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OpEdNews Op Eds    H4'ed 5/23/11

Dr. King Spanks Obama: Part 6

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With dirt-cheap wages and a compliant government in China, what incentive is there for wealthy individuals to create jobs in the United States? It's a simple matter of supply and demand, or 'free-market economics' if you like. When the supply of unemployed workers in China (200 million) [12] [13] is greater than the total workforce of the United States (154 million), [14] there is no reason to expect a significant increase in Chinese wages any time soon. Quite the contrary, increased competition in the labor market tends to drive wages down. According to Zachary Karabell's recent Time magazine article, "structural' versus "cyclical' unemployment generally means that American jobs aren't coming back, [11] even if American workers get on their knees and promise to be 'real good n*ggers' from now on. [15] "The truth is that the decline in jobs is a result of megatrends including the growth of technology and the rise of globalization". [11]
 
This is the general character of wage labor, one of the cornerstones of capitalism which requires some level of unemployment to discipline the workforce and drives wages down. But it's no excuse for American workers to compete with Chinese workers for jobs, or more specifically, for wages. A far more viable and sustainable approach is for American workers and American communities to create their own jobs with or without assistance from government bureaucrats or wealthy investors. While this Mondragon-style approach doesn't threaten the emerging economies of developing nations, it could significantly stabilize our crumbling American economy and provide an example for other nations to emulate. Continuing education is integral to this endeavor, as emphasized by the recent Time magazine article, the appendix of Dr. King's last book, and the daily experience of the Mondragon Cooperative Corporation for the past 50 years.
 
It should be further noted that the real-world possibility of 'full employment' is not incompatible with a guaranteed income. In fact, advocates of a guaranteed income generally agree it should be provided to every citizen, regardless of employment status. Mondragon provides the equivilent of a guaranteed income for displaced workers who need time and additional training for their relocation to new employment opportunities. In Mondragon, workers are transferred, not fired or laid off, and the overall mission of Mondragon is to create new jobs for community development. So the unemployment rate in Mondragon is essentially zero, and yet their social 'safety net' is unsurpassed worldwide.

Norway is another example, where the average paid maternity leave is about one year. Is it a mere coincidence that maternal and child mortality rates in Norway are the lowest in the world, and women's life expectancy and years in school are the highest? By comparison, the well-being of mothers and babies in the United States ranks 31st amongst 164 other nations. [23] Amongst wealthy nations, Richard Wilkinson and Kate Pickett's research entitled "The Spirit Level: Why Greater Equality Makes Societies Stronger" consistently ranks the United States lowest regarding any sort of well-being and highest in terms of income inequality, suggesting a causal relationship between the two. [20] Some obvious implications of a guaranteed income combined with full-employment include less work-hours per person, more job-sharing and more leisure time, to facilitate "the potential of the individual". [16]

It's also important to note that a leisure dividend is not government subsidized sloth. In fact, it has been suggested that 'leisure' is the culmination of work. [17] In strictly economic terms, so-called 'leisure' denotes any non-market activity, like continuing education, child-rearing, and the maintenance of good health, which are all necessary to facilitate market activities. [18] Veteran policy analyst for the U.S. Treasury, Richard C. Cook, has actively promoted the implementation of a Basic Income Guarantee at the Federal level since long before the economic crisis of 2008. Also an advocate of monetary reform, Cook believes that spending, not lending, credit into circulation is the best way to facilitate what he calls a 'leisure dividend'.

Moreover, any challenge to rehabilitate a disabled American economy must be accompanied by adequate purchasing power. In his recent book, "We Hold These Truths: The Hope of Monetary Reform", Richard C. Cook claims the 3-trillion-dollar difference between consumer purchasing power and annual GDP would easily fund a 'leisure dividend' in the United States. [19] In view of Sarah Palin's adolescent narcissism, it might seem ironic that the state of Alaska consistently turns up in statistical research as the region with the very least income inequality and the very least social/health problems in the United States. [20] Is it a mere coincidence that the state of Alaska also happens to be the only state in the union which facilitates a guaranteed income for all of its citizens regardless of employment status?
 
The Alaska Permanent Fund is rooted in Alaska's Constitutional assertion that the natural resources of Alaska belong to all Alaskans, and it is the legislature's responsibility to develop these resources for the "maximum benefit of its people." Imagine that. A value system where people control the wealth instead of wealth controlling the people. If this value system is good enough for Sarah Palin and her Republican constituents, then why not extend it to every citizen of the United States? [21]

To conclude, the following is a short excerpt from chapter 5 of Dr. King's book, "Where Do We Go From Here: Chaos or Community?" For many readers, this will be a review. It is by far the most popular excerpt from his book, as it has been posted and analyzed widely across the Internet over time. But it bears repeating here for a number of reasons.

First, this is where Dr. King writes about moving beyond the issue of racial segregation to confront economic problems that affect people of all races. Second, this is where he calls for a unified coordination of all so-called 'civil rights' programs that have been so typically disjointed in the past. This revisits his insistence, outlined earlier in chapter 5, upon a 'cohesive cooperative alliance' between all the agents of social justice. Third, Dr. King observes that people must become consumers through either a guaranteed income or guaranteed employment or both. He argues that, while a guaranteed income might be the most direct route, the "potential of the individual" must be facilitated one way or the other. Finally, Dr. King has recognized that averages tend to be heavily influenced by extreme values in any distribution. So he goes on to insist that a guaranteed basic income must be tied to the median, not the lowest or even the average societal income, and that it must be dynamic over time.

What if a such a 'dynamic' policy were applied to Social Security and Medicare? Moreover, why do American politicians keep trying to draw a sinister connection between 'entitlement programs' and tax increases for the rich? After all, the notable genius behind Social Security and Medicare is that they are paid for by wage earners who work all of their lives to fund both programs. As such, these programs should most certainly be considered 'entitlements', and not in any derogatory sense. These 'self-help' programs are ways for American workers to pool their resources in caring for themselves and their families, the elderly and the disabled, without any 'handouts' from the 'rich'. Recent studies indicate a mere 3.15-percent 'payroll' tax increase for every American worker would effectively maintain Social Security and Medicare at their current levels. [24] This would have no impact whatsoever on the wealthy, whose incomes are derived from ownership, not from 'payroll'. Job creation and income stability will be facilitated through similar methods of self-management in the United States when Americans and their institutions begin to collaborate toward economic democracy.

But for now, the following short excerpt most clearly illuminates the glaring contrast between Dr. King's vision to "abolish poverty" and Barack Obama's goal to "save capitalism from itself". In view of this, there simply is no reason for anyone to consider Barack Obama's 'compromise' the so-called 'fulfillment of Dr. King's dream'.

************

"Where Do We Go From Here: Chaos or Community?"
By Dr. Martin Luther King Jr.
Excerpt from Chapter 5

In the treatment of poverty nationally, one fact stands out: there are twice as many white poor as Negro poor in the United States. Therefore I will not dwell on the experiences of poverty that derive from racial discrimination, but will discuss the poverty that affects white and Negro alike.

Up to recently we have proceeded from a premise that poverty is a consequence of multiple evils: lack of education restricting job opportunities; poor housing which stultified home life and suppressed initiative; fragile family relationships which distorted personality development. The logic of this approach suggested that each of these causes be attacked one by one. Hence a housing program to transform living condition, improved educational facilities to furnish tools for better job opportunities, and family counseling to create better personal adjustments were designed. In combination these measures were intended to remove the causes of poverty.

While none of these remedies in itself is unsound, all have a fatal disadvantage. The programs have never proceeded on a coordinated basis or at similar rates of development. Housing measures have fluctuated at the whims of legislative bodies. They have been piecemeal and pygmy. Educational reforms have been even more sluggish and entangled in bureaucratic stalling and economy-dominated decisions. Family assistance stagnated in neglect and then suddenly was discovered to be the central issue on the basis of hasty and superficial studies. At no time has a total, coordinated and fully adequate program been conceived. As a consequence, fragmentary and spasmodic reforms have failed to reach down to the profoundest needs of the poor.

In addition to the absence of coordination and sufficiency, the programs of the past all have another common failing -- they are indirect. Each seeks to solve poverty by first solving something else.

I am now convinced that the simplest approach will prove to be the most effective -- the solution to poverty is to abolish it directly by a now widely discussed measure: the guaranteed income.

Earlier in this century this proposal would have been greeted with ridicule and denunciation as destructive of initiative and responsibility. At that time economic status was considered the measure of the individual's abilities and talents. In the simplistic thinking of that day the absence of worldly goods indicated a want of industrious habits and moral fiber.

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David Kendall lives in WA and is concerned about the future of our world.
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