I’ve frequently written articles on the ‘Empire’ thread of “Op-Ed News” describing the ‘problem’ of Empire (including the Economics of Empire). The global corporate/financial Empire of the 21st century hides itself behind the façade of a virtual “Vichy America”. But ordinary citizens have the power to non-violently solve this deadly control of guileful Empire both through our remaining voting rights, and by turning a new era of democratic and socially responsible capitalism upon the imperial capitalists themselves.
The potential for confronting Empire has already changed quietly but significantly in the 'socially responsible' mutual fund industry ---- and this potential tool is about to change much more dramatically ---- particularly as the SR Fund industry expands and remarkets itself as the Socially Responsible and Honest Investment Fund Industry.
Yes, the quiet little 'socially responsibility' mutual fund sector of the far bigger and nastier capitalist investment world has actually already grown (with little MSM reporting, of course) to being responsible for the analytical reviewing of 10% of companies regarding the morality, legality, environmental impact, etc. of investments ---- and this SR world has also proven that it provides returns comparable to the 'Nasty Boyz' of the dominant "sell your mother" style finance capitalist investing 'professionals' (sic).
But, the big news is that the nastiest of the 'Nasty Boyz', like Citi, UBS, and Lehman have just issued 350 pages of nearly identical analytical reports saying that the entire 'nasty side' of the professional investment community (including themselves) have somehow overlooked (a well known 'market failure' that was oops, accidentally ignored) on the 'market valuations analysis' of many large F500 corporations (particularly nasty polluters like coal, oil, autos, weapons makers, etc.), and that if you take into consideration a little thing called "negative externality cost liabilities" what you find is that the real 'valuations' of such companies have to be discounted, as Dick Cheney likes to say, "BIG TIME"!
“The UBS and Lehman Brothers reports concur that climate change represents a classic market failure where company valuations neglect to take into account negative externalizations.”
“If climate change, one of the most studied environmental phenomena, represents a market failure, one can only wonder to what degree the legion of lesser-studied environmental and social externalities are not being priced into corporate valuations.”
Well, surprise, surprise, surprise! How do these accidental oversights keep happening? How could anyone have even anticipated things like that --- or things like the insurgency in Iraq? However, yours truly, had carried on a debate seven years ago with the then chief investment strategist of Deutsch bank about whether precisely such 'negative externality cost liabilities' shouldn't really be taken into account in any realistic financial analysis of the 'valuations' of corporations that appeared to be dumping their 'negative externality costs' on society (or the environment) ---- because, if/when they were caught and made to pay for their 'negative externality dumping' it would obviously decrease their market valuations?
You might guess how this debate ended seven years ago; with the chief investment strategist of one of the world's biggest banks saying basically, "I don't see any signs that the analytical methods of valuations are now or will in the future be affected by such a 'negative externality' worry". Whereas, the amateur, non-degreed political economist said, "But the tobacco settlement for 'negative externality cost dumping' might well spread to bigger offending industries and corporations, don't you think?" Bottom-line, the professionals won, the banks won, the Wall Street crooks won, and the dumb little guy was ignored. But, now the truth can no longer be ignored ---- even the biggest nastiest financial Ponzi con-artists are reporting the sick truth of this monumental, decades-long Ponzi scheme variation of making faux-profits by investing in global corporations that really only make money "the old fashioned way" (as the bankrupt Smith Barney used to say in it's TV ads, before it had to sell itself to CitiGroup) --- and that "old fashioned" phony, corrupt, immoral, and elitist way of "making money" --- was to 'game' the whole system of finance capitalism by rewarding and investing in corporations whose only way of 'making money' was to dump their 'negative externality costs' on society, to jimmy the accounting books by “hiding expenses" and claiming to be profitable. (Which, when you think about it, is really only a more destructive, dirtier, and deadlier version of what Enron did by hiding expenses in 500 Caribbean ‘shell companies’).
Having discussed, and viewed in the above article, this recent exposure of the worst of finance capitalism’s investment pathologies and crimes against our social environment --- now let's take a look at the promise of better times for all the people and not just the elite crooks.
The path toward restructuring the entire scam of the global corporate/finance Empire’s current perversion of capitalism (which serves only the elite ‘house’, and screws us ‘rubes’) is by growing the real and honest, Schumpeterian capitalism of the ‘socially responsible’ investment community, and to support and expand that community --- which is ‘our community’ of real people, not elite crooks.
To accomplish this goal, beyond the small, quiet, and somewhat accidental progress that the ‘socially responsible’ mutual fund investment community has already made, the SR Fund marketplace must fully advertise, market and communicate to the whole community of average ‘working class’ people all of the advantages of making SR investments:
1. Many people already know that, as the name says, investing in ‘socially responsible’ funds is obviously ‘socially responsible’ ---- but that doesn’t half explain all of the real benefits of SR Funds.
2. The SR Fund community must do a much better job of marketing to the whole human community, and much better job of leveraging it’s complete advantages and benefits compared to the nasty entrenched elite and crooked investment community by emphasizing that it is ‘Honest’ and does not also steal from its customers in confusing fees and continual illegal activities that the ‘Keystone cops’ of the SEC intentionally overlook for their elite buddies in the traditional, crooked investment ‘bidness’.
As a former product and market strategist, I would first advise them not to leave any unmentioned marketing advantages ‘off the table’ and to re-introduce their industry as the “Socially responsible and ‘Honest’ Investment Fund industry”. This marketing tip is so obvious that it’s like falling off a log to me. I don’t think many average people would argue with me at all today in America if I asked; “Do you worry that the mainstream investment world of Wall Street is probably cheating you on your investments?” How would you personally answer that question? How do you think a hundred million average Americans would answer, after constantly hearing vague, weak-kneed and gutless waffling comments about “enforcement” and “honesty” from pompous, elite, pontificating liars in Congress, the SEC, NYSE, US Treasury Secretaries, and Wall Street about, “never, never repeating the errors of that last set of ‘problems’, which will be ‘voluntarily’ corrected to insure that we never again see the US public cheated by the likes of Enron, WorldCom, Tyco, Putnam, LTCM-like hedge funds, private equity funds, etc, etc., etc.” What crap are we to believe from these ‘practiced liars’? Are we as bad as ‘Charlie Brown’ believing that Lucy will finally hold the football --- after pulling it away for years?
The Socially Responsible Investment Funds industry should boldly re-introduce itself to the American public as the new Socially Responsible and Honest Investment Funds industry ---- and the vast majority of the honest, average American public will desert the entrenched elite financial Empire of cheats and Wall Street swindlers faster than you can say, “sell the rope to hang themselves”. Average Americans will make this epochal shift in their investment habits not just because they want to “feel good” about their money not going into anti-social and anti-environmental schemes, but even more importantly because they are tired of constantly worrying about being cheated by the Wall Street ‘house pros’ who are neither socially responsible nor honest.