A corporation’s imperative is to make a profit. That imperative is baked into its DNA in the form a contractual agreement between the stockholder and the company. A company that fails to strive for profits will, in all likelihood, be sued.
As crass as making a profit may sound in today’s political environment, many non-profits, pension plans, unions, educational and philanthropic trusts rely on this principle and invest accordingly. Anyone with a memory that goes back over the last 8 years remembers what happened when our economy tanked in 2008-09. People rich and poor were hurt.
Like profit, some believe free trade is a bad word. They are wrong. Free trade removed export tariffs which lowered the cost of many goods to consumers– groceries, cell phones, computers, TVs, and cars, for example. The poor benefited from those lower costs as well as the rich. Even Robert Reich, economist and darling of the liberal left, has said, “free trade has undoubtedly boosted the overall American economy.” (USNews.com, excerpted in The Week, March 25, 2016, pg. 19.) Whatever one’s feelings, free trade and globalization won’t be disappearing now or in the future.
Facing the new reality makes it possible to steer the ship of state through tricky waters. Globalization has meant job loss in this country, but it has created opportunities in the third world, lifted those economies and made their citizens consumers of the goods we do export. America may have ceased to be a major manufacturing center, which remains a concern, but globalization isn’t the sole cause. Robotics is a significant factor. Unlike the industrial revolution which created work, automation eliminates it. (See blogs, 8/6/15, 11/17/15) Few political candidates are thinking beyond taxing the rich and closing financial loopholes as a way to deal with the growing class inequality.
We need a new paradigm and corporate structure should be our model. While automation is causing jobs to disappear, profits are likely to increase because fewer employees are on the payroll. To spread the wealth, rather than allow it to pool in the hands of a few, citizens should think of themselves as shareholders in America’s enterprise. The dividend should be a decent standard of living. We accept the principle of education and health care for all. Why not housing? Why not a food dividend?
As job numbers decline and people live longer, we must accept that extended periods of unemployment are inevitable. Assured a basic living standard, the unemployed become, not a drag on the economy but a new leisure class capable of serving the planet rather than exploiting it. Perhaps a new wave of Peace Corp volunteers might emerge whose members will share their skills where they are needed.
So far, human history has moved smoothly from the agrarian to the industrial age; from the industrial to the technological age and from the technological age… to what? The teaching age? We need a new paradigm for the future.