There are numerous examples of this magical thinking. For example:
- Taxes should be reduced, especially on the rich, who, as supposed job creators, will spur more economic value by their astute spending and investment habits.
- Regulations should be slashed, because greater freedom from rules allows commonsense decisions that provide wider economic benefits.
- Government should be smaller at every level and decisions should be devolved to more local government, again because the decisions made are supposedly better.
But notice that these are all economic arguments. In areas of true personal decision-making, many who argue for laissez-faire economics sing a very different tune.
- The federal government must vigorously prosecute the so-called war on drugs; people cannot be allowed the choice to smoke pot, for example.
- Gay marriage must be banned, perhaps even by constitutional amendment.
- Decisions about your own body? First the vaginal probe!
People make decisions for all kinds of reasons, or no reason at all. Many decide in a way that is completely irrational and not in the best interest of themselves or others.
So why do we assume that their economic decisions are always rational, or even beneficial? One not look far to find terrible economic decisions either—sub-prime mortgages, payday loans, excessive credit card debt, McMansions, ...
If there are good reasons for endless tax cuts, radical deregulation and the rest of the doctrinaire free-market agenda (which I doubt) the supposed superiority of individual decision-making is not among them.
Craig Farlinger responded to a post I made on Facebook with a very creative approach to ensuring corporate responsibility.
ReplyDeleteI copy his notes below.
"It's systemic. It can't be fixed my friend. Only educating the public will have an effect. Regulators can decide what "kinds" of financial products certain institutions can offer and some criteria, but they can't decide the "quality" of what is offered. White-washed pigs will always sneak into the system and their importance is why Wall Street hires snakes who know how to dress up and flog "verisimilitude" product that makes them wealthy at the expense of unsophisticated investors.
I'm pessimistic because what I think is needed is "Corporate Responsibility" legislation with conflict of interest provisions and consumer protection laws. Like the 43-101 "resource estimation" regulations which were instituted after the Bre-X scandal, I think laws like this would add value to companies that comply, but there is strong philosophical opposition.
There is no chance anything like that would ever pass in the USA. In Canada under an NDP or Liberal government it could happen but without a corresponding law in the USA it wouldn't do much good since the economies are so integrated.
You could make signing on to the "Corporate Responsibility" charter voluntary, then make being a charter member a requirement for all government contracts and assistance. That might fly in the USA.
Sort of a reverse Grover Norquist pledge."
As a freshly minted citizen in the USA (this election will be my first to vote for a president) with a keen interest in participatory democracy I think the "Ling" has perhaps hit upon a path to make corporations contribute to "the commonwealth", a term that I find interestingly used in the naming of Massachusetts.
I find the phrase accurately embodies the concept of shared responsibility for the greater good.
It takes emphasis off of the maligned concept of "spreading the wealth around" and focuses it instead on the common good.
I've enjoyed reading a number of your previous blog posts, thanks for sharing your thoughts.
Jeff, thanks for commenting and sharing your and Craig's thoughts.
ReplyDeleteWe need some other kinds of laws, with real consequences attending their breaking. What we have currently is demonstrably inadequate, and the notion it will be better if we vacate more laws is, simply, the triumph of ideology over evidence (and lately, like second marriages) that of hope over experience. What those laws could or should be is tricky, but it is essential that we enforce more responsible corporate citizenship. (I use corporate "citizenship" for want of a better term; they cannot be co-equal as actual citizens.)
While it will be hard to craft effective workable laws with teeth, it will be vastly harder still to summon the political might to even start. One big reason. Alas.