At an event hosted by Synergos, an organization that helps leaders and partnerships change the systems that keep people in poverty, I spoke with a friend who is a senior executive at IBM. We discussed that businesses, particularly multi-nationals, need to understand that their greatest asset is their relationships with leaders from all sectors – including civil society activists – in the communities in which they provide goods or services. All too often, they simply think of their corporate citizenship – if they think of it at all – in the narrowest sense possible: a kind of side-bar philanthropy. Instead, they should be looking to create and sustain deep relationships with these advocates for social justice as key to their sustainable business model. Doing good will, in fact, be good for their business as they’ll have a healthy, well-educated, financially capable customer base and work force. We agreed that we needed to find a way to convey this need that most corporations don’t yet understand they have.
Frank Rich’s op-ed “The Rabbit Ragu Democrats” in the New York Times underscores how the main relationships businesses currently cultivate are with lobbyists who can press their pet concerns with government officials. His article is a cautionary tale of the adverse affects these highly lucrative relationships have, not only on the citizens who take a hit from policies that are against their best interests, but also, ultimately, on the very business leaders who pursued them. I just saw Michael Moore’s Capitalism: A Love Story which describes the phenomenal disparities of well-being among Americans and their access to the powers that affect their status. I have encouraged many to see the film. I explain that, even if they don’t agree with all of Moore’s conclusions, he exposes fundamental conditions about which we should engage in a vibrant discussion. Leaders from business, government and communities, along with the ordinary citizens who make the respective endeavors of these leaders possible, need to make a frank assessment of what will benefit all of us. The financial collapse and climate change are just two of the myriad inter-related global crises revealing that we sink or swim together.
Article comments
— go to most recent comments1 - Doug Hunter
I don't understand the supposed benefit of 'relative equality'. I'd rather make $30K next to a guy that makes $1billion than make $15K next to everyone else who makes $15K. How does what someone else has or earns effect me?
2 - Dave Nalle
It doesn't, Doug. It's a standard fallacy of the anti-capitalist elite. They don't understand the realities of living on a limited income or how much more $10,000 means to someone earning $30K a year than it does to them.
Dave
3 - Ruvy
Equality isn't necessarily a good thing. But what is positively evil and poisonous in any society is a vast disparity in wealth and income.
4 - Ruvy
That said, it is a lot easier to talk about "the simple life" and "equality" than to actually live it and make it work.
5 - Jeanne Browne
Brava, Ms. Hack! An important article with truthful and valuable things to say. I was watching a news report recently in which it was explained that in the 60s and 70s, the ratio of CEO compensation to that of average workers was 40 to 1 - substantial, but not unreasonable, since it may be assumed that the CEO contributes significantly more to the company's progress and profitability than the mail room clerk. But now, and growing steadily since the 90s, that ratio is well over 500 to 1. That's a disaster for both the company and the nation. This kind of disparity is what makes it increasingly impossible for ordinary working folks to live in NYC, for example, and why those earning six figures really have no idea what it means to live on a low 5-figure fixed income. I understand that in a society that rewards imagination, initiative and enterprise, and punishes those with minimal skills who make minimal effort, there will be rich people and poor people. But there used to also be a thriving middle class in this country, and that has been and continues to change radically, as a small portion of the middle catapult into the rich category, and the rest, the majority of the middle, slowly sink (or quickly dive) into poverty or damn close to it. Such disparity inspires both rage and indifference and creates a climate in which the rich and poor are literally disgusted by each other. The problem is that while resenting the rich, the poor still aspire to their status. No one feels good about making a good, modest, but totally adequate living anymore: it's all about being at the top of the heap or dirt under its feet. Vast inequity is fueling greed, dishonesty, envy, contempt, and a fatal lack of concern for The Other. I think you've made a very strong case for these ideas, Nadine, and, once again, I don't understand why some people view this as a)confusing or b)a political football. This is just what's so, and it ain't good.
6 - STM
I disagree on some counts with the anti-capitalist notion of equality. Getting NEARER to equality is the key. The working man or woman gets to share a bigger slice of the corporate pie; universal health care, everyone gets the same and pays in proportion to what they earn, but the care MUST be good and come with an option to private, etc.
Of course, getting a bigger slice of the pie means trade-offs, since it's the workers who earn all the money for the big corporations in the first place. I up my productivity, earn them more money, they give me more. But to keep me happy, they have to pay me a decent wage in the first place, provide first-world and safe working conditions, have legislation in place that means I can't be sacked on the whim of, say, someone who doesn't like my hair-do, and respect my right to a) belong to a union (or not) b) withdraw my labour and c) try the first option of having disputes settled through mitually agreeable industrial abritration in the courts.
That's Oz (and there's that socialism Dave, which I prefer to call community).
And one thing I noticed in the US that I don't see quite as much down here in Oz is the huge gap between rich and poor.
Sure, there's still a gap ... but overall, it's become like one giant middle class, where families who, say, have three people working blue-collar jobs in the one family will have a combined, very large disposable income.
But the truth is, it doesn't work without private enterprise.
And as Dave and I have both witnessed, real equality doesn't exist even in those countries claiming to base their entire political system upon it.
I'm talking about the old Soviet Union especially, which was among the most class-conscious of any countries I've ever been to.
While my views might be very left of Dave's, they aren't what I'd call namby-pamby liberal.
I still; believe in a fair day's pay fopr a fair day's work.
It's just the amount of pay compared to what my boss earns - and what I consider a fair day's pay on that basis - that's the issue.
And rather than everyone earning $15k, most people should be earning $100k if others are getting around on huge salaries.
Basic maths: The head of a corporation that could run itself is on, let's say, $30 million, and most of his workers are earning between $40k and $100K.
Take some of his, still leave him or her and their mates in the boardroom with nice fat salaries and top-of-the-range cars, big houses, boats, etc and divvy the rest up among the workers.
When you're the CEO of a big corporation on huge dollars anyway, there's a point at which more money means nothing.
So share it with those who help make the profits for your shareholders.
7 - roger nowosielski
I don't think the notion of arriving at "equality" is the right way of looking at the issue, Stan. It is rather that for many people, the idea of accumulating wealth is inseparable from creating inequalities.
So your example and the situation in Oz is instructive, because it show that growth is possible under conditions where sharing wealth (rather than creating impoverishment) is a viable and winning idea.
If there's fairness, the resulting "inequalities" should never be an issue. We wouldn't even think of them as such.
8 - Doug Hunter
"If there's fairness, the resulting 'inequalities' should never be an issue. We wouldn't even think of them as such."
Many people don't now. There is political power to be had in convincing people and selling them on class warfare though, so I don't see it ending anytime soon.
If you (not you specifically Roger, anyone reading this) think being a CEO is easy and that they are overpaid then I would suggest you try and become one yourself and let us know how that works out.
9 - roger nowosielski
Perhaps we are creating a situation which breeds "class warfare." Many politicians no doubt bank on this idea - which isn't to say they have to dream it up: the conditions abound, so that those who want to see a divergence of interests between the haves and the have-nots may not need much persuading.
It wasn't always so. One could argue that even the labor-management disputes of old weren't over the discrepancy in pay but improving the workers' lot. Envy used not to be an American trait.
So the recent abuses in the corporate and financial world, and the change in America's corporate culture, have certainly contributed to the antagonism, and the CEO's image has definitely plummeted.
Whether this is reversible, I have no idea. Meanwhile, the CEO has become his own worst enemy.
10 - Doug Hunter
"so that those who want to see a divergence of interests between the haves and the have-nots may not need much persuading."
Sometimes they do. I'd have to go back to the archives but I remember a few liberal articles questioning why they couldn't 'get people to vote what is in their own best interest'. The answer of course is because those people aren't buying the idea that someone else owes them something. Their class hatred and envy has not grown enough to suspend their natural sense of fairplay.
As for the bad corporate culture, the financial industry and corporate excesses would have destroyed those unsustainable habits naturally were it not for corporate welfare from the government, something I don't advocate. Perhaps a crop of more reasonable businessmen could have picked up the pieces, we'll never know now.
11 - roger nowosielski
It will be interesting to see whether we can experience business renaissance in the West given that the governments have made it point to exercise tighter control. The financial industry certainly can't serve as a model.
I do see the possibility of something like that occurring but only in the high-tech industry - which is fine with me because they'll be the leader and the driving force of all the economy. And then, who knows? It might spread.
I don't think that corporate welfare has played that much of a part in what had happened in the finance industry. It was a runaway train, in my opinion. (I'm not talking about bailouts and the government enabling afterwards.)
12 - Doug Hunter
#11
I was speaking of the government's action after the fact. I think prudent government regulation should have deflated this crisis before it happened or enabled a softer landing. From my limited perspective, it seems that companies 'too big to fail' should not be allowed to function as private entities. I don't know that they were 'too big to fail' in the first place but assuming that was true they should have been broken up or otherwise dealt with beforehand. If an entire industry of smaller not too big players goes down and a bailout is felt to be the best option at least you can choose to let the worst offenders fail first rather than basing your decision on size. Some of the worst offenders got bailed out this go round while some semi-responsible entities went bankrupt from getting caught in the wake.
And please, although I don't think you would do it, don't give me the line about how Democrats have been for regulation all along. Not all regulations are created equal and doozies like requiring banks to loan a certain percentage to low income customers likely even contributed to the situation. Just because I think the majority of red tape, regulation, and even laws in this country aren't worth the paper they're written on doesn't mean I don't believe in any law or regulation.
13 - roger nowosielski
"Some of the worst offenders got bailed out this go round while some semi-responsible entities went bankrupt from getting caught in the wake."
Right. So nobody had learned their lesson, and we've only rewarded irresponsible behavior.
14 - Mary Anne
Wow - what a great discussion this post has generated! I think that there will always be a great disparity between the "haves" and the "have-nots."
Equality is a great ideal, but I think that it will never happen. Life is never fair.
15 - Dr Dreadful
"Inequality Affects Us All".
Now there's an ironic title if ever I saw one!
16 - Baronius
Doug, you're right. Inequality doesn't affect anyone.
A multimillionaire spends all his savings on a Rembrandt. He decides to clean it using Windex and steel wool. In a few moments, his wealth drops from 100x mine to exactly equal to mine. In what way am I affected?
17 - Dr Dreadful
A multimillionaire spends all his savings on a Rembrandt. He decides to clean it using Windex and steel wool. In a few moments, his wealth drops from 100x mine to exactly equal to mine. In what way am I affected?
He's forced to sell his company, which happens to employ you, and the new owners decide to absorb the business into their own corporate structure and fire everyone.
18 - zingzing
"He's forced to sell his company, which happens to employ you, and the new owners decide to absorb the business into their own corporate structure and fire everyone."
making him, once again, 100x richer than you, which means, everything stayed the same! everyone suffers equally! equality for all!
19 - roger nowosielski
Dreadful,
You failed to mention the most important thing - the Rembrandt is ruined.
Apparently, Baronius mustn't care for art, especially not for Rembrandt's nudes.
20 - Silas Kain
A multimillionaire spends all his savings on a Rembrandt. He decides to clean it using Windex and steel wool. In a few moments, his wealth drops from 100x mine to exactly equal to mine. In what way am I affected?
The multimillionaire files an insurance claim, collects millions, and YOUR insurance premiums go up.
21 - roger nowosielski
That's greater crime, I'd say, than the Rape of the Sabine Women.
22 - Doug Hunter
"A multimillionaire spends all his savings on a Rembrandt. He decides to clean it using Windex and steel wool."
It was just a nickels worth of raw materials all along. A Rembrandt is only 'valuable' as long as everyone else agrees it is, just another form of currency much like lighting a $100 bill ablaze. If the wealthy person had instead bought an asset such as a Saudi oilfield and set the wells ablaze then you'd have a different scenario.
23 - zingzing
"If the wealthy person had instead bought an asset such as a Saudi oilfield and set the wells ablaze then you'd have a different scenario."
bonfire! hippies! total social destruction!
24 - roger nowosielski
You're a philistine, Doug Hunter. Join hands with Baronius and do a savage dance around the bonfire. Zing will orchestrate.
25 - zingzing
na na na na
na na na na
hey hey hey
goodbye
everybody
bluuurgh.