The Parallel Parliament

by Glen Pearson

Tag: economy

Raising the Floor

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TUESDAY OF THIS WEEK WAS EQUAL PAY DAY – a date missed by millions.

We have the four main kinds of wages: minimum, subsistence, living, and fair wages. But the most important one is missing from this list – equal wage. According to Statistics Canada, women over 15 make up 48% of our national workforce. Yet when you add it all up, women working full-time make 72 cents for every dollar made by men undertaking the same responsibilities. So, yes, efforts at improving wages are vital for those in low-income situations, but our ultimate efforts must seriously embrace an equal wage between the genders.

It’s one thing to recognize gender equality and elevate women’s issues in public consciousness and in politics, but until equal pay for equal work is achieved our words will ring hollow.

This emptiness has endured for decades – a reality acknowledged by the United Nations in 2015 when it recognized that out of 34 countries, Canada maintained the 7th highest gender wage gap. That put us at 27th on the list. The UN Human Rights Report concluded that “the persisting inequalities between women and men,” including this high level of pay gap, had a disproportionate effect on low-income women, visible minority women, and indigenous women.

Okay, so this is a bit embarrassing, but the real discomfort we might be experiencing is that we have yet to make significant headway. As with the concept of a Living Wage, implementation will take time, especially due to all the complexities that will impact equal pay for equal work. It takes time for us to get our heads around the problem. We understand that. But the needle has moved so little in recent years, even as gender issues have take on increased prominence in the public, political, and policy arenas.

Talk to most people in any coffee shop today and you’ll find near unanimous agreement with the idea of equal pay for equal work, yet we somehow never get around to it, either to study it or level the economic playing field. For sure, it will be a costly advancement, but so is defeating climate change, poverty, or unemployment – challenges upon which societies move ahead.

Another excuse for inaction has been that what is going on right now is legal – no one’s breaking the law. As my friend Tim Carrie posted on Facebook yesterday:

  • Apartheid was legal.
  • The Holocaust we legal.
  • Slavery as legal.
  • Colonialism was legal.

There’s a lesson in this – namely that legality is primarily about power, not justice, and the longer we permit these legal paradigms to linger the harder it will be for the human race to make any effective advancement. Laws must be changed.  Or as author Farshad Asl plainly stated: “Leadership is the act of serving others and has no gender preference.” But we do have this preference and it infests so much of our collective life. It’s expensive. It’s hurtful. It’s inhumane. And if our aspirations mean anything, it’s unCanadian.

Hillary Clinton has been fond of saying American’s primary season that it’s time to break through the glass ceiling in regards to women’s role in society and in leadership. Agreed. But as Sheryl Sandberg has written: “We must raise both the ceiling and the floor.”  That can’t be done without equal pay.

Tomorrow:  More about equal pay and how to take action

Middle-Out

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“AMERICA’S PREMIER SELF-LOATHING PLUTOCRAT“ – no kidding, that’s what they call Nick Hanauer. He’s been in these blog posts before, where we spoke of his criticizing his peers for robbing the wealth of the United States instead of investing in productivity.

He’s now at it again, only this time championing a $15 minimum wage south of the border. Again, his peers and the corporate elite are irate with his position, and small business owners aren’t wild about it either, but his rationale, and the way he publicizes it, is carrying some momentum. In fact, the way he sees it, it’s not the labour leader or minimum wage employee who’s the best face of the effort, but his own. His rationale? “A guy like me – a very successful capitalist – is the best face for the message of reforming capitalism, right? I’m the one who can say, ‘It doesn’t have to be that way.’“

Hanaeur made his billions primarily through shrewd investments in businesses like Amazon, but somewhere along the way he came to understand that a wealth that is moving ever-upward would result in a nation spinning ever-downward. He puts it plainly:

“The other side thinks that growth produces a thriving middle class. That’s wrong and backwards. When they say (his peers) that the better profits are, the better it will be for everybody, I’m the one who can say ‘That’s a lie.’ A thriving middle class is the source of growth in a technological, capitalist economy.  Investing in the middle class is the most pro-business thing you can do.”

He finds politicians uninspiring and his fellow plutocrats unimaginative. And so he set about to battle for the $15 minimum in the public arena, and its picking up steam. It began when he made a presentation on the subject to the Democracy Alliance in 2012. What was ironic wasn’t just that he was a plutocrat, but that, while labour leaders were promoting a $10 minimum wage, Hanaeur came in $5 higher. Soon enough striking fast-food workers across the country rallied to his call. When he centered his efforts shortly afterwards in Sea Tac, Washington, that community became the country’s first $15 an hour minimum wage community. Soon enough Seattle followed, as did Los Angeles and San Francisco. Now the concept is under serious consideration in many states and cities across America.

We have all heard the arguments from the other side, about how raising minimum wage will put downward pressure on business and result in increasing job loss, but Hanaeur counters that it will lead to more jobs for the simple reason that workers will have more money and create demand for more products and services. He calls it “a positive feedback loop of prosperity.” Some supporting economists call it “middle-out economics.”

This odd notion that if poor people start doing better it’s bad for the economy is increasingly wearing thin, and the way that the next generation is taking to the message of Bernie Sanders on this point is likely a sign that the time for change in financial policy is now possible. “Trickle down” is slowly yielding to “middle-out.”

The fact that Hanaeur’s efforts are building increasing support from capitalists and economists means that the old divide between labour and business is slowly dissolving, leaving the field open for a new kind of economic policy based on the engine of average people with a bit of capital to spend. In a political season like no other that America has witnessed, “middle-out” just might stand a chance.

50 Years Ago, Martin Luther King Jr. Said We Had the Resources to End Poverty. What Happened?

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ALL THIS WEEK WE’LL BE LOOKING at the legacy of Martin Luther King Jr. and if it still has a prevailing effect on the modern era. He had certain core principles he stuck to, elaborated upon, and ultimately died for. We respect him. We quote him. Some even venerate him. But in so many ways we have refused to walk the path he led.

The day following his receiving of the Nobel Peace Prize in 1964, King delivered his famous Nobel Lecture titled, “The Quest for Peace.” His reasonings didn’t go in the direction people anticipated. He wondered how we can really have peace, or even maintain it, if we continue to leave large swaths of our populations in poverty. Then he delivered a stark admission:

“There is nothing new about poverty. What is new, however, is that we have the resources to get rid of it.”

He was greeted with a huge round of applause on that occasion over 50 years ago, but we must ask ourselves: what happened? How, after the explosion of the global economy, the movement of so many nations towards democracy, and an era of relative peace among nations, can it be that the needle has moved so little on the poverty file? Recent estimates claim that 30% of the world continues to live in poverty and that, in the affluent nations, people suffering in low-income situations are actually on the increase.

The biggest problems faced by the world’s poor are actually lack of the most basic things required for survival – clean water, food, health, shelter, safety, social inclusion, and the opportunity to participate in their own solutions. And yet, for all the wealth presently generated in this world, we can’t deliver on these most fundamental of resources.

If King was right and we had the resources a half-century ago, what do we say now that the world is flushed with cash that accrues increasingly to a small minority? It’s truer now than in his time that the resources are there, and yet we haven’t progressed as a civilization to the point where we can solve the most basic and durable of human problems.

A month prior to his tragic end, King busied himself with planning the “Poor People’s Campaign” – an effort that was predicated upon the belief that civil rights can never be achieved and guaranteed as long as people, especially the vulnerable, don’t have the means to live peacefully and productively. King seemed especially concerned about those living in hunger. Since then we have had the proliferation of food banks, monumental starvation in developing nations, billions of dollars of good food thrown into garbage dumps, and child poverty at stubbornly high levels. What are we thinking? How do we justify it? If King couldn’t do so in his generation, surely we can’t in our own.

Franklin Roosevelt noted during the Great Depression that, “The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” In all honesty, we have failed that test – which then puts the lie to our belief in inevitable progress.

Martin Luther King Jr. would surely have agreed with Roosevelt’s observation, as he would with that of author John Green: “There is no Them. There are only facets of Us.”

It’s time to stop quoting King and start moving forward on the ethical foundations of what he fought for. Our greatest regret as a generation might be the understanding that in failing to take the road not taken that King offered us, we will never discover the fullness of life that might have been ours if we had learned to share the wealth. Fifty years on and little has changed. Time for a civilization reset.

Basic Income: An Idea With a History

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ARTIST ANDY WARHOL OFTEN EXHIBITED FASCINATING INSIGHTS into the human condition that, at times, became colloquialisms. At one point he noted, “They always say time changes things, but you actually have to change them yourself.” And that is true. Yet there are those occasions when time itself can be of assistance.

Take the concept of a basic income as a measure of that truth. Yesterday we noted how the idea of some kind of baseline income could be of great help to the marginalized. Many progressives are shocked when they discover that libertarian economist Milton Friedman threw his support behind early efforts of what was then called a “Guaranteed Annual Income,” but which he preferred to label a “negative income tax.” From across the political and economic spectrums came support. Left-learning economists like James Tobin and John Kenneth Galbraith got behind Friedman.

It was Martin Luther King Jr. a few years previous who brought the basic income concept to more popular attention in his book Where to Go From Here: Chaos or Community?

“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.”

Even in 1972, as George McGovern challenged Richard Nixon for the presidency, one of his key proposals was the implementation of a more generous basic income. Nixon won and the initiative was lost, at least for a time.

It seems to have been around forever, but it is only in recent years in Canada that it has come to the fore as the nation deals with the complexity and incessant growth of poverty itself. Former senator and Mulroney Chief of Staff Hugh Segal has pushed the concept for two decades, acquiring along the way some key support. In frustrating fashion, however, it languished interminably in that spot between good intentions and decisive action.

The Great Recession of just a few years ago created significant fallout in everything from shrinking government resources and unemployment to general distemper among the citizenry. Poverty itself was quickly being vaulted to the front of the line when it came to policy matters. People began talking about the urgent need for a housing strategy for the homeless and more effective poverty reduction initiatives in Canadian communities. Increased talk moved through political circles about other nations that had practiced various forms of basic income for decades and there was an openness to explore such options within the Canadian context.

And now it seems that time itself has created a ready audience for the concept of a basic income in Canada itself. It was slow in coming, but now that it has arrived, Warhol’s observation that things won’t change unless we change them ourselves seems achievable. Canadians themselves are increasingly impatient over the poverty situation in the nation, and especially the growing gap between the rich and poor. The idea of a basic income is emerging again, only this time to a more willing audience. Breaking ground and instilling a willingness to move forward on the concept may have taken decades, but those years weren’t wasted or lost. They accomplished their work and prepared us for something not only innovative, but perhaps revolutionary.

Tomorrow:  Basic Income – How it Works

If You Want to Fix Poverty, Fix the Economy

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HE AWOKE FROM A DEEP SLUMBER A couple of weeks ago to the sound of phone ringing incessantly, but when he answered he didn’t mind. Angus Deaton was being informed by someone on the other end of the phone that he was being awarded the Nobel Prize for Economic Science. Interestingly, it was how he shed new light on persistent poverty that earned him the credit. Or as the Nobel committee put it:

“To design economic policy that promotes welfare and reduces poverty, we must first understand individual consumption choices. Angus Deaton has enhanced this understanding.”

Deaton wasn’t so much focused on large market trends as on the average household and how choices are made within it. The Nobel committee has recently honoured a number of academics who have shown through their research that markets are inefficient and that there is great difficulty in knowing what to do about it.  Poverty is beginning to gain traction because of its very unfairness.

For too long now – centuries really – we have placed the blame for being of low-income squarely on the shoulders of the poor themselves. The amount of times we have heard that certain people should just get a job, or stop wasting their money on trivialities, or should go back to school stretches almost to infinity.

But to think that way is to misconstrue what is really happening. Worse, it can bring out some of the worst of subtle prejudices when we blindly believe that people are poor primarily because they are too idle or lack ambition. In reality, it is the way we organize our societies and the way institutions themselves enforce that organizing effect that leads to fewer and fewer opportunities for those in low-income situations.

A huge percentage of the non-working poor have been deemed irrelevant by a market design that increasingly seeks the advantage of productivity without heavy labour costs. People by the thousands are losing their jobs to this trend and yet it remains easier for us to blame the unemployed than it is for us to ask serious questions about the very future of work itself. If capitalism can increasingly get by without people, why, then, do we continue to lay blame on those who have been cast off? No serious researcher can lay claim to the belief that endless possibilities lie before the poor. In-depth data reminds us that people are increasingly constrained because how we construct democracy, promote capitalism, and determine the destination of wealth is, ever increasingly, limiting the opportunities for industrious people to enjoy a more prosperous life.

The secret, of course, is not to change the poor but the systems that create them. Yet it remains easier to blame a person down and out on their luck than it is to confront financial policies, political parties, elite societal structures, or crony capitalism. And, as Angus Deaton recently pointed out in his Nobel prizing winning work, when households themselves make selections that enforce the current financial structure, even average citizens can play a troubling role in enforcing poverty.

The importance of all this is that we could change these realities, but only if we show a willingness to pay for a more equitable society – all of us, including companies. That would require us to develop economic structures that don’t deliberately impoverish those the market deems disposable.

And speaking of the word “disposable,” it is the very lack of disposable income that lies at the root of poverty, not those people who lack it. It was Gandhi who made the troubling observation concerning how the colonial systems resulted in grinding poverty by claiming that, “Poverty is the worst form of violence.” Prejudice is at its worst when we not only wrongfully demean people, but when it refuses to provide them opportunity. Benign bigotry can be just as violent as a clenched fist. An opinion in the lack of evidence is nothing other than prejudice. With all that is up against the marginalized, and the economic systems that keep them in despair, useless accusations is the last thing they need. Fewer things are more frightful than ignorance that leads to inaction.

 

 

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