by Alan Briskin | Conscious Capitalism, Consciousness, Leadership
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Eight
Planetary Consciousness Arises, Cautiously
FLASH POINT
Himalayas, 1964
“Slowly and painfully, we are seeing worldwide acceptance of the fact that the wealthier and more technologically advanced countries have a responsibility to help underdeveloped ones. Not only through a sense of charity, but also because only in this way can we ever hope to see any permanent peace and security for ourselves.”
~ Sir Edmund Hillary, Schoolhouse in the Clouds
World Population, 1967
“[H]istorians have estimated that the world’s population at the beginning of the Christian era was 250 million. By the middle of the seventeenth century it had doubled, rising to about 500 million. By the middle of the nineteenth it had doubled again and reached the first billion mark.… By 1965, it was well over three billion, and the doubling period had shrunk from 1,500 years to about 35 years …
“Returning to the planet as a whole, the prospect is: 7 billion people in 2000; 14 billion in 2035; 25 billion a hundred years from now. ‘But,’ as a sober Ford Foundation report says, ‘long before then, in the face of such population pressure, it is inevitable that the Four Horsemen will take over.’”
— Arthur Koestler, The Ghost in the Machine
United Nations, 1969
I do not wish to seem overdramatic, but I can only conclude from the information that is available to me as secretary-general that the members of the United Nations have perhaps ten years left in which to subordinate their ancient quarrels and launch a global partnership to curb the arms race, to improve the human environment, to defuse the population explosion, and to supply the required momentum to development efforts. If such a global partnership is not forged within the next decade, then I very much fear that the problems I have mentioned will have reached such staggering proportions that they will be beyond our capacity to control.
— U Thant, Secretary-General, United Nations
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
New York City, 1973
In the early 1970s, I worked summers for my father delivering packages and assembling hand machines that stapled nailheads and rhinestones into fabric. His shop was almost exactly two miles from the Triangle Shirtwaist Factory on 23–29 Washington Place, which burned down in 1911. It was hot and muggy in his shop, and I didn’t enjoy working there, but it was nothing like the sweatshops that had existed over a half-century earlier. One reason for this was unions.
Marx was correct in predicting, counter to the sentiment of his time, that workers would not simply have more children, diluting their bargaining power, but would become ever more skillful in negotiating their immediate and mostly economic self-interest. For Marx, however, it would be this very advance that would trigger the system’s instability, as the workers’ demands would threaten profit and control. Owners would reject their workers’ ever-increasing demands, and workers would seek to strike back. Marx was quite certain that both sides would remain unconscious of their predicament. They would battle ceaselessly with each other until social unrest upended the whole system. How different circumstances were for me.
I recall one evening riding home with my father on a bus that took us from Manhattan to Queens. He wondered if I would be interested in taking over the business one day. It was an awkward moment between us, and I sat in silence looking out the window. “I don’t think so,” I mumbled. He didn’t respond, and we sat together in silence the rest of the way.
For me, taking over the business would have been abandoning myself. I would have preferred stapling nailheads through my hand. I was in college and passionate about finding alternatives to what I believed were soul-crushing institutional forces beginning in public schools and continuing through college, professional education, and most definitely the workplace.
My plan was to chart a new path, although how I might do that was unknown to me. I shared, with many others, a belief that economic survival was no longer the key determinant of career choices. Survival was at the bottom of a hierarchy of needs that included meaning, creativity, and human development. The work of the future involved social change, greater personal and interpersonal depth, and healing our planet earth. The stars in the sky proclaimed that this was the Age of Aquarius—or at least the stars on Broadway shouted it out loud, which was good enough for me.
Next Week: Wages Decline, Credit Expands, Rapidly
What I did not know, setting my sights on creativity and meaning, was that the economic rocket ship we were on was about to sputter and go sideways. For 150 years, capitalism in the United States had functioned, despite its busts and booms, to move in an upward spiral. Working people, on average, saw their real wages rising decade after decade. Until the 1970s, every generation had a reasonable chance to expect a better life than the previous one.
From 1978 to 2011, real wages after adjusting for inflation went flat, nada, nothing. I’ll say it again…
by Alan Briskin | Collective Folly, Conscious Capitalism, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Seven, Part Two
How Wealth Became Concentrated and the Poor Were to Blame: What Should Be Done with the Poor?
For the record, Harrington tried to address the dilemma of what constituted poverty, but his efforts backfired. He acknowledged that poverty was a social and historical construct, different in different time periods and cultures. He believed, like Roosevelt, that those without minimal levels of health, housing, food, and education were poor — especially when those same resources were available to the larger population. It is with this definition that he arrived at the 40–50 million figure of poverty in 1962.
Harrington came to believe that poverty was a function of reinforcing social elements that shaped an individual’s outlook. The outlook of the poor was different from the outlook of those who, like my parents, had hope for a better future. In that context, he believed that government had a critical role to play, but the real backdrop was the inadequate functioning of our economic and social institutions. Poverty resided in diverse physical locations and with different populations, but all faced similar obstacles. What were they?
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
FLASH POINT
Mitt Romney Criticized By Franciscan Friars For Comments On The Poor
Alex Becker
Huffington Post
Posted: 08/09/2012 2:36 pm Updated: 08/09/2012 3:55 pm
WASHINGTON- The Franciscan Action Network (FAN), a Catholic faith-based advocacy and civic engagement organization, is strongly criticizing Mitt Romney’s recent ads and rhetoric regarding welfare programs and welfare recipients, urging him to spend some time in low-income communities.
“Our Christian tradition teaches that we are to treat the poor with dignity and to prioritize the poor in our policies as a society,” the organization said in a press release on Thursday. “At a time when millions are struggling financially, it is degrading to talk about the ‘dependency’ of people hurting in this economy, as Gov. Romney did recently.”
Rhett Engelking, a secular Franciscan in Milwaukee and member of FAN, has even personally invited Romney to visit with the low-income people he assists. “Political leaders would not talk about the poor in demeaning ways or cut job training programs if they spent more time with the people they are affecting with their policies,” he said.
While faith-based anti-poverty and charity organizations have often criticized candidates and lawmakers for a perceived unwillingness to highlight and tackle issues affecting the very poor, FAN claims Romney’s rhetoric goes a step further, unfairly using welfare recipients as political props.
He understood something that has only recently been supported statistically by studying geographic zip codes. Harrington argued that poverty was a toxic mix of factors that included poor health, minimal access to health care, high-crime neighborhoods, hostile police presence, failing schools, generational cycles of unemployment, low income, family instability, and inadequate diets. Overcoming any one of these factors was possible, but together they represented a vicious cycle of cumulative obstacles whose aggregate outcome was failure. For example, I have estimated that there are zip codes in my hometown of Oakland, California, in which the chances of an eighth grader eventually graduating from a four-year college are less than 6%.
A few miles away in another zip code, on the border of Oakland, the figure is closer to 90% graduation with 98% planning to attend some form of college. Naturally, the attitudes and resources of the group in which 98% aspire to college will be different from those with little evidence that they will succeed. It was in this context that Harrington attempted to address a “culture of poverty,” and the term stuck in the worst possible way.
What Harrington was hoping to communicate was the hellish interlocking forces that resulted in a systematic repudiation of individuals and the groups they came from. He added that it was not uncommon to find an attitude of futility and lack of self-worth within these settings — but he stressed that these attitudes were the symptoms, not the disease. For Harrington, the absence of what he called positive aspirational qualities was the psychological demarcation separating this new form of poverty from others, enclaves so beaten down that the individual response was passivity, self-destructive behavior, and outbursts of violence. He believed that somehow if the larger society became conscious of such a destructive spiral, they would be inspired to change it.
Looking back with hindsight, we might wonder what the hell he was thinking. Instead of altruistic regard, a backlash against the symptoms of poverty became the rallying cry for both the left and the right. The left wanted to create legislative policies and fund government programs to fix the problem; the right vilified the subjects of Harrington’s findings – the poor and marginal – as failing due to their own poor attitude and dismal culture.
Harrington’s analysis, viewed as initially catalyzing John Kennedy’s interest in the subject of poverty and later Lyndon Johnson’s war on poverty, inadvertently provided fodder for the belief that poverty was simply other. The poor were subject to character flaws of epic dimensions. These included lack of impulse control, limited sense of self, manipulativeness, unwillingness to contribute to society, and being destitute by nature if not by choice. Daniel Moynihan, a drinking buddy of Harrington’s at the White Horse Tavern in Greenwich Village and former assistant secretary of labor under both Kennedy and Johnson, compounded the problem with a report a few years later focusing on the inner city titled The Negro Family: The Case for National Action.
Now poverty would be construed as other and black, though some might question that as redundant. What is unquestioned is that the same forces that polarized during Roosevelt’s time in office now found a new subject to disagree about with each other. What Harrington tried to portray as a byproduct of failing economic and social institutions cutting across age, race, and geographic region instead became the stigmatization, if not demonization, of the poor. The culture of poverty was for many the confirmation of an existing belief. The poor were to blame for having too many children, fostering negative attitudes, lacking personal responsibility, and demonstrating an absence of respect for law and order. The poor would drag us all down if we let them.
A decade or so later, Ronald Regan would campaign against welfare queens driving Cadillacs and taking money out of our collective pockets with their welfare checks. His message was that government should not aid and abet personal misconduct. Years later, Bill Clinton would negotiate new welfare reform legislation that mandated “chastity training” for poor single mothers. As Barbara Ehrenreich pointed out in an article on the 50th anniversary of The Other America’s publication, the language of a “culture of poverty” began as a jolt of social consciousness but devolved into the cornerstone of conservative ideology. The assault from the right was that poverty was caused “not by low wages or a lack of jobs, but by bad attitudes and faulty lifestyles.”
Meanwhile, the ghost of Karl Marx snickers on a stool at the Red Lion Pub. Ehrenreich, who knew Harrington, noted the subterranean forces that may have driven Harrington to use the “culture of poverty” as an explanatory principle. “Maurice Isserman, Harrington’s biographer, told me,” she wrote, “that he’d probably latched onto it in the first place only because ‘he didn’t want to come off in the book sounding like a stereotypical Marxist agitator stuck-in-the-thirties.’” Harrington, a socialist, probably didn’t want to be dismissed for evoking the one who could not be named.
In many respects, Harrington succeeded by not being identified with Marx. However, by avoiding one pitfall, he fell into another. By offering up the idea of culture as a way to understand what was happening in America, he provided an escape valve for both sides of the debate. One side viewed the poor as evidence of an unfulfilled contract within an affluent society needing remedy; the other viewed them as a danger to society. Neither really wanted to talk about the distribution of wealth or the structural basis of social inequality. Icebergs will melt and buildings will fall before we get to that one.
Next Week:
Chapter Eight: Planetary Consciousness Arises, Cautiously
by Alan Briskin | Community, Conscious Capitalism, Photography, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Seven, Part One
How Wealth Became Concentrated and the Poor Were to Blame: “Paupers are Everywhere”
1962
“Paupers are everywhere.”
~ Complaint heard from Queen Elizabeth, late 16th century, after returning from travels in the English countryside.
Michael Harrington, political activist, socialist, and professor of political science at Queens College, was no Queen Elizabeth, but his research on poverty came to the same conclusion. As he wrote in his book The Other America, he was horrified to find that 40 to 50 million Americans lived in poverty, a fifth to a quarter of the entire US population in 1962. Where were they hiding?
He believed that a subtle shift had taken place in the psychology and culture of poverty. Whereas the tenements of the early 20th century were seething with a mixture of races and immigrants, there was enough diversity of intelligence, backgrounds, and aspirations to create a modicum of hope and vitality. There was poverty, disease, and poor housing in the past, but they were circumstantial obstacles to be overcome in a country that could provide social mobility and the promise of riches. Something about the very nature of poverty had changed from these historical antecedents.
My father and mother were never rich, but through hard work and frugality they found a way to make a living and see that their children might have more education than they did. There was hope for a better future. In the ’30s, when my parents were teenagers, the context for poverty was the Depression, and it gave them a collective sense of shared hardship and sacrifice. Poverty was a marker not so much of the person as of the times, a condition of society. The poor, which included tens of millions on low wages, had more of a voice politically and were not necessarily stigmatized by their circumstances. The 1930s were also a turning point for unions, which were able to flex their collective muscle and found themselves, just as Marx predicted, able to aggressively pursue their members’ own economic self-interest relative to wages and work rules.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
In the late 1930s and early ’40s, the world itself was at risk. The United States went from an economic depression into a fight with an enemy believed to be the incarnation of evil. These were tough times, and the sheer exuberance of victory over evil by the mid-’40s made it easier to believe that the forces of poverty were lessening as well. In the late ’50s and early ’60s, when my parents were finally finding success and Harrington did his research, there may have been a willingness to overlook poverty as a still important aspect of the social fabric requiring attention.
Poverty, as Harrington saw it, had now matured into something separate, multigenerational, and psychological. Separate in the sense that there were whole towns, cities, or parts of cities throughout the United States that were stuck in a downward spiral. Economic and social vitality was in the business hubs of cities, in suburbs where the affluent raised their children, and along geographic corridors, not in rural areas or urban centers, where poverty was concentrated.
Small towns were adversely affected by the greater dependence on skilled labor and technology. Smaller farms were being marginalized by greater mechanization and corporatization. Minorities increasingly congregated within inner cities, which were referred to as slums and characterized by a pervasive attitude of futility. Those who could exit such places did, and the remaining were hemmed in by tight social beliefs and attitudes. The more rural or isolated an area, the more cut off from diverse lifestyles and perspectives, the more insulated and rigid became the social milieu, and the more hostile and unforgiving was its view of others.
No longer was poverty simply across the tracks; it was a contagious mindset of scarcity, fear, and resentments. It was passed down generation after generation and socially reinforced by members of its own community. Poverty and economic hardship manifested psychologically through symptoms of anger, cynicism, and intolerance. The swelling anger that Marx predicted was not crystallized between workers and owners of capital. No, it was fragmented across race, religious, geographical, and educational divisions.
Where were the poor? In the ’60s, the poor were increasingly becoming invisible — the aged tucked away in old-age homes, poor children in failing schools, minorities in slums, rural poor in the countryside just a stone’s throw away from tourist travel. A decade later, when I worked at a state prison located in St. Johnsbury, Vermont, my job was to find local employment for inmates finishing their sentences. My territory was called the Northeast Kingdom, an area as poor as Appalachia. A tourist would never have known this from driving through the area, however — a year-round recreation destination for skiing, fall foliage, and maple syrup. How sweet it might have looked to a person just passing through.
Who were the poor? If you measured the poor by material possessions such as a television set, a refrigerator, or even a decent pair of sneakers, nearly everyone was well off. If you measured only by income, you included many still starting out toward success. If you measured by psychological factors, you risked subjective prejudice. The very idea of poverty was becoming porous, fluid, and ambiguous. Poverty was not only physically becoming separate from society; it was also psychologically separating itself from social awareness, as something to be avoided. Poverty was no longer circumstantial, as it had been for my parents, or temporary until one found productive outlets; it was an all-encompassing and pitiful predicament to be in. Harrington believed, however, that if we looked at poverty with an open heart and mind, social conscience would well up in our breast. Over a million copies of his book were purchased, a surprising number to be sure, and suggesting that something unsettled was still nagging in the American psyche.
Next Week: Chapter Seven, Part Two: What Should Be Done with the Poor?
Harrington understood something that has only recently been supported statistically by studying geographic zip codes. Harrington argued that poverty was a toxic mix of factors that included poor health, minimal access to health care, high-crime neighborhoods, hostile police presence, failing schools, generational cycles of unemployment, low income, family instability, and inadequate diet. Overcoming any one of these factors was possible, but together they represented a vicious cycle of cumulative obstacles whose aggregate outcome was failure. For example, I have estimated that there are zip codes in my hometown of Oakland, California, in which the chances of an eighth grader eventually graduating from a four-year college are less than 6%.
by Alan Briskin | Conscious Capitalism
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Six:
The Organization Man Meets Radical Self-Interest
Time Range: 1956 – 1960, 1987 – 2008
In 1956–1957, two enormously successful books came out that might be thought of as shadow documents for this period of history — shadow in the sense that they exposed unstated fears and extreme reactions that lay just outside the upbeat portrayal of American society. The first was The Organization Man, by William H. Whyte. Decrying the subtle homogenization of thought and attitude in American society, Whyte warned that a new form of false cooperation was being preached in corporate hallways. Having conducted interviews at General Electric and Ford, he came to believe that a collectivist ethic was leading to a pathological love of safety and fear of risk taking. The emerging language of corporate human relations was nothing more than a justification for hiding in crowds and expecting a predictable career path.
The shadow of emerging affluence was people without character, without a soul. For those who still remembered Marx, it was a confirmation of his warnings about human degradation and loss of authenticity. For others, it was a clarion call to advance the value of self-reliance and the importance of individual self-interest against the wave of homogenizing influences.
In 1905, a nice Jewish girl named Alisa Rosenbaum was born in Russia. She was educated there and came to the United States in 1926. She could have been my father’s older sister, as he was also Jewish, was born in Eastern Europe, and came to the United States in 1925–1926. They both believed in an individual’s capacity via hard work and persistence to shape his or her own destiny. My father’s path was to work in New York City’s garment district selling fabric and wire for hats until he invented a small hand machine that set rhinestones and nailheads into clothing. He called it the Brisk-Set.
Alisa took another path. She became a Hollywood screenwriter and wrote novels. She demanded reverence for her ideas, and her wild mood swings may have been influenced by the amphetamines that she took. She called herself Ayn Rand and in 1957 published her magnum opus, Atlas Shrugged.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
Atlas
Shrugged, which I read in
high school, struck some fundamental chord in the American psyche. The book
launched her from an already-successful author to a major intellectual force,
and the book still sells well to this day. Championing a morality of radical
self-interest, Atlas Shrugged was a
fictional account of a brilliant and creative man who simply did not feel
appreciated enough. We can only begin to imagine how many people identified
with such a hero.
In Rand’s social dystopia, society had been hoodwinked, and the best and brightest were being compromised by illegitimate attitudes of altruism, collectivism, and state-controlled interventions. From what she believed was a rational and objective perspective, society owed its future to the few truly extraordinary individuals, and government should get out of their way. She certainly viewed herself in this way, declaring herself on national television the most creative thinker alive, although one of her admirers, Newt Gringrich, might have had a quarrel with her on that score.
Alan Greenspan, former chairman of the Federal Reserve, was also a great admirer, paying his respects at her funeral and sharing with her a deep faith in laissez-faire capitalism and individual rights. He served as chairman of the Federal Reserve from 1987 to 2006, and his disdain for regulation was almost as revered as his reputation as a financial wizard. However, something went awry a couple of years after he stepped down. He acknowledged to Congress in testimony regarding the economic collapse of 2008 that he simply could not believe that markets would not be self-correcting. “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief” (New York Times, October 23, 2008).
He acknowledged a “flaw” in his conceptual framework of reality and was distressed by it, believing the model had worked, in his mind, exceedingly well for 40 years. Hearing him speak in his gray monotone style reminded me of a computer initiating a safety check, looking for bugs in the code that might be influencing the computer’s efficiency.
In metaphoric terms, Ayn Rand was writing code back in the ’50s for successful individuals to separate themselves from others without guilt or shame. This had been achieved in the past by royalty, having associated their divine rights with God, but for Rand this could not be the justification.
Instead, she welded her very real distrust of central authority encountered in Russia with a mandate for individual self-esteem, an emerging philosophy of positive self worth that would crest in popularity late in the 1960’s. She proclaimed that what benefited societies were people who used their talents to the full and who were not inhibited or regulated by others. Laissez-faire capitalism was simply the economic and social extension of these ideas.
Unfettered capital accumulation by the individual was only logical to Rand – one should keep what was personally earned. The individual had to be constantly at war with the collectivist viewpoint, a battle that must be waged continually, or risk the very moral fiber of the nation. This was a battle that transcended Rand herself; individualism was a philosophy associated with triumph.
The pristine nature of these libertarian ideas was like a tonic to the ambitious organization man. Here was a remedy for the forces of conformity and homogenizing influences of a mass-producing culture. In Rand’s model of a robust society, individual self-esteem and making lots of money were inseparable. How could this not be right? It was the perfect marriage. The organization man meets a tough and spirited woman in a cocktail bar called Capitalism, and they go at it. If only it were so. The ’50s in the United States had an underlying tone of self-congratulation that was about to change quite dramatically.
FLASH POINTS
April 17, 2012
Paul Ryan Suddenly Does Not Embrace Ayn Rand Teachings
WASHINGTON- Rep. Paul Ryan (R-Wis.) tried to send the message this week that, contrary to ‘urban legend,’ he is not obsessed with philosopher and author Ayn Rand.
“‘I reject her philosophy,’ Ryan told the National Review on Thursday. ‘It’s an atheist philosophy. It reduces human interactions down to mere contracts and it is antithetical to my worldview. If somebody is going to try to paste a person’s view on epistemology to me, then give me Thomas Aquinas. Don’t give me Ayn Rand.’
“Best known for her novels ‘The Fountainhead’ and ‘Atlas Shrugged,’ Rand advocated a philosophy that emphasizes the individual over the collective, and viewed capitalism as the only system truly based on the protection of the individual. She has been a significant influence on libertarians and conservatives.
Ryan, whose name has been floated as a possible running mate for GOP presidential candidate Mitt Romney, appeared to be distancing himself from Rand in response to a public letter he received this week from nearly 90 faculty and administrators at Georgetown University. In their letter, they criticize him for misusing Catholic social teaching in defending his budget, which hurts the poor by proposing significant cuts to anti-hunger programs, slashing Pell Grants for low-income students and calling for a replacement of Medicare with a voucher-like system. They also invoke Rand’s name.
“‘As scholars, we want to join the Catholic bishops in pointing out that his budget has a devastating impact on programs for the poor,’ said Jesuit Father Thomas J. Reese, one of the organizers of the letter. ‘Your budget appears to reflect the values of your favorite philosopher, Ayn Rand, rather than the Gospel of Jesus Christ. Her call to selfishness and her antagonism toward religion are antithetical to the Gospel values of compassion and love.’
“But any urban legend about Ryan’s affinity for Rand surely started with Ryan himself, who, prior to this week, had no qualms about gushing about Rand’s influence on his guiding principles.
“‘The reason I got involved in public service, by and large, if I had to credit one thinker, one person, it would be Ayn Rand,’ Ryan said during a 2005 event honoring Rand in Washington, D.C., the Milwaukee Journal Sentinel reported in April 2009.
“During the 2005 gathering, Ryan told the audience, ‘Almost every fight we are involved in here on Capitol Hill … is a fight that usually comes down to one conflict — individualism versus collectivism.’ The event was hosted by The Atlas Society, which prominently features a photo of Rand on its website and describes itself as a group that ‘promotes open Objectivism: the philosophy of reason, achievement, individualism, and freedom.’”
~ Huffington Post
“PBS Frontline Investigation into Financial Crisis Suggests Another Disaster on Horizon
April 24, 2012
“On Tuesday night PBS will air the first two parts of a four-part documentary on the crisis, called ‘Money, Power and Wall Street,’ with the second two parts to air next Tuesday, May 1. …
“It puts credit derivatives in their rightful position as the ultimate cause of the financial crisis — not the selling of houses to poor people, not super-low Federal Reserve interest rates, not a surplus of savings from China or Japan. …
Derivatives — bundles of securities that sliced and diced mortgages and sold them to investors, and credit default swaps that helped investors pretend they’d bought insurance against those bundles going bad — fueled what Frontline calls ‘an unfettered brave new world of banking,’ spreading credit liberally throughout the land, feeding the housing boom and exposing the banking system to nightmarish risk.
“And this all happened far, far away from the oversight of regulators, who bought the arguments of Alan Greenspan, the Thomas Friedman of finance, that any fetters on the free market would block the free flow of credit.
“‘The regulation of derivatives transactions that are privately negotiated by professionals is unnecessary,’ rasped the Ayn Rand acolyte, who seems to grow more monstrous with hindsight. ‘It hinders the efficiency of markets.’
“Banks, meanwhile, whined that they would lose their ability to compete in the global financial system if the government didn’t immediately break down the Depression-era rules that prevented them from getting too big to fail. Okey-doke, said both Congress and the Clinton administration. You got it.”
~ Huffington Post
Next Week: How Wealth Became Concentrated and the Poor Were to Blame
“Paupers are everywhere.” ~Complaint heard from Queen Elizabeth, late 16th century, after returning from travels in the English countryside.
Michael Harrington, political activist, socialist, and professor of political science at Queens College, was no Queen Elizabeth, but his research on poverty came to the same conclusion. As he wrote in his book The Other America, he was horrified to find that 40 to 50 million Americans lived in poverty, a fifth to a quarter of the entire US population in 1962. Where were they hiding?
by Alan Briskin | Conscious Capitalism, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Five:
A Shining City on a Hill
Problems No More, USA, 1952-1956
In a dozen short years removed from FDR’s last State of the Union address, the economic landscape had changed dramatically, or so it seemed. The brilliant Robert L. Heilbroner, economist and economic historian, could write that what distinguished the capitalism of the United States from all others was its refutation of Marx’s assumption that government could not be an impartial arbiter. American democracy, he proclaimed, tolerated and allowed for an open discussion of class struggle without class warfare.
Heilbroner believed government could, and did, play a significant role in reconciling divergent interests — and this, Marx, the flawed observer, did not see. How could Marx, Heilbroner suggested, surrounded as he was by the Dickensian factories of England, Russia’s brutal condemnation of trade unions under the czar, monopolies officially championed in Germany, and the ineffectiveness of Italy and Greece to collect their own levied taxes on their respective business communities? The huge chasm between the rich and poor in Europe obscured any vision of reconciliation.
But not in America. Here was the shining city on a hill, to use Ronald Reagan’s attribution of America’s exceptionalism decades later. Here was a country that was neither frozen by a historical aristocracy nor closed to social mobility.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
The expansion of the economy after the war seemed closer to Adam Smith’s Wealth of Nations than to some sourpuss guy named Marx, who at times couldn’t even leave his home because his coat and shoes were sitting in a pawnshop. Even a progressive intellectual like Mary McCarthy could write:
The mansions are torn down and the real estate “development” takes their place…. Class barriers disappear or become porous; the factory worker is an economic aristocrat in comparison with the middle class clerk … vast inequalities and dramatic contrasts are ceasing to exist.
~ Quoted in The Illusion of Unity in Cold War Culture by Alan Brinkley.
From out of inner-city tenements sprang planned communities, like Levittown in New York, and more generally the birth of the suburbs. Mass production strengthened its hold on construction, agriculture, livestock, and our general view of using natural resources. How we build our homes, grow our food, house our animals, and slaughter them all came increasingly under management with an eye to efficiency and surplus value. Under what was labeled free enterprise, incomes grew among the middle class, products expanded, and television emerged to entertain and enchant. What’s not to like? And in contrast, a dozen years of Joseph Stalin (1941–1953) solidified views not only of the error of communism as an economic model but also of the danger of collectivist strategies that masked a top-down concentration of political power.
In the United States, a new society seemed possible, suggesting a greater unity of interests and values traversing classes and regions. What was required was a good work ethic, a little imagination, and a can’t-say-quit attitude. Running for president in 1952 and 1956, General Dwight D. Eisenhower captured this zeitgeist while simultaneously repudiating Franklin Roosevelt’s call for an activist government. Eisenhower beat Adlai Stevenson, who had served under Roosevelt and attacked Eisenhower’s championing of the business community, twice — by large margins. Was it possible that capitalism had matured to the point where it was beyond booms and busts?
Next Week: The Organization Man Meets Radical Self-Interest, 1956 – 1960
Alisa took another path. She became a Hollywood screenwriter and wrote novels. She demanded reverence for her ideas, and her wild mood swings may have been influenced by the amphetamines that she took. She called herself Ayn Rand and in 1957 published her magnum opus, Atlas Shrugged.
by Alan Briskin | Business, Conscious Capitalism, Health, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Four, Part Two:
Out of Depression and War, a New Vision of Wealth Distribution
Time Range: 1929-1944, 2012
The economic bill of rights highlighted
a scar in the American psyche. Roosevelt’s time in office, which included a
failed coup d’état directed against him, deepened the resolve of factions
opposed to government intervention. From
this moment on, a widening split would cleave those who believed in federal
intervention from those who perceived arrogance in a government that addressed
questions of economic distribution.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
FLASH POINT
The Obama Economy–and Ours
Government didn’t build
that.
By Patrick J. Buchanan, July 24, 2012
“If you’ve
got a business, you didn’t build that. Somebody else made that happen.” Mitt
Romney fell on this Obama quote like an NFL lineman on an end zone fumble
during the Super Bowl. And understandably so.
For this
was no gaffe, said Romney, this is what Obama believes. This is straight out of
the catechism. Obama thinks that had not the government created the
preconditions, none of us could succeed. We all depend on government. None of
us can make it on our own.
Had Obama
been channeling Isaac Newton–”If I have seen further than others it is because
I am standing on the shoulders of giants”–or John Donne — “No man is an island,
entire of itself”–many would have nodded in agreement.
But what
Obama seemed to be saying–indeed, was saying–was that, without government, no
business can succeed.
Realizing
that statement rubs against a deeply ingrained American belief–that the people
built the nation–Obama and his acolytes are charging that Romney ripped his
words out of context.
Here is Obama’s full quote:
“If you were successful, somebody along the line
gave you some help. There was a great teacher somewhere in your life. Somebody
helped to create this unbelievable American system that we have that allowed
you to thrive. Somebody invested in roads and bridges. If you’ve got a
business, you didn’t build that. Somebody else made it happen.”
Conservatives, as opposed to liberals, proclaimed that people had a right to own what they owned and government should be on a very short leash. Government intervention should be held to the strictest criteria for determining what benefited the nation as a whole, especially in regard to infringing on private property and wealth accumulation.
The danger of deviating even a little from this principle, they warned, would unleash a swarm of another form of special interest groups, mostly those not very good at earning a living. This meant limiting what government should do and how much taxes it should collect.
If Roosevelt argued the moral and
political basis for ensuring freedom from want, conservatives argued the moral
and political basis for ensuring freedom of individual rights and protecting
those who succeeded on their own without government assistance. If one side
argued against the special interests of business and corporate influences, the
other side argued against the special interests of labor and minorities.
The interdependence of the whole was
visible to some and invisible to others. Both felt the success of the nation
was at stake. Both sides felt varying
degrees of contempt for the other, to the point where even the same words would
appear to have entirely different meanings.
FLASH POINT
US Supreme Court: Closing Arguments Regarding Health Care Mandates
New York Times, March 30, 2012
“Solicitor General Donald B. Verrilli Jr. concluded his defense of the law
at the court this week with remarks aimed squarely at Justice Kennedy. Mr.
Verrilli said there was ‘a profound connection’ between health care and
liberty.
“‘There will be millions of people
with chronic conditions like diabetes and heart disease,’ he said, ‘and as a
result of the health care that they will get, they will be unshackled from the
disabilities that those diseases put on them and have the opportunity to enjoy
the blessings of liberty.’
“Paul D. Clement, representing 26
states challenging the law, had a comeback. ‘I would respectfully suggest,’ he
said, ‘that it’s a very funny conception of liberty that forces somebody to purchase
an insurance policy whether they want it or not.’”
To complicate matters further, discussion of the
proper role of government also pinched a nerve in the neck of the county’s
individualistic orientation. Going back to Henry David Thoreau, the view of
government was that it was the least capable of social institutions to do
anything right. Government was no more than a body of collective incompetents
compromised further by having to compromise with each other. Thoreau, a
naturalist, was not very fond of what he observed of human behavior,
particularly in regard to group behavior on the political stage.
So the mold was cast:
individualism, the right of private property, and state’s rights against those
who believed in groups, collective interdependence, and federal government
intervention. Hopefully the problems would just go away, because the lines were
drawn in such a fashion that no resolution was possible.
FLASH POINT
Health Care Reform and the Supreme Court
New York Times, June 29, 2012
The Supreme Court largely upheld President Obama’s health care law, the Affordable Care Act, in a mixed decision. The conservative chief justice, John G. Roberts, joined the
majority in affirming the central legislative accomplishment of Mr. Obama’s
term.
Chief Justice Roberts ruled that the key provision in
question, the so-called individual mandate requiring all Americans to buy
insurance or pay a fine, failed to pass constitutional muster under the
Commerce Clause, which was the heart of the administration’s arguments in favor
of it. But the chief justice declared that the fine amounted to a tax that the
government had the power to impose, and that the mandate could survive on that
basis.
The decision did
significantly restrict one major portion of the law: the expansion of Medicaid,
the government health-insurance program for low-income and sick people. The
ruling gives states some flexibility not to expand their Medicaid programs,
without paying the same financial penalties that the law called for.
The
debate over health care remains far from over, with Republicans vowing to carry
on their fight against the law, which they see as an unaffordable infringement
on the rights of individuals. The presumptive Republican presidential nominee,
Mitt Romney, has promised to undo it if elected.
Next Week: A shining City on a Hill, 1952-2956
In a dozen short years removed from FDR’s last State of the Union address,
the economic landscape had changed dramatically, or so it seemed. The brilliant
Robert L. Heilbroner, economist and
economic historian, could write that what distinguished the capitalism of the United
States from all others was its refutation of Marx’s assumption that government
could not be an impartial arbiter. American democracy, he proclaimed, tolerated and allowed
for an open discussion of class struggle without class warfare.
FLASH POINT
United Nations, 1969
