Showing posts with label Adam Smith. Show all posts
Showing posts with label Adam Smith. Show all posts

Socialism in America

A chinese worker supplying WalMart the shop for all american types :)


Piece by Bill Moyers:

"So, for the record let's acknowledge that all this current rhetoric about socialism in Washington is partisan poppycock. The word being fought over so fiercely today lost its meaning long ago. The late social activist and preacher William Sloane Coffin said on my show some years ago that we have to keep pressing the socialist questions because they are questions of justice, but that we should be dubious about are the socialist answers, because while the Biblical prophets may call for justice to roll down as mighty waters, figuring out the irrigation system is damned hard.

Furthermore, Barack Obama is still standing at the crossroads. Some old hands around him yearn for a third Clinton term -- government as subsidiary of corporate America. Ardent progressive followers, on the other hand, hope his heart really leans to the left, toward the public provision of public goods.

But at bottom, the issue isn't one ideology or another - we're not that kind of country. The issue is inequality. Two British researchers have just made news with a study over three decades, showing that where income is more evenly distributed, people are healthier in mind, body and spirit. You can find out more about their report on our website at pbs.org.* They found that violence, mental illness, overcrowded prisons, drugs, and obesity are more likely in a society where the gap between the have's and have-not's is as great as it is in the United States.

Our gap grew over the past quarter century as capitalism went on a spree of speculating, swindling and cheating. The great collapse is a painful correction. Our long term rescue, however, depends not on any "ism," but on democracy's ability to create a more level playing field, where the health of a battered woman in San Antonio is every bit as valued as a majordomo's on Wall Street.




This is a book with a big idea, big enough to change political thinking, and bigger than its authors at first intended. The problem they originally set out to solve was why health within a population gets progressively worse further down the social scale; they estimate that together they have clocked up more than 50 person-years gathering information from research teams across the globe. Their eureka moment came when they thought of putting the medical data alongside figures showing the extent of economic inequality within each country. They say modestly that since dependable statistics both on health and on income distribution are internationally available, it was only a matter of time before someone put the two together. All the same, they are the first to have done so.

Their book charts the level of health and social problems — as many as they could find reliable figures for — against the level of income inequality in 20 of the world’s richest nations, and in each of the 50 United States. They allocate a brief chapter to each problem, supplying graphs that display the evidence starkly and unarguably. What they find is that, in states and countries where there is a big gap between the incomes of rich and poor, mental illness, drug and alcohol abuse, obesity and teenage pregnancy are more common, the homicide rate is higher, life expectancy is shorter, and children’s educational performance and literacy scores are worse. The Scandinavian countries and Japan consistently come at the positive end of this spectrum. They have the smallest differences between higher and lower incomes, and the best record of psycho-social health. The countries with the widest gulf between rich and poor, and the highest incidence of most health and social problems, are Britain, America and Portugal.

Richard Wilkinson, a professor of medical epidemiology at Nottingham University, and Kate Pickett, a lecturer in epidemiology at York University, emphasise that it is not only the poor who suffer from the effects of inequality, but the majority of the population. For example, rates of mental illness are five times higher across the whole population in the most unequal than in the least unequal societies in their survey. One explanation, they suggest, is that inequality increases stress right across society, not just among the least advantaged. Much research has been done on the stress hormone cortisol, which can be measured in saliva or blood, and it emerges that chronic stress affects the neural system and in turn the immune system. When stressed, we are more prone to depression and anxiety, and more likely to develop a host of bodily ills including heart disease, obesity, drug addiction, liability to infection and rapid ageing.

Societies where incomes are relatively equal have low levels of stress and high levels of trust, so that people feel secure and see others as co-operative. In unequal societies, by contrast, the rich suffer from fear of the poor, while those lower down the social order experience status anxiety, looking upon those who are more successful with bitterness and upon themselves with shame. In the 1980s and 1990s, when inequality was rapidly rising in Britain and America, the rich bought homesecurity systems, and started to drive 4x4s with names such as Defender and Crossfire, reflecting a need to intimidate attackers. Meanwhile the poor grew obese on comfort foods and took more legal and illegal drugs. In 2005, doctors in England alone wrote 29m prescriptions for antidepressants, costing the NHS £400m.

Bonuses for American financiers are in the firing line, and other news | The week ahead | The Economist


This model of society organisation is bankrupt ethically as well as financially, but even more so from an efficiency point of view. Failure and incompetence is rewarded. Boom and bust is rewarded.
We need to change all that in every country.

"BONUSES paid to employees at AIG, a big insurer rescued by America’s government, will stay under the spotlight. Public outrage and lawmakers' anger have steadily mounted as it has become clear that executives will share $165m in bonus payments, even after AIG received $170 billion of aid to keep it afloat. On Monday March 23rd the Senate will consider a House proposal to tax bonuses awarded to financiers at insitutions in receipt of bail-out cash at 90%. The next day the House Financial Services Committee will grill both Ben Bernanke, chairman of the Federal Reserve, and Tim Geithner, the Treasury secretary, over AIG's bail-out and bonus packages. Mr Geithner is under particular pressure, not only because of AIG’s bonuses but his botched unveiling of a bank-rescue plan."

Adam Smith wanted equality

Today Smith's reputation rests on his explanation of how rational self-interest in a free-market economy leads to economic well-being. It may surprise those who would discount Smith as an advocate of ruthless individualism that his first major work concentrated on ethics and charity. In fact, while chair at the University of Glasgow, Smith's lecture subjects, in order of preference, were natural theology, ethics, jurisprudence, and economics, according to John Millar, Smith's pupil at the time. In The Theory of Moral Sentiments, Smith wrote: "How selfish soever man may be supposed, there are evidently some principles in his nature which interest him in the fortune of others and render their happiness necessary to him though he derives nothing from it except the pleasure of seeing it."