Systemic change requires individual change
“The road to recovery cannot be simply about returning to modified free-market capitalism and a re-established, utterly bankrupt consumer society.” Henry A. Giroux
April 6, 2009
By Rob Lafferty
The slow, expensive death of the American version of free-market capitalism is causing a lot of pain across the planet. That’s always what happens when a terminal patient lingers for months or even years before finally succumbing to the inevitable. Even for those most deeply affected by the tragedy, however, comes an opportunity to learn valuable lessons and live a better life in the future.
Unfortunately our politicians don’t seem to have learned much from the imminent demise of a financial system that has dominated the world economy for the past sixty years.
We spent $6.6 billion in January to provide food stamps for 32 million Americans. In February, 8.1 percent of the workforce had no jobs, the highest unemployment rate in 25 years. Last week 669,000 new claims for jobless benefits were filed, the highest amount in 26 years.
The high cost of college is creating an educational rift that’s cracking the middle class in half. Tuition fees of $12,00 or more per year are common at favored universities the same places where the head football and head basketball coach will both be paid several million dollars per year.
For a young American of college age and no family money, earning enough to pay rent and buy food is a significant challenge. So students take loans and beg for grants and essentially mortgage four years of their life to earn the credentials they’ll need to get a better job in the future. Or maybe not a lot of those unemployed folks are people with excellent collegiate credentials.
On a national level the numbers are huge; six million students took out a total of $85 billion in loans last year. There will be no bailout for any of those young people if they default on their loans. They aren’t too big to be allowed to fail...
Meanwhile the bankruptcy rate is keeping steady pace with the rise in homeless people and the appearance of tent villages on the fringe of major cities across the land. The Federal Reserve keeps printing money and selling Treasury bonds to prop up the dollar and shock the system in hopes of a response, but the prognosis hasn’t changed.
The numbers and statistics are bad on almost every level and don’t need repeating. Our approach has been to treat all symptoms as they appear by throwing money to the same institutions and individuals who started sucking blood out of the system when it was healthy and are still sucking as much as they can today. Members of Congress and the Obama administration have stated openly that we need some of the same people who helped caused this crisis, that only those people know how to solve the resulting problems.
That’s either simply stupid or it’s a deception; there’s no other explanation for faulty reasoning behind statements like that.
Most elected public servants aren’t stupid; most of them understand that business ethics and integrity have been devalued over the last three decades until they no longer have any value at all. They understand that unrestrained greed and elitism natural human tendencies that we once regulated became acceptable practices at upper management levels, even desirable. They don’t like this moral sickness our economy has developed any more than the rest of us, but they won’t even consider surgery. Most of them are free-market capitalists in their core beliefs, people who still hold faith that rehab and recovery is possible, and they’re willing to spend all the taxpayer dollars it takes to follow that path.
Ultimately we American citizens bear a collective responsibility for our current sad state of affairs. We grew complacent with the practice of management getting paid more than they deserve, partly due to the success of the labor movement. Union bosses who grew fat and corrupt were protected by a majority of workers who kept getting better contracts in return. A corrosive mindset developed, one that allowed managerial work to be overvalued. Over the past four decades a reasonable 4-1 ratio of management-to-labor salaries has now become an imbalance of as much as 400-1 in many transnational corporations.
We’re also guilty of enabling a society where “special” people among us are expected to make millions of dollars for what they do. We don’t resent the huge salaries of professional athletes enough to stop going to their games or buying the products they pitch. We buy the music of famous performers or pay for movies of famous actors even when their product is mediocre, even when they have enough money already to fund a lifetime of comfort and indulgence. We accept and smile at the excesses of the rich instead of mocking them for being self-indugent fools, as we should.
We need a fundamental change of our economic system from this dying 20th Century version into one that functions well in a constantly changing 21st Century reality. That’s the kind of Change we voted for in November. Bailing out the failed institutions of the past isn’t what we had in mind at all. But we aren’t going to see any kind of substantive changes until we start making wiser decisions as individuals about how we spend our money, how we respond to those who are in need, and how we react towards those who have more than they need.
Rob Lafferty is a former editor of the Haleakala Times. He can be reached via email at email@example.com