Futureworkers may be interested in the following exchange. Ed
----- Original Message ----- From: Ed Weick To: [email protected] Sent: Sunday, November 21, 2010 8:39 AM Subject: Re: [Ottawadissenters] On why the revolution won't be tweeted Good morning, John, Ideals and good theory supporting those ideals are one component of thinking about the market. But another, which I think totally outweighs them, is morality. In my opinion, the golden rule goes completely out of the window in market behavior. The big players in the market are there to get rich - very rich! To do that, they have to be in control. To be in control, they have to bend whatever rules they have to work with. I recall reading that one thing that brought on the Great Depression of the 1930's was wealthy stockholders running up the value of stocks, cashing them in, letting them fall, and then taking another run. Behavior was similar in the running up of bubbles during the past couple of decades. During the most recent bubble, the housing bubble, companies like Lehman and Bear Sterns were fully aware of what they were doing, as were the rating agencies that gave the dubious securities they were producing triple A ratings. In some cases, people in control got very rich; in other cases companies went broke. But it was the millions of people who thought they were fulfilling their dreams by buying houses they couldn't afford that really suffered and are still suffering. What are the consequences of market immorality? One is that the rich are getting richer and the poor poorer. In "Winner-Take-All Politics", Jacob Hacker and Paul Pierson examine the period from the 1970s to the present and find a very large shift wealth from the bottom and middle classes of American society to the uppermost classes. While all classes gained some income between 1979 and 2006, the incomes of the top one percent of all recipients increased by 256%! By 2007, the richest one percent received some 23% of all of the income earned or accruing to Americans. All of this took place via the market, which now includes not only people who buy and sell goods and services, but politicians and lobbyists able to manipulate things to favor those who pay them. We do need the market. It's essential to our survival and continuity, but the market isn't the beautiful, efficient and orderly thing that early economists like Adam Smith envisioned it to be. If it is ever to operate in the name of the common good, it needs to be controlled. It needs to be debubbled by bringing back legislation like Glass-Stegal. Perhaps it needs to be more localized, as several decades of 'back to the landers' have argued. In my opinion, globalization has added a large element of mystery and instability to it. But above all else, people in the market need to be made honest in their dealings. Morality is highly necessary, even if it is enforced by constant surveillance, huge fines and imprisonments. The market has be made accountable to the common good. Ed ----- Original Message ----- From: John Verdon To: [email protected] Sent: Saturday, November 20, 2010 5:10 PM Subject: Re: [Ottawadissenters] On why the revolution won't be tweeted Ed, I completely agree with you. The distinction concerns the tinkering that has been done on how we establish the conditions for a 'should be' market system. Has this tinkering been done to align the real with the 'real should be' or has the tinkering been to re-establish the social structure that the market system needed to erode in order for the market system to work. I love the synchrony of 1776 - the year of both the Declaration of Independence and the publishing of the wealth of nations. For me this marks the birthing of "Responsible Autonomy" as an organizational and social architecture (search triarchy and Gerald Fairtlough). The gap between the rich and poor remained stable during the time of the New Deal and advent of Reagan/Thatcher monetarist philosophy of deregulation. The rules of the market have been distorted with the equation of a Corporation as a 'person' but a special type of person that by law can only pursue one type of interest - maximizing shareholder profit (The documentary The Corporation illustrates the consequences of this very well). Other distortions include lack of vigorous anti-monopoly/trust vigilance, enabling unearned inheritance to be perpetuated such that it erodes a meritocratic approach to the principle of equality - to balance the undue liberty that comes with great wealth and so on and on. The erosion of public education also add to inequity in human capital development so necessary to a knowledge-based economy. The reason we need good theory is to guide our tinkering of the real to attain a 'more perfect union'. Tinkering with the real - through policy, laws, regulation must be guided by some 'ideal' and refined by good theory. That's why the principles of perfect justice, perfect equality and perfect liberty are the overarching 'design' principles for our tinkering. Recently I've been reading Philip Petit and Jose Marti and the theory of Republican (Not the US party - but the much older political theory) and they refine the concept of liberty even more by exploring the roots of republican political movements in the pursuit of Liberty defined as not simply Freedom from Interference (which was a cop out of the more difficult goal of) but as Freedom from Domination (a type of blend of equality and liberty). So I would think the real is not a reified static by a constantly tinkered dynamic - the key is in the design principles underlying who get to tinker and what guides the tinkering and what goals the tinkering aims to attain for whom. With the birthing of responsible autonomy at least two major narratives have been in conflict for pre-eminence - the just society founded on principles of equality, justice and liberty and the hierarchic chain of being that structures societies through authoritative elite control hierarchies - self-governed-organization or governing through command. apologies if I blather on john On Sat, Nov 20, 2010 at 4:35 PM, Ed Weick <[email protected]> wrote: This is the third time I'm sending the following. It's a comment on something John Verdon wrote. If the other postings come through, please don't feel compelled to read it three times. Ed I think one always has to consider the difference between the ideal and the real. What Adam Smith wrote about was the economy as it should work and, to some extent, how it may have worked in his time. We've come a long way since then and markets have become much more complex. Producers and middlemen may vie with each other for power, but the little guy who sells the stuff they supply is in a distinctly subordinate position. The powerful advertising industry exerts substantial control over the consumer, generating and regenerating the economic myths that we should live by. The financial sector has become increasingly more powerful, and is now in a position to generate huge bubbles and collapses, like the sub-prime mortgage crisis. It may be a little too strong to say that the market no longer exists to serve people, but that people now exist to serve the market, but it does seem that way. Ed -- John Verdon 4 Ashbury Place Ottawa, ON K1M1H3 voice 613-744-4278 searching for the pattern which connects.... knowing the difference that makes a difference... Sapere Aude - The true is the whole. Compassion is the natural condition of what one really is.
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