If you missed it, a few thousand people have been marching around Wall Street to protest what they see as corporate greed in the face of our long-lived recession. They have been joined now by unions, which are more motivated by the desire to shift some of the money going to executives to the rank and file than worrying about executives being overpaid.
The protest itself is not unusual in that people who feel deprived have been on marches before, including Coxey’s Army in 1894 and the Hoovervilles set up in Washington D.C. during the Depression. The Vietnam War launched a swath of protests as well, although protesters were more likely moved to prevent their own participation in the war than any other cause.
Regardless, Americans have never hesitated to express their opinions.
On the other hand, these guys have targeted Wall Street in New York – far from the Capitol or White House that are the usual targets. I cannot recall any similar protest, although lots of folks have gone to Wall Street because of the various recessions in our history and the Depression. However, even in the worst economic times, no one has attacked our economic base before.
Times have certainly changed.
Just for starters, the protest demonstrates how mass communication can rapidly bring together divergent people. This kind of flash crowds was unheard of decades ago. There were instant riots, of course, especially in the 1960s during civil rights protests, but they were in response to something that happened. In this case, people contacted each other through Twitter and other sites. In many ways, they are no different than the organized mobs that end Hosni Mubarak’s reign in Egypt and threaten to topple Muammar Gaddafi in Libya and Bashar Assad in Syria. Other countries with problems, such as China, are concerned that such movements could show up a lot closer to home.
The New York mayor was alarmed enough to order the police to arrest hundreds of protesters. His concern focused on the disruption of normal commerce, not on the possible end of civil government or the government of the United States.
Moreover, in the past, protesters invariably have some kind of clear motive. These protesters do not. They are expressing nebulous concerns about how our businesses are being run.
Wall Street has become symbol of the type of behavior they object to, even though, as the protesters are aware, U.S. businesses have long been international and may have little to no connection to what was once the bastion of finance.
Nevertheless, the protests mark a sea change in political views. The protesters are objecting to capitalism, the economic system that not only transformed this country but has spread around the world.
It is based on money: the more, the better. Corporations exist to make money for investors and owners. While giving lip service to environmental and social responsibility, corporate leaders per force concentrate on profits. In some cases, that has meant secretly dumping pollutants into rivers to avoid the cost of a cleanup or producing dangerous chemicals, which work well, but destroy the environment.
One company I worked for refused to put poison symbols on a fertilizer product because the business could make more money selling the fertilizer while defending itself in court than from the expected decline in sales when the symbol was added to packaging.
The focus on profits has meant huge paychecks for the corporate leaders who generate income, with decreasing shares for workers.
That’s a two-edged sword. Capitalism has produced the finest standard of living in human history. All the technology and other advancements owe their existence to capitalists, who risked their money to support an invention or an idea. Capitalism provides incentive for innovation by holding out the promise of huge payoffs for successful ventures.
On the other hand, capitalism has little empathy for those unable to help produce profit. Those people with physical, mental or other handicaps are a drag on growth. In addition, pollution controls and other limitations simply add expense. Auto companies, for example, fought hard to prevent required mileage standards even though the rules would increase mileage, cut travel costs and pare pollution. Profits were more important.
Corporations have the backing of government, particularly by members of the Republican Party who see business has the savior of our economy. They would loosen control on business, leaving companies free to follow procedures that, in their mind, would boost profit and, subsequently, employment.
Such laissez faire policies also led to the Depression of the 1930s and helped underwrite our recession today.
They have also contributed to the climate change that endangers all of us. Companies not concerned about environment or other basic issues often let short-term profits override any thought about the future.
On the other hand, placing businesses in a straitjacket will simply strange the economy, leaving no money either for jobs or for efforts to improve the environment.
Clearly, there needs to be a compromise, particularly in the boardroom. For starters, corporate bigwigs are paid too much. In 2010, according to a USA Today, chief executive officers averaged a 27 percent increase while worker salaries climbed an average of 2.1 percent.
Robert Iger of Disney made more than $28 million in 2010. Philippe Dauman at Viacom took home $84 million. Howard Schultz at Starbuck managed to get by on $21.7 million. In contrast, billionaire Warren Buffet only paid himself $524,900.
In contrast, the average wage in this country in 2005 was $45,000, according to the Christian Science Monitor. Social Security Administration put that total at $40,711 in 2009, a drop of more than 12 percent.The U.S. Census Bureau chimed in, reporting that “the top-earning 20 percent of Americans – those making more than $100,000 each year – received 49.4 percent of all income generated in the U.S., compared with the 3.4 percent made by the bottom 20 percent of earners, those who fell below the poverty line, according to the new figures. That ratio of 14.5-to-1 was an increase from 13.6 in 2008 and nearly double a low of 7.69 in 1968.
“At the top, the wealthiest 5 percent of Americans, who earn more than $180,000, added slightly to their annual incomes last year, the data show. Families at the $50,000 median level slipped lower.”
By any standard, only the rich are getting richer.
That kind of statistic evidence is fueling the protests. They will only get louder.
Nevertheless, capitalism won’t die. It’s too successful and too powerful an idea. Alternatives, like socialism and communism, simply lack the necessary incentives. However, corporations may have to start rethinking how they compensate their executives and their employees, unless they wish to confront an endless series of protests.
Bill Lazarus regularly writes about religion and religious history. He also speaks at various religious organizations throughout Florida. You can reach him at www.williamplazarus.com. His books are available on Amazon.com, Kindle, bookstores and via various publishers. Many of his essays are posted at www.williamplazarus.blogspot.com.