Wednesday, September 24, 2008

An Economic Policy of Selfishness

One of the most common words being bandied about around the Wall Street financial crisis is the word ‘greed’. Greed caused this, many say. Greed is bad say many like blogger John McIntire aka MacYapper:

Greed isn't good. It's bad. If the free market system wasn't populated with a bunch of greedy, selfish, reckless a-holes, perhaps we wouldn't need so much oversight. But that's what we got.

Others who fancy themselves as free-market economic purists like to argue that greed is good. The desire for great wealth causes people to produce products and services that we all need or enjoy.

It’s an interesting argument that I think is worth pursuing.

First of all, we need to define greed.

greed [greed]
strong desire for more: an overwhelming desire to have more of something such as money than is actually needed

So is that really the problem? While many people are struggling, there are lots of other people who have all the money they will ever need who still work and earn even more money. Most of us don’t seem to have a problem with that, so is greed by this definition really the problem? But much of the real world is a zero-sum game.

with gain offset by loss: relating to a situation in which a gain by one side or person requires any other side or person involved in it to sustain a corresponding loss

When we work in the job market, we compete for enough of a share of the economic pie so we can afford the things we need along with hopefully enough of the things we want to make life more enjoyable. In a free market society, some people will naturally get more of the pie than others. But what happens when some get so much of a share of that pie that others don’t have enough to live on?

For example, are the huge salaries, bonuses, and sometimes golden parachutes that CEOs are receiving OK? If they really do something to earn the money, maybe so. But the real problem as I see it is that many of these same companies who pay the most lavish bonuses to CEOs (often when the company’s performance doesn’t warrant it) also do their best to hold down the salaries of those on the bottom of the food chain to help pay for these excesses. That’s more than just greed, that’s selfish!

self·ish [sélfish]
1. looking after own desires: concerned with your own interests, needs, and wishes while ignoring those of others
2. demonstrating selfishness: showing that personal needs and wishes are thought to be more important than those of other people

So while greed is considered the problem by many, I say that instead the main problem behind many of our economic problems is not greed but selfishness. Too many of the ‘haves’ are out to get more for themselves at the expense of the ‘have nots’. When the ‘have nots’ cry out that they are struggling, all too often the ‘haves’ dismiss them as ‘whiners’.

Now we come to the standard conservative argument waged here. That anything we do to try and address this is ‘redistribution of wealth’ and is therefore wrong. So for those who are struggling despite their best efforts, that’s just too bad!

But there is a strong counter-argument from the liberal side. Many of the economic policies during the Bush years (like the tax cuts) have mostly benefited those who were already doing well in the hopes that the trickle-down effect would help those further down the economic ladder. But the result has been a widening gap between the ‘haves’ and ‘have nots’. The joke made by then presidential candidate George W. Bush
at an $800 a plate charity fundraiser in 2000 was telling:

"This is an impressive crowd - the haves and the have-mores," quipped the GOP standard-bearer. "Some people call you the elites; I call you my base."

Hey, there’s nothing wrong with being rich or wanting to be rich. In my life, I have both had money and been broke and having money sure beats the hell out of being broke! Wanting money — even a lot of it isn’t wrong in my view. But when we disregard the hurt we may inflict on our fellow man in the pursuit of that wealth, that’s selfish! And that is not good.

A government that has a tax policy that gives tax cuts to those who are already wealthy, the ‘haves’ and the ‘have-mores’, while vetoing the S-CHIP bill to cover uninsured children because some of the benefits might cover a few who are not living in total poverty is selfish!

We see some businesses making handsome profits, sometimes with the help of government tax breaks and subsidies. But so often, much of that profit goes to enrich the CEOs and others in the board room instead of sharing some of the wealth with the workers that helped to create it in the first place. This is the result when companies use much of their profits to buy back their own stock. Instead of Hewlett-Packard rewarding their fired CEO Carly Fiorina with $42 million, wouldn’t it have made more sense to use at least some of that money to instead reward the other good workers at H-P?

Some of the people who go into the biggest rants about how the government should never get involved in health insurance get their own health insurance in the form of Medicare from the federal government. While the number of people affected is subject to some debate, it is undeniable that there are many working people who have no access to affordable health insurance. And many people who do have health insurance are still forced to file bankruptcy when they find that their insurer didn’t adequately cover the care they needed. Wouldn’t it be better if we all worked together to try and make affordable health insurance in the US available to everybody instead of some of us selfishly obscuring the issue with the language of right-wing ideology like ‘socialized medicine’?

And finally there is the economic collapse on Wall Street that we are now trying to repair. Was this caused by the ‘greed’ of people trying to make lots of money? I argue that it was caused more by a financial environment that rewarded selfishness of those who were unconcerned about the people who were losing their homes if it meant making the big bucks for themselves. Indeed, one of the biggest concerns about any bailout plan that is approved is that it may well reward these same selfish people!

There are obviously a number of serious problems to be solved. But I feel that the only chance to succeed is for all of us to agree that we are all in this together!

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