Friday, August 3, 2012

The Superfluous Class


For a republic founded by proponents of meritocracy, dedicated to "life, liberty, and the pursuit of happiness," it seems we stray from our mission a little. European style inherited royalty and persistent aristocracy represent the antithesis of our founders' ideals: life, liberty, and pursuit of happiness. Those founders supposed happiness and prosperity would accrue to those who earned it, not those who belonged to the right church, club, political party, or corporate board (race and sex were omitted from that list).
Now, reversion from the meritocratic ideal infects our culture. Few take offense at the cultivation of a crass ruling-class in our midst. With obscene piles of cash, our self-appointed aristocracy insulate themselves from the endemic sickness, poverty, and inadequate opportunity to learn and earn that plague the vast majority of us. Few objected while those who profited most over the last three decades decreed they should contribute the least. Toward that goal, the rich mastered a strategy to retain wealth; that is, to minimize their taxes. Equally insidious, they elevated their social status and esteem via the media outlets they own: movies, television shows, and magazine articles that celebrate riches but ignore the method of acquiring those riches. Not only do they extract wealth from us -- the vast un-wealthy majority -- but they extract our praise and admiration, too. They seize their pound of flesh, and expect us to applaud as they lop it off.
Our praise and admiration yields more than icing on the cake. Praise serves an essential purpose. Our collective fawning over the rich erects in our minds psychological barriers to the creation of laws that would impede retention of filthy lucre. We want so much to be like them we defy egalitarian attempts to inhibit unjust concentration of wealth. We fear friction on the upward flow of wealth will prevent our own acquisition of fabulous excess. In addition, our universal admiration of wealth grants the overfed an unassailable bully pulpit.

Of course, the rich do not risk climbing the towering pulpit themselves, their loyal designees do: politicians. Politicians financed by the wealthy eagerly and often reel off the virtues of their benefactors. And, like artists blessed with a devoted patron, the art tends to fit the taste of the sponsor. Bought politicians remind us, falsely: the rich create jobs for the rest of us. That sounds logical. It sounds inevitable. But it is not true. The vast majority of the rich are not business operators, but passive investors. They do not hire anyone. They seek maximum gain on investment. They are part of the constituency corporate CEO's and boards swear their allegiance to: investing shareholders (mutual and pension fund managers form the remaining bulk of that constituency).
Maximizing returns for shareholders does not require facilitating prosperity for domestic wage earners. On the contrary, with laws passed over the last thirty years by presidents and legislatures beholden to the rich, most corporations find it easier to exploit "free" trade rules and create wealth overseas. Overseas labor comes cheap. Overseas workplaces profitably omit modern standards for worker safety, health, and pensions, not to mention environmental protection. If free markets existed, this would not be the case. Impoverishing, poisoning and maiming your employees and rendering your environment toxic imposes costs. In a free market, violators would logically pay the assessed cost of worker and environmental abuse. Consumers would reject purely on a price basis products from companies that incur the highest overhead for worker injuries, workplace induced ill-health, and environmental degradation.

Besides pure cost consideration, would you buy a product from someone you knew poisoned your wife and then fired her, or lopped off the hand of your cousin and then fired him, or spilled mercury in your drinking water and ignored your plea for cleanup? Not likely. Not if you had a choice. A free, fully transparent market reveals such realities.


No comments:

Post a Comment

share your thoughts...