One fact I didn't know was that a year before FDR died, and right in the middle of the biggest political issue of all time (not Lewinsky-gate, but WWII), he proposed a second or "Economic bill of rights" to help guarantee a better quality of life for all Americans. He wanted to do this because the first Bill focused on our political rights, and FDR felt that equal and fair access should be linked to the pursuit of happiness (otherwise what's the point?). FDR came from privilege but saw how greed from the rich sunk the market and crippled many of honest families during the Depression, and wanted to lay the foundation for a better future for Americans. Frankly, I find it utterly negligent and immoral that my public high school did not teach this, and I hope your schools were better. But then again, social sciences textbooks are produced by large companies that could stand to lose if an economic bill of rights were ever supported and enacted by the people.
Part of FDR's 1944 State of the Union speech went:
It is our duty now to begin to lay the plans and determine the strategy for the winning of a lasting peace and the establishment of an American standard of living higher than ever before known. We cannot be content, no matter how high that general standard of living may be, if some fraction of our people—whether it be one-third or one-fifth or one-tenth—is ill-fed, ill-clothed, ill-housed, and insecure.
This Republic had its beginning, and grew to its present strength, under the protection of certain inalienable political rights—among them the right of free speech, free press, free worship, trial by jury, freedom from unreasonable searches and seizures. They were our rights to life and liberty.
As our nation has grown in size and stature, however—as our industrial economy expanded—these political rights proved inadequate to assure us equality in the pursuit of happiness.
We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. “Necessitous men are not free men.”[2] People who are hungry and out of a job are the stuff of which dictatorships are made.
In our day these economic truths have become accepted as self-evident. We have accepted, so to speak, a second Bill of Rights under which a new basis of security and prosperity can be established for all—regardless of station, race, or creed.
Among these are:
The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;
The right to earn enough to provide adequate food and clothing and recreation;
The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;
The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;
The right of every family to a decent home;
The right to adequate medical care and the opportunity to achieve and enjoy good health;
The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment;
The right to a good education.
All of these rights spell security. And after this war is won we must be prepared to move forward, in the implementation of these rights, to new goals of human happiness and well-being.
For unless there is security here at home there cannot be lasting peace in the world.
http://en.wikipedia.org/wiki/Second_Bill_of_Rights
Unfortunately, FDR was quite ahead of his time. "Unless there is security here at home, there cannot be lasting peace in the world." Why do so many young, poor Americans "volunteer" for our armed forces or defense contractors? Some due to patriotism, but others due to material need and lack of gainful employment at home. Why did we go to war in Iraq? Partly because we don't have trade and energy security for our economy at home.
"Individual freedom cannot exist without economic security." How many of us are "slaves" to our jobs, and just put up with more and more abuse and loss of rights/benefits/dignity because we have no choice, and people count on us to make ends meet? How many of us are enslaved by the ridiculous cost of living in many metro US locations, the ridiculously complicated paperwork associated with taxation, finance, property, family, and other legal issues (that is way worse than any other G20 nation), and the ridiculous cycle of what economist Thorstein Veblen first coined "conspicuous consumption," because we think buying all that stuff will make our lives better, and make us look cooler and more successful to our peers (when they actually just steal our time, money, and even health)? What kind of "labor market" do we have when people don't pursue their dreams and innate talents because of material considerations (I can't believe that the best and brightest of us choose to work in finance, software, and cosmetic surgery because they truly love it more than other fields of letters and arts with more tangible social benefits)? What is the difference if a Marxist Leninist state tells you what job you will have, or the market? It's not really your choice either way unless you're independently wealthy, really lucky, or a standout with some desired skill set. How many of us or people we know stay at a bad job just for the medical coverage, or because they're worried they will run out of money during retirement? When we're economically desperate (or some may call it economically rational), we will endorse many harmful political and social practices. Our efforts to "maximize personal profit" may end up hurting us, and it happens every day.
Look at the list of rights: a useful and remunerative job that pays enough to provide and even have a little fun, a fair market with decent returns and competition, adequate housing, medical care, retirement, education, and disaster insurance. He's not asking for the moon here, but these days it seems like it. There isn't even a right for workers to unionize or represent themselves on the board. There's nothing that says everyone is entitled to a McMansion, SUV, and tropical time-share. What's ironic is that the idealists in our government who were inspired by FDR went out to the ravaged nations in Europe and Asia through the Marshall Plan, and helped create constitutions and societies that did uphold these rights that never materialized in FDR's country, rights that the business community equates to socialism and evil. Yes those other countries are no paradises (well, maybe Sweden would be if it had San Diego weather) and have their share of economic problems. Their social safety nets are fraying under the pressures of rising costs and aging populations, Japan had its own housing bubble and decade-long recession, and Europeans engaged in risky financial speculation and over-leveraging. Actually they only when wrong when they decided to act like Americans. At least they did what they could to create reasonably equitable societies (the rich-poor gap in Japan is the smallest in the world, while free market Mexico and Brazil have some of the highest), and presided over at least two generations of very happy, healthy, peaceful, productive, and well educated people. Think about how their policies helped prevent millions of people from going hungry, getting sick, and going to jail unnecessarily, while the numbers of those in America have soared since WWII despite our superior wealth.
When considering the cases of those nations (of course FDR had no way of predicting how the world would be in 2010), critics may say that we couldn't afford the economic bill of rights and it would be a government-run disaster of a social experiment. Inefficient markets due to government price controls and mandates always cause other problems, like the New York City rental market or gas rationing during the OPEC embargo. But who really knows, since we didn't give it an honest try. Imagine if all the wealth that was concentrated on Wall Street and among the richest 1% of us since WWII was instead used to make social services better and more efficient, or even make companies and communities more sustainable. Imagine if all the big brains behind Enron and mortgage-backed securities instead used their talents to improve society for all. It's a positive cycle that then raises the overall productivity, health, happiness, and wealth of a society. We'd waste less money on prisons, wars, pharmaceuticals, and frivolous products, which would give us more spending power for life essentials, and might even drive down the market price for the super-expensive things that we struggle with today (housing, education, health, elderly care). A "socially responsible" free market could have worked.
Before you write me off as an anti-consumerist socialist, I do want to say that I endorse the economic principle that efficient markets do create wealth and give everyone a "bigger share of pie". The problem is that the rich get most of the pie gains, so what's the point for the rest of us? As Moore said in his film, and maybe we have postulated over email too, those of us in the non-rich masses tolerate and even support this innately unjust market system because we hope that one day we will join the likes of the rich. It's like wasting one's pocket change at a slot machine because someone's gotta get a jackpot eventually, right? Except this time it's your life, your life savings, and no do-over. But what if you don't make it to the promised land (and don't get a federal bailout when you fail)? You would have endorsed a system that has brought you and millions like you unnecessary hardships just so a lucky, smart, or cheating few can profit immensely. If we had a choice between a reasonably socially secure life without the possibility of being rich or poor, or the free market where one can soar high or crash and burn (and be required to pay for everything out of pocket), would you be willing to pull the slot machine lever? And even if you do manage to make it big, is it still justified to gain at so many others' expense? Most major religions say no, and in fact they say the greedy and rich are cursed to hell.
The free market works better if people are more responsible with their profit motives, and don't take more than they reasonably need. But how the hell do you enforce that in a democracy? The incentive principle states that people tend to make decisions that will benefit them, so hopefully the wealthy will feel more personal benefit from philanthropy than making that one extra million (to add to their already immense net worth) from a Ponzi scheme. If a big investor owns X million shares of company Y, which had a good year, why not forgo dividends so that the company can pay its people better and offer its products for less? The stock already went up, you don't need the extra money, and your contribution will position the company to do even better in the future. Generosity, or even common sense, pays too and maybe better than greed. A good rancher keeps his milk cow healthy and doesn't slaughter her for meat. Goldman Sachs and George Soros types are the latter, speculators who contribute to and profit from market volatility that brought immeasurable panic and even suicides to honest investors and pensioners. There's no economic safeguard or equilibrating force to prevent the super rich from getting more and not sharing, which hurts everyone unless the pie is growing at a crazy pace (which we all know can't last). I guess the government used to step in and "spread the wealth around." The top tax bracket was 90% under JFK (when America had fewer super-rich), but today it is half that and capital gains/dividend taxes are obscenely low (the rich get much more money from investments than wages) as part of the Bush tax cuts that may expire soon. A society is not sustainable if the super rich profit without giving a "fair share" back, which also contributes to massive government debt (in both good and lean times it seems) which hurts everyone. Even conservative free marketeer Alan Greenspan, who helped us into this recession as chairman of the Fed, came out against extending the Bush cuts for that reason: http://www.pbs.org/newshour/bb/business/july-dec10/greenspan_09-24.html.
Other shocking points from the movie:
1) Remember the Continental Express plane crash near Buffalo, NY a while back? Apparently right before the crash (which was attributed to weather and pilot error), the 2 pilots were complaining about their wages, which was a paltry $16,000 for the co-pilot Rebecca Shaw and not much more for the lead pilot. Moore interviewed some pilots who said they needed to take 2nd jobs or food stamps to get by, despite having a college degree and pilot's license that cost about $100K in student fees. This doesn't really apply to the subset of big-time pilots flying 747s on major routes, but why would lower pilots accept this horrible situation? They are cursed to love what they do, and airlines exploit this. Post 9/11 airlines need to cut costs to please Wall Street (even Southwest recently had a losing quarter), so they over-work and under-pay pilots, despite being unionized and even though those human beings are the only thing standing between hundreds of people getting to where they need to go safely, or dying a fiery death. Wages have been slashed and pensions are gone, but airline execs are living well. Are you ok with your pilot exhausted and stressed out about his or her personal finances? Imagine what other ways airlines are cutting safety or barely meeting FAA minimums. Even Miracle on the Hudson pilot Sully Sullenberger testified before Congress about this problem, but to deaf ears (and Congressmen take at least 50 plane trips a year!). If this is the magic of the market, I don't want any of it.
http://www.allheadlinenews.com/articles/7015139878
2) Companies take out "dead peasants" life insurance policies on some workers in order to make a little extra cash on the side, which they don't share with the deceased's family. Young workers are especially lucrative because they have so much future earning power and the chances of death are low, but for big firms like Wal-mart or AMEX, they have enough staff to try. They probably have actuaries crunching HR demographics data to select the subset of workers with the most profit potential. Companies are not required to disclose any of this, and it is perfectly legal, but lawyers and the media have found out through leaks and erroneous mailings to next of kin. It's just an example of how the profit motive has been terribly twisted into something that most of us would hopefully find very offensive. A worker may be worth more to a company dead than alive. I'm not saying that companies actively try to help their insured workers die, but if they stand to gain from death, do they have a subtle economic incentive to not really take care of the welfare and personal needs of that worker? Maybe over-work them and cut health benefits? And it's not like companies need to insure themselves against losing most workers (apart from rare critical personnel like Steve Jobs types) like a breadwinner insures his or her death for the family. Most companies are set up to have interchangeable parts and redundancies, so losing a worker now and then won't cripple the business. Co-workers cover until HR can hire a substitute, so it's all really just a side-bet to make more cash.
http://deadpeasantinsurance.com/
There are dozens of companies listed on the site, so see if your employer is among them! And remember that these are only the firms that got exposed.
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A recent NPR story about this topic, and more specifically an alternative to the corporate business model:
http://www.npr.org/templates/story/story.php?storyId=130197557
You are probably familiar with the Maglite heavy flashlights that police officers use, and their smaller versions for civilians. Those products are made by Mag Instruments, a decades-old private company of 700 employees located in Ontario, CA. The company founder and leader, Anthony Maglica, is over 70, hasn't taken a vacation since the 1990's, and wears a shop floor uniform to work. He grew up in the US during the Depression, and unfortunately his family moved from the frying pan into the fire, and he grew up hungry in WWII-ravaged Croatia. Maybe these early experiences formed his business priorities, such as customer and employee treatment over profits. While most small consumer goods are manufactured overseas for cost savings, Maglites have remained domestic, and the company has even internalized more parts fabrication to reduce supplier costs. Maglica has also kept the retail costs of his products the same as they were in the 1970's, which he achieved through automation and a general lack of desire for profit taking. Sure he could make more money by going overseas, but he doesn't feel the need (as in, do those rich bastards really NEED that 10th car and 20,000 sq. ft. home?). Things are not perfect, as Mag posted an $11M loss last year, and had to lay off 200 workers (I believe the first layoff in the company's history). Maglica said it was the worst day of his life when he issued the pink slips. Of course this model may not work for larger public corporations, but maybe it really depends on the conscience of the company's leader.
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