Saturday, October 7, 2017

The Smoldering American Civil War© of the Twenty-First Century

INCOMPLETE DRAFT


The Smoldering American Civil War© of the Twenty-First Century

Under a pile of forest debris, a fire can linger, quietly and unsuspectedly burning at a low intensity. Smoke might be seen rising up from a few places and animals might avoid the hot spots in the debris, yet no one would think to put out something that was not producing flames. Now turning the analogy in our minds, do we really think a modern political conflict can be “put out” like a campfire? Or does any such smoldering conflict have to burn through its own historic route? Do the very elemental conflicts in human nature and within our shared national values have to burn with all intensity before we realize the epoch we live, and realize its meaning to our shared life as a nation?

The thrust of this article is that the differences between American citizens is not stark, is not lining us up on warring sides. The differences are not so volatile until the political gamesmanship of the Congress, White House, lobbyists, state legislatures, issue-driven groups, journalists and talk show hosts, etc. start jockeying for position, competing to outdo each other over the issues of liberty and community life. When the rhetoric turns hostile under those considerations, and civilians beyond those halls of rhetoric begin internalizing the diametrically opposing views from the media, then we can see people picking up arms against each other. To avoid war, can we find some middle grounds for dialogue, for discussions, for education, for empathy with the fears expressed by others?

Calling our current epoch a Civil War is a way of referring back to the Civil War of 1861 – 1865. That war had a smoldering beginning too. The young nation was learning of its own prosperity and its ability to self-govern without royalty or lords or despots. All of the European principalities and colonists, Russia, the Turkish Empires were watching to see if this American experiment would last or if it would collapse for some reason, offer some proof this democracy was a flash-in-the-pan, destined to fail as it had in the ancient Roman example.

The young nation had serious setbacks too!! The War of Independence had cost them dearly, in treasure, debt, infrastructure, relations with the Mother Country England and lives, valuable lives. Then the new nation tried out their Articles of Confederation (1777) which failed miserably by 1787. A new constitutional convention did convene. They wrote a Constitution based on a great deal of learning and the experiment of the first ten years of running the nation. This Constitution spelled out civil rights for citizens in the ten Bill of Rights, voting and balloting privileges for land-owning men, a census for counting people and counting those enslaved people who were calculated as only three-fifths of a person each. The Constitution set up three branches of government to check and balance out the power between each other. The document also noted that the powers not specifically assigned to the federal government were to be allowed to the states to perform and oversee. This was an experiment, The American Experiment, and we have been living through that experiment ever since, still testing individual liberty within collective progress.

Individually, each land-owning man could feel like a king in these United States. Prosperity was wide spread between the European descendants, and even for some of African descent. The populace agreed in a feeling that their own generation and communities could have improved lifes, better than the previous generation. The American model, the American dream was coming to fruition for countless people, and quickly (relatively speaking). At another time, in more discussions and another space, we should face the truth that much of this prosperity was based on theft from the native people, and enslavement of foreign people. To the privileged of European descent, the prosperity was remarkable and reason enough to be proud and expectant for the economic benefits to only grow.

This was the belief for both sides of the 1860’s Civil War. The Confederates and the Unionists both believed in the prosperity they had earned and deserved. Their views on how that prosperity was generated brought on the schism that led to bloodshed and war. The Unionists held tight to the American experiment, that national strength and common bond allowed for this prosperity in a market based economy. The Confederates agreed to those ideas but they clung to slavery and their perception that very cheap labour was absolutely necessary for the prosperity to continue at the current pace of growth.

Cassius M. Clay, a scion from the same family as the Senator Henry Clay, returned to his Kentucky home after growing his own personal fortune in New England and foresaw a dystopia for the enslaving Southern states of the US. The population of Kentucky and all states south of it were being segmented into three extreme classes: the plantation owners, the skilled craftsmen who were enslaved, and the white poor who were relegated to overseeing the field workers or scraping by on subsistence farming on the least productive land. In Clay’s future-vision, the white poor could not expect to gain anything from education since they could never offer their labour at a lower cost than the enslaved tradesmen. These tradesmen were specializing in leather-work, animal husbandry and veterinary medicine, blacksmithing, musical performances, culinary arts, and all the valuable economic pursuits. All the highly skilled trades would surely be monopolized by the enslaved people unless slavery came to an end. America could be imagined as departing from a market-based economy and returning to serfdom with the vicious attributes of slavery included. So Cassius M. Clay went to studying and searching for the fundamental arguments to support the end of slavery.

He had plenty of examples of moral arguments towards that end in the work of the third political group in the young country, the Abolitionists. To the Unionists and the Confederates, the Abolitionists were a bother and were to be brushed aside. In a nation that believed without remorse in the ideals of white supremacy, the Abolitionist cause was without grounds and without a redeemable (little lone worthwhile) end-goal. Without taking up their cause, and without endorsing their rationales, Clay looked back to the "dead document" called the Declaration of Independence for his legal arguments against slavery. He lectured around the country on the fundamental truths of the Declaration and how its undergirding to our Constitution and to all other laws of the nation and its states obligated us to see all people born on this soil as free and equal by the endowment of their Creator.

In July of 1854, Cassius M. Clay was invited to speak at the Illinois State House. Once he was in town due to growing tensions about his abolitionist messages, he was uninvited. He spoke anyway, outdoors for more than two hours. Abraham Lincoln listened to his lecture and was inspired by the legal arguments along with many other reasons for absolutely opposing the spread of slavery. When Lincoln entered the 1858 campaign for the US Senate and opposed the “Little Giant” Senator Stephen Douglas, he incorporated the arguments from Clay into that series of great debates chronicled between the two candidates. Here are Lincoln’s words that demonstrate his acceptance of white supremacy but also demonstrate his reasons for halting the spread of slavery:

I will say here, while upon this subject, that I have no purpose, directly or indirectly, to interfere with the institution of slavery in the States where it exists. I believe I have no lawful right to do so, and I have no inclination to do so. I have no purpose to introduce political and social equality between the white and the black races. There is a physical difference between the two, which, in my judgment, will probably forever forbid their living together upon the footing of perfect equality, and inasmuch as it becomes a necessity that there must be a difference, I, as well as Judge Douglas, am in favor of the race to which I belong having the superior position. I have never said anything to the contrary, but I hold that, notwithstanding all this, there is no reason in the world why the negro is not entitled to all the natural rights enumerated in the Declaration of Independence, the right to life, liberty, and the pursuit of happiness. I hold that he is as much entitled to these as the white man. I agree with Judge Douglas he is not my equal in many respects-certainly not in color, perhaps not in moral or intellectual endowment. But in the right to eat the bread, without the leave of anybody else, which his own hand earns, he is my equal and the equal of Judge Douglas, and the equal of every living man. (https://www.nps.gov/liho/learn/historyculture/debate1.htm) 

He did not see any way to end slavery, but instead wanted to stop it from spreading. In other speeches, Lincoln questioned the basis for enslaving one group of people instead of enslaving another group of people. Here Lincoln was also afraid of losing the American Experiment, afraid of departing from the market-based economy and returning to an economy based on serfdom. If the nation were to adopt serfdom with the edge of violent slavery, then who would say what new bases would be adopted by the plantation owners for enslaving more and more groups of people?

July 1, 1854: Fragment on Slavery
Lincoln often encountered views supporting slavery. In this fragment, he countered the arguments that slavery was justified based on color and intellect.
“If A. can prove, however conclusively, that he may, of right, enslave B. -- why may not B. snatch the same argument, and prove equally, that he may enslave A?--  You say A. is white, and B. is black. It is color, then; the lighter, having the right to enslave the darker? Take care. By this rule, you are to be slave to the first man you meet, with a fairer skin than your own. You do not mean color exactly?--You mean the whites are intellectually the superiors of the blacks, and, therefore have the right to enslave them? Take care again. By this rule, you are to be slave to the first man you meet, with an intellect superior to your own. But, say you, it is a question of interest; and, if you can make it your interest, you have the right to enslave another. Very well. And if he can make it his interest, he has the right to enslave you.” (https://www.nps.gov/liho/learn/historyculture/slavery.htm)

This was the call that forced the Confederates to secede from the nation after the election of Abraham Lincoln to be President of the United States two years after the Lincoln-Douglas debates. The differences between the Unionists and the Confederates could have been glossed over except for the formulation of political power in the US Congress and in the state legislatures. The Confederate leaders were gaining absolute power in the slave-owning states, and their representatives in Congress knew that to ensure their political power, they had to work for new states (such as Kansas and Nebraska and all the other territories to the west) to allow for enslavement. If the growth of slavery were halted, then Confederates would become the minority in the Congress and lose all future political battles. The Unionists of the northern states were working against that expansion of slavery again largely for their own political benefit, and Abraham Lincoln was the most articulate politician on this cause.

During his train trip in 1861 to Washington DC for his first inauguration he committed himself to ensuring the sanctity of slavery in the states where it was already practiced. Abiding to the interpreted wishes of the Founding Fathers, slavery could not be allowed to spread beyond those established states. He proposed an amendment to the Constitution enshrining slavery where it already existed. That could not have pleased the Confederates who were concerned about their political power in the Congress.

Lincoln did slowly mature in his view of African Americans as equal in every respect to white people. Unfortunately the battles waged and people died in the bloodiest war for the United States while Lincoln contemplated the questions and tried to figure out how to fight this war. His Emancipation Proclamation was a strategic measure to allow for the recruitment of black soldiers by the Union and to take away some economic might from the rebel states. Not until Lincoln came into a friendship with Frederick Douglass and drafted the Thirteenth Amendment to the Constitution did he publicly demonstrate his realization of the equality between the races. Then he maneuvered to pass that Amendment, finally fully adopting the moral code of the Abolitionists. Did he force the nation into accepting equality between the races, and this was well before the self-governing citizens were ready for that social change? Yes, most definitely he and his followers did codify equality too early, too quickly, and without the education necessary to fully accept the change. The nation has continued to struggle in developing the morality and understanding and values necessary to live out the ideals of equality between the races. 

That racial filament runs throughout the culture of the United States, even to the point where some individuals from minority ethnic groups carry and live out racist views about themselves and about others in their own castes. Today, I say the Smoldering Civil War is not about race, and is not about returning to any form of slavery. No. The dividing lines are splitting us between urban and rural (based on voting records). We are allowing greater riffs and gulfs to grow between Republicans and Democrats. Looking at the voting patterns between those counties throughout the states is what worries me. Our divisions may even be understood as lining up the sides between protecting conservative liberty and seeking segmented or fragmentary or factional progress.

Conservative liberty to my mind is a specific type of liberty, a specific view of the liberties that are under threat by the needs of urban life, requiring some historically unusual adaptations to allow for greater density of population. Unregulated gun ownership is highly problematic in a densely populated city, while having less companion concerns in a rural community. On another issue, community efforts which too often become government regulations to curb obesity, caloric intake (i.e. sugary sodas), diabetes, smoking related disease, diseases related to stress, and communicable diseases are of high importance in a city, but less so in rural areas where manual labor can be a daily expectation and open spaces do not result in smog and concentrations of toxins. Yet economic opportunities are disappearing in the rural areas, forcing many of the younger generations to seek livelihoods in the cities, and leaving the rural populations all the more worried about the threats to conservative liberties.

Meanwhile, progressives have uphill battles trying to win over some hoped-for-society that is potential but untried. If greater gender diversity leads to same-sex marriage, what are all the implications for society and future generations. No one can say for sure, and so conservative liberty often sets against that progress for a fragment of the population. With a one-payer system of healthcare, will the pattern for losing the numbers of doctors and medical facilities in the rural areas be stopped, or will rural populations be all the more forced to travel for medical attention? How can progressive advocates reassure those fighting for conservative liberty? The progressive causes can be named and supposed over several pages and hours of discussions. Many progressive campaigns seem to be unrelated to the others. They do not coordinate into any unifying grand vision. In the current political environment then we can understand generally why proponents of conservative liberty oppose the progress, hold fast to the status quo, and are suspect of anyone opposing their traditions and worldview. 


These generalized differences between conservative liberties and factional progress can be pushed to a warring cause when one party holds super majorities in state after state legislature, teamed up with politically aligned governors and court judges who champion the same causes as the elected officials. This sets us to the point of having a Smoldering Civil War. 

Friday, October 21, 2016

#ConcessionSpeech

#ConcessionSpeech

We all face reality in our own time. When we do admit to our own humility we all think the best of ourselves. We all think we can be graceful and honorable as we step down in humility. Yet we also try to hold onto our dreams, our higher aspirations, even accepting some change to those aspirations when we face the realities of setbacks, too little support around our ideals, or even defeat.

Honestly, what would be your highest hope for a defeated presidential candidate who had to offer a concession speech? You can write out your ideas, a full 15-minute speech if you like and then offer the same to a candidate to let that campaign know how an honorable concession would sound, what it might include, and how it could be effective. Below is my offer to Mr. Donald J. Trump:

“Friends, friends! I’d like to get your attention. I have to tell you . . .  there’s a lot of work ahead now, yes, now! A lot of work!! Thanks to you, to my family and to so many millions, I say tons of millions of citizens, supporters, enthusiasts across this country we have really started something here, with this citizen banded campaign. We have really, really started something here! Now! Are you ready to work for more? Good, I’m ready too.

“In this campaign for the US President, all of you have backed me, have rallied behind me as your champion. If you still see me as your champion, then thanks!! I am honored and prepared to fight on, to do the work. And you too can do some work, in your communities and in your states. Yes, I’m giving you license, license to get more involved just as you have spurred me on to get more out of our nation, then I’m turning the tables on all of you to get more involved. Speak out at all sorts of meetings and keep this campaign of citizens going! Keep it going! I’ve offered you examples, I’ve offered you my courage, encouragement. Keep it going! You can speak out at city councils, and county commissions. You can lift up your schools, police forces and the businesses around your homes by joining the school boards, and chambers of commerce, community policing and citizen police reviews. Support your police forces, really we must. You can each take action, you can each continue to have your voices heard and your visions expressed. That’s what I’m encouraging you to do! Keep it up!!

“Cause now I have some sad news to share. I made the phone call, yes, I dialed the phone and just spoke with Secretary Clinton. I thanked her for a spirited competition and I have agreed that she and her campaign have won the race for the presidency. Yes, I did, yes. Hold on, but, hold on, you can not forget my opening message to you today. Yes, she won this race, but we are all still moving ahead with our efforts to have citizens heard and to have citizens play their roles! Keep it going! Now! Now! . . .  she will not dominate this country. Citizens will dominate, and citizens will direct this country and citizens will act to make things happen and she’ll be reacting to you and following your lead. You become the champions, all of you, all of the Trump voices, you become your own champions, taking action and leading this country into greatness. You can do this, keep it up and keep supporting each other to speak out, voice your best wishes for our nation. Keep it going!!

“And I thank you, I thank each and every one of you! Damn this is tough! You know, I have committed so many hours and so much energy and so many dreams, do you follow that? Commit your dreams to the best, to improving your country so it can be its best!! Commitment!! Do we all understand what it means to commit our dreams to our country? I wanted so much to please all of you, to fulfill the committed dreams, to make you know that we could get this done, have a truly great president. And now I have to thank you, each of you, thank you for committing your dreams to me and to this campaign. Thanks to Mike Pence, his family and staff, and to my wonderful wife and children! Thanks!! Thanks! Wow, through the primaries and the rallies, in hundreds of locations, the airports and convention centers, we have committed so much to making America great again, and I thank you and I am pleading with you to keep it going. Don’t give up on your champions, you are now the champions, don’t give up, keep it going! Keep it going!


“I’ll speak with you again, another day. For this good night may God bless the US of A and bless all of her citizens and their committed voices, their committed dreams. God bless and keep it going!”

Thursday, October 13, 2016

The ideas of each of us can have life, once you write them out and share them with others

Please accept this post in part as an attempt of inspiring myself, while also being a prompt from me to you, reader. We can each succeed in bringing new ideas to light and bringing them to life. That can't happen if we fervently say them out loud only to the mirror! We need to work through the details, say the words to listening ears and risk having them be cut apart by criticism, and maybe even parceled out (even stolen) for others to take only what are the truly valuable nuggets of our thoughts.

I have always told myself (and those around me) that we don't know what we think until we say it out loud. We really must do the work of expressing those fragments of thought and seeing how they are joined together by logic or by intuition or by emotion or by what ever other human expression.

I've been searching for a publishing company, yet have not finished any of my eleven chapters. I have outlined the entire book, but have yet to work out all those details. I wish I could find an illustrator, or really a graphic artist who would put comic book character and explanations to my ideas on income inequality. What good would it do to find a graphic artist when I don't have the text from which to draw the characters?? I need to do the hard work.

Re-writing the sections of each chapter could even be a useful exercise, I have told myself. Giving myself permission to express the ideas in a different way, coming at them from different angles could be liberating, invigorating. I have even been told that the best writers through away some 90 percent of what they write, are hyper critical of their own writing. I have not been that disciplined nor deliberate in letting go of something I have created. I too often think each is too precious. I hang onto the writing for too many wrong reasons, sentimental and self-aggrandizing reasons. By re-writing, I may find very good reason to pitch out one day's writing in favor of another day's advances. Let me get to it!

1. Profit motives are THE organizing principle for growing each of our household, enterprise/business and national economies if we are striving for and can measure greater value creation and continuous self-improvement each year.

2. Under the three options for modern economic life (owner, or employee, or dependent), great majorities of people must become dependent on keeping a job, being employees in this monetary-based world.

3. THE POWER of the market-based economy is found in the coincidental benefits possible for both buyer and seller, and in the mutual benefits for both employer and employee. The 2016 Nobel Prize in Economics celebrates the contracts between buyers and sellers, and the contracts between employers and employees.

4. While owners/employers take on the greater financial risks and other risks, they relieve the employees of some risks. Profits are among the benefits for employers, profits which can be traced back to taking economic advantage over the employees. The employees transform inputs into valuable and marketable goods and services. The employees must create more value than the value of their paychecks combined with the costs of the other inputs. That is a truism about profits. If there are no profits and no money to reinvest in the business, then the business must go bankrupt. Employers must take economic advantage over employees for the business to survive.

Now for two fronts of restraint on unlimited profits and unlimited income for employers/owners:

5. Individual rights and dignity of employees are not to be ignored because of profit opportunities (similar to court rules of minority rights before majority rule). Other options are available to employers: individual promotions with expanded markets and expanded product lines, more training, greater safety protocols, higher pay rates, etc.

6. Social norms and values restrain monetary profit opportunities within social systems created by culture, history and the consensus of communities.

7. Owners, corporations and the ultra-rich too often take unnecessary risks with employees, non-participants, and public resources. High monetary incentives and the associated social status with wealth become the focal objectives of business owners and the ultra-rich. Risks placed on others have been and continue to be ignored while seeking these high monetary incentives.

8. We live in a REGULATED-MARKET ECONOMY, and ours has never been a free market economy. Human values, morals, and culture have always regulated business agreements.

9. Society can regulate greed and regulate the associated risk-taking, especially once society members agree The Market does fail in regulating itself.

10. Human rights are unalienable rights. Our laws endow political organizations, corporations, labour unions, government bodies and other legal inventions with some abilities. Extending human rights to those legal inventions alienates those rights from the citizens.

11. Excessive income gaps create a second class of citizens.

Someone recently confronted me with the notion that writers work alone. During hours of writing sessions, work days are lonely. So I need to quit complaining about my solitude and get the work done, get the writing rolled out!

Thursday, November 19, 2015

Three options to economic life

          The choices for living  (in a world that will become market-based economies only) then have come down to three options. 
          Be unemployed and depend on others to provide for your material means of living (food, shelter, clothing, transportation, etc.). This choice is not helping to grow the economy, this is not demonstrating the self-improvement that has been our focus. (I remember one economics professor starting out a semester of study with the assumption that all people are lazy and helped his class to understanding the world based first on that assumption. The assumption is not true, and what that professor did not help us understand is that the lazy people are the least important to the workings of any economy. Discarding the assumption of that one professor,) The group of unemployed people in society does include the very young, adult students who are investing in skills, training and knowledge, and the elderly, and some adults who are (the very pinnacle measure of our humanity) disabled. ("If we want to discover the full potential in our humanity, we need to celebrate those heartbreaking strengths and those glorious disabilities we all have. It is our humanity and all the potential within it that makes us beautiful." -- Aimee Mullins)
          The other two choices ARE expressions of financial self-improvement and I would even term as seeking "financial livelihood." 
          Second you might be employed and manage to spend, save and invest the income that is earned from an employer or several employers. 
          The third choice is for you to be a business owner, an employer.
          What about employment by the government? How is this different from employment by a business owner and why can't we all just be employed by the government, letting the government be the business owner? The difficulty in depending upon government employment too heavily is that government agencies do not operate on a profit basis as a decision-making mechanism like businesses do. This same reasoning can be applied to non-profit employers. Let's demonstrate with a long example. 
          (Hopefully readers will not become confused if outside of this book pundits use the term Mixed Economy as a substitute for a Regulated Market Economy. The substitution does not work. A mixed economy depends upon the government to produce some sizable proportion of the country's gross domestic product. Well in that case, most every economy is a Mixed Economy since governments produce the education, roads, military training, and so many other portions of the economic whole. The emphasis here is to point out that by "Regulated Market Economy" we are dismissing the misleading phrase of Free-Market Economy since no market organizes freely, free of regulation or free of societal restraints.) 
          In a business, the owner is managing the capital, the loans, the costs of maintaining those two, the labour costs, the input costs and quality of goods and services, and is trying to squeeze profits out of every sale. The mathematics behind each of those costs and any revenue streams are all comparable (in dollars or Euros or Yen or other national currencies) and all directly affect each other by the measure of the currency. 
          How is this different in a government agency? First of all, if government agencies generate surplus revenue (or profit) for one year's budget, then their funding is cut with the expectation that they will be able to perform like that in the next budget year. That is wrong. Government agencies are not organized to generate "profits" or excess revenues. If there are excess revenues, then it's as much of a fluke as any roll of the dice.
          Secondly, the managers of a government agency have not been trained and conditioned to notice how extra revenues are being generated, so they don't specifically know how to repeat those steps that led to any excess revenue. In fact those managers will see any reduction in funding as a demerit, or a disciplinary action. This will be a dis-incentive for them trying to repeat the effort at generating excess revenue. Along this same line, the agency managers do not have any personal financial incentive in generating excess revenue -- they do not personally get bonuses for easing the burden on the tax payers. 
          By those two reasons, we see how a business operates with an advantage by using the currency and the mathematics possible through the currency to gauge costs, revenues, profits, the success of any planning, to look into future months and deal with shortages, to see peaks and valleys in the seasons of their industries and of their communities. Using the flow of currency works dramatically well for the business owner. Government agencies and their managers do not have the same tools or insights. 
          Why can't that principle be applied to government agencies or to non-profit organizations? The first answer is that those agencies and organizations often times have to respond in reverse to the business cycle. So while a business owner may forecast a slow season based on the mathematics behind the money flow (laying off employees, cutting the size of orders, not purchasing replacement equipment, etc.), government agencies may have to increase their expenditures at that very time because of greater unemployment, greater demand for low-cost housing, bread-winners experiencing greater difficulty in feeding their families, or when a natural disaster disrupts the smooth working of the market economy. Then when a community is more self-sustaining based on the general health of the market economy, the government agencies need to remain vigilant and those managers need to fight to keep their budgets at levels high enough to keep the agencies intact even though demand may be low for their services. This type of management is counter-intuitive to the management of a financially based and profit-seeking business. 
          Non-profit organizations can base many of their decisions on cash flows. At the same time they need to base their decisions on the missions and objectives and goals set out for them to accomplish, which justify their operation as non-profit organizations. A church may offer free cooked meals to groups of homeless or disadvantaged people. They are not looking to profit from this, but they do need to manage their costs, predict how much food to prepare, not be too wasteful with left over foods. Funds still need to be collected to pay for all those costs. A church could be collecting excess food from restaurants and grocery stores, and could be collecting cash donations from members and finding other sources of funding. Instead of delivering cash dividends as a business would, such a church needs to be sure they communicate the success of their programs to all those who generously give to the non-profit mission. Still those "returns on investments" or returns on donations are very difficult to measure, unlike the ease of measuring cash flow, costs and revenues, profits and capital values. 
          In spite of these complications and the differences between business employers, government employers, and non-profit employers, a principle of Capillary Action http://bit.ly/1SI4HIj must still be recognized. On the micro-economic level, each employee must be creating value for the employer, value that is greater than the paycheck which the employee receives. The justification becomes more complicated and sometimes more difficult to gauge for the government agency and for the non-profit organization. They cannot judge the value of the employee's contribution solely on monetary values. In fact, businesses should not judge solely on monetary values either. For instance, a business does need to build loyalty and trust with its customers, which is difficult to measure in monetary amounts, but employees do create that loyalty and trust in their relationships with customers. Employees do create some value that is beyond monetary measurement. Business managers and owners can base their decisions more weightily on monetary values since the cash flows are involved in every facet of a business. Government and non-profit employees will be evaluated on more loosely defined values (expressed in mission statements and funding directives) they create beyond any savings of costs or generation of revenues. 

          For an economy to be stable and healthy, we might wonder what proportion of people can be employed by business owners and how many could be business owners. And is it possible to have too many business owners and not enough employees? If everyone decides to own a business and not be dependent on an employer, what would the economy look like, would if function properly? 
          According to experts including master restaurateur Gordon Ramsey and small business advisers Second Wind Consulting, your business should be all right if you are spending approximately one-third of your gross income on payroll. Spending more means you're not making enough profit, or unable to make investments to support the business. Spending less means you might lose your best employees because you're paying them too little. . . .

          Those numbers work well for businesses that manufacture a product. However, you can afford a higher percentage for payroll if you run a service business. Service businesses don't have materials costs, and thus have more room to pay their staff -- who are essentially their product. Even in service businesses, Second Wind Consulting recommends keeping payroll below 50 percent. (Wayne, Jake, of Demand Media, http://smallbusiness.chron.com/percentage-payroll-vs-income-small-business-13026.html)

          Since businesses need employees and their labour to create value, then some people must be convinced to remain as employees and depend on the income earned from employment. Within businesses, employees are necessary.
          Employees do become dependent on their paychecks and dependent on their roles within businesses, under the management of owners. In a market-based economy, financial livelihood is possible from ownership (which not everyone can have) and from employment. Considering Capillary Action, if value is flowing up hill to the owners through the work efforts of the employees, then there is a clear possibility of taking excessive financial advantage over the employees. 
          Changing jobs is not a process that can be taken without a great deal of planning and considerations. As an employee, a person has a certain skill set that is valuable and employable, but often not quickly transferred to another employer nor to another industry. So while there may be pay and other incentives attracting an employee to keep a job, there are also heavy potential costs to leaving a place of employment to seek other opportunities. Employees can not specify one point at which a current job will be abandoned. More reasonably, they have a range of issues to consider before looking for and applying for a job with a different employer. 
          Secondly, an employee is not fully informed about how an employer is taking advantage. A group of coal miners may be very happy as a group when they are kept ignorant of the level of income and life styles outside of their "company town." Meanwhile the coal company executives could be living excessively lavish lifestyles based on the value created by the coal miners. Those company executives will want to keep the employees ignorant of the differences in their lifestyles. A company executive may even believe that one deserves the better pay and lifestyle given ones investment in education and social graces and tough negotiating skills. This is a complication. Once the miners learn of the inequities between the levels of pay and living standards, they as a group could organize and demand better pay, and demand that their lives not depend solely on the coal company. That history offers a great many trying lessons.
          So far in this economic treatise, I have dealt only with employment, labour and management. Much of economics examines the role of capital too and its level of earnings. Investors and silent partners, owners of land and wealthy individuals who lend money to a business but take no role in managing the business practices, are they "owners" or are they "dependents" under this model? Precision in naming the distinctions can be difficult. If a person offers capital until such time as some level of returns has been reached, then the capital is withdrawn, then that person is acting as a dependent. 
          (This does not speak to the role of any lending or investing business such as a bank. Those businesses are acting in far more complicated ways. We are speaking about the actions of individuals, basing our model on the actions of individuals. i.e. The committee did not act, rather individual members within the committee voted and their majority rule placed some processes into action by agents, individuals, who agreed to carry out the directives of the group.) 
          In opposite extreme to these dependent capitalists, if an investor or lender places pressure upon business managers for the business to emphasize some value(s) other than earning profits, then that capitalist may be seen as acting an employer. An involved investor can be seen managing some resources and directing the actions of employees to achieve something other than simple profits, or to achieve profits by a particular expression of personal character or culturally shared values.

Thursday, January 1, 2015

spelling out my bias for Stiglitz’s preface

Stiglitz’s preface does not bode well for his 2012 book “The Price of Equality” to accomplish very much, nor to open up new discussions, nor to impress enough decision makers about the value of his work. In the preface, he points to a downward spiral of inequality corrupting the political and business processes of a country. This corruption leads to less efficiency for the markets and less stability for the markets. With markets being less efficient and less stable then there is growing inequality and then more corruption. I want to see how Stiglitz develops this theory, and what evidence he can offer to convince his readers. But then for the rest of the preface, he seems to be whining, “It’s unfair, it’s unfair, it’s unfair, and it’s unfair,” like a second-grader. And then I saw him slip in the idea of government redistribution of wealth.

Life is unfair, and if he expects to undo that reality, then I am biased against his book and I need to deal with my bias against him before continuing the reading. Holding on to my bias is not going to allow me to read and best understand what he does have to offer. I will write out this essay so that I can work out my bias, and then maybe I will be able to read and better appreciate what his book has to offer.

And get off the idea of government redistribution of wealth!!! Before government can lay their hands on wealth, capital, assets, or possessions, they have to offer due process. Through due process a government can claim imminent domain, or public goods, or “the needs of the many out weigh the needs of the few or the one.” (Star Trek reference there, and I think Gene Roddenberry had a beautiful vision for a future economic system.) Wealth should be out of the reach of the government. Income meanwhile is within reach, through monitoring and through taxation (payroll taxes apply with every paycheck and April 15 is coming). But wait, the government can not know what’s best for the redistribution of the income. We cannot trust a corruptible government to best decide what to do with one person’s income in assigning it to other people!! If we are striving for efficient markets, then what about allowing the markets to decide about the redistribution of income?? (Specifics on how can come in a bit.)

First we much realize that all questions of income and markets and economics are rooted in micro-economic questions. Let’s toss out Stiglitz’s downward spiral and replace it with the micro-economic story. Individuals are the only ones who act within an economic system. Maybe a statistician or scientist can spot a trend based on watching and measuring the actions of many individuals, but you can realize that the individuals act. Within a corporation, individuals act to create the value that is marketed and sold to individual customers. Within the stock market, individuals write the code for the computerized buying programs and then individuals decide the prices that will trigger bids to buy and to sell. Individuals in representative bodies and in executive offices decide to lead on a legislative initiative, or to vote one way or the other. All those individual actions accumulate together to play out the economic system. This is micro-economic actions playing out to cause macro-economic trends and realities.

Individuals will act based upon perceived incentives which should pay off compared to risking some investments of time, labour, skill, strategy, reputation, weighed against other opportunities and other dimensions of a decision to act. If the incentives can be increased for growing numbers of people, then more might risk starting their own businesses, more might risk an embarrassment in front of a supervisor and a work team to offer a revolutionary production method, more might risk investing in a new home, real estate or new vehicles and equipment. If more incentives can be offered to more individuals, then the economy can grow based on what opportunities the individuals seek (not based on the government’s corrupted notions). From this micro-economic view, the growth of the economy is based on individuals perceiving and acting upon greater incentives which drives those prospering individuals to seek out even more opportunities and understanding the incentives that keep compelling them to make economic investments and striving for greater efficiencies and stability and to all the more appreciate predictable markets, those being the markets that do not fail so often and probably that have less volatile business cycles.

Of course when we say incentives, we mean cash. We mean getting more money out in front of more people. We mean offering them more income, that is what is meant by incentives. (Along with prestige, and individual autonomy, and self actualization, but economists don’t do well at measuring those things. We measure money.)

(Are we a bit further on yet? Can we now turn to the specifics of how income can be redistributed if not by government?)

What’s needed then is some extra incentives, but where can they come from?? They will not magically appear.

If inequality is an unwanted outcome, is there a way to lessen the inequality as a method for increasing the incentives for more people? Is there a way to lessen the inequality as a method for increasing the incentives for 99 percent of the people? Income can be taxed. But we don’t want the income to go to the corruptible government as tax revenue. What if instead of a tax, we capped all individuals so that no one in the whole world could earn more than 10 million Euros in a year, or no more than $15 million in a year, or the equivalent per country in a year (remember countries wish to keep their sovereignty)? What could corporations do with those revenues that no longer can be offered to their executives, their superstar employees (a term from Freeland‘s book “Plutocrats”), to their board members, to their consultants, nor to their richest investors? How would corporations and businesses redistribute those revenues?

Now how would a cap work?? Well, yeah, . . . let’s call it a tax. After earning the income up to that annual cap within a year, all further individual income will be taxed at 100 percent. This is a tax that the government does not want to collect -- how awful it would be to allow the government to collect that money!!!! And it is a tax that no millionaire would want to approach or to deal with! After all, not only is the millionaire loosing all of that extra income, but one would still have to deal with the costs of accounting for the money earned over the cap. So the tax rate really would feel like 102 percent or 105 percent when you figure in the accounting costs. Then there would be the embarrassment among ones peers should they find out you tried to earn money over the annual cap (which they are all denied) and then got busted by the feds!! Yes, we’ll call it a tax that is never intended to be collected. This will be a 100 percent tax on all income over the annual cap.

What could corporations do with those revenues that no longer can be offered to their executives, their superstar employees, to their board members, to their consultants, nor to their richest investors? How would corporations and businesses redistribute those revenues? Would corporations and their markets find some efficient means for steering funds toward more research and development? Efficient means for raising the pay of deserving employees who are not near the annual cap? Efficient means for investing in equipment, real estate and manufacturing opportunities? Efficient means for green and sustainable developments? Efficient means for greater training, education, workplace safety? More creative ideas on serving customers, earning greater loyalty and reducing the risks to the lives of customers?

I believe in the markets, and in people’s abilities to recognize economic opportunities and incentives. Things would still be unfair with an income cap in place, would still be unfair regardless of how society evolves (even if guided by Roddenberry himself). But I do want to understand the price of inequality in economic systems, and I hope Stiglitz can help open my eyes.

Friday, October 3, 2014

Summarizing Two Actions Proposed after all the preliminary truths

Trevor, Brian and Jordan, (who commented on http://www.pewresearch.org/fact-tank/2013/12/05/u-s-income-inequality-on-rise-for-decades-is-now-highest-since-1928/?moderated#comment-546050) 

I agree completely!! Corporations are non-citizens and should not be influencing ballot measures or candidate campaigns at all. We already rule out any influence from Japanese citizens, or German citizens. Corporate stock can be owned by anyone around the globe, and thus corporations have interests that conflict with our national interests. Restore the privileges of citizenship to the citizens exclusively (see the 14th Amendment to the Constitution, and my arguments about how courts have been alienating citizens from their rights and privileges)!! And after all corporations are merely legal inventions -- why should they be represented in any manner similar to the representation of citizens??

Following Trevor's second point, the circumstances from Ferguson (and so many other communities) demonstrate how people are not represented adequately in our Republic! We need to get more people to be active citizens through voting and through constant conversations with their representatives. 

Similar to Trevor's second point, we need to be sure there are enough incentives for all people to be community involved and to seek out adequate income. Knowing that you own part of this country will make you more interested in what is important to keep the country on the right track.

My most striking proposal (I suspect this will take 30 years to happen) is to have an income cap. If the top earning people are taxed at 100% for every dollar they earn after the first $15 million in a year, then they will walk away from the table after that ceiling is reached. Then the market systems (not governments) can help to redistribute (not the dollars but) those financial incentives to larger and larger groups of people. Plus, corporations (not allowed to have their finances prying into political balloting and not overpaying their top executives, managers and investors) will have to find efficient ways to spend their money (R&D, equipment investments, greater workplace safety, higher wages for employees, greater quality of products) and/or lower some prices in the market place. Yes, the market mechanisms can redistribute all this without the government trying to decide IF we regulate the greed. As a bonus, if we regulate the greed with an income cap, then a lot of other minor regulations can be eliminated -- those regulations that are merely nibbling at these problems of income inequality. 

I'd like to stay in touch with people of your thinking!!
AuntieGreed@gmail.com

Friday, September 5, 2014

Three arguments against corporate involvement in citizen ballots and campaign funding


A complete political restriction on corporations needs a bit more discussion. Corporate laws as far back at the 1700's originally were written to allow people to take risks that they personally and professionally could not take as individuals. So while a partner in a firm could not take the risks financing of spice trade with India, a corporation could take those risks. Through our evolution of corporations, eventually they would operate with investments from people who were not directly involved in the management of the company, with decision making by boards that held wide-ranging perspectives on several related industries, and based on the expert abilities of managers and directors who could focus on the best financial health of the company and its projects. The risks were not personal or individual risks, and so each individual was protected from the heaviest, most onerous of risks. The corporation, as a legal entity or as a legal invention, could accept those risks and act based on the outcomes.  

Something went wrong when corporations started being compared to people -- legally, socially, in marketing efforts, and politically. {explain the moral questions raised by giving corporations and businesses the same rights as citizens} 

The United States is the longest standing republican form of government, and the vitality of its markets over the past 200 years offers testaments to the validity of a market based economy. The example of the United States has also been one leading basis for framing the laws, constitutions and market institutions throughout Latin America, western Europe, Japan, Korea and other  nations of the eastern Asia, India and nations of Africa and Arabia. So the United States' example will lead in our discussions here followed by examples from other nations. 

Ballot measures are issues for citizens to determine. Corporations are legal inventions, not citizens. Corporations represent the interests of their owners and investors and executives and managers. Corporations can base themselves in any nation, state or province, and even be multi-national -- meaning they could have conflicts of interest with and between the best interests of their multiple nations! And in a very real sense, the corporations and businesses are mainly interested in the value of profits which for them supersede any community values or national values.  

Non-citizens are restricted from voting. Non-citizens are banned from giving financial support to political campaigns. {offer examples of laws from several countries} Why then should corporations (defined as non-citizens) be allowed to give financial support to political campaigns, or even express opinions about the ballot issues that are solely for the consideration of the citizens? I am seeking agreement on the idea that corporations should not be allowed to express opinions on ballot measures because of the influence of the non-citizens in those corporations and their interests which may be contrary to the best outcome for the citizens. That concludes one argument.  

By recent decisions of US courts, rights to free speech have been extended to corporations and businesses. From that basis, corporations have found themselves completely free to give unlimited amounts of financial support to politically active groups that are swaying voter opinions on ballot measures throughout the US. (Even the selection in states of their Secretaries of State is being politicized {...}.) 

From the US Declaration of Independence, there is a recognition that human rights to "life, liberty and the pursuit of happiness" are unalienable rights. Saying this in another way, no action or inaction by anyone or any group should allow citizens to be alienated or separated from their rights. Yet by giving rights to the non-citizen corporations these court decisions are alienating the citizens from their rights as voters. As those corporations exercise to finance political campaigns, the liberties and free speech of citizens are being drowned out, are being overshadowed by the power of these corporate voices. The negative advertisements, the extremely loud and too-often repeated advertisements, and many other efforts financed by corporations are alienating the citizens from their rights to speak and to be heard, and from their rights to consider and vote on ballot measures. Some growing apathy and antagonism towards "government by the people" is the very sign that the people are being alienated from their rights. That concludes the second argument. 

Lastly, Section One of the Fourteenth Amendment to the US Constitution reads, "All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States, nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws. 

Did you notice the change in terms, the difference that is expected between citizen and person? Any person shall not be deprived of life, liberty or property without due process. Yet a citizen falls into a more specific group and the privileges and immunities of a citizen shall not be abridged.  

One privilege of being a citizen is that citizens can not be anonymously influenced by non-citizens in voting matters, in discussing and deciding upon ballot measures. I point to the "free speech of corporations" as an abridgement of the privilege of citizens to exercise their right to vote because those non-citizens do attempt to influence and affect the citizens, their opinions, and their resolve in casting ballots  

If a non-citizen is permitted by some state law to keep a citizen away from the ballot box on election day, then that directly affects the citizen and that state law is abridging a citizen's privilege. If a non-citizen, permitted by states or by courts, overwhelms citizens with any opinion on a ballot measure, especially by way of negative advertising, then those efforts are abridging a citizen's privilege. Finally, if the number of advertisements, financed by a non-citizen, and then some confusion from those advertisements brings a citizen to not vote out of frustration or a sense of apathy, then the advertisements are abridging a citizen's privilege.  

Based on the history of court decisions and other duly passed laws, only an amendment to the US Constitution may reverse this current trend in the corporate funding of political campaigns.  

Beyond these three arguments the US Declaration of Independence reads, "That to secure these rights [we are focused on the right to vote], Governments are instituted among Men [we understand this to be citizens, not legal inventions, but a special group of persons], deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People [again the right of citizens] to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them [exclusively citizens] shall seem most likely to effect their Safety and Happiness." We citizens have the right to exclude non-citizen corporations.