Tuesday, June 12, 2012

For Liberals, the Way Forward is the Way Back

If the Liberals are ever coming back, and that's a lot more iffy than many of them want to admit, it will be under a leader determined to reverse the party's corrosive slide to the right.   That would mean a leader willing to take up the cause of malignant inequality - of wealth, of income, of opportunity - and climate change in all its aspects.

Harper's Cons have gone hard right with the NDP in trail to the centre.  If the Libs insist on remaining centre-right they will, and rightly should, be consigned to political irrelevance to await some distant reincarnation.

Why should the Libs veer left right now?   Because that's where Canada needs to shift to face the conditions that will confront us, and the rest of the world, as this century unfolds beginning within just a decade or two.   And to meet those challenges we'll need a healthy, cohesive society of the very sort that Harper is now working hard to undermine.   And an essential (as in sine qua non essential)  key to rehabilitating our society lies in reversing inequality.

One of those annoying economists who just keep getting it right, Nobel laureate Joe Stiglitz, has made the case for fighting inequality in his new book, "The Price of Inequality."

"...we have a world in which there are huge unmet needs—investments to bring the poor out of poverty, to promote development in less developed countries in Africa and other continents around the world, to retrofit the global economy to face the challenges of global warming. At the same time, we have vast underutilized resources—workers and machines that are idle or are not producing up to their potential. Unemployment—the inability of the market to generate jobs for so many citizens—is the worst failure of the market, the greatest source of inefficiency, and a major cause of inequality.

As of March 2012, some 24 million Americans who would have liked a full-time job couldn’t get one.

In the United States, we are throwing millions out of their homes. We have empty homes and homeless people.

...This book is about why our economic system is failing for most Americans, why inequality is growing to the extent it is, and what the consequences are. The underlying thesis is that we are paying a high price for our inequality—an economic system that is less stable and less efficient, with less growth, and a democracy that has been put into peril. But even more is at stake: as our economic system is seen to fail for most citizens, and as our political system seems to be captured by moneyed interests, confidence in our democracy and in our market economy will erode along with our global influence. As the reality sinks in that we are no longer a country of opportunity and that even our long-vaunted rule of law and system of justice have been compromised, even our sense of national identity may be put into jeopardy.

...Markets, by themselves, even when they are stable, often lead to high levels of inequality, outcomes that are widely viewed as unfair. Recent research in economics and psychology has shown the importance that individuals attach to fairness. More than anything else, a sense that the economic and political systems were unfair is what motivates the protests around the world. In Tunisia and Egypt and other parts of the Middle East, it wasn’t merely that jobs were hard to come by but that those jobs that were available went to those with connections.

In the United States and Europe, things seemed more fair, but only superficially so. Those who graduated from the best schools with the best grades had a better chance at the good jobs. But the system was stacked because wealthy parents sent their children to the best kindergartens, grade schools, and high schools, and those students had a far better chance of getting into the elite universities.

...One aspect of fairness that is deeply ingrained in American values is opportunity. America has always thought of itself as a land of equal opportunity. Horatio Alger stories, of individuals who made it from the bottom to the top, are part of American folklore. But, increasingly, the American dream that saw the country as a land of opportunity began to seem just that: a dream, a myth reinforced by anecdotes and stories, but not supported by the data. The chances of an American citizen making his way from the bottom to the top are less than those of citizens in other advanced industrial countries.

There is a corresponding myth—rags to riches in three generations—suggesting that those at the top have to work hard to stay there; if they don’t, they (or their descendants) quickly move down. But this too is largely a myth, for the children of those at the top will, more likely than not, remain there.

...For years there was a deal between the top and the rest of our society that went something like this: we will provide you jobs and prosperity, and you will let us walk away with the bonuses. You all get a share, even if we get a bigger share. But now that tacit agreement between the rich and the rest, which was always fragile, has come apart. Those in the 1 percent are walking off with the riches, but in doing so they have provided nothing but anxiety and insecurity to the 99 percent. The majority of Americans have simply not been benefiting from the country’s growth.

...If markets had actually delivered on the promises of improving the standards of living of most citizens, then all of the sins of corporations, all the seeming social injustices, the insults to our environment, the exploitation of the poor, might have been forgiven. But to the young indignados and protestorsmost important of all, the degradation of values to the point where everything is acceptable and no one is accountable.

...Americans, Europeans and people in other democracies around the world take great pride in their democratic institutions. But the protesters have called into question whether there is a real democracy. Real democracy is more than the right to vote once every two or four years. The choices have to be meaningful. The politicians have to listen to the voices of the citizens. But increasingly, and especially in the United States, it seems that the political system is more akin to “one dollar one vote” than to “one person one vote.” Rather than correcting the market’s failures, the political system was reinforcing them.

Politicians give speeches about what is happening to our values and our society, but then they appoint to high office the CEOs and other corporate officials who were at the helm in the financial sector as the system was failing so badly. We shouldn’t have expected the architects of the system that has not been working to rebuild the system to make it work, and especially work for most citizens—and they didn’t.

The failures in politics and economics are related, and they reinforce each other. A political system that amplifies the voice of the wealthy provides ample opportunity for laws and regulations—and the administration of them—to be designed in ways that not only fail to protect the ordinary citizens against the wealthy but also further enrich the wealthy at the expense of the rest of society.

...Given a political system that is so sensitive to moneyed interests, growing economic inequality leads to a growing imbalance of political power, a vicious nexus between politics and economics. And the two together shape, and are shaped by, societal forces—social mores and institutions—that help reinforce this growing inequality.

 ...It is often argued on the right that we could have more equality, but only at the steep price of slower growth and lower GDP. The reality (as I will show) is just the opposite: we have a system that has been working overtime to move money from the bottom and middle to the top, but the system is so inefficient that the gains to the top are far less than the losses to the middle and bottom. We are, in fact, paying a high price for our growing and outsize inequality: not only slower growth and lower GDP but even more instability

And this is not to say anything about the other prices we are paying: a weakened democracy, a diminished sense of fairness and justice, and even, as I have suggested, a questioning of our sense of identity."

The Liberal Party's shift to the centre-right was an act of contempt toward the Canadian people.   To me this was made plain when Ignatieff convened his "thinkers' conference" at which CEOs and management consultants dominated the speakers' list.  Iggy left the Liberals sitting atop an elitist perch from which they'll have to openly, visibly step down if they're ever to reconnect with the voting public.   The old sops don't work any more.  Daycare and funding for the arts won't meet the looming challenges of the 21st century.


kootcoot said...

".....it seems that the political system is more akin to “one dollar one vote” than to “one person one vote.”

And if the political system doesn't respond to the very real problems that exist and continue the trend to violently suppressing peaceful protest and demonstration it will eventually become what I like to call Latin American Democracy......i.e. ONE BULLET = ONE VOTE!

Owen Gray said...

The Liberal Party would be wise to channel the anger of those who have been left behind. If the party doesn't do that, that anger will take to the streets.

It will make what's happening in Montreal look tame.