. It might smell nice but it ignores the source.
Monday, March 30, 2009
Sunday, March 15, 2009
Reverend Frederick Denison Maurice
Back in May of 2008 I posted a brief biography about the founder of The Catholic Worker: Dorothy Day. This time I’ve decided to post a short biography of one of the lesser known advocates of cooperativism: Reverend Frederick Denison Maurice.
Reverend Maurice (b. 8/29/1805 – d. 4/1/1872) was the son of a Unitarian minister and one of the most brilliant of the 19th century Christian Socialists. He’s been described as “mild, unobtrusive, averse to undue opposition, convincing by his example and his earnest logic rather than by appeals to the feelings.”
Maurice honed his skills on a debate club as a young man in an Owenite society. As a young adult he was denied the right to graduate from Cambridge for refusing to sign the Anglican Church’s "Thirty-nine Articles." He later reversed himself and signed the Articles, which allowed him to attend Oxford. Between Cambridge and Oxford, Maurice worked as a writer and wrote a novel. In addition, after being ordained he served as a chaplain at Guy’s Hospital.
While a member of the faculty at Cambridge's King's College Maurice was known for being scholar, theologian, and historian. After his book, Kingdom of Christ, was published his reputation was enhanced. The Kingdom of Christ is often viewed as an omen of the future ecumenical movement for holding that while there are many divisions, such as denominations and sects, the church is essentially united. In 1848 Maurice joined with Kingsley and others to form the Christian Socialist Movement. Then in 1853 he published Theological Essays in which he expressed a belief that hell was not eternal. This was the last straw and as a result he was dismissed from his position at King’s College. He then became the first principle of the Working Men’s College.
According to Capaldi, the Christian Socialists "tried to combine cooperative economics with political conservatism." Of Christian Socialism, Maurice wrote that it was, "true socialism, true liberty, brotherhood, and equality- not the carnal dead level equality of the communist, but the spiritual equality of the Church idea, which gives every man an equal chance of developing and rewards every man according to his work." Once Maurice learned of the Parisian co-ops he was convinced that there was a need of cooperatives in England. He then wrote several pamphlets on cooperatives and declared that anyone that accepted the principles of cooperation could be called a socialist. In addition, Maurice and the Christian Socialists rented a building in London to start a cooperative with 12 tailors called the Working Tailor’s Association. Later the Society for Promoting Workingmen Associations was formed, which made loans to start-up other cooperatives.
Early on Maurice and the Christian Socialists were very successful. Soon in London there were approximately 17 cooperatives. After a point these cooperatives formed a central body, which was a forerunner of the Co-operative Wholesale Society. But they weren't limited to London. Cooperatives also began springing up in other large cities.
By 1853 though, things began to fall apart. The productive cooperatives started to close as problems appeared in their organizations. Some workers were robbed of their funds. Others closed due to internal disputes or apathy. Yet, he did help push through some legislation that helped cooperatives. While the Christian Socialists of the time failed to substantially change England, the work of Reverend Maurice did have a major impact on Christianity that is still felt today.
Reverend Maurice (b. 8/29/1805 – d. 4/1/1872) was the son of a Unitarian minister and one of the most brilliant of the 19th century Christian Socialists. He’s been described as “mild, unobtrusive, averse to undue opposition, convincing by his example and his earnest logic rather than by appeals to the feelings.”
Maurice honed his skills on a debate club as a young man in an Owenite society. As a young adult he was denied the right to graduate from Cambridge for refusing to sign the Anglican Church’s "Thirty-nine Articles." He later reversed himself and signed the Articles, which allowed him to attend Oxford. Between Cambridge and Oxford, Maurice worked as a writer and wrote a novel. In addition, after being ordained he served as a chaplain at Guy’s Hospital.
While a member of the faculty at Cambridge's King's College Maurice was known for being scholar, theologian, and historian. After his book, Kingdom of Christ, was published his reputation was enhanced. The Kingdom of Christ is often viewed as an omen of the future ecumenical movement for holding that while there are many divisions, such as denominations and sects, the church is essentially united. In 1848 Maurice joined with Kingsley and others to form the Christian Socialist Movement. Then in 1853 he published Theological Essays in which he expressed a belief that hell was not eternal. This was the last straw and as a result he was dismissed from his position at King’s College. He then became the first principle of the Working Men’s College.
According to Capaldi, the Christian Socialists "tried to combine cooperative economics with political conservatism." Of Christian Socialism, Maurice wrote that it was, "true socialism, true liberty, brotherhood, and equality- not the carnal dead level equality of the communist, but the spiritual equality of the Church idea, which gives every man an equal chance of developing and rewards every man according to his work." Once Maurice learned of the Parisian co-ops he was convinced that there was a need of cooperatives in England. He then wrote several pamphlets on cooperatives and declared that anyone that accepted the principles of cooperation could be called a socialist. In addition, Maurice and the Christian Socialists rented a building in London to start a cooperative with 12 tailors called the Working Tailor’s Association. Later the Society for Promoting Workingmen Associations was formed, which made loans to start-up other cooperatives.
Early on Maurice and the Christian Socialists were very successful. Soon in London there were approximately 17 cooperatives. After a point these cooperatives formed a central body, which was a forerunner of the Co-operative Wholesale Society. But they weren't limited to London. Cooperatives also began springing up in other large cities.
By 1853 though, things began to fall apart. The productive cooperatives started to close as problems appeared in their organizations. Some workers were robbed of their funds. Others closed due to internal disputes or apathy. Yet, he did help push through some legislation that helped cooperatives. While the Christian Socialists of the time failed to substantially change England, the work of Reverend Maurice did have a major impact on Christianity that is still felt today.
Sunday, March 1, 2009
The Other
"If men could only know each other, they would neither idolize nor hate." ~ Elbert Hubbard, US author (1856 - 1915)
Recently our new President made history (again) by speaking before a joint session in Congress in his first year. The majority of his speech consisted of Obama making his case for his economic package. Near the end the President introduced several guests. One of them was a banker name Leonard Abess. I’ll let the President explain:
"I think about Leonard Abess, the bank president from Miami who reportedly cashed out of his company, took a $60 million bonus, and gave it out to all 399 people who worked for him, plus another 72 who used to work for him. He didn't tell anyone, but when the local newspaper found out, he simply said, "I knew some of these people since I was seven years old. I didn't feel right getting the money myself.""
Leonard Abess provides an interesting lesson for us on the Left. The lesson isn’t a claim in the nobility of capitalists nor is it to praise bankers. The lesson Mr. Abess teaches is that we cannot, we must not, stereotype capitalists or anyone else as being "The Other." It’s the socio-economic system of capitalism that’s evil. Capitalists are people who are caught up in an oppressive system. We need to recognize that the capitalists are victims as well as workers.
Labeling any group of people as evil runs the risks of starting down a path that eventually ends at a guillotine.
Recently our new President made history (again) by speaking before a joint session in Congress in his first year. The majority of his speech consisted of Obama making his case for his economic package. Near the end the President introduced several guests. One of them was a banker name Leonard Abess. I’ll let the President explain:
"I think about Leonard Abess, the bank president from Miami who reportedly cashed out of his company, took a $60 million bonus, and gave it out to all 399 people who worked for him, plus another 72 who used to work for him. He didn't tell anyone, but when the local newspaper found out, he simply said, "I knew some of these people since I was seven years old. I didn't feel right getting the money myself.""
Leonard Abess provides an interesting lesson for us on the Left. The lesson isn’t a claim in the nobility of capitalists nor is it to praise bankers. The lesson Mr. Abess teaches is that we cannot, we must not, stereotype capitalists or anyone else as being "The Other." It’s the socio-economic system of capitalism that’s evil. Capitalists are people who are caught up in an oppressive system. We need to recognize that the capitalists are victims as well as workers.
Labeling any group of people as evil runs the risks of starting down a path that eventually ends at a guillotine.
Monday, February 16, 2009
Lack of Trust
"The chief lesson I have learned in a long life is that the only way to make a man trustworthy is to trust him; and the surest way to make him untrustworthy is to distrust him and show your distrust." ~ Henry L. Stimson
The capitalists are rattled. They’ve suddenly realized that there’s a serious absence of trust in our economy. In a December 24th, 2008 editorial the staff of the Dallas Morning News whined, “For want of trust, the global economy nearly melted down.” On his web site the capitalist apologetic Scott Burns cried, “Right now all we know is that nothing is trustworthy. Not our political leaders. Not our business leaders. Not the government or private institutions that are supposed to provide oversight and evaluation.”
Like Captain Renault exclaiming that he’s shocked, shocked to find gambling at Rick’s their surprise isn’t very convincing. That’s because the seeds of the current growth of distrust were planted by the capitalism itself.
Distrust originates in capitalism from its own hyper-competitive nature. It’s well documented by authors such as Barbara Ehrenreich and Robert Sennett that within capitalism, especially the current globalized version, relationships are viewed as simply means to an end. The other person is either a threat or an opportunity. So we don’t want to show our hands, to borrow a gambling phrase, to just anyone lest we allow the other person to learn something that they can use to either get ahead or against us.
It took hundreds of years but this distrust has spread from the economic infrastructure and now infects all aspects of the superstructure of society. Parents distrust their children so they place nanny technology on their computers. Couples distrust each other and jealousy abounds. Neighbors distrust each other so people set up housing associations full of rules and regulations to make sure that each person maintains his or her property just as the neighborhood expects.
How can we climb out of this pit? While the return of Keynesian-style regulation by the Obama administration will provide limited increase in trust in the short-term it won’t truly solve the problem. The only real solution is to replace our greed-based competitive system with a system based on cooperation and mutual support. The solution demands an economic democracy.
The capitalists are rattled. They’ve suddenly realized that there’s a serious absence of trust in our economy. In a December 24th, 2008 editorial the staff of the Dallas Morning News whined, “For want of trust, the global economy nearly melted down.” On his web site the capitalist apologetic Scott Burns cried, “Right now all we know is that nothing is trustworthy. Not our political leaders. Not our business leaders. Not the government or private institutions that are supposed to provide oversight and evaluation.”
Like Captain Renault exclaiming that he’s shocked, shocked to find gambling at Rick’s their surprise isn’t very convincing. That’s because the seeds of the current growth of distrust were planted by the capitalism itself.
Distrust originates in capitalism from its own hyper-competitive nature. It’s well documented by authors such as Barbara Ehrenreich and Robert Sennett that within capitalism, especially the current globalized version, relationships are viewed as simply means to an end. The other person is either a threat or an opportunity. So we don’t want to show our hands, to borrow a gambling phrase, to just anyone lest we allow the other person to learn something that they can use to either get ahead or against us.
It took hundreds of years but this distrust has spread from the economic infrastructure and now infects all aspects of the superstructure of society. Parents distrust their children so they place nanny technology on their computers. Couples distrust each other and jealousy abounds. Neighbors distrust each other so people set up housing associations full of rules and regulations to make sure that each person maintains his or her property just as the neighborhood expects.
How can we climb out of this pit? While the return of Keynesian-style regulation by the Obama administration will provide limited increase in trust in the short-term it won’t truly solve the problem. The only real solution is to replace our greed-based competitive system with a system based on cooperation and mutual support. The solution demands an economic democracy.
Tuesday, February 3, 2009
Death by Greed
Most of us have heard or read how hundreds of people were sickened, and eight died, from a recent outbreak of salmonella. Recently the FDA reported that they had finally traced the source of the outbreak to a factory in Blakely, Georgia owned by Peanut Corporation of America. But while the peanut butter shipped by the factory was indeed contaminated with salmonella it wasn’t the ultimate source of what sickened and killed people. The ultimate source of their suffering and death was greed.
According to the Wall Street Journal the government has charged that the company’s own internal tests had found salmonella but that the company didn’t disclose their results and continued to ship the contaminated peanuts. Why didn’t the company report their internal findings? According to the article they didn’t because they weren’t required to.
Was this the result of corporate abuse of power? Not in this case. Headquartered in Lynchburg, Virginia, PCA is actually a privately owned company with approximately one-hundred to two-hundred and fifty employees. Their annual sales have ranged from $10 million to $25 million.
When one considers the seriousness of the charges along with the nature of the company we see a simple truth. An economic enterprise doesn’t have to be an investor-owned firm to be corrupted by greed.
What lesson might we learn for a future economic democracy out of this mess? As I see it the most important lesson is that in an economic democracy there would still be a need for government regulation. While cooperatively run enterprises tend to operate with a higher level of ethics people won’t become angels with the end of capitalism just as they weren’t angels in the modes of production that preceded it. So we can expect that there will still be a need for oversight by federal, state, and local authorities to insure safety for both consumers as well as workers.
According to the Wall Street Journal the government has charged that the company’s own internal tests had found salmonella but that the company didn’t disclose their results and continued to ship the contaminated peanuts. Why didn’t the company report their internal findings? According to the article they didn’t because they weren’t required to.
Was this the result of corporate abuse of power? Not in this case. Headquartered in Lynchburg, Virginia, PCA is actually a privately owned company with approximately one-hundred to two-hundred and fifty employees. Their annual sales have ranged from $10 million to $25 million.
When one considers the seriousness of the charges along with the nature of the company we see a simple truth. An economic enterprise doesn’t have to be an investor-owned firm to be corrupted by greed.
What lesson might we learn for a future economic democracy out of this mess? As I see it the most important lesson is that in an economic democracy there would still be a need for government regulation. While cooperatively run enterprises tend to operate with a higher level of ethics people won’t become angels with the end of capitalism just as they weren’t angels in the modes of production that preceded it. So we can expect that there will still be a need for oversight by federal, state, and local authorities to insure safety for both consumers as well as workers.
Monday, January 19, 2009
Poor People’s Campaign
A brief post on this historic day. Shortly before his assassination Dr. Martin Luther King Jr. had started what he referred to as the “second phase” of the civil rights movement, which was to confront capitalism head on with a “Poor People’s Campaign.” Reverend Hosea Williams explained the reason for the PPC, “We will never get free by eliminating racism or bringing about integration. If black people were able to eliminate every aspect of racism and integrate every aspect of American life, we would not be free. Black folks will never be free until we have our fair share of the economy. We live not in a political society, nor in a social society, nor a religious society, we live in an economic society. So we had to launch a movement to gain our fair share of the economy.”
We need to honor Dr. King by demanding an economic democracy.
We need to honor Dr. King by demanding an economic democracy.
Saturday, January 10, 2009
Congo
The four horsemen of the apocalypse are riding across the heart of Africa. According to the International Rescue Committee malnutrition, war, and disease is killing 45,000 people every month in the Congo. Since the start of the war as many as 5.4 million people have died. All of this death and suffering is largely due to powerful forces (such as Rwanda, Uganda, Burundi) who have tried to dominate and exploit the Congolese natural resources, primarily Columbite-tantalite known as coltain.
While conservatives tend to turn a blind eye to the suffering liberals tend to place too much emphasis on blaming people rather than analyzing the socio-economic relations at play. The Cowardly Lion closes his eyes while Dorothy pays too much attention to the image of the wizard with the noise and the fire and ends up ignoring the man behind the curtain.
The cause of the problem isn’t simply that we buy electronics, such as cell phones, with coltan. While the situation in the Congo is rather complex a large part of the blame for the violence in the Congo belongs to globalized capitalism. As I’ve written before capitalism is a socio-economic system focused on the expansion and protection of capital (i.e. private investment). One of the primary ways of expanding capital in the manufacturing process is to acquire raw materials at the lowest price possible. These cheap resources help increase surplus value (i.e. profit), which the corporations send to their shareholders (i.e. capitalists) in the form of dividends. This perpetual demand by corporations for cheap raw materials, such as coltran, regardless of the human consequences is what drives the violence in the Congo.
Do you want to do something substantial to help the people of the Congo? Get involved in helping to replace capitalism with an economic democracy.
While conservatives tend to turn a blind eye to the suffering liberals tend to place too much emphasis on blaming people rather than analyzing the socio-economic relations at play. The Cowardly Lion closes his eyes while Dorothy pays too much attention to the image of the wizard with the noise and the fire and ends up ignoring the man behind the curtain.
The cause of the problem isn’t simply that we buy electronics, such as cell phones, with coltan. While the situation in the Congo is rather complex a large part of the blame for the violence in the Congo belongs to globalized capitalism. As I’ve written before capitalism is a socio-economic system focused on the expansion and protection of capital (i.e. private investment). One of the primary ways of expanding capital in the manufacturing process is to acquire raw materials at the lowest price possible. These cheap resources help increase surplus value (i.e. profit), which the corporations send to their shareholders (i.e. capitalists) in the form of dividends. This perpetual demand by corporations for cheap raw materials, such as coltran, regardless of the human consequences is what drives the violence in the Congo.
Do you want to do something substantial to help the people of the Congo? Get involved in helping to replace capitalism with an economic democracy.
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