I started reading the synopsis of "Caritas in Veritate" found on Wikipedia. This document was written by Pope Benedict XVI of the Catholic Church, the current Pope at the time of this writing. Now, if you follow my blog, you are probably aware that I am not Catholic (I am in fact LDS aka Mormon). The fact that there are many religious beliefs that I do not share with the Pope does not, however, mean that I consider his opinion invalid. I am not so insecure in my beliefs that I will not listen to the reasoning of others, and further I recognize that in spite of differences in beliefs, truth can come from many sources. I chose to look into this document when I came across an article by another religious minister (who happens to be protestant) suggesting that all Christians could benefit from reading it.
The synopsis of the first chapter (this is as far as I have gotten; as such, this may be the first in a series), found on Wikipedia says that it begins where "Populorum progressio" (a document written by a previous pope) ends. It discusses poverty and charity. Specifically, it discusses an idea from the previous document, that the primary causes of poverty are not disaster or other material things, but "the lack of brotherhood among individuals and peoples." He quotes "Populorum progressio" again later, "the peoples in hunger are making a dramatic appeal to the peoples blessed with abundance." He also points out that those working for the benefit of others, which I interpret as those employed by businesses or other people, need a sense of fulfillment.
The first part, discussing poverty and hunger gave me pause for reflection. In the past, it has been common for civilizations to allow people to go hungry when they chose not to earn their keep. This was seen as fair, because it put undue strain on society and its ability to provide enough for everyone. In the past, people were barely capable of providing for themselves and their families, let alone anyone else. If one person refused to work, or even was unable to work, the cost on society to care for this person could be disastrous. Natural conditions that reduced food supply were common. It was natural and fair that those who did not produce or otherwise provide useful labor should starve. This is no longer the case, however.
One of the major points of Christian teaching is charity. Jesus spent most of His recorded life giving care to those in need. Many times, He helped people without the ability to help themselves, but there were also cases where He helped those who needed help because they had placed themselves in bad situations due to their own poor choices (generally with a plea to choose better in the future). He never passed judgement on these people, and He never refused to help them, even when their situation was obviously their own fault.
This is what the first chapter of Caritas in Veritate is speaking of. When Pope Benedict XVI quotes "Populorum progressio" saying that the primary cause of hunger and poverty is "the lack of brotherhood among individuals and peoples," he is pointing out that the problem is not laziness or the fault of those in poverty. The fault lies with those who have plenty, but are too judgmental or greedy to share when needed. Now, I admit that poverty is a natural consequence of laziness, but we are no longer a society where scarcity dictates that the lazy must starve so that the rest of society can survive. The argument that since poverty is the natural consequence of laziness, it is just to withhold necessities from the lazy is no longer valid. Would we allow the murderer to be put to death by starvation and exposure to the elements? I hope we would recognize this as cruel and unusual punishment. Is laziness such a bad crime that it justifies such a cruel punishment? If our culture is so heartless that those with abundance will allow such suffering for such an insignificant crime, then we are worse than savages and barbarians.
Further, the teachings of Christ do not differentiate between the naked and hungry who are at fault for their situations and those who are not. As I have mentioned, He did not judge those He helped. He helped them because it was the right thing to do. He recognized, far better than most people in our modern culture, that regardless of fault, allowing people to suffer in such ways is wrong, when you have the means to provide relief.
The second thing that impacted me was the part about how those who work for the benefit of others deserve fulfillment. This is the difference between slavery and fair employment. Employers who treat their employees like robots who should be able to do anything they are commanded to are treating them like slaves, not like human beings. This includes employers who pay their employees only enough to survive and no more, or who do not even pay that much. If a job is not worth enough to generate enough income to survive and have at least a little left over (employees deserve to profit as much as anyone else), then it is not worth being done at all. When employers pay only enough to survive, they are treating their employees like machines that have regular maintenance and fuel costs, but who have no other needs or wants. This is humiliating and unfulfilling to employees. Disrespect of employees is equally wrong, and I would like to include in this requiring more labor than is reasonable for a single person, as well as deadlines that are excessively difficult to meet. This also includes rating performance of an employee based on the performance of others. If one employee performs better than the rest, it does not mean that the rest are lazy. Often it means that the one employee has a higher capacity for work, or that that employee is taking credit for the work of others. If an employee is not earning his keep, then it is reasonable to request higher performance or to dismiss him. If most or all of the employees are not earning their keep, then maybe you have chosen a business that is not profitable enough to justify paying for labor. Instead of demanding unreasonable performance, or paying wages that are disrespectfully low, you should get out of that business entirely and try something else.
Our world produces enough to feed every person on it. If some people are lazy, there is no risk that the rest of society will suffer if we continue to support them. I don't want to sound like I am justifying laziness. The lazy should not be given every convenience without any labor. Neither should they be allowed to starve or suffer from lack of necessities either, as long as there is enough excess to go around. Even the lazy deserve sanitary living conditions, shelter from harsh weather, clothing, and sufficient water and nutrition. This may be as limited as studio apartments with two people to an apartment, the cheapest thrift store clothing, clean water that is merely warm instead of hot, and healthy food from soup kitchens that does not always taste great, but provides all of the necessary nutrients. Are we so cruel and uncaring that we will not even provide this little bit to reduce suffering?
I would like to briefly make a statement to all of the celebrities I hear say that they wish for world peace, or to end world hunger: What are you doing to fix this problem? Yes, I see that many of you donate money to charities to cure breast cancer and AIDs, to fly food to starving people in Africa, that ultimately gets confiscated by their governments to be used to fuel hate wars, or to save some endangered animal, but what are you really doing? There are people in New York, L.A., Chicago, Seattle, and every other large city in our nation (replace these with cities for your own country, if you do not live in the U.S.) who need food, shelter, and medical care, who cannot afford it, and you are pouring millions of dollars into charities to help minorities or people in other countries. How do you think that we can eliminate world hunger by sending money to other countries, when we have not even managed to eliminate hunger in our own country? When you get up in front on millions of people and say you want to end world hunger, and then go to the expensive after party and then your billion dollar mansion and never think about those starving people again, that is hypocrisy, which is the one thing that Jesus did judge people for.
I don't care if you do not believe in God, or Jesus, all of the principals still stand. Society is only strong when those with excess help support those in need. The stories of Jesus, true or not, are the single best example of this that we have. Natural laws do not care if you choose to believe in God or not, if a civilization refuses to support its poor, it will eventually loose its civility.
This is a very controversial battle. This is because most of the rich ignore their responsibility to the poor. It appears that the majority of Americans recognize that there is a responsibility there, otherwise we would not have any welfare systems, but the rich are throwing huge amounts of money and influence into convincing people that no responsibility exists and that civilization is every man for himself. If we can see that the rich have a responsibility to make sure the poor have sufficient resources to survive, and if we can see that a majority of the rich will do everything in their power to escape this responsibility, what do we think should be done about it? Should we allow the poor to die in one of the cruelest ways possible, because we believe that the rich have a natural right to shirk the responsibilities that come with excess resources? We claim to be a country dedicated to justice. Is this truly justice, to allow people to suffer to death because they cannot or will not find a way to support themselves? What rights are so important that the will of the majority should not be enough to allow the government to step in and right this wrong? Are not all of our laws somehow based on religion (and Christian religion at that)? How then is it so wrong to make laws that enforce this commandment (that those with excess help support those in need), when it is right to make laws that prohibit murder, theft, and other highly religious principals? Ironically, the strongest opponents of these laws are those conservatives who claim to be Christians.
I do understand the argument that charity should be a personal choice, and really it is. The problem is, where is the point where law should override personal choice (because that is specifically what law is designed to do)? I would argue that when thousands or millions of people are suffering and dying, it is way past the point where law should override personal choice. If we were still a nation of virtuous people, this would not even be an issue. I agree that the government should not be involved in this. Unfortunately, when the people refuse to fulfill their own responsibilities, and others suffer as a result, someone has to take that responsibility. There is no one else as uniquely qualified to do this as a government, if the people will not do it themselves. However, once the government has to take the place of individual charity, it is no longer charity, and the people giving no longer receive the benefits of charitable actions. Even if you do not believe in God, if you have any ethics you must admit that giving to the poor because the government forces you to does not give you the good feeling you get when you do it entirely voluntarily without being compelled to.
I will continue reading the synopsis of "Caritas in Veritate." I would suggest, as the protestant minister who's writings encouraged me, that all Christians would benefit from at least reading the synopsis of this document, if not the document itself. Even non-Christians would likely benefit from reading it, as even in a non-religious sense, the principals make good sense. I may choose to write more on this document, if I feel so inclined, as I continue to read through the synopsis. I may eventually read the document itself, if I can find a translation and if I can find enough time.
Lord Rybec
14 August 2012
09 August 2012
Intellectual Property Ethics & Piracy
I had an interesting discussion today about media production, distribution, and pricing. Some of those present expressed a belief that the free market system controls prices sufficiently for media. The argument was that we pay the prices demanded, thus it is fair that we should pay that much. I know I have discussed this idea before, on a general level, but I would like to discuss it again, with its relationship to intellectual property and media piracy.
First I would like to submit that the argument that "we pay the demanded prices, thus the prices must be fair" is false. As I have said, I have addressed the fairness issue previously. I would now like to address the assertion that we pay the demanded prices.
First let's look at piracy. Initially, piracy was only defined as maritime theft. If the crew of one ship overpowered and seized the goods carried by another ship, this was piracy. Besides the fact that it was specific to sea travel, it defined theft. Now, theft is most generically defined as someone taking something that does not belong to them and sometimes more specifically as taking something which belongs to someone else, without permission. There are, however, some underlying assumptions. First, we assume that the item taken has some value, either monetary or emotional, to the owner. Second, we assume that the deprivation of the item will cause significant harm or hardship to the owner. Thus, taking money, a valuable item, or even a worthless item with sentimental value to the owner would clearly be defined as theft.
Media piracy does not take place on the seas, but given that we often use comparable terms for air travel, one might argue that it is not entirely unfair to call it piracy if it has the potential to be transmitted wirelessly (I wouldn't buy it, but the semantics here are not the ones in question). The concept of media theft however, is rather questionable. First, could media piracy be construed as taking something of value? Given the quality of modern media, this is debatable, but I will give the benefit of the doubt and assume that if it were not of value, no one would want to take it. Second, does the deprivation of the item cause significant harm or hardship? Well, given that modern media can be copied and distributed for almost no cost, the supposed theft of media does not actually deprive the owner of it. So, really media piracy does not fit the normal understanding of theft. There are, however, some that argue that it does still cause significant loss, which could be considered hardship or harm.
Now, let's quantify the loss caused by media piracy. Unless the stolen item was a book, CD-ROM, or other physical media, there is no value lost directly from the media. If the pirate managed to hack the owner's computer and download it directly from there, the taking of the media might cost the owner a few cents in electricity and network fees, if they pay based on bandwidth used. As nearly all media piracy takes place through copying physical media at home, transferring files using personally owned physical media, or through networks in ways that never touch the owner of the media, the pirates generally pay the entire cost of distributing the media. In short, media piracy does not incur a direct cost on the owner. This is extremely different from physical media; in fact it is so substantially different that trying to apply the same laws to it has proven absurd.
The actual loss caused by media piracy is not quantifiable. Media companies make guesses, but how are they counting physically copied media? Does someone tell them every time anyone uses their DVD burner to copy a DVD? How do they know the number of times their media has been transmitted over the internet? What about encrypted connections; do they know what gets transferred on those? So, they actually try to quantify it using guesses based on what little data they can collect. Besides being a guess, this method ignores other pertinent facts. They do not take into account how many of those pirates would have paid full price for the media if they had not been able to obtain it for free. They cannot reasonably claim that they have lost money because someone was able to obtain the media for free, if the person would not have paid for it even if they could not obtain it for free. In essence, the media companies are calculating imaginary losses that cannot even be estimated to within an order of magnitude.
Let's return to the original assertion: "we pay the demanded prices, thus the prices must be fair." I don't believe we pay the demanded prices. Let's put aside the ethics of piracy for a moment. There has been no time in history where such a large number of people took what was perceived to belong to another person without permission or payment. (I would like to note here that our nation's founders did not believe that information of any type should belong to a person. They implemented the patent and copyright systems as a means of encouraging inventors and artists to disclose their work to the general public, so that technology could advance more quickly. They also recognized that without reward, people would quit creating new things, so they created a system intended to allow a reasonable profit, if the invention/media was of value. There was no implication of property rights for media.) I submit that this is how we refuse to pay the demanded prices for media. When the media prices are higher than we are willing to pay, we obtain it from a competitor that charges less.
In reality, there is no evidence that media companies are loosing significant money from piracy. All of the figures that can be found on the internet are made up, including the ones attributed to government agencies (who, when questioned, said that they have neither obtained nor published such figures). In short, they are lies. Media companies are still making absurd profits on their products, in spite of high piracy rates. The real question is one of fairness.
The media companies are benefiting from the ability to effortlessly transfer digital media. In the past, they have had to rely on physical media to transport media. The first large scale media (ie, mass produced) was books. These were initially expensive to produce (the invention of the printing press did not reduce the cost of making paper or ink). Even now, a majority of the production cost of a book is the physical creation. Then we invented CDs (I am skipping some of the less wildly popular physical media; cassette tapes were pretty big at one point and were the first easily copyable media). CDs can be copied easily and cheaply. Still, the physical media distribution is most of the cost. When we started transferring files over the internet though, the cost per copy was reduced to almost nothing. This has been an enormous boon to the media companies, because now the biggest cost of selling their product is gone. Why then have media prices stayed pretty much the same? Right, so rental costs for movies and games are lower now, and some distributors give discounts for download versions, but nothing significant. I also understand that you can buy songs at $1 a piece, but as music CDs with 15 or so songs cost around $15, this is not actually a price reduction at all. The vast majority of the cost per unit has been eliminated, but the price has not gone down significantly.
So, where is the fairness? The cost of production has dropped to almost nothing. Why have the prices not dropped? I understand that these companies need to make money, but this amounts to millions or even billions of dollars unaccounted for. How then is it fair for them to complain about piracy, when the very medium that allows it is making them greater profits than they could have ever imagined? Wide spread media piracy is the consumer rebellion against unfair prices. We are not willingly paying what they are demanding. Many of us are refusing to pay what they are demanding. The market is speaking. This is how a truly free market works. If these companies want our business, they will have to charge prices that reflect all of the savings that these new mediums are bringing.
What should the government do? Do these businesses need protection? To answer the first question, we must first answer the second. Is there evidence that the media companies are suffering due to piracy? According to them, they need protection. If you look at their profit margins, even with piracy, they are still raking in the cash. I don't think they need any protection. They are doing perfectly fine. As such, I don't think the government has any business protecting them. Further, if there is a reason for the government to intervene, I would submit that it should be in the opposite direction. Looking at the profit margins (try popular movies, and only look at opening day for a surprise), I would say that these companies are charging prices that amount to extortion. If anyone needs protection it is the consumers. That said, I think that we have found a fairly good solution: piracy. Not only is this a perfectly fair free market solution, it requires no government action at all. We have already seen it work. The iTunes store finally dropped the oppressive DRM built into all of its products. This generated further evidence that people are more willing to pay than pirate if it is a fair deal, when their sales shot up as a result. That aside though, the government is supposed to represent the people, and if piracy rates are as high as the media companies claim, then the people have spoken. At this point, the government has no business intervening in behalf of the media companies.
I don't think most media pirates are greedy people who are unwilling to pay fair prices when they can easily get it for free instead. I think most media pirates are either unwilling to pay the unfair prices, or are unable to. There was a time when convenience was also a major issue. The iTunes store and other vendors found ways to make purchasing media more convenient, and sales went up. DRM has been a huge issue, and when iTunes dropped it, we saw their sales go up again. I think that if prices were reduced to a fair amount, we would again see an increase in sales and a drop in piracy. There will still be people who want free stuff and will not be willing to pay if they can get it for free, but I don't think this describes most media pirates.
The American people are demanding fair prices. The government can try to prevent media piracy, but we will always find a way around it (PIPA and SOPA did not even get passed, but the very fact that the bills got to Congress resulted in more means of circumventing internet censorship). Piracy may be illegal, but evidently, most Americans do not see it as ethically wrong, when the only alternative is to be treated unfairly by media companies. When the ethical dilemma of piracy is compared to the ethical dilemma of extortion, it looks like piracy wins. The only way to reduce piracy is for the media companies to listen to the people and begin treating them fairly.
First I would like to submit that the argument that "we pay the demanded prices, thus the prices must be fair" is false. As I have said, I have addressed the fairness issue previously. I would now like to address the assertion that we pay the demanded prices.
First let's look at piracy. Initially, piracy was only defined as maritime theft. If the crew of one ship overpowered and seized the goods carried by another ship, this was piracy. Besides the fact that it was specific to sea travel, it defined theft. Now, theft is most generically defined as someone taking something that does not belong to them and sometimes more specifically as taking something which belongs to someone else, without permission. There are, however, some underlying assumptions. First, we assume that the item taken has some value, either monetary or emotional, to the owner. Second, we assume that the deprivation of the item will cause significant harm or hardship to the owner. Thus, taking money, a valuable item, or even a worthless item with sentimental value to the owner would clearly be defined as theft.
Media piracy does not take place on the seas, but given that we often use comparable terms for air travel, one might argue that it is not entirely unfair to call it piracy if it has the potential to be transmitted wirelessly (I wouldn't buy it, but the semantics here are not the ones in question). The concept of media theft however, is rather questionable. First, could media piracy be construed as taking something of value? Given the quality of modern media, this is debatable, but I will give the benefit of the doubt and assume that if it were not of value, no one would want to take it. Second, does the deprivation of the item cause significant harm or hardship? Well, given that modern media can be copied and distributed for almost no cost, the supposed theft of media does not actually deprive the owner of it. So, really media piracy does not fit the normal understanding of theft. There are, however, some that argue that it does still cause significant loss, which could be considered hardship or harm.
Now, let's quantify the loss caused by media piracy. Unless the stolen item was a book, CD-ROM, or other physical media, there is no value lost directly from the media. If the pirate managed to hack the owner's computer and download it directly from there, the taking of the media might cost the owner a few cents in electricity and network fees, if they pay based on bandwidth used. As nearly all media piracy takes place through copying physical media at home, transferring files using personally owned physical media, or through networks in ways that never touch the owner of the media, the pirates generally pay the entire cost of distributing the media. In short, media piracy does not incur a direct cost on the owner. This is extremely different from physical media; in fact it is so substantially different that trying to apply the same laws to it has proven absurd.
The actual loss caused by media piracy is not quantifiable. Media companies make guesses, but how are they counting physically copied media? Does someone tell them every time anyone uses their DVD burner to copy a DVD? How do they know the number of times their media has been transmitted over the internet? What about encrypted connections; do they know what gets transferred on those? So, they actually try to quantify it using guesses based on what little data they can collect. Besides being a guess, this method ignores other pertinent facts. They do not take into account how many of those pirates would have paid full price for the media if they had not been able to obtain it for free. They cannot reasonably claim that they have lost money because someone was able to obtain the media for free, if the person would not have paid for it even if they could not obtain it for free. In essence, the media companies are calculating imaginary losses that cannot even be estimated to within an order of magnitude.
Let's return to the original assertion: "we pay the demanded prices, thus the prices must be fair." I don't believe we pay the demanded prices. Let's put aside the ethics of piracy for a moment. There has been no time in history where such a large number of people took what was perceived to belong to another person without permission or payment. (I would like to note here that our nation's founders did not believe that information of any type should belong to a person. They implemented the patent and copyright systems as a means of encouraging inventors and artists to disclose their work to the general public, so that technology could advance more quickly. They also recognized that without reward, people would quit creating new things, so they created a system intended to allow a reasonable profit, if the invention/media was of value. There was no implication of property rights for media.) I submit that this is how we refuse to pay the demanded prices for media. When the media prices are higher than we are willing to pay, we obtain it from a competitor that charges less.
In reality, there is no evidence that media companies are loosing significant money from piracy. All of the figures that can be found on the internet are made up, including the ones attributed to government agencies (who, when questioned, said that they have neither obtained nor published such figures). In short, they are lies. Media companies are still making absurd profits on their products, in spite of high piracy rates. The real question is one of fairness.
The media companies are benefiting from the ability to effortlessly transfer digital media. In the past, they have had to rely on physical media to transport media. The first large scale media (ie, mass produced) was books. These were initially expensive to produce (the invention of the printing press did not reduce the cost of making paper or ink). Even now, a majority of the production cost of a book is the physical creation. Then we invented CDs (I am skipping some of the less wildly popular physical media; cassette tapes were pretty big at one point and were the first easily copyable media). CDs can be copied easily and cheaply. Still, the physical media distribution is most of the cost. When we started transferring files over the internet though, the cost per copy was reduced to almost nothing. This has been an enormous boon to the media companies, because now the biggest cost of selling their product is gone. Why then have media prices stayed pretty much the same? Right, so rental costs for movies and games are lower now, and some distributors give discounts for download versions, but nothing significant. I also understand that you can buy songs at $1 a piece, but as music CDs with 15 or so songs cost around $15, this is not actually a price reduction at all. The vast majority of the cost per unit has been eliminated, but the price has not gone down significantly.
So, where is the fairness? The cost of production has dropped to almost nothing. Why have the prices not dropped? I understand that these companies need to make money, but this amounts to millions or even billions of dollars unaccounted for. How then is it fair for them to complain about piracy, when the very medium that allows it is making them greater profits than they could have ever imagined? Wide spread media piracy is the consumer rebellion against unfair prices. We are not willingly paying what they are demanding. Many of us are refusing to pay what they are demanding. The market is speaking. This is how a truly free market works. If these companies want our business, they will have to charge prices that reflect all of the savings that these new mediums are bringing.
What should the government do? Do these businesses need protection? To answer the first question, we must first answer the second. Is there evidence that the media companies are suffering due to piracy? According to them, they need protection. If you look at their profit margins, even with piracy, they are still raking in the cash. I don't think they need any protection. They are doing perfectly fine. As such, I don't think the government has any business protecting them. Further, if there is a reason for the government to intervene, I would submit that it should be in the opposite direction. Looking at the profit margins (try popular movies, and only look at opening day for a surprise), I would say that these companies are charging prices that amount to extortion. If anyone needs protection it is the consumers. That said, I think that we have found a fairly good solution: piracy. Not only is this a perfectly fair free market solution, it requires no government action at all. We have already seen it work. The iTunes store finally dropped the oppressive DRM built into all of its products. This generated further evidence that people are more willing to pay than pirate if it is a fair deal, when their sales shot up as a result. That aside though, the government is supposed to represent the people, and if piracy rates are as high as the media companies claim, then the people have spoken. At this point, the government has no business intervening in behalf of the media companies.
I don't think most media pirates are greedy people who are unwilling to pay fair prices when they can easily get it for free instead. I think most media pirates are either unwilling to pay the unfair prices, or are unable to. There was a time when convenience was also a major issue. The iTunes store and other vendors found ways to make purchasing media more convenient, and sales went up. DRM has been a huge issue, and when iTunes dropped it, we saw their sales go up again. I think that if prices were reduced to a fair amount, we would again see an increase in sales and a drop in piracy. There will still be people who want free stuff and will not be willing to pay if they can get it for free, but I don't think this describes most media pirates.
The American people are demanding fair prices. The government can try to prevent media piracy, but we will always find a way around it (PIPA and SOPA did not even get passed, but the very fact that the bills got to Congress resulted in more means of circumventing internet censorship). Piracy may be illegal, but evidently, most Americans do not see it as ethically wrong, when the only alternative is to be treated unfairly by media companies. When the ethical dilemma of piracy is compared to the ethical dilemma of extortion, it looks like piracy wins. The only way to reduce piracy is for the media companies to listen to the people and begin treating them fairly.
28 July 2012
Losing the American Dream
I just read an article on the American Dream, that questions whether it is still obtainable. The American Dream is a poorly understood concept. Originally, it referred to the fact that destitute immigrants could go from poverty to wealth during their lifetime, if they were willing to work for it. Now, each person understands it differently. Going by the original meaning, however, I think it is truly dying. Even many of our current politicians recognize that economic mobility in the US has decayed dramatically. Some researchers have even found evidence that Canada and most of Europe provide higher economic mobility than the US. If you really want a chance at the American Dream, America is not where you want to be.
The article cites a study by Pew Charitable Trusts' Economic Mobility Project. According to the study, 43% of the economic bottom 20% stay in the bottom 20%. It also says that 93% of those in the bottom 20% do better than their parents. It does not state exactly what this means, however, and I would like to look at this closer.
According to the study, the bottom 20% of households make less than $28,900 a year (it does not qualify the number of dependents in a household). They say that 93% of the bottom make more than their parents. I would like to know if this is based on dollar amount, or on inflation adjusted income. This is important, because the money that my parents made 20 years ago was worth more than my money is now, based in inflation. (I use 20 years, because comparing the wages of an employee with 20 years work experience with one with none cannot yield a reliable conclusion. This assumes that there is only a 20 year age difference between parent and child. If there is more, the difference is more dramatic.) For example, total inflation from 1992 to now (2012) is 64%. This means that if I make $28,900 a year, my parents would have had to make less than $17,622 in 1990 for me to make more than they made.
Inflation is extremely important here. If you account for inflation, the claim that the lower 20% is earning more than their parents is false. Most are earning less. I have mentioned a statistic in a previous article that I feel I should repeat. From 1960 to 2010, total average inflation is 659%. For the lower 75%, average wage increase is only 75%. Unless the wages of the lower 20% have increased by much more than the rest of the lower 75%, then they are earning far less than their grandparents did. Our economy has not improved dramatically over this time, so this is very unlikely. (Admittedly, minimum wage does tend to increase a bit faster than the natural wage increase, so the lower 20% may have seen faster wage increases than the rest of the lower 75%, but it is not anywhere near enough to make up the difference.)
So, to my primary point: economic mobility. I have had conversations with strong conservatives on the subject of fair wages. One argument in favor of less regulation of wages is that we can always get a job somewhere that pays better. Also, if we don't like our local economy, we can move. Lastly, if we cannot get a good paying job, we can freelance, or start our own business. The first of these is only ever true in an economy with very low unemployment and high demand for labor. We have not had this kind of situation in the US for decades. The second argument is a lie. If we cannot make enough to survive in our local economy, how do you think we can afford to move somewhere else? The third is true, but has a very low chance of success (most small businesses fail within the first year).
Economic mobility is the ability of an individual to change economic levels within an economy. High economic mobility, which we had when our country was founded, gives the poor the ability to rise from poverty to become self sustaining, or even wealthy. It also often implies higher risk of failure to the very rich. High economic mobility requires those with wealth to keep working and to use their money wisely, if they wish to stay wealthy.
Low economic mobility is the opposite. It makes it difficult or impossible to rise from poverty. It also places the wealthy in positions of power that make it difficult for them to loose their wealth, even if they spend unwisely and do no useful work.
Obviously, high economic mobility is better for the poor and worse for the rich, while low economic mobility is good for the rich, but bad for the poor. An example of high economic mobility (which has been fairly rare throughout history) is the US in its first half century, where starting your own business was fairly easy and where you could build a farm and grow your own food if you could not get a job. An example of low economic mobility is old England, where surfs were bound to the land, and were taxed anything beyond what they needed to feed themselves (and often a bit more). So, where are we now? The US has lower economic mobility than most other first world countries. In most European countries, it is easier to escape poverty than in the US. You might ask if low economic mobility is really the problem, or why it is so bad.
Economic mobility has many different levels. If it is too high, it could result in dramatic economic instability. If it is too low, it results in even worse problems though. The first is that it hinders economic freedom (the single most important reason that most people immigrated to this continent both before and after it became a country). In our country today, can I survive without relying on a large corporation? Even if I own my own business, I cannot. I have to rely on them for supplies for my business, as well as for my day to day needs. Now, this is not entirely bad, but what happens if they raise the prices for food a lot? Can I make my own at a reasonable cost? Can I start my own grocery store to compete with them? The answers are no, I cannot. If economic mobility were high, I could at least start my own competing store. Unfortunately, the barriers to entry are so high that my chance of success, even with very good resources, are less than 50%. This is partially because small businesses don't get the huge tax cuts that large ones do.
Second, it causes money to flow towards the top. Right, you have heard this before. You might be skeptical of its validity. Let me explain why this is bad. First, when money flows towards the top, it stays there. Contrary to what businesses claim, most profits do not go to pay individual workers. When money gets to the top, it is used to invest, to buy bulk supplies, and now days, to pay for intellectual property law suits. Money that is invested is generally used for expansion. This sometimes pays for more jobs, but more often it is used for buying new equipment, which is produced mostly by machine, with few human workers (I have nothing against automation, but I believe that the savings it generates should be distributed fairly). Money that is used to buy bulk supplies primarily goes to pay for automated production, equipment, and raw materials that again are produced or harvested by machine. Money that pays for intellectual property lawsuits never does anything useful. It might pay the paychecks of a few already overpaid lawyers, but then it sits in the bank waiting for the next lawsuit when it might need to be paid to the next guy. It just gets passed around between businesses. The last thing that money at the top does is makes rich individuals richer. These are people who invest (we've discussed this already), or just hoard the money. Hoarding money hurts everyone. Hoarding money removes it from the economy, reducing the amount of available money, but it does not destroy it, so the value of the remaining money does not increase (significantly anyhow). This allows prices to increase, but money to decrease, which is worse than legitimate inflation or deflation.
The ultimate problem with money flowing to the top is that those who are not rich become too poor to survive. When reduced money supply is not countered with deflation (the decrease of prices, or increase of value of money), the middle class is slowly reduced to poverty. This results in reduced physical mobility, which prevents the poor from escaping to somewhere where they can survive. This either causes them to starve, or forces them to provide more work than is fair for their wages. This will decay until the poor cannot even survive on the wages they are getting for that. When this happens, employee turnover increases as people are "burnt out" from too much work. This is unsustainable. Eventually, they will run out of employees to burn out. Before this happens though, the diminishing spending power of the lower and middle classes will no longer be able to support the enormous business infrastructures that support the few rich. In short, low economic mobility leads to economic disaster.
An example of this is the US over the last few years. Banks have to buy debt (provide loans) to survive. Money does not accrue interest on its own. The banks got to a point where they were providing too many high risk loans. At the same time, prices were increasing faster than wages (buying debt inherently raises prices as it increases the availability of money in the economy). The result was that people began defaulting on loans, which destroyed many banks, and caused a small economic crash. Sadly, we have not learned from this, and our economic mobility is further decreasing.
Low economic mobility makes economic recovery more difficult. High economic mobility makes economic recovery almost unnecessary, as it allows holes to be filled very quickly. When economic disaster does hit, high economic mobility makes recovery faster and less painful.
So, how do we increase economic mobility? First, allow fair competition. If we give large businesses advantages over small ones, it will be more difficult for small businesses to compete with large ones. This allows large businesses to control prices which gives them power to hedge their markets against competition. This makes it nearly impossible for a new business to compete. If we even taxed businesses equally regardless of size, economic mobility would increase dramatically.
Second, slow or stop the flow of money to the top. I recognize that businesses need money to operate, but they do not need to expand at the rates that most US businesses do (and excessive expansion eventually leads to disaster, when the bubble breaks and profits can no longer keep up with costs). How do we do this? I cannot say what would work best, but I have a few suggestions. Many people promote progressive taxes for businesses. To complement this, they also suggest more progressive taxes for individuals, so that less money is funneled to overpaid CEOs. This would reduce the incentive for excessive profits at higher tax brackets, but it would instead funnel money into the government, which also often tends to push money upwards (necessarily in most cases). I have previously suggested profit margin limits that incur fines if they are exceeded. This would likely work fairly well. With this, a wage cap would prevent excess profits from being given to those who do not need the money, which would prevent flow to the richest individuals. I personally prefer this because it is more difficult to abuse than a tax based solution.
If you wonder why we have not already collapsed if this is all true, I can explain that as well. We are well past the point where businesses refuse to pay wages that can support people. We do still have a functional middle class, but it has shrunk dramatically, as a few have risen higher and the majority has sunk into near poverty. The reason those in poverty can still survive is that the government takes up the slack of the businesses. Our welfare system makes sure that the worst off have enough money for food and a place to sleep. Unfortunately, it is not the government's responsibility to take up the slack of businesses. The government is responsible for making sure that businesses treat people fairly, in a large degree, but any welfare should be for those with a legitimate problem providing for themselves or their family, not to make up what businesses cheat their workers out of.
We have lost the American Dream. Microsoft, WalMart, and Apple are having their American Dreams, but at the expense of the rest of us. If the American Dream is the opportunity to rise from poverty to sustainability through hard work, then why are the hardest workers often the poorest? Many Americans' American Dreams are being stolen from them for minimum wage. People like Bill Gates and the late Steve Jobs did not only take their American Dreams, but they took the American Dreams of millions of other Americans. I don't have anything against wealth, but wealth at the expense of others is wrong.
The only way that the US can retain its economic superiority is through high economic mobility. We are currently behind many other countries, some by a large margin. There was a time when the US had the highest economic mobility in the world. This made us into an economic powerhouse. Now, Mexican farm workers are leaving the US, because they can find higher economic mobility in Mexico. We are at the end of an era. We can enter the next as either the most economically powerful nation in the world, or as a barely first world nation struggling to stay above imminent economic disaster. Which shall we choose?
Lord Rybec
The article cites a study by Pew Charitable Trusts' Economic Mobility Project. According to the study, 43% of the economic bottom 20% stay in the bottom 20%. It also says that 93% of those in the bottom 20% do better than their parents. It does not state exactly what this means, however, and I would like to look at this closer.
According to the study, the bottom 20% of households make less than $28,900 a year (it does not qualify the number of dependents in a household). They say that 93% of the bottom make more than their parents. I would like to know if this is based on dollar amount, or on inflation adjusted income. This is important, because the money that my parents made 20 years ago was worth more than my money is now, based in inflation. (I use 20 years, because comparing the wages of an employee with 20 years work experience with one with none cannot yield a reliable conclusion. This assumes that there is only a 20 year age difference between parent and child. If there is more, the difference is more dramatic.) For example, total inflation from 1992 to now (2012) is 64%. This means that if I make $28,900 a year, my parents would have had to make less than $17,622 in 1990 for me to make more than they made.
Inflation is extremely important here. If you account for inflation, the claim that the lower 20% is earning more than their parents is false. Most are earning less. I have mentioned a statistic in a previous article that I feel I should repeat. From 1960 to 2010, total average inflation is 659%. For the lower 75%, average wage increase is only 75%. Unless the wages of the lower 20% have increased by much more than the rest of the lower 75%, then they are earning far less than their grandparents did. Our economy has not improved dramatically over this time, so this is very unlikely. (Admittedly, minimum wage does tend to increase a bit faster than the natural wage increase, so the lower 20% may have seen faster wage increases than the rest of the lower 75%, but it is not anywhere near enough to make up the difference.)
So, to my primary point: economic mobility. I have had conversations with strong conservatives on the subject of fair wages. One argument in favor of less regulation of wages is that we can always get a job somewhere that pays better. Also, if we don't like our local economy, we can move. Lastly, if we cannot get a good paying job, we can freelance, or start our own business. The first of these is only ever true in an economy with very low unemployment and high demand for labor. We have not had this kind of situation in the US for decades. The second argument is a lie. If we cannot make enough to survive in our local economy, how do you think we can afford to move somewhere else? The third is true, but has a very low chance of success (most small businesses fail within the first year).
Economic mobility is the ability of an individual to change economic levels within an economy. High economic mobility, which we had when our country was founded, gives the poor the ability to rise from poverty to become self sustaining, or even wealthy. It also often implies higher risk of failure to the very rich. High economic mobility requires those with wealth to keep working and to use their money wisely, if they wish to stay wealthy.
Low economic mobility is the opposite. It makes it difficult or impossible to rise from poverty. It also places the wealthy in positions of power that make it difficult for them to loose their wealth, even if they spend unwisely and do no useful work.
Obviously, high economic mobility is better for the poor and worse for the rich, while low economic mobility is good for the rich, but bad for the poor. An example of high economic mobility (which has been fairly rare throughout history) is the US in its first half century, where starting your own business was fairly easy and where you could build a farm and grow your own food if you could not get a job. An example of low economic mobility is old England, where surfs were bound to the land, and were taxed anything beyond what they needed to feed themselves (and often a bit more). So, where are we now? The US has lower economic mobility than most other first world countries. In most European countries, it is easier to escape poverty than in the US. You might ask if low economic mobility is really the problem, or why it is so bad.
Economic mobility has many different levels. If it is too high, it could result in dramatic economic instability. If it is too low, it results in even worse problems though. The first is that it hinders economic freedom (the single most important reason that most people immigrated to this continent both before and after it became a country). In our country today, can I survive without relying on a large corporation? Even if I own my own business, I cannot. I have to rely on them for supplies for my business, as well as for my day to day needs. Now, this is not entirely bad, but what happens if they raise the prices for food a lot? Can I make my own at a reasonable cost? Can I start my own grocery store to compete with them? The answers are no, I cannot. If economic mobility were high, I could at least start my own competing store. Unfortunately, the barriers to entry are so high that my chance of success, even with very good resources, are less than 50%. This is partially because small businesses don't get the huge tax cuts that large ones do.
Second, it causes money to flow towards the top. Right, you have heard this before. You might be skeptical of its validity. Let me explain why this is bad. First, when money flows towards the top, it stays there. Contrary to what businesses claim, most profits do not go to pay individual workers. When money gets to the top, it is used to invest, to buy bulk supplies, and now days, to pay for intellectual property law suits. Money that is invested is generally used for expansion. This sometimes pays for more jobs, but more often it is used for buying new equipment, which is produced mostly by machine, with few human workers (I have nothing against automation, but I believe that the savings it generates should be distributed fairly). Money that is used to buy bulk supplies primarily goes to pay for automated production, equipment, and raw materials that again are produced or harvested by machine. Money that pays for intellectual property lawsuits never does anything useful. It might pay the paychecks of a few already overpaid lawyers, but then it sits in the bank waiting for the next lawsuit when it might need to be paid to the next guy. It just gets passed around between businesses. The last thing that money at the top does is makes rich individuals richer. These are people who invest (we've discussed this already), or just hoard the money. Hoarding money hurts everyone. Hoarding money removes it from the economy, reducing the amount of available money, but it does not destroy it, so the value of the remaining money does not increase (significantly anyhow). This allows prices to increase, but money to decrease, which is worse than legitimate inflation or deflation.
The ultimate problem with money flowing to the top is that those who are not rich become too poor to survive. When reduced money supply is not countered with deflation (the decrease of prices, or increase of value of money), the middle class is slowly reduced to poverty. This results in reduced physical mobility, which prevents the poor from escaping to somewhere where they can survive. This either causes them to starve, or forces them to provide more work than is fair for their wages. This will decay until the poor cannot even survive on the wages they are getting for that. When this happens, employee turnover increases as people are "burnt out" from too much work. This is unsustainable. Eventually, they will run out of employees to burn out. Before this happens though, the diminishing spending power of the lower and middle classes will no longer be able to support the enormous business infrastructures that support the few rich. In short, low economic mobility leads to economic disaster.
An example of this is the US over the last few years. Banks have to buy debt (provide loans) to survive. Money does not accrue interest on its own. The banks got to a point where they were providing too many high risk loans. At the same time, prices were increasing faster than wages (buying debt inherently raises prices as it increases the availability of money in the economy). The result was that people began defaulting on loans, which destroyed many banks, and caused a small economic crash. Sadly, we have not learned from this, and our economic mobility is further decreasing.
Low economic mobility makes economic recovery more difficult. High economic mobility makes economic recovery almost unnecessary, as it allows holes to be filled very quickly. When economic disaster does hit, high economic mobility makes recovery faster and less painful.
So, how do we increase economic mobility? First, allow fair competition. If we give large businesses advantages over small ones, it will be more difficult for small businesses to compete with large ones. This allows large businesses to control prices which gives them power to hedge their markets against competition. This makes it nearly impossible for a new business to compete. If we even taxed businesses equally regardless of size, economic mobility would increase dramatically.
Second, slow or stop the flow of money to the top. I recognize that businesses need money to operate, but they do not need to expand at the rates that most US businesses do (and excessive expansion eventually leads to disaster, when the bubble breaks and profits can no longer keep up with costs). How do we do this? I cannot say what would work best, but I have a few suggestions. Many people promote progressive taxes for businesses. To complement this, they also suggest more progressive taxes for individuals, so that less money is funneled to overpaid CEOs. This would reduce the incentive for excessive profits at higher tax brackets, but it would instead funnel money into the government, which also often tends to push money upwards (necessarily in most cases). I have previously suggested profit margin limits that incur fines if they are exceeded. This would likely work fairly well. With this, a wage cap would prevent excess profits from being given to those who do not need the money, which would prevent flow to the richest individuals. I personally prefer this because it is more difficult to abuse than a tax based solution.
If you wonder why we have not already collapsed if this is all true, I can explain that as well. We are well past the point where businesses refuse to pay wages that can support people. We do still have a functional middle class, but it has shrunk dramatically, as a few have risen higher and the majority has sunk into near poverty. The reason those in poverty can still survive is that the government takes up the slack of the businesses. Our welfare system makes sure that the worst off have enough money for food and a place to sleep. Unfortunately, it is not the government's responsibility to take up the slack of businesses. The government is responsible for making sure that businesses treat people fairly, in a large degree, but any welfare should be for those with a legitimate problem providing for themselves or their family, not to make up what businesses cheat their workers out of.
We have lost the American Dream. Microsoft, WalMart, and Apple are having their American Dreams, but at the expense of the rest of us. If the American Dream is the opportunity to rise from poverty to sustainability through hard work, then why are the hardest workers often the poorest? Many Americans' American Dreams are being stolen from them for minimum wage. People like Bill Gates and the late Steve Jobs did not only take their American Dreams, but they took the American Dreams of millions of other Americans. I don't have anything against wealth, but wealth at the expense of others is wrong.
The only way that the US can retain its economic superiority is through high economic mobility. We are currently behind many other countries, some by a large margin. There was a time when the US had the highest economic mobility in the world. This made us into an economic powerhouse. Now, Mexican farm workers are leaving the US, because they can find higher economic mobility in Mexico. We are at the end of an era. We can enter the next as either the most economically powerful nation in the world, or as a barely first world nation struggling to stay above imminent economic disaster. Which shall we choose?
Lord Rybec
04 May 2012
Fairness in Business Part 2
My last article brought up some interesting questions. In the article, I established that the government has a responsibility to make sure that employees are treated fairly by employers. I gave some examples of how legal contracts are not inherently fair, but the first example actually showed how such a contract could be unfair to the employer and give an unfair advantage to the employee. This brings up a new question on the subject of fairness in business. If the government has a responsibility to enforce fairness in business, as it relates to the employee, does that not also mean that the government has a responsibility to make sure that the employer is treated fairly as well?
My answer to this is yes. If the employee deserves protection from unfair contracts, the employer also deserves to be protected from unfair contracts. If the employee is legally entitled to a fair share of the profits generated, the employer is also entitled to a fair share of those profits. Just as the employee deserves protection from unfair treatment from the employer, the employer deserves protection from unfair treatment from the employee.
You might ask if this is really a problem in the US. Most businesses seem to be doing far better than the average worker. Why should we even bother offering the businesses protection from unfair treatment by employees when the businesses have been the ones ripping the employees off for so long? The answer is actually very complicated. First let us talk about how employees are treating businesses unfairly.
There are some obvious ways in which employees treat businesses unfairly. The first is theft. Businesses already have some protection from that. If a business catches an employee stealing, the business can fire the employee and take him to court for damages. Theft is illegal, and the government does its best to enforce the laws against it. The second is laziness. Again, a lazy employee can be fired, though there are no laws requiring that the lazy employee compensate the business for losses. Firing a lazy employee can be dangerous though, as the business must keep enough records to back up their decision to fire the employee. This, however, is required to prevent businesses from firing employees for reasons that are illegal (religion or race, for instance) and then claiming that the employee was lazy to avoid prosecution. This is not all, but all of these are fairly minor, or are already protected against.
The biggest way in which employees treat businesses unfairly is unfair contracts. If you have not read the first article in this series, you probably should. I give a very good example of how an employee can benefit from an unfair legal contract with a business. Now, you probably want to know, if this is really that big, where can we actually see this problem in action? The answer is upper management. There are not exactly a lot of people out there with the experience to be qualified CEOs, but there are a lot of corporations out there that need qualified CEOs. This means that businesses are forced to agree to absurdly unfair contracts to hire a decent CEO. You might ask if CEOs do not deserve more pay, because they do harder work. I would agree. CEOs do deserve more pay than regular employees. CEOs generally put much more labor capital into a business than other employees. Further, CEOs often have to be available constantly and are often required to travel a lot. All of these things deserve greater compensation. That said, according to aflcio.org CEOs in 2011 made 380 times what the average worker made. Even if the average was minimum wage, the average CEO would have been paid $2,717 an hour. Computer programmers and electrical engineers do far more complex and difficult work than CEOs and they do not generally get more than $50 an hour. According to about.com the US President currently makes $400,000 a year. Assuming that the President only works 40 hours a week (which is absurd), that is only $192 an hour, and he runs the country!
This is a clear case where businesses are being taken advantage of by employees. This is wrong and not just because it is harmful to the businesses. That is money that has to be generated by paying other employees less and charging customers more. When one employee rips off a business, other employees suffer, even if the one ripping off the business is the CEO. In addition, when an employee rips off a business, customers suffer for it. Because of the extremely widespread harm that unfair treatment of businesses by employees causes, maybe it is more important for businesses to be protected from unfair practices than it is for employees.
Unfair treatment of businesses by their upper management is very probably the root of our recent economical problems. Much like unfair treatment of employees by businesses is very destructive to the lower and middle classes, unfair treatment of businesses by employees is very destructive to businesses and our economy as a whole. In the previous article, I said that without government enforcement of fairness in business, capitalism will ultimately lead to implicit slavery. The employees that are treated unfairly will be the slaves. The masters will be the employees that are treating the businesses unfairly.
Lord Rybec
My answer to this is yes. If the employee deserves protection from unfair contracts, the employer also deserves to be protected from unfair contracts. If the employee is legally entitled to a fair share of the profits generated, the employer is also entitled to a fair share of those profits. Just as the employee deserves protection from unfair treatment from the employer, the employer deserves protection from unfair treatment from the employee.
You might ask if this is really a problem in the US. Most businesses seem to be doing far better than the average worker. Why should we even bother offering the businesses protection from unfair treatment by employees when the businesses have been the ones ripping the employees off for so long? The answer is actually very complicated. First let us talk about how employees are treating businesses unfairly.
There are some obvious ways in which employees treat businesses unfairly. The first is theft. Businesses already have some protection from that. If a business catches an employee stealing, the business can fire the employee and take him to court for damages. Theft is illegal, and the government does its best to enforce the laws against it. The second is laziness. Again, a lazy employee can be fired, though there are no laws requiring that the lazy employee compensate the business for losses. Firing a lazy employee can be dangerous though, as the business must keep enough records to back up their decision to fire the employee. This, however, is required to prevent businesses from firing employees for reasons that are illegal (religion or race, for instance) and then claiming that the employee was lazy to avoid prosecution. This is not all, but all of these are fairly minor, or are already protected against.
The biggest way in which employees treat businesses unfairly is unfair contracts. If you have not read the first article in this series, you probably should. I give a very good example of how an employee can benefit from an unfair legal contract with a business. Now, you probably want to know, if this is really that big, where can we actually see this problem in action? The answer is upper management. There are not exactly a lot of people out there with the experience to be qualified CEOs, but there are a lot of corporations out there that need qualified CEOs. This means that businesses are forced to agree to absurdly unfair contracts to hire a decent CEO. You might ask if CEOs do not deserve more pay, because they do harder work. I would agree. CEOs do deserve more pay than regular employees. CEOs generally put much more labor capital into a business than other employees. Further, CEOs often have to be available constantly and are often required to travel a lot. All of these things deserve greater compensation. That said, according to aflcio.org CEOs in 2011 made 380 times what the average worker made. Even if the average was minimum wage, the average CEO would have been paid $2,717 an hour. Computer programmers and electrical engineers do far more complex and difficult work than CEOs and they do not generally get more than $50 an hour. According to about.com the US President currently makes $400,000 a year. Assuming that the President only works 40 hours a week (which is absurd), that is only $192 an hour, and he runs the country!
This is a clear case where businesses are being taken advantage of by employees. This is wrong and not just because it is harmful to the businesses. That is money that has to be generated by paying other employees less and charging customers more. When one employee rips off a business, other employees suffer, even if the one ripping off the business is the CEO. In addition, when an employee rips off a business, customers suffer for it. Because of the extremely widespread harm that unfair treatment of businesses by employees causes, maybe it is more important for businesses to be protected from unfair practices than it is for employees.
Unfair treatment of businesses by their upper management is very probably the root of our recent economical problems. Much like unfair treatment of employees by businesses is very destructive to the lower and middle classes, unfair treatment of businesses by employees is very destructive to businesses and our economy as a whole. In the previous article, I said that without government enforcement of fairness in business, capitalism will ultimately lead to implicit slavery. The employees that are treated unfairly will be the slaves. The masters will be the employees that are treating the businesses unfairly.
Lord Rybec
03 May 2012
Fairness in Business
Should fairness in business be enforced by the government? To what degree?
The US Republican Party asserts that businesses should be allowed to use their profits as they please. This is based on the claim that all profits gained by a business inherently belong to the business and its owners. This is seen by Republicans as a natural law. The principal of fairness, according to conservative thought, is entirely governed by contracts. The reasoning behind this line of thought is that all contractual agreements must be fair, otherwise the party being treated unfairly would not have agreed to it. Let us examine these assumptions.
First, do all the profits gained by a business inherently belong to the business? How do businesses gain profits? Most businesses gain profit by buying resources and either making them into something more useful and selling them for more than they paid, or directly retailing them at higher prices than they paid. It would seem reasonable to assume that because the business put up all of the initial capital, it is entitled to all of the profits. The business is, of course, bound by law to pay its employees whatever it contracted to pay them. This contractual agreement is assumed to always be fair, because employees would not agree to an unfair contract. The first flaw with this argument is the assumption that the business put up all of the initial capital. It may have put up all of the initial monetary capital, but where would it be if the employees had not put up work capital? The employees are thus entitled to a fair share of the profits. This brings us to the second assumption.
Is the idea that legal contracts are inherently fair, because both parties must willingly agree, a valid assumption? US law invalidates contracts that are agreed to under duress. This means that a contract where either party was forced to agree to it under threat of harm is invalid. The mere existence of such a law invalidates the assumption that contracts are inherently fair. This law is intended to mitigate a specific instance of potential unfairness of legal contracts, but by no means mitigates all of them. So, how does this apply to the previously mentioned employees?
The fairness of a contract agreement depends strongly on the specific circumstances. If the economy is in very good condition, the employees have many options for employment, the pay offered everywhere else is fair, and the other options are safe and desirable, then a contract would be totally fair for the employee. It might not be so fair for the employer though, because the employee may require more than fair wages and the competition for the employee's labor may put the business in a situation where it is forced to offer more than fair wages. If the employee is part of a union, this may make the contract even less fair for the business. The question right now though is whether the government should have a hand in requiring businesses to act fairly. Given the state of our economy and where most of the money is going, there is no question that most businesses are not suffering from being forced to pay employees more than is fair.
If the above circumstances were flipped, things would be very different. What if the economy is in the toilet, the employees have few other options for employment, the pay offered elsewhere is much worse, and the other options are not safe or are otherwise undesirable? If this is the case, a contract would not enforce fairness for the employee. The business could offer pay barely more than the other options, but far less than fair compensation for the work capital offered by the employee. The business could offer barely safer work conditions than the other options. Unless the employee is independently wealthy, he will be forced to agree to the contract so he can meet basic needs, even though it is grossly unfair. Evidence that contracts are not inherently fair can currently be found in the work contracts of every lower class worker and a good portion of middle class workers in the US.
Now for the question: What responsibility does the government have in enforcing fairness in business? Minimum wage law, that law invalidating contracts signed under duress, and many precedents set by judges ruling in favor of actors and actresses claiming that they were not paid fairly for blockbuster movies (even though they were paid exactly what they had agreed to in legal contracts) give us a pretty strong case to the effect that the government has a strong responsibility to enforce fairness in business.
Movements like Occupy Wall Street have a very strong position in their claim that responsibility for the distribution of wealth problem in the US lies squarely on the shoulders of the government. Previous government actions have asserted the responsibility of the government for enforcing fairness in business. The claims that natural law gives businesses the right to distribute their profits as they please are clearly false, as well as claims that legal contracts are inherently fair. I am all for free trade and capitalism, but I also recognize that without government enforcement of fairness in business, capitalism will ultimately lead to implicit slavery.
The US Republican Party asserts that businesses should be allowed to use their profits as they please. This is based on the claim that all profits gained by a business inherently belong to the business and its owners. This is seen by Republicans as a natural law. The principal of fairness, according to conservative thought, is entirely governed by contracts. The reasoning behind this line of thought is that all contractual agreements must be fair, otherwise the party being treated unfairly would not have agreed to it. Let us examine these assumptions.
First, do all the profits gained by a business inherently belong to the business? How do businesses gain profits? Most businesses gain profit by buying resources and either making them into something more useful and selling them for more than they paid, or directly retailing them at higher prices than they paid. It would seem reasonable to assume that because the business put up all of the initial capital, it is entitled to all of the profits. The business is, of course, bound by law to pay its employees whatever it contracted to pay them. This contractual agreement is assumed to always be fair, because employees would not agree to an unfair contract. The first flaw with this argument is the assumption that the business put up all of the initial capital. It may have put up all of the initial monetary capital, but where would it be if the employees had not put up work capital? The employees are thus entitled to a fair share of the profits. This brings us to the second assumption.
Is the idea that legal contracts are inherently fair, because both parties must willingly agree, a valid assumption? US law invalidates contracts that are agreed to under duress. This means that a contract where either party was forced to agree to it under threat of harm is invalid. The mere existence of such a law invalidates the assumption that contracts are inherently fair. This law is intended to mitigate a specific instance of potential unfairness of legal contracts, but by no means mitigates all of them. So, how does this apply to the previously mentioned employees?
The fairness of a contract agreement depends strongly on the specific circumstances. If the economy is in very good condition, the employees have many options for employment, the pay offered everywhere else is fair, and the other options are safe and desirable, then a contract would be totally fair for the employee. It might not be so fair for the employer though, because the employee may require more than fair wages and the competition for the employee's labor may put the business in a situation where it is forced to offer more than fair wages. If the employee is part of a union, this may make the contract even less fair for the business. The question right now though is whether the government should have a hand in requiring businesses to act fairly. Given the state of our economy and where most of the money is going, there is no question that most businesses are not suffering from being forced to pay employees more than is fair.
If the above circumstances were flipped, things would be very different. What if the economy is in the toilet, the employees have few other options for employment, the pay offered elsewhere is much worse, and the other options are not safe or are otherwise undesirable? If this is the case, a contract would not enforce fairness for the employee. The business could offer pay barely more than the other options, but far less than fair compensation for the work capital offered by the employee. The business could offer barely safer work conditions than the other options. Unless the employee is independently wealthy, he will be forced to agree to the contract so he can meet basic needs, even though it is grossly unfair. Evidence that contracts are not inherently fair can currently be found in the work contracts of every lower class worker and a good portion of middle class workers in the US.
Now for the question: What responsibility does the government have in enforcing fairness in business? Minimum wage law, that law invalidating contracts signed under duress, and many precedents set by judges ruling in favor of actors and actresses claiming that they were not paid fairly for blockbuster movies (even though they were paid exactly what they had agreed to in legal contracts) give us a pretty strong case to the effect that the government has a strong responsibility to enforce fairness in business.
Movements like Occupy Wall Street have a very strong position in their claim that responsibility for the distribution of wealth problem in the US lies squarely on the shoulders of the government. Previous government actions have asserted the responsibility of the government for enforcing fairness in business. The claims that natural law gives businesses the right to distribute their profits as they please are clearly false, as well as claims that legal contracts are inherently fair. I am all for free trade and capitalism, but I also recognize that without government enforcement of fairness in business, capitalism will ultimately lead to implicit slavery.
07 March 2012
Good Revolution
Historically, revolutions have been a common method for the oppressed masses to escape tyrannical leaders. Nearly all forms of government have shown a propensity to decay towards oppression of their subjects. Some tend to decay very quickly, while others can take a very long time. One thing that is very common is that the governments that replace the oppressive governments are often as bad or worse than the original governments.
In feudal Europe, revolutions were generally led by nobles that wanted to control the government themselves. The nobles often felt that they were oppressed by the royalty, but when they succeeded in taking control they were as bad or worse. These revolutions did not generally have the support of the general population, except so far as the nobles had control over them.
Many other revolutions did have the support of the general populace. Sometimes these revolutions were incited by members of the oppressed lower classes, but many times, these revolutions were incited by people with a lust for power, who were able to use the oppression of the government to convince the lower classes to band together. Whichever the case, most revolutions have ended up with leaders who did not have the interest of the general populace in mind. In short, most revolutions have become engines for putting people aspiring to gain control into power. These are most often people who care as little or less than the previous government for the general populace. Again, most revolutions end with a worse government than the one that is overthrown.
So, now for the question: Why is this? When people overthrow their government to escape tyranny, why do they put up with someone worse? How do these aspiring tyrants gain control of the revolutions in the first place? Why don't good people stop them? The answer is that good people tend to oppose revolution, even when they are obviously oppressed.
Out of the many revolutions in the world, the American Revolution was an exception to this. No aspiring tyrant with ulterior motives got control of this revolution. The government that this revolution eventually established was a government that, for the most part, did care about the general populace. How was this revolution different from the vast majority? How did this revolution end up being lead by good people, instead of people trying to gain absolute control of the general population?
The answer is very complicated. First, the population of the American colonies at the time was mostly people trying to escape tyranny. The population was small, and the technology level was inferior to that of Europe. People desiring control like to have a lot of people to control, and stuff (read: technology) to make them more powerful. In short, the American colonies were not very tempting, so few aspiring tyrants bothered coming. The result was a population of people who valued freedom and were not interested in controlling everyone else (right, there were some Puritan sects that did try to control people, but this was a vast minority). This was not everything though. Many good people did oppose the revolution, on moral grounds. This is one of the strongest reasons that revolutions tend to be led by people without ethics.
As the American Revolution began to turn into a significant force, there were many good people who opposed it, on religious grounds. Religious discussions on the subject were very common. In the New Testament, there are many passages that establish the importance of government and of being subject to government. Many people took this to mean that God wanted them to submit to the oppressive British government. Many preachers urged pacifism and submission, on religious grounds. One of the big breaking points were a few preachers that took the same scriptures to mean something different. The same scriptures used to suggest that revolution was a violation of Biblical principals were taken by other preachers to mean that the people should submit only to righteous governments. These preachers became very popular among good people, because the people saw that there was a problem. These preachers were not the typical aspiring tyrants trying to get control. They were part of the general populace that wanted freedom for themselves and everyone else. Without them, any revolution probably would have been controlled by someone with ulterior motives. Instead, a lot of good people were convinced that they had not only a right to overthrow an oppressive government, but a moral responsibility to do so. Instead of a lot of angry rabble rebelling against an oppressive government by rioting in the streets and rushing government buildings, only to put in a worse government, the American Revolution was led by good, intelligent, and organized people, who only had a desire to free themselves and everyone else from the government that was oppressing them, and to establish a free government that did not oppress the people.
Revolutions require the participation of good people to be truly successful. If a government is truly corrupt and oppressive, the people have the responsibility for correcting the situation. When the majority does not feel oppressed, they have a responsibility to fight against revolution. When the majority does feel oppressed, the good people are responsible for being involved in correcting the problem. If good people refuse to be involved in just revolution, then they are just as responsible for whatever oppression the new government creates as if they had actively helped that government come into power.
"All that is required for evil to triumph is for good men to do nothing." When good men support oppressive governments, because they don't want to get involved, or because they believe that their religion opposes self defense, they are as guilty for the oppression as those in power. We are responsible for recognizing when a government has become oppressive. We are responsible for doing whatever we can to defend our freedom. Sometimes we can assert our authority through our voice and our vote. Other times, we must assert our authority with violence. Are we going to be those people who are eternally oppressed because we find self defense to be distasteful, or are we going to assert our authority by defending our right live without oppression?
Lord Rybec
In feudal Europe, revolutions were generally led by nobles that wanted to control the government themselves. The nobles often felt that they were oppressed by the royalty, but when they succeeded in taking control they were as bad or worse. These revolutions did not generally have the support of the general population, except so far as the nobles had control over them.
Many other revolutions did have the support of the general populace. Sometimes these revolutions were incited by members of the oppressed lower classes, but many times, these revolutions were incited by people with a lust for power, who were able to use the oppression of the government to convince the lower classes to band together. Whichever the case, most revolutions have ended up with leaders who did not have the interest of the general populace in mind. In short, most revolutions have become engines for putting people aspiring to gain control into power. These are most often people who care as little or less than the previous government for the general populace. Again, most revolutions end with a worse government than the one that is overthrown.
So, now for the question: Why is this? When people overthrow their government to escape tyranny, why do they put up with someone worse? How do these aspiring tyrants gain control of the revolutions in the first place? Why don't good people stop them? The answer is that good people tend to oppose revolution, even when they are obviously oppressed.
Out of the many revolutions in the world, the American Revolution was an exception to this. No aspiring tyrant with ulterior motives got control of this revolution. The government that this revolution eventually established was a government that, for the most part, did care about the general populace. How was this revolution different from the vast majority? How did this revolution end up being lead by good people, instead of people trying to gain absolute control of the general population?
The answer is very complicated. First, the population of the American colonies at the time was mostly people trying to escape tyranny. The population was small, and the technology level was inferior to that of Europe. People desiring control like to have a lot of people to control, and stuff (read: technology) to make them more powerful. In short, the American colonies were not very tempting, so few aspiring tyrants bothered coming. The result was a population of people who valued freedom and were not interested in controlling everyone else (right, there were some Puritan sects that did try to control people, but this was a vast minority). This was not everything though. Many good people did oppose the revolution, on moral grounds. This is one of the strongest reasons that revolutions tend to be led by people without ethics.
As the American Revolution began to turn into a significant force, there were many good people who opposed it, on religious grounds. Religious discussions on the subject were very common. In the New Testament, there are many passages that establish the importance of government and of being subject to government. Many people took this to mean that God wanted them to submit to the oppressive British government. Many preachers urged pacifism and submission, on religious grounds. One of the big breaking points were a few preachers that took the same scriptures to mean something different. The same scriptures used to suggest that revolution was a violation of Biblical principals were taken by other preachers to mean that the people should submit only to righteous governments. These preachers became very popular among good people, because the people saw that there was a problem. These preachers were not the typical aspiring tyrants trying to get control. They were part of the general populace that wanted freedom for themselves and everyone else. Without them, any revolution probably would have been controlled by someone with ulterior motives. Instead, a lot of good people were convinced that they had not only a right to overthrow an oppressive government, but a moral responsibility to do so. Instead of a lot of angry rabble rebelling against an oppressive government by rioting in the streets and rushing government buildings, only to put in a worse government, the American Revolution was led by good, intelligent, and organized people, who only had a desire to free themselves and everyone else from the government that was oppressing them, and to establish a free government that did not oppress the people.
Revolutions require the participation of good people to be truly successful. If a government is truly corrupt and oppressive, the people have the responsibility for correcting the situation. When the majority does not feel oppressed, they have a responsibility to fight against revolution. When the majority does feel oppressed, the good people are responsible for being involved in correcting the problem. If good people refuse to be involved in just revolution, then they are just as responsible for whatever oppression the new government creates as if they had actively helped that government come into power.
"All that is required for evil to triumph is for good men to do nothing." When good men support oppressive governments, because they don't want to get involved, or because they believe that their religion opposes self defense, they are as guilty for the oppression as those in power. We are responsible for recognizing when a government has become oppressive. We are responsible for doing whatever we can to defend our freedom. Sometimes we can assert our authority through our voice and our vote. Other times, we must assert our authority with violence. Are we going to be those people who are eternally oppressed because we find self defense to be distasteful, or are we going to assert our authority by defending our right live without oppression?
Lord Rybec
14 February 2012
Death Penalty
I support the death penalty. I support it in cases when someone is such a threat to society that it would not be just to force society to pay for their room and board in a jail. I support the death penalty in cases like first degree murder, violent rape, and similar extreme cases of violation of human rights. I don't support the death penalty because criminals deserve to be punished. I support it as a means of protecting society from dangerous criminals. I support it because I find it extremely unjust that society should be forced to pay the upkeep of these people who will never be safe to release into the general public.
I do not support the death penalty for laziness. Right, long ago laziness was the difference between obtaining enough food to eat, or starving to death. Back then the death penalty (by starvation) might have been just for those who were too lazy to pull their share of the weight. That was a law imposed by nature. In some places this natural law still holds sway over humans, but not in the US. According to Wikipedia, only 2-3 percent of the US labor population works in agriculture. "US agriculture has long since passed the point of being able to meet the demand for food in the US population. Much of US agricultural production is now exported to other countries. For example, the United States exports 60 percent of its wheat crop and 30 percent of its soybeans. Agricultural products make up 10 percent of all exported US merchandise." (portaec.net) Forcing people to starve because they are lazy, or because there is not enough work to go around is essentially enforcing the death penalty for laziness. In the case of those who are not working because they cannot find work, but are looking, it is enforcing the death penalty for involuntary laziness. I know of no State in the US that enforces the death penalty for involuntary homicide. Why then is it tolerated for involuntary laziness?
I also do not support the death penalty for those with health problems that prevent them from working, or health problems that cost too much for them to pay for on their pathetically low salary, even though they may work a full 40 hours a week. This goes back to the production issue. The US produces far more than it needs to survive. Doctors might deserve to get paid for their work, but no one deserves to die for their health problems just because they don't work or don't get paid enough. Are health problems really so dangerous to society at large that those who have them deserve the death penalty because they cannot afford to pay for care? Right, I understand that people with health problems might have been an inconvenience that could have substantially harmed the rest of society, long ago. Just like food though, this is not the case in the modern US. The claim that our society cannot afford to give health care to those who cannot afford it is a lie. Humans only need a few things for survival. Specifically, humans need food, water, shelter, and clothing (and not even this in some climates). If US society had to pay for health care for everyone who cannot afford it, which of those four things would we suddenly be unable to provide for everyone? In short, those who need health care, who cannot afford it for whatever reason, do not deserve the death penalty. Again, this especially applies to those who have heath problems involuntarily (voluntary health problems would include those caused be poor choices, like smoking or reckless driving).
The US produces enough for every single citizen to have enough food, water, housing, and clothing. Our current record unemployment is a testament to the fact that the US can produce enough for everyone, even when over half the population is not working. The fact that anyone lives on the streets involuntarily, the fact that anyone in the US is undernourished, and the fact that many people in the US die every day due to lack of medical care, is a testament to the fact that we are no better than uncivilized barbarians (actually, historically barbarians helped their own when needed). The fact that many US citizens take political stands in support of this barbarism is testament that even when the tools to create a Utopia are handed to them on a platter, petty humans will just use them to cruelly rip each other off.
I support the death penalty when a heinous crime has been committed and death is the only truly just punishment. I do not support the barbaric practice of death penalty by inaction when the only crimes are laziness and poor health, at least, not when these things do not pose the slightest threat to the rest of society. Right now, humans are still uncivilized barbarians. Yes, we are barbarians with buildings, computers, cellphone, cars, and all manner of technology, but we are still barbarians. It is time to choose: Are we going to be worthless barbarians forever, or are we going to take the tools we have been given and create a truly civilized Utopia? Are we going to rise from uncivilized barbarians to become the first civilized species on Earth, or are we going stay here, playing in our own filth and killing each other over century old ideals that no longer apply?
Lord Rybec
I do not support the death penalty for laziness. Right, long ago laziness was the difference between obtaining enough food to eat, or starving to death. Back then the death penalty (by starvation) might have been just for those who were too lazy to pull their share of the weight. That was a law imposed by nature. In some places this natural law still holds sway over humans, but not in the US. According to Wikipedia, only 2-3 percent of the US labor population works in agriculture. "US agriculture has long since passed the point of being able to meet the demand for food in the US population. Much of US agricultural production is now exported to other countries. For example, the United States exports 60 percent of its wheat crop and 30 percent of its soybeans. Agricultural products make up 10 percent of all exported US merchandise." (portaec.net) Forcing people to starve because they are lazy, or because there is not enough work to go around is essentially enforcing the death penalty for laziness. In the case of those who are not working because they cannot find work, but are looking, it is enforcing the death penalty for involuntary laziness. I know of no State in the US that enforces the death penalty for involuntary homicide. Why then is it tolerated for involuntary laziness?
I also do not support the death penalty for those with health problems that prevent them from working, or health problems that cost too much for them to pay for on their pathetically low salary, even though they may work a full 40 hours a week. This goes back to the production issue. The US produces far more than it needs to survive. Doctors might deserve to get paid for their work, but no one deserves to die for their health problems just because they don't work or don't get paid enough. Are health problems really so dangerous to society at large that those who have them deserve the death penalty because they cannot afford to pay for care? Right, I understand that people with health problems might have been an inconvenience that could have substantially harmed the rest of society, long ago. Just like food though, this is not the case in the modern US. The claim that our society cannot afford to give health care to those who cannot afford it is a lie. Humans only need a few things for survival. Specifically, humans need food, water, shelter, and clothing (and not even this in some climates). If US society had to pay for health care for everyone who cannot afford it, which of those four things would we suddenly be unable to provide for everyone? In short, those who need health care, who cannot afford it for whatever reason, do not deserve the death penalty. Again, this especially applies to those who have heath problems involuntarily (voluntary health problems would include those caused be poor choices, like smoking or reckless driving).
The US produces enough for every single citizen to have enough food, water, housing, and clothing. Our current record unemployment is a testament to the fact that the US can produce enough for everyone, even when over half the population is not working. The fact that anyone lives on the streets involuntarily, the fact that anyone in the US is undernourished, and the fact that many people in the US die every day due to lack of medical care, is a testament to the fact that we are no better than uncivilized barbarians (actually, historically barbarians helped their own when needed). The fact that many US citizens take political stands in support of this barbarism is testament that even when the tools to create a Utopia are handed to them on a platter, petty humans will just use them to cruelly rip each other off.
I support the death penalty when a heinous crime has been committed and death is the only truly just punishment. I do not support the barbaric practice of death penalty by inaction when the only crimes are laziness and poor health, at least, not when these things do not pose the slightest threat to the rest of society. Right now, humans are still uncivilized barbarians. Yes, we are barbarians with buildings, computers, cellphone, cars, and all manner of technology, but we are still barbarians. It is time to choose: Are we going to be worthless barbarians forever, or are we going to take the tools we have been given and create a truly civilized Utopia? Are we going to rise from uncivilized barbarians to become the first civilized species on Earth, or are we going stay here, playing in our own filth and killing each other over century old ideals that no longer apply?
Lord Rybec
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