Between the rich and the rest

Robert Reich has a good op-ed piece in The New York Times today, How to End the Great Recession. It’s a clear and convincing account of a major reason this recession resists all the usual remedies.

Reich asks how American families could manage to keep spending as if they were keeping pace with overall economic growth, and in turn fuel that  growth. There were three reasons: (1) more women joined the paid work force, (2) everyone put in more hours, and (3) families went deep into debt. The last was OK as long as home prices kept rising. But eventually the bubble burst, and there’s no reserve left to rebuild.

Now we’re left to deal with the underlying problem that we’ve avoided for decades. Even if nearly everyone was employed, the vast middle class still wouldn’t have enough money to buy what the economy is capable of producing.

But if the economy was growing, where did the money go?

Mostly to the top. The economists Emmanuel Saez and Thomas Piketty examined tax returns from 1913 to 2008. They discovered an interesting pattern. In the late 1970s, the richest 1 percent of American families took in about 9 percent of the nation’s total income; by 2007, the top 1 percent took in 23.5 percent of total income.

Note that the 23.5% figure is the highest since just before the stock market crash of 1929 and the Great Depression.

Some right-wing commentators have tried to equate social justice with communism. It is ironic that many in their audience see social justice as the final blow to their own economic survival, when in fact it is the lack of social justice that has put them in difficult straits.

In fact, social justice is the only thing that may save capitalism. Without it, even the top 1% will suffer, because their wealth can only be drawn from a healthy economy, and a healthy economy requires a more equitable distribution of wealth, through fair taxes (the US system enormously favors the wealthy), fair wages (real wages have been falling, except at the top), and improved social services, such as health care.

Stating it more broadly: How long can any political/economic system survive if it remains socially unjust?

References

“Free” as in free enterprise?

When Clear Channel has a station at the DFW airport saying “FREE Charge and Internet™”, would you think that it offers free charging AND free Internet”? I foolishly did, in part because I thought the ™ applied to “FREE Charge and Internet” and that they hadn’t actually trademarked “Internet”.

It’s possible that they meant that you could get free Internet if you were already a home Clear Channel subscriber, but for me, it was $7.95. I know, it’s less than two medium lattes, but that still fails to add to my already incalculable love of flying.

This is from a press release on their website:

“FreeCharge™ has, not surprisingly, been very popular with passengers flying in and out of our busy airport. They provide not only free power but also free internet with CAT 5 and USB ports.”

Network neutrality notes

Network neutrality means no restrictions by Internet Service Providers and governments on content, sites, platforms, attached equipment, or modes of communication. This includes neither blocking sites nor offering tiered service models. It can be viewed from the perspective of users wanted to access particular content, such as peer-to-peer sites for video or music, or from the perspective of producers seeking to deliver their content more effectively to users.

History. Concerns with telegraph: “messages received from any individual, company, or corporation, or from any telegraph lines connecting with this line at either of its termini, shall be impartially transmitted in the order of their reception. (Pacific Telegraph Act of 1860)

In 1934, Congress created the Federal Communications Commission (FCC) with the purpose “to make available, so far as possible, to all people of the United States… A rapid, efficient, Nation-wide, and world-wide wire and radio communications service with adequate facilities at reasonable charges, for the purpose of the national defense, [and] for the purpose of promoting the safety of life and property through the use of wire and radio communication.”

The Internet developed out of public funded services, such as Arpanet, NSFnet, TCI/IP. Eventually centralized routing aspects were removed, allowing the free-wheeling Internet we use today. But in recent years, corporate control over key aspects of the Internet has grown, essentially privatizing a service developed at public expense to serve public needs.

Tiered service. Opponents of net neutrality see it as “a solution in search of a problem”, arguing that broadband service providers have no plans to block content or degrade network performance. Yet, Comcast, for example, “intentionally and secretly blocked access to lawful content on the Internet,” e.g.,  peer-to-peer (P2P) communications, such as BitTorrent. The FCC attempted to block that, but lost that authority after a US Court of Appeals decision on April 6, 2010.

Google may soon reach an agreement with Verizon, which will severely compromise the free flow of information that has made the Internet such a powerful force for creativity, collaboration, and learning.

Issues.

  • Innovation: The Internet has been a striking incubator of new ideas, enterprises, products, services, and jobs. This is to a large extent based on its open practices.
  • Privacy: An Internet with built-in nonneutrality would require an additional level of monitoring, i.e., surveillance, so that packets of information can be routed at the agreed-upon speed and that premiums can be charged. (Cohen, 2010).
  • Free speech: The more service is based on the ability to pay, the less access will ordinary people have to the public forum. ISPs, with a legal responsibility to their shareholders alone, have no incentive to guarantee high quality access to all, and in fact, are legally bound not to do so. They could degrade or block any Web site that was critical of them or did not support their political views.
  • Secrecy: In a Kafkaesque mode, there is no provision for corporations to reveal their selective control of content, including whom they target for preferential or degraded service, why they do so, or even whether or how much they have done. Nearly all major phone and cable companies have promised their shareholders that they plan to block or degrade the content and services of their competitors.
  • Access to information: The other side of free speech. Access suffers when what’s available is based on how much someone paid to put it there.

Who decides. Beyond the specifics of access, privacy, free speech, innovation, etc., the big question is “Who should decide internet policy?”

References

Cohen, Noam (2010, August 15). Internet proposal from Google and Verizon raises fears for privacy. The New York Times.

Pacific Telegraph Act of 1860. Central Pacific Railroad Photographic History Museum.

US Court of Appeals (2010, April 6). Comcast Corp. v. Federal Communication Commission..

Priorities and values

Money reflects priorities, and priorities reflect values. Consider US Government expenditures to

Put another way:

The US government has in effect offered $3.80 for each of the 20 million people who’ve lost family members, food, clean water, homes, and livelihoods because of the floods. It’s spent 158 times that for military aid, much of which has not gone to fight terrorism, but to bolster a military dictatorship, to provide heavy weaponry that threatens India, and to benefit the US defense industry. It’s spent 4,276 times as much to fight a war that shows little prospect of winning hearts and minds, nor for ending terrorism.

(Of course, we may later spend more on flood relief; we could consider annual, rather than total costs; all of the numbers are contested estimates. But regardless of how you cut it, the differences are striking.)

Then we ask: Why don’t “they” love us and embrace our values?

The texture of peace

The Vision of Humanity project has just released its latest report on the “texture of peace.”

Using 24 indicators, such as a nation’s level of military expenditure, its relations with neighbors, and the respect for human rights, the report quantifies the different aspects of peacefulness. It measures peacefulness within, as well as between, nations.

Understanding the texture of peace is more useful than saying simply “at war” or “peace is good.” It helps us see that no country is totally peaceful and that degrees of peacefulness can be quantified for comparison among countries or over time. We can also see how the lack of peace has costs beyond acts of violence per se.

The report identifies some of the drivers of peace, such as levels of democracy and transparency, education, and national well being. Their data show that

[t]he most peaceful societies have higher per capita income, high levels of well-being, more freedom, perform better at sustainability, and appear to have a more equitable distribution of social spending (Institute for Economics & Peace, 2010, p. 4).

The study also examines the economic consequences of peace. One remarkable finding for 2010 is that

…had the world been at peace, world economic output might have reached US$62.4 trillion, an increase of 8.5% and easily exceeding the output losses due to the economic crisis of 2008/9… Even a reduction in levels of violence of just 15% would equal the output loss due to the economic crisis (Ibid, p. 51)

I doubt that many people who turn to violence as a solution for conflicts, or any military contractors who benefit from the lack of peace, will read this report and suddenly decide that they’re misguided. But for the rest of us, this study provides some tools to question the direction we’re going, a way to measure progress, and a way to demonstrate the consequences of violence to the economy and the quality of life.

By the way, last year I celebrated ironically the ascension of the US to #83 on the list. It’s not good for anyone that the most powerful nation on earth is ranked among countries with severe poverty, Balkan states, which are still recovering from major conflict, and former Soviet republics. This year the US has dropped to #85.

References

Institute for Economics & Peace (2010). Peace, wealth and human potential. 2010 discussion paper.

Outside lies magic, Part 1

Gesa Kirsch recently pointed me to John R. Stilgoe’s, Outside lies magic: Regaining history and awareness in everyday places. It’s a refreshing call for becoming more aware of the ordinary world around us. Stilgoe urges us not only to walk or cycle more, but also to use the advantages of those modes of transport to see the world that we usually ignore.

I finished the book, and am writing now, in the antipode of his call to walk and observe. I’m cramped in an airplane seat near the end of a four and a half hour flight. Stilgoe would say that I should still take the opportunity to observe, to learn, and to make sense of my surrounding, but instead I’m counting down the minutes until we land.

The chapters—Beginnings, Lines, Mall, Strips, Interstate, Enclosures, Main Street, Stops, Endings—lie somewhere between prose poems, history lessons, and sermons about the everyday. They remind me of John McDermott’s summary that John Dewey “believed that ordinary experience is seeded with possibilities for surprises and possibilities for enhancement if we but allow it to bathe over us in its own terms” (1973/1981, p. x).

To appreciate the book, you need to follow Stilgoe as he discovers nature, history, urban planning, ethics, social class, and more through cracks in the pavement, vegetation, telephone poles, roadside motels, angle parking, and other seemingly forgettable objects. The real point is not his own findings, but the demonstration that slowing down to look can open up worlds of understanding.

He shows the value of a camera, despite the lament that “ordinary American landscape strikes almost no one as photogenic” (p. 179). He recognizes the dread of causal photography (‘why are you photographing that vacant lot?’), but ties it to “deepening ignorance” (p. 181). This ignorance makes asking directions dangerous: People question us back, ‘Why do you want to know?’

Stilgoe says, “discovering the bits and pieces of peculiar, idiosyncratic importance in ordinary metropolitan landscape scrapes away the deep veneer of programmed learning” (p. 184). Unprogrammed exercise and discovery leads to a unified whole that reorients the mind and the body together. Someone else may own the real estate, but “the explorer owns the landscape” (p. 187).

Stilgoe’s prescription is simple:

Exploration encourages creativity, serendipity, invention.
So read this book, then go.
Go without purpose.
Go for the going.

See Outside lies magic, Part 2.

References

  • McDermott, John J. (1981). The philosophy of John Dewey: Two volumes in one. Chicago: University of Chicago Press. (Originally published 1973)
  • Stilgoe, John R. (1998). Outside lies magic: Regaining history and awareness in everyday places. New York: Walker.

Will there at last be a public option for health care?

Finally, the Democrats are stepping up to offer a real alternative to the Republican’s do-nothing approach and their own save-the-insurance-companies approach.

On March 9, Congressman Alan Grayson, D-Fla., introduced a bill (H.R. 4789 — the Public Option Act, or the Medicare You Can Buy Into Act) which would make it possible for any US citizen or permanent resident to buy into Medicare.

Grayson said,

Obviously, America wants and needs more competition in health coverage, and a public option offers that. But it’s just as important that we offer people not just another choice, but another kind of choice. A lot of people don’t want to be at the mercy of greedy insurance companies that will make money by denying them the care that they need to stay healthy, or to stay alive. We deserve to have a real alternative.”

The bill would require the Secretary of Health and Human Services to establish enrollment periods, coverage guidelines, and premiums for the program. Because premiums would be equal to cost, the program would pay for itself.

“The government spent billions of dollars creating a Medicare network of providers that is only open to one-eighth of the population. That’s like saying, ‘Only people 65 and over can use federal highways.’ It is a waste of a very valuable resource and it is not fair. This idea is simple, it makes sense, and it deserves an up-or-down vote,” Congressman Grayson said.

I signed the petition calling for at least a vote on Grayson’s proposal. If you agree, sign it too and to urge Speaker Pelosi to allow that vote.