Monday, November 25, 2013

Wisdom from Aristide's "Eyes of the Heart"

pg 36 of Jean-Bertrand Aristide, Eyes of the Heart: Seeking a Path for the Poor in the Age of Globalization. Common Courage Press, 2000.

Do not confuse democracy with the holding of elections every four or five years. Elections are the exam, testing the health of our system. Voter participation is the grade. But school is in session every day. Only the day-to-day participation of the people at all levels of governance can breath life into democracy and create the possibility for people to play a significant role in shaping the state and the society that they want.

Auntie Greed: maybe this is a nice point to emphasize about the November 24 referendum vote in Switzerland. The youth wing of the JUSO had proposed and won more than 100,000 signatures to a petition. That led to a referendum on a proposal that the top pay within any Swiss company be held to no more than 12 times the pay of the lowest wage earner in the same company. If the measure would have passed, then executive pay would have been lowered for those companies, and lowest wages in those companies would have been raised to allow the top executives to earn greater amounts.

The referendum failed with 35 yea vote to 65 no vote margin. Remember now, Aristide said the vote was merely the grade. The fact that Swiss citizens are engaged with the issues demonstrates the true power of their democracy. Salute to the Swiss and their attempts (there have been other ballot measures) to raise questions about inequality of pay scales.

My opinion is that such a ratio based policy on pay scales would not have worked. If the Swiss would have passed the measure and executed the letter of the resulting laws, then companies would have exited the country and conducted their business under more favorable laws. That is a crucial point I have been making about corporations and businesses. They are not citizens. They are not bound to any location or nation. They are only bound to profits and the good of their owners/stock holders. Switzerland would have lost out if the measure would have succeeded on the ballot.

Also, nothing would have prevented a company wanting inordinate pay for their top executives to end up subcontracting a great deal of their business. That would be a pretty simple model for a company to operate. A bank could contract each of its branch locations to some pseudo firms. The top earners of those sub-contractors could only receive the maximum pay of 12 times the lowest paid bank teller. But the true bank would get to set it's executive pay at some higher level because it would no longer employ those underpaid tellers.

What I hope the Swiss leaders and the rest of the world appreciates is that the democratic systems are working, and the voices of those who are hurt by the current level of inequality are being heard. As their voices join together under some common mantras, they will organize and find solutions that fit the needs of the many countries around the world.

All my best,
Auntie Greed

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