Monday, October 31, 2011

Occupy Wall Street v. Indian Fasting

I would like to highlight some of Bill Keller's op-ed piece, Beyond Occupy, which appeared in the New York times on October 31.

Mr. Keller, writing from New Delhi, attempted to interview the" contemporary Indian 'Ghandi'", Anna Hazare.  Mr. Hazare, as you may know, had been on a recent hunger strike in order to exert pressure on the Indian government to institute reforms.  These fasts have apparently resulted in a number of successful results.  Keller points out that Hazare's Indian campaign is hardly anti-capitalism.  Hazare's aim, says Keller, "is to stop a political class from usurping the fruits of capitalism."  A Hazare spokesman (Hazare himself has taken a "vow of silence") is quoted as indicating "we're not anti-capitalism.  We're pro-integrity."  Hazare's spokesman called the Occupy Wall Street movement "engaging," but lacking in a destination!  "We had a destination," he said.

Keller summarizes his column a follows:  "I'm prepared to celebrate when the Occupiers - like the lone hunger artist of India - accomplish something more than organizing their own campsite cleanup, demonstrating their tolerance for tear gas, and distracting the conversation a little from the Tea Party.  So far the main achievement of Occupy Wall Street is showing up."

Wednesday, October 26, 2011

Wealth Distribution - How "Poor" is "Poor?"

Occupy Wall Street!  Re-distribute wealth!  OK, it's clear that inequality in wealth exists in America (as it does in all "developed" countries.)  If we genuinely want to create more equality in wealth-distribution in the United States, how do we do this?  Not by taxation.  Lets assume Billionaire Bill, with accumulated wealth of $30 billion earns (with outstanding advice and insight) 20% on his investments.  That calculates to $6 billion.  Even if we tax him at 80%, it still leaves Bill with $1.2 billion to add to his $30 billion.  One can't create equality by taxation initiatives.  We can try to narrow the gap by putting a ceiling on income and wealth.  Laws can be instituted to limit wages to some multiple of a calculated "poverty wage" in the country.  Assuming a base poverty-level income of $20,000, maximum income could be restricted to a multiple of 20 x $20,000, or $400,000, a difference of $160,000.  Needless to say this is a generalized illustration; there would be modifying factors.

But consider the implications.  If this formula were in place, one would anticipate that the lowest income level would rise by re-distribution.  But as it rises, of course, the upper level would continue to rise by a factor of 20.  A new base of $40,000 would result in a ceiling of $800,000, or inequality that has now reached $760,000.  As the level rises, so does the difference between the extremes of income.  Now, since money begets money, the richer will get richer.  Yes, the "poor"will also get richer, but the difference in the extremes will continue.

Are today's "underprivileged" "99%" so much worse off than the "privileged" "1%?"

Let's examine the "poor households" in the United States:  43% own a home, 73% own a car or truck, 31% own two or more cars, 80% have air-conditioning, 37% have a dishwasher, 97% have a color TV, 55% have two or more color TVs, 63% have cable or satellite TV,  etc. (1) Not too shoddy.  The poor American (as defined by the government) reports that his family is not hungry and has the funds to meet essential needs and access to quality medical care.  While life is not opulent, dire poverty, as we often imagine it, exists only rarely in the United States.

Another interesting statistic:  Housing space per capita (in square feet): US - 721,  US poor - 439, High income countries (UK, France, Germany, Japan) - 377, Low income countries (Egypt, Philippines, Morocco) - 95, Very low income countries (India, China, Nigeria) - 66.  By the way, this comparison of US poor is to "average," not "poor," populations of the listed countries. (2)

Yes, poverty exists in America, but although some 12% of Americans are classified as "poor" very few actually lack essential resources. Yes, disparity exists....and, I believe, always will.  As long as there is equality of opportunity, there will be inequality of success,  as defined by income or by any other criteria.   Should we somehow place a financial limit on wealth disparity?  Will such a system be better for America?  Could it be worse?  Are the "poor"really "poverty-stricken" in the true sense of this condition?  Inequality is not the same as inequity.

Sources:  1. US Census Bureau, American Housing Survey for the US 2003,2005.  US Dept of Energy 2001. 
               2. UN Center for Human Settlements and World Bank, 1993.  US Dept of Energy, 2007.

Wednesday, October 19, 2011

Opting Out v. Opting In

How do you feel about "opting out" as opposed to "opting in?"  This recently became a subject of interest in the Republican presidential debates.  Gov. Rick Perry defended his signing of a bill passed by the Texas legislature requiring all girls of a certain age to be vaccinated against HPV (human papilloma virus).  HPV can be precursor to cancer of the cervix.  His argument, when challenged by those who maintained that this was government interfering with a decision that should be left to families, was that the legislation included an "opt out" clause, allowing unwilling families to do just that - opt out.

What about this "opting out" choice?  It seems to me that for any organization (government, business, health facility, etc.) the "opt out" option clearly favors the organization rather than the individual.   "Opting in" is  an intentional choice.  "Opting out" is a default choice.  Very different!  It is much easier to not respond than to respond.  Businesses are well aware of that fact - especially book clubs and magazine subscription services.  "We will send you this book if we don't hear from you by...." is quite a contrast from "Once we receive your order, we will send you this book." There are obvious reasons why the default option rather than the intentional choice option is offered.

"Opt-out" (default) choices have a ring of speciousness about them.   When a choice is in the offing, doesn't an "opt-in" (intentional) choice seem far more equitable?

Friday, October 14, 2011

History Does Not Repeat Itself

History does not repeat itself. We can learn from historical events, but we cannot use them to predict future occurrences. And that is because yesterday is never the same as today and today is never the same as tomorrow. Things change. Facts affecting events change. Players participating in events change. Situations affecting events are ever changing. Change fuels the world and does not permit the retrospective analysis of history to be the sole decider in decision making. Such an analysis can serve only as a background for decisions affecting today.

Has history helped us avoid conflict? Is the world a better place because of the lessons of history? I think we would all agree that the answers to both questions are a resounding "no!"

History seems to cycle rather consistently. That is the one, if only, true historical fact. Wars, man-made disasters, non man-made disasters, financial crises, crises of thoughts and ideas - ever constant, but never the same.

Programs instituted to stem the depression of the '30s cannot be the answer to our present financial debacle. Early 20th century is not early 21st century: trading in the stock market is different, corporate management is different, the value of currency is different, the population is different, the people in control are different. The world is different.

Ahmadinejdad's antisemitism is not Hitler's antisemitism: the situation is different, the world is different, weapons are different, spread of information is different, the organization of countries is different, the population is different, the people in control are different.

Slogans echoing a reference to a past occurrence, such a "Don't forget Munich!" (vis-a-vis the Iran issue) should serve only to remind us of the event, but never to intend for us to respond to today's issue as we feel we should have to yesterday's. Remember history. Learn from history. But do not become a prisoner of history! The world of today "resembles" but does not "mirror" the world of the past.