Economy


New York Times columnest David Brooks argues for the power of local solutions to global problems:

The correct response to these dynamic, decentralized, emergent problems is to create dynamic, decentralized, emergent authorities: chains of local officials, state agencies, national governments and international bodies that are as flexible as the problem itself.

Local ownership and community responsibility is not only a great way to reintroduce responsible capitalism into the culture – it is also good national security and threat response.  Without turning inward, we need to find ways of engaging citizens at the local level – as a way of unleashing creative, locally-relevant solutions.

One of the enduring American myths is that we shape and control our own destiny.  A recent Pew-commissioned poll found that more than 70% of Americans believe that their own hard work was the major factor in upward mobility — even as the middle class has experienced stagnating wages and witnessed an historic transfer of wealth to the top 1% of the US population.

By a 71 to 21 percent margin, Americans said that personal attributes such as hard work and drive are more important to economic mobility than structural issues such as the state of the economy and one’s economic circumstances growing up.

Are self-motivation and personal responsibility important?  Absolutely.  Is it all there is to the story?  Not by a long shot.  In the past few decades, changes to  tax policies and lack of regulations have  enriched the top 1% of the economy at the expense of the middle class.   Meanwhile, real wages for the middle class have been stagnant for decades.   Rather than face this fact, we cling to our belief in exceptionalism.  “These statistics may apply to someone else, but not to me,” we seem to think.  This is, of course, the same viewpoint that leads folks to the casinos and lottery-ticket-dispensers.   Ironically, it is this very belief that keeps us from being properly outraged at  a whole series of bubbles – from real estate to tech  to mortgage-backed securities – that have allowed a few individuals to become obscenely wealthy by doing nothing more than manipulating the financial markets – no value added at all.

An even-more-disturbing downside to this view is that, in our religion and politics, as well as our economics, we value individual concerns over corporate concerns.  Salvation over justice, tax cuts over fiscal responsibility, my own income over a living wage and an equitable distribution of wealth.  We are quick to yell “Socialism” when money goes to those who need it, but have only admiration when the elites raid our own bank accounts to enrich themselves (which is exactly what has been going on in the US, with the amount of  income going to the top 1% increased from 8.9% in 1972 to 21.8% in 2005).  This is certainly a redistribution of wealth, and one that hurts us all.  But the millionaire right-wing pundits, for some reason, don’t see this as a problem!

It has gotten to the point that even folks like Alan Greenspan and Richard Posner are questioning their former support for deregulation and “free-market” capitalism.  It should hardly comes as a surprise when you champion the idea that profit should be the only motivation in an economic transaction that this creates a tremendous pressure to align laws and practices around maximizing of profit at the expense of all other values – including human rights, conservation, pollution, global warming, local communities and even basic community values like honesty, hard work and respect for your neighbor.

So the appropriate response?  Insist that corporations behave like good neighbors, and make profit just one aspect of their mission statement.  This means, for example, finding a way to pay a living wage, providing universal health insurance and a way to save for retirement that is not based on the shell game that the stock market has been shown to be.  It means discovering a way to pay for the full cost of goods and services – from extraction to transportation to manufacturing, marketing  distribution and disposal.  It means finding a way to value strong communities and local ownership, while valuing universal human rights and ecological responsibility.

Some may argue that this is already happening, with businesses heavily involved in corporate philanthropy, public-private partnerships and community planning.  Not only is this kind of corporate citizenship rare, but all too often, the “good neighbor” part of a business is divorced from the core mission of the company.  Yes, there are positive examples of manufacturers working to reduce their environmental footprint, becoming proactively involved with local concerns, and holding their off-shore suppliers accountable to better standards of responsible practices.  But all-in-all, these are the exception, not the norm.  What is more, as companies become more global, local and regional philanthropy and involvement decline, if for no other reason than the owners are no longer on-site, experiencing the impact of their operation and the needs of the community first hand.  And at the end of the day, a company is judged solely on its short-term financial performance.  This cannot help but have dire consequences for issues like the ecology and quality of life that have no hard economic value.

We’ve seen, once again, what happens when we give business a free reign.  The antidote is personal responsibly.  Not theirs (at least at first) but ours.  We have to insist that our own employers behave more responsibly.  We have to insist that the folks we buy from behave more responsibly. We have to reject the notion that our most important role in life is that of consumer, and reshape an economy where our primary role is a member of a community, a nation, the world.  When each of us takes on, as our own personal responsibility, working for justice and equality and fairness, when we each make it our personal responsibility to advocate for meaningful work at a living wage for everyone then we will have made a start.

Can such a thing happen?  Well, we’ve managed to believe the lie that unregulated capitalism is good for us, why not accept the truth that  personal and corporate responsibility is the only path to a livable future?

As the disparity between rich and poor continues to grow, and in the US, as the middle class is put at risk, and the concentration of wealth (which will only increase as a result of this economic downturn) increases, the importance of strong communities with a local focus become even more urgent.

Why strong communities with a local focus?

David Korton underscores what is at stake when he writes:

One of the important lessons of history is that those who own, rule. Even in titular democracies, the powers of ownership readily trump the power of the ballot and play an often decisive role in shaping cultural values. For these reasons, growing living economies that democratize economic relationships in the deepest sense is a leading edge of the work of birthing Earth Community.

“The Great Turning: From Empire to Earth Community” (2006, p342+)

When we let corporations, who exist to generate money, manipulate values and consumer preferences for their own ends, things like quality of life, character and the environment become collateral damage.  A possible response?  Local ownership and accountability.

Read a longer excerpt here (link will open in a new window).

Many of us watch the stock indexes, read the jobless numbers, listen to the what Buffets and Sorroses have to say about the markets while we wait for the rich oligarchs on Wall Street and the capital markets to decide that it is safe to play again, and get the engines of the economy moving.

Why look to these selfish elitists, who are obviously only in it for themselves?  They didn’t show such great judgment leading up tho this debacle, did they?  Missing the warning signs, ignoring the risks, reaping vast profits, heedless of the potential impact on the entire world.    They are the ones who devised the complex and deceptive financial instruments that got us into this mess, or were duped into buying them.  They are the ones we have entrusted the economic health of the planet to – and as it turns out, they were off enriching themselves, and not at all interested in what happened to the rest of the world.  And these are the folks we look to for turning things around?  These are the folks we are bribing with infusions of cash, mortgaging our future to coax into coming out to play, so the whole cycle can be repeated again in a few decades, when the public memory has grown dim?

What we need are accountable communities – a system with absolute transparency, measurable effectiveness, and clear goals and objectives.  Under the current approach of global capital, we see economic exploitation, yawning gap between the rich and poor, ecological disasters and a frivolous use of our dwindling natural resources.  We see a stunning lack of fore site and planning.  A system based on a few individuals getting rich at the expense of the rest, a system where our job is simply to shop – this system cannot produce a rational, fair and forward-thinking economic or social policy.

At the same time, a return to some religious view of personal morality is not the answer.  Their focus on personal morality has proven to be a distraction.  While religious leaders are expound on their version of sin, the social and economic systems continue unchallenged.  The churches all too often breed a narrow, self-interested view of life and our place in society – one that uncritically accepts consumerism, lack of accountability from business and government, and ignores the larger social, political, environmental and economic ramifications of their faith.

The US is a pluralistic, secular democracy.  Though people are free to live out their beliefs concerning social relationships, morality and community (within limits), they are not and should not be allowed to impose their views on these arenas on others.   What is somewhat ironic is that one area where a personal moral message could have an impact on the current crisis is in the area of consumerism – the very topic that is off-limits in many faith communities, due to the close connection between religious and social conservatives and capitalism.

What is more, these “culture wars” are a distraction.  The narrow focus on things like gay marriage and gun control have effectively distracted us from issues like the ecological & climate crises, our crumbling infrastructure and our dependence on foreign oil.

The prescription?  More accountable, less hierarchical communities.  Churches are often great communities – but they do not reach enough people.  Social and civic groups are often too narrow in who they target.  Gangs are a kind of dysfunctional community – essentially, a kind of clan capitalism – distorting the idea of a community to make money or promote the power of the bosses.  As has happened before, these gangs need to make the transformation from criminal to social enterprise.  Though they may have little utility to global capitalism, these folks can be functioning members of local communities.  What we cannot allow, however, is to replace rule of law with rule by gun, democracy with the “big man,”  legitimate work with crime.  All of this is undermined when we celebrate a life of crime because it is a way of asserting power and personal dignity in a system that seems people as interchangeable parts in a machine designed to make a few wealthy and the rest wage slaves.

This involves a return to a local economy.  One reason that owners should be local is because they can be held accountable – not just by laws, but by personal relationships.  Owners ought to know and love the local community, geography, political situation – rather than be part of a disconnected economy where both product and profit are consumed by faceless strangers.  What people do for work ought to be connected to who they are and where they live.

This also involves rediscovering how to live in community.  Community is a skill, and a community can be a good thing, or it can be a toxic thing.  But we know how to encourage vibrant, effective communities – we know how to develop skills, spot talents and abilities, emntor and recognize the gifts and abilities that foster and maintain communities.  As a society, we need to learn to identify, train, support and honor the hard work and dedication it takes to foster community.

This does not mean a return to some parochial village model – a modern model of the human psyche and the our information infrastructure can connect us – humanize our trading partners, prevent a completely local focus – but returning a personal, accountable, local nature of work will be a good start- and we should take advantage of this current economic crisis to take back our economy and builtstong, local, diverse communities.

Ever think about why corporations are so effective?  They allow people to specialize, apply their resources, talents and energy to a specific goal.  In lots of ways they are like a community, but rather than have as their end the survival of the group, their aim is the growth of the corporation, and profit to the shareholders.

No wonder individuals and ad hoc groups are so ineffective in fighting them.  Same with organized crime, trafficking drugs and people.  The concern of a few are up against the capital and group efforts of folks who have a clear aim and purpose (not to mention the financing that comes from their eager clients).

Most communities, churches, even special interest groups are often less effective because they lack the resources, dedicated skill sets and single-minded motivation of the enterprise they are contending with.  A community might have a goal, but lack resources, or have resources, but rely on volunteer or non-specialist staff, or be diversified across a whole range or worth objectives.

On the other hand, a healthy community, joined with other communities and organizations can provide a resilient response to crime, to materialism, to exploitation.