N.A.A.A.P. Perspective

Spring 1996—Vol. III, No. 2

Editor's Note

Welcome to the premiere issue of the N.A.A.A.P. Perspective! Actually, we aren't all that new, at Volume III, No. 2, so bear with me while I explain for the benefit of both new and old subscribers.

If you aren't a new subscriber, you will undoubtedly be surprised at Camden's Commentary's new name. We hope you don't find the change too disconcerting. The change is more cosmetic than substantive. Camden's often iconoclastic and always provocative commentary is still the main feature. We liked the name Camden's Commentary just fine. It suited our low-key style preference — but it did present us with a marketing problem. The name just didn't have what it takes to attract prospective readers to take a second look and actually sample the fare. The Natural Association for the Advancement of All People, which has been an "idea feature" in Camden's Commentary from its inception, however, is a Natural!

The letters, "N-triple-A-P" alone are perceived by some as politically incorrect. Because they resemble both the NAACP and the NAAWP, they tend to evoke a second look, perhaps a raised eyebrow, and an "N-double-A what?!" response. Though one of our goals is to promote tolerance and understanding while at the same time conveying a "patriotic" message, (albeit through frank, often provocative coverage of sometimes touchy subjects) political correctness certainly is not among our editorial constraints. We submit only to the dictates required by a genuine loyalty to what we believe to be truth, common decency, and common sense.

We write from a decidedly American point of view. But we are neither flag wavers or Bible pounders. We don't espouse a "fire-power and brimstone" message. However, we are faithful advocates of the principles set out in the Declaration of Independence, the Constitution, and Bill of Rights, as our founding fathers conceived and intended them. And we believe the "Christian ethic" to be the critical underpinning of our national identity and purpose and crucial to both personal and national success. We believe in the primacy of those founding documents as the essential blue-print for good, just, and limited government. Also central to our belief is that our government has strayed dangerously far from its founding principles and purpose.

We know we can never escape the suspicions and condemnation of the PC crowd, and we don't try. We would know we were failing if we did. Thus we feel the new name is appropriate, and hope it leads to a few new subscribers.

Editor

STAKEHOLDER EQUITY

THE NEED TO REFORM CAPITALIST MENTALITY

As The United States of America continues its suicidal lurch into the new integrated global disorder, and toward the new millennium, the euphoric hopes born of the crumbling of the Soviet Communist Empire continue evaporating into the kind of social and economic situation from which despair is fashioned. Now that there is peace, low inflation, and a booming stock market, all Americans should be sharing in the alleged national prosperity, but this is not the case. Ironically, it has been the collapse of the global communist threat, combined with a fatally flawed grand design for a world peace and prosperity that has yanked defeat from the jaws of victory. Without the threat of communism, (or rather joined by its former hosts) our government has seen fit to free big capital from all the constraints that once extracted from it a semblance of national loyalty. In so doing it is inadvertently, or intentionally, encouraging big capital, in the form of multinational corporations, to revert to its more perverse, amoral instincts in the name of globalism and "competing in the global marketplace of the twenty-first century." Only unwittingly perverse, or down-right criminal, national policy could make this apparent official endorsement of predatory and greed capitalism possible. (Forgive me for perhaps sounding a little cynical, but in my opinion even the best intended stupidity is criminal when it is crafted into national policy by the alleged representatives of the people.)

The seductive, and intentionally deceptive, devices known as "international free trade" and "free global markets" are being used to make this development appear an exceptionally good thing for everybody. Even the very term "free enterprise" is quickly falling into disrepute as it is repeatedly, and inappropriately, equated with big capitalism. Big internationalized capital is becoming increasingly predatory and given license to micro-and macro-exploit the globe and all its resources. But the general public's perception that "free enterprise is inherently good" is obscuring the fact that the term, like so many others, has been given Orwellian "double-speak" meanings, and routinely mis-applied. Free enterprise is good in its true context, but that isn't really what we are talking about here. We're not talking about freedom, but corporate license without responsibility to workers, community, or nation. They are creating an economic boom for those fortunate enough to be comfortably invested in the stock market, and a rise in the GNP, but labor is not sharing in the benefits. (Except insofar as they, as consumers, can for the time being enjoy the production of the third world labor replacing them in the workplace.) Workers, being the majority of the population, are seeing their share of the pie and the good life eroding, even as they become more productive. We are told that this slippage is the unfortunate but inevitable result of the wonders of free enterprise and free markets.

Utilizing devious word-games as tools, (Doublespeak) whereby wrong policy is made to appear right, (using the most sophisticated and extensive propaganda machine money can buy) the face of big capital has once again turned cold and ugly and is proud of it. This fact has already been made starkly obvious to the millions of Americans who have already lost their good-paying jobs. "Lean and mean" have become the corporate catch-words of the day, even as slick TV ads present an exceedingly attractive picture of the wonderful world just ahead at the end of the rainbow — disguising ugly reality for the benefit of the advertising dollar and Wall Street. The ready-made justification CEO's find for this lean and mean countenance is loyalty to the "stockholder" and the bottom line — and nothing else. "The only purpose of business," high salaried top corporate executives gleefully reiterate, "is to make money for the stockholders." That is the unmasked essential nature of raw greed capitalism. "Bottom-line! Devil take the hind-most!" The hind-most is labor. That's us folks!

Meanwhile, encouraged both by free trade policy and direct government assistance, many corporations have moved production and many other operations offshore. Many of those staying at home are compelled to consolidate and "downsize," often whether they want to or not, in order to stay competitive in the new globalized marketplace. As a result, as many as 43,000,000 of the nation's best jobs have disappeared in the last two decades. If more than 70,000,000 new jobs have been created during the same period, as claimed, most of those lost were one-bread-winner per family jobs, while most of the new ones are of the two or three bread-winner per family variety, with fewer benefits or no benefits at all. For most, unemployment insurance has become a downward stair-step, rather than a bridge between comparable or better employment. To make matters more exciting, the already looted Social Security system, (labor's golden parachute) has gapping holes in it and is direfully threatened with insolvency. Rather than hope, it represents a threat to the present and future generations of workers, as Social Security taxes will inevitably have to rise to unconscionable heights to rescue the system. Most alarming, this has all occurred during an unprecedented period of "economic growth and prosperity!"

The advent of the "jobless economic recovery," in the eighties, (the very first in history) ought to have been a wake-up call, but wasn't. The rewards of this prosperity, in the form of corporate chain stores brimming with inexpensive imports, and fast-food, has been much too alluring and pervasive for that. And there is no turning back. The rush to "international interdependence," (literal national suicide) has been invoked precisely to see to that. To go back to reason would be more painful than plunging on toward certain ruin. Short-term comfort and security are always take precedent, and are more easily sold to the public, than long-term considerations. A return to a reasonable degree of isolationism and protectionism would be an unmitigated disaster, the experts tell us. Why, we would loose our competitive position in the global economy!

To the stalwart thinkers who man the internationalist think tanks, (who now do all the thinking for our mis-representatives in government) there is no longer such thing as a reasonable degrees of isolationism or protectionism. "The integration of all global markets is the end of the globalists' rainbow." Both, along with the traditional concepts of patriotism and nationalism, have become the forte of "extremists" and regressives. The New World Order is already here, and it's here to stay, whether we like it or not, we're assured. And, of course, we're assured that it is all for the "greater good of mankind" and with a little extra career training, we'll all be part of one big happy global family.

For years my old Pappy has been saying, "We're being sold down the river while we're being told we're going up the river all the time." But he's old-fashioned and out-of-date. As President Reagan might have told him, "You ain't seen nothin' yet!" It looks to me like we aren't even going to make it down the river. We're being weighted to be cast overboard and sunk right here.

This is the state of affairs in America today. Things are being turned upside down as we're being assured that they are being set right. The North American Free Trade Agreement, (NAFTA) is decreed not only a success, but an irreversible economic imperative. This, even after it has already once taken on the trappings of a national and international emergency, necessitating a fifty-billion dollar bailout, (not to mention the fact that Mexican workers have suffered a devastating 50% cut in real wages as a result, and the continuing loss of industries and jobs to this country)! Most favored nation trade status for China, resulting in an obscene trade imbalance in China's favor, and an unseemly dependence on Chinese production, is considered good national business. Never mind that China is thereby quickly being fitted out to be tomorrow's greatest economic and military super-power.

On March 8th the stock market suffered its third greatest daily loss in history due to the good news that unemployment was slightly down. This should be considered a very significant "leading economic indicator." Alarm bells should have been ringing in the heads of our trusty representatives. Yet these things don't seem to convey a relevant message to Washington. (Only as a result of Buchanan's extremism has Clinton paid some recent lip-service to such matters.) Regardless of presidential or congressional rhetoric, our national government has become an agent of Wall Street, rather than the people. It feels that what is good for Wall Street is good for America. There was a time, not so long ago, when that might have been true. That is, when what was good for American big business was also good for American labor. "Labor," comprising the vast majority of the population, is the only true, hands-on, producers of real wealth we have, (and by labor I mean practically everybody who isn't in "top management," government, or academia). Of course, faced with this criticism, politicians are always careful to remind us that our pension funds are invested in Wall Street. True enough, perhaps, but this is certainly not very reassuring given the bubble-like nature of the current market.

The stock market has quintupled since the opening up of the new global economy — proof to Republicans and Democrats alike that the global economy is a success, and that it is good. Wall Street is happy, thus our mis-representatives in Washington are either complacent or gloating. Stock market analyst Ed Yardeni, who correctly predicted in 1994 that the Dow would hit 5,000 by 1996, predicts that it will go to 10,000 by the year 2,000. (U.S. News & World Report, March 11, 1996) But the wealth of Wall Street is now somewhat balloonish, in my opinion — very much akin to the national debt. Much of it is what I call "soft wealth," rather mushy, without much substance — some of it actually gaseous, contained within a large but rather filmy skin. I'm not sure, but I think it stinks too. I'm certainly no market expert, but, for what it's worth, I have the uneasy feeling the Dow will hit 2,000 before 2,000. I hope I'm wrong, but I'm not going to risk any money by investing in Wall Street. This isn't a scientific prediction, of course, I simply see too many things on collision courses. Voodoo Economics, being wonderfully flexible and creative, may save the day, but at this moment I don't see how.

(For sound investment advice, I would steer you to author and financial guru, Harry Browne, [and, for the record, presidential candidate on the Libertarian ticket]. One of his more recent books is The Economic Time Bomb, How You Can Profit from the Emerging Crises. His carefully considered prognostications indicate, as I recently heard him say on a talk show program, "The stock market will either go up or down. Take that from an expert." His market savvy would position you for both.)

What do you suppose accounts for the quintupling of the stock market in a dozen or so years? Has our economy expanded by 500% during that period? Have the assets represented by those stocks really increased in real value that much? I hardly think so. Even Yardeni allows that we may be creating "...one of the biggest speculative bubbles of all time." Some of the increase, as he admits, has been bubble-growth — companies bidding up their own stock prices by putting their profits into the market rather than dividends. In his optimism, he is "counting on the fact that the number of consumers American companies have access to is a couple of billion more than before the cold war came to an end." What he is saying is that he's betting on the New World Order and the emerging markets of the third world, including China and the former Soviet Union. (The weakening purchasing power of the majority of Americans doesn't seem to worry him at all.) In other words, he's counting eggs before they hatch and counting us, the working people, out.

There is little doubt that the biggest factor behind the surge of the Dow has been the transfer to stockholders of money that once would have been the rightful wages of labor. The wages of forty-three million displaced workers goes a long way toward explaining this otherwise inexplicable degree of increase in the value of the market. There has been a massive shift of money from stakeholder equity to stockholder equity — from the payrolls of workers to stock portfolios and upper echelon executive salaries. If this is the course to national prosperity, apparently labor is going to be forced out of the boat. Is this the way capitalism should function? Should the top two fifths of the population continue to get richer while the bottom three fifths are increasingly impoverished in the name of corporate prosperity? This is the kind of national prosperity — if we can call it that (this increasing concentration of wealth in the hands of a few) — of which revolutions are made.

The U.S. News & World Report, (January 22, 1996, Winter of Discontent) shows that the ratio of average CEO salaries to average American worker salaries, in America's 10 largest corporations, went from 41:1 in the 1973-5 period, to 225:1 during the 1992-4 period. And the trend is continuing. What this means is that while CEO's were donning their lean and mean faces, and handing out pink slips to improve bottom lines, they were personally rewarded by being given the wages of 184 of their fired workers. (225 minus 41). These CEO's smugly justify their reward by saying something like, "My multi-million dollar salary is warranted because I have created multi-billions of dollars worth of product or value for the company." The "product" or "value" they refer to, of course, is translated to profits for themselves and their shareholders, at the expense of umpteen thousand laid-off workers. This doesn't reflect true economic growth, but robbing Peter, (labor) to pay Paul, (Capital). Most of these 10 largest corporations were very profitable before all of the downsizing began. So what was the point? Pure greed, apparently, but the excuse is always "to remain competitive in the emerging global economy." Oh yes, they do "feel" for their former employees, but find comfort in the conventional wisdom that displaced workers will be retrained to become the "knowledge workers" of the twenty-first century, (as management expert, Peter Drucker has dubbed the the future work force).

Retrained for what? India alone has about a billion potential "knowledge workers" on hand who are willing to work for a tenth of what the displaced American worker needs to maintain his standard of living. India can satisfy the world's demand for "knowledge workers" well into the twenty-first century. And ample numbers will be available, trained, and "on-line" as demand increases. If India runs low, China has about two billion. And there's always Mexico, Vietnam, and Brazil and a hundred other sources. We simply don't need fifty or a hundred million highly trained American "knowledge workers." We've already got more of such workers than we have jobs for, and more and more such jobs are fleeing to less expensive labor markets every day. Even if America became the world's only repository of knowledge, who or what would pay for all the knowledge talent? Of course, with our educational system in its current state of disrepair, we need not worry about that in the foreseeable future. The simple answer is, all American workers, whether knowledge workers or tomato pickers, will have to accept the world standard wage if they are ever to be competitively employed in the new global scheme of things as envisioned. We have more rocket scientists out of work than is generally believed. We not only need need jobs for them, but we need jobs, and lots of them, for high school drop-outs and functionally illiterate graduates. Yes, we jobs of the kind many of our political and economic experts constantly refer to as "unwanted" or "undesirable" jobs. If we don't get those kinds of jobs back into our economy, we'll have to build a lot more prisons. Left to our current course, prisons will have to be so numerous, or so large, that the terms Gulag and concentration camp may come into current usage as descriptions of Americana.

The Dow Jones has gone from being worth about $236 billion at the beginning of 1990 to $1.3 trillion by the end of 1995. This roughly five-fold increase is primarily thanks to the diligent efforts of corporate CEO's prodding the bull on behalf of Mammon. There were other factors, of course, but downsizing of corporations had a lot to do with the increase the market has enjoyed in the last several years. One must reflect on what a fair return on investment for capital or stockholders ought to be? If a steady ten percent annual return on investment could be considered fair in this period of low inflation, the stock market should have grown from $236 billion in 1990 to about $378 billion by now. (I should think that a steady 10% ought to be sufficient for the well-to-do, if the rest of us poor beggars are obliged to make do with 2.5% or 3% — if we've been lucky enough to be able to save anything at all.)

Investors might have been satisfied with this amount of increase in times past, when steady and stable growth was considered desirable. But a ten percent return doesn't satisfy investors today. Such a slow, steady, and dependable gain, reflecting a more realistic growth of the real asset values of capital, isn't "dynamic" enough. But I believe it would allow everybody to rest a little more easily. As a result of the dynamic and vigorous growth the market has enjoyed, the stock market is almost a trillion dollars higher than it might have been as the result of a slower, more realistic, growth rate. Investors, naturally, are ecstatic with annual returns averaging 20% or more, but many are also very nervous. And they are nervous for good reason. If something seems too good to be true, it probably is. If it seems too good to last, it probably won't. Stress-related illness is increasing apace with the markets.

That extra trillion dollars' worth of stock market "gravy" represents the wages of 3.33 million $50,000.00 per year workers working six years, if my abacus serves me correctly! Whether my figures are accurate or not, the point I intend to make is that millions of jobs could, and should, have been preserved — and stockholders would still have made a fair return on their investment over the same period. Additionally, those investments would be on a much more solid footing, in my opinion, than they now are. We needed those jobs preserved in order to avoid the social chaos already fomenting in our cities and countryside alike. Chaos of any kind can wipe out years of stock market gain overnight. As it is, we are at the edge of a financial precipice from which we may at any moment be thrust into an abyss, either by social upheaval or any other major calamity. Things can go awry mighty easily, and they probably will before the year 2000 unless Congress wakes up and sees the light. That light, of course, would illuminate Congress to the reality that its constitutional duty is to represent "we the people," not just stockholders, multi-national corporations, Wall Street, and the international money brokers.

My analogy is rather simplistic, of course, but nonetheless I believe it valid — and, I hope, clear. The economy of the elite has grown at the expense of displaced labor — and given the high expectations of American labor, this is a very unnatural and dangerous situation. Much real production has moved offshore, so although overall real production, as well as wealth creation, has increased, the patterns of the distribution of that wealth have been radically, and tragically, altered. The robber baron of yore has returned in new trappings, and our corporate capitalist system is becoming the enemy of the goose that laid the golden egg. Just as predatory capital has been the perceived enemy of third world labor on corporate plantations since the official demise of slavery and colonialism, it is finally becoming the declared enemy of American labor.

Insofar as our own government is acting as the primary agent facilitating this change on behalf of globalized capital, in total disregard to the interests of the general population, the cause for the disquieting rumblings from below, that seem to so perplex many of our mis-representatives, becomes obvious. And the case is made for the tentative stirrings of private citizen militia groups throughout the nation — something that was once unthinkable in this country and still ought to be unthinkable.

Unfortunately, the sad truth is that Karl Marx was right on some of his assessments of capitalism. He saw how utterly predatory capitalism was as it developed in nineteenth century Europe. It wore the ugly dual faces of greed and exploitation — wage slavery, and child labor were its coerced tools. Deplorable working conditions were the rule rather than the exception, and huge industrial sweatshops evolved. Labor was exploited by capitalist fat-cats, and deprived of its most essential birthright — that known as human dignity.

Marx, himself, was worse than any capitalist predator. He was right about some things, but dreadfully wrong about how to reform the system. But perhaps he can be pardoned on the basis that he himself was the product of a Europe where oppression had been the rule since time immemorial. Only now, after a three-quarter century trial of his revolutionary ideas, the communism and state socialism he advocated now stand totally discredited. It simply didn't work because its basic premise, in denying private property and the free market, was unnatural and wrong. Because of its "end justifies the means" philosophy, and the ruthlessness the means employed, it was inherently morally repugnant. Aside from that, state socialism is fundamentally unworkable for one empirical reason. Government, most especially big government, is essentially, and inescapably, a vehicle of mass corruption. Even the more mundane forms of democratic socialism now practiced in Europe will probably ultimately prove unsustainable. This includes the insidious, creeping variety that continues to make itself felt in this country alongside our own particular, and heretofore successful, brand of capitalism.

The capitalism that developed in Europe rose up on the back of a feudal society. Capitalists merely replaced some feudal overlords. Many of the oppressed peasants became the equally oppressed factory labor. During this period, the consumers of labor's production were always "others" and "elsewhere" — either the mercantile class, upper classes, or foreign markets. Labor's sole function was simply to show up at work and produce. Under these conditions, the growing class of industrial labor became a fertile seedbed and green house for Marxist ideology and communist revolution. Communism held out hope for freedom from capitalist oppressors.

In this country, as we all know, industrialization and capitalism ushered in the days of the infamous robber barons — with obscene concentrations of wealth gravitating into the hands of a few monopolists. There were plenty of capitalist abuses, of course, but things were never as bad here as they were in Europe. Most Americans were independent freehold farmers whose heritage was one of freedom rather than serfdom. Most of those who were not farmers were independent craftsmen, artisans, and shopkeepers. Because those who were free, white and over twenty-one had been nurtured on notions of liberty, equality, and individual sovereignty, most of the wage-slave and sweatshop jobs fell to imported labor, whether free, indentured, or slave. Even wage slavery in this country was preferable to that of Europe, because here there was always abundant hope for betterment of one's lot.

As industrialization and the division of labor grew here, and the nation expanded westward, the chronic shortage of labor in the United States grew in spite of large numbers of immigrants. This tended to bid the price of labor up, and force capital to develop, if not a kinder face, at least a better wage and easier conditions than in Europe. For this reason, American labor has almost always fared better than its European counterpart. But there was something else that insured that American capitalism developed a kinder face than that of European capitalism. It was freedom itself, and the free market economy which existed here that produced the initial free-market miracle. That free-market principle, protected within our vast borders, developed into the capitalist miracle America eventually became. American agriculture, shopkeepers, craftsmen, and artisans, had enjoyed an unprecedented degree of prosperity from pre-Revolutionary times. After the Revolution, that prosperity was significantly increased by the institutions of freedom embodied in the nation's charter. Most of the people were kept constructively employed in self-fulfilling, free-enterprise, free-market, activities, free from arbitrary government interference — and this played a vital role in the nature of American capitalism. And the young American government, in loyalty to its people, and to American industry, wisely protected the American market.

But the real post-agrarian industrial revolution, that eventually changed us from a predominantly agricultural economy to an industrial powerhouse, can be attributed the coming of the automobile age. It was the automotive age that propelled industrial labor into a degree of dignity and affluence never imagined by the likes of Marx. A critical turn in the story of American capitalism came when industrialist Henry Ford decided that what was good for Ford workers was also good for the Ford Motor Company. In 1914 he shortened the work week and raised the wages of his workers to the until then unheard of rate of $5.00 a day. He wanted to pay his labor enough to be able to purchase and enjoy the fruits and products of their own labor, and give them the leisure time to do it. Capitalism has never been the same since.

What Ford had discovered, or at least put into industrial practice, was the concept of stakeholder equity. Labor was the most valuable asset to production, he reasoned, and it could be made even more valuable if it could consume its own production. Thus a true, mutually beneficial, partnership between capital and labor was initiated. Though few of the workers were shareholders, they were valued stakeholders in the Ford Motor Company. This story illustrates the meaning of stakeholder equity better than I could define it.

Resisted by many contemporary industrialists, de facto stakeholder equity nonetheless became the rule in this country until the advent of globalism. It was the key to the success of the American capitalist system and literally paved the road to the ultimate greatness the United States attained.

Labor unions also played an important role in asserting and maintaining the right of labor to a fair return for its contribution to capital. Even under the adversarial, and sometimes violent, relationship between the owners of capital and organized labor, capitalism assumed a form, and gained a spectacular degree of success, unassailable by the European advocates of socialism and communism. Soviet Communism was actually stillborn in 1917 because of this. Only support and sustenance from perverse forces within the capitalist west rescued and nurtured the Soviet Empire into the appearance of health and apparent economic success until its final collapse — but that is a subject for another issue.

The empirical problem in economics, no matter what the system, has been one of wealth distribution. By the mid-twentieth century, United States capitalism had solved the problem admirably well. When the farms prospered and industry prospered, the working people prospered and visa versa. The solution to the problem had proven ridiculously simple. Give farmers a fair price for their production, and labor a fair wage for its toil. Allow labor to organize. Limit the excesses of big capital through child labor and anti-trust laws, but reward it and keep it loyal to the nation through tarriff protection.

Capitalism works. But it worked well only when corporations shed their ugly characteristic of exploitation and recognized their employees not only as valuable asset, but a full fledged business partners. Lamentably, this mutually beneficial shareholder - stakeholder relationship was never codified into corporate law. It has only existed as the result of either benevolent paternalism on the part of certain companies, (of which there were many) or, lacking that, by virtue of union contract.

Almost all large businesses started small. Many matured into large corporations still nurturing a family-like relationship with employees. The result was mutual loyalty and de facto stakeholder equity for workers. Where mutual loyalty or respect was lacking, organized labor usually forced an often uneasy stakeholder equity on management. Unfortunately, organized labor, in its usually adversarial relationship with capital, failed to see that one of its primary missions should have been to seek laws that would have codified stakeholder equity in large corporations.

In spite of the fact that stakeholder equity was not codified in law, our nation came to its position of economic, industrial, and military preeminence under an effective stakeholder system. To quote David Gergen's article "Squeezing American Workers," (U.S. News & World Report, January 22, 1996) "Since World War II, America has enjoyed an unwritten social contract between management and labor: They would work together to generate prosperity and then, together, they would share in the rewards. Many workers and middle managers think the contract is now in shreds." That contract is in shreds. Mr. Gergen goes on to say, "In short, we are creating a witches' brew that could poison our national life.... the most important step we can take is to place the issue of income inequality much more centrally upon the national agenda."

Secretary of Labor, Robert Reich, thinks so too. He has been aware of the problem for a long time, as evidenced in the 1982 book, Minding America's Business, he co-authored with Ira C. Magaziner. Both Gergen and Reich, along with practically all establishment politicians and economists, fall back on the same critically flawed remedy — education, and a "dramatic improvement in the skills of our work force" so we can be competitive in the new global economy. Yes, our educational system needs a lot of work, but our politicians are the ones who need to be educated. If the jobs were really there, the work force, with the help of industry, would quickly acquire the necessary skills to perform them.

One of the most important factors that made this stakeholder equity possible was that our government functioned for much of our history as a representative republic, protecting the interests of its citizens through protectionist policies with regard to external trade, and free markets within the national borders among the several states, in accordance with the Constitution. Tariffs and regulations that protected certain industries from unfair or unwanted foreign competition served a three-fold purpose. For over a century they provided the government with revenue so that onerous or direct taxes did not have to be placed on citizens; nurtured fledging home industries and allowed them to grow and prosper; and it protected domestic labor from having to compete head-on with lower-paid foreign labor. Yet, during our entire history, in spite of isolationist and protectionist policies, the United States carried on friendly relations and robust trade with most of the rest of the world. It seems there must have been something right about these things that made this a great nation.

Since almost all necessities were produced inside our own borders, the general population suffered no significant negative impacts from tariffs and duties or restrictive trade policy. In fact, they unquestionably benefited from an obvious ever-increasing standard of living. Tariffs and duties were taxes shouldered only by those who could afford to purchase imports, which were almost invariable considered luxury items.

With the advent of post WWII globalism, (and especially since the end of the cold war and the unveiling of the New World Order, NAFTA, and the World Trade Organization) American policy has undergone a momentous change which is now being manifested in the lean and mean face of big business. The Republican party, as traditional champions of big business and free market economics, still fails to appreciate the significance of the change. It believes it is still representing the people by remaining loyal to big business. It believes that global free markets, being bigger, must be better than protected domestic markets. I believe they are deadly wrong.

In the last issue of Camden's Commentary I explained why encouraging export oriented industry, in an attempt to fill the employment gap and repair the trade deficit, is a fatally flawed solution to our growing economic problems. In short, workers who produce for export, are not the customers or consumers of their own production, thus it is always to the advantage of their employers to cut their wages and reduce their numbers to the barest minimum. In an export oriented business, the broader concept of a natural stakeholder equity is impossible. The solution is for American labor to produce primarily for the domestic market using American raw materials, and limiting imports to what is not easily produced here. Exports should not be the prime goal of most domestic industry, but merely an outlet for excess production. Only in this way can a natural stakeholder system exist.

Free enterprise, it must be remembered, has its fundamental root in the individual's guaranteed right to property, and his right to do with it as he pleases. Only individuals possess this fundamental right. Corporations, being artificial "persons," created at the behest of the state, do not. Yet we have come to erroneously associate free enterprise almost exclusively with corporations and big capital. European capitalism, and the evolution of the corporations, was born of the combined mercantilism and plutocracy of feudal societies. The United States adapted it to its own unique circumstances based on liberty and free internal markets. American capitalism, and most American corporations, grew directly out of individual free enterprise. But the corporate system, and the capitalism itself, has unavoidably taken on a life of its own which is not necessarily all good in all of its manifestations. Thus one of the few responsibilities of government is to maintain regulatory control over corporations to prevent capital excesses and abuses, and make sure the interests of the broader public is served.

Under the concept of global free trade, big capital is being given free-reign to exploit people and resources on a global basis without any regard to the short or long-term impact on people effected. The only criteria used to judge success of a company is bottom line and gross national product measured solely in terms of money. These are the fatal flaws, as well as the predominate threat, of the current globalist agenda.

Only Congress has the power to change our current rush to economic ruin and social chaos in this country. Only by reclaiming our political and economic independence, and securing the domestic prosperity that once seemed inviolable, can social chaos be averted. A three-pronged approach is needed. (1) We must re-institute a reasonable degree of protectionism to level the trade playing field at the border through tariffs and duties. (2) Use the tax code to keep corporations loyal to the nation and return production to our shores. (3) Write the concept of stakeholder equity into corporate law to keep more people working in partnership with industry. Stakeholder equity could be instituted by mandating that labor be represented on corporate boards of directors, and by stock option programs for employees.

Any such government mandates should apply only to public corporations above a certain critical size, so as not to interfere with small business, individual proprietorships, and grass-roots free enterprise activities and job creation. But we have too many mis-representatives in Congress for this to happen any time soon. Many still buy the propaganda of the "experts" that emanates from the universities and various think tanks, both right and left. And, America First leadership hasn't visited the White House in recent memory.

Of course Bill Clinton, true to what seems a chameleon-like character, while doing everything within his power to promote free trade and Wonderful New World politics, is now paying lip-service concern for displaced workers. In January, before the Congress he asked corporations to put "long-term prosperity ahead of short-term gain." Labor Secretary, Robert Reich, has openly accused corporations of abandoning their responsibility to communities and employees. But firms are abandoning employees and community as the direct result of the globalist free trade policies that Clinton champions. (Unfortunately, Bob Dole wears the same globalist shoes as Bill Clinton.)

The very concept of stakeholder equity is being vigorously attacked and discredited before most people have ever heard of it. The Economist magazine goes to great lengths in its February 10th issue to explain why any policy designed to promote the idea of stakeholder equity is un-American. Why? "It would be hard to think of a better way to make American workers less productive, and to make American companies less able to compete in the world economy." The Economist, of course, is published in London — but be that as it may, our politicians have been marching to the same drummer as The Economist for decades. But how is it that we take our marching orders from Europe?

Japan and Germany have operated under stakeholder capitalism since WWII, and it has served their peoples very well, indeed. However, as The Economist points out, their economies are running into trouble as they evolve into the global economic mold. The stakeholder concept is turning into a handicap now that businesses are increasingly wanting to take advantage of the global scramble for cheap labor "elsewhere." Japanese and German companies are beginning to see the advantage of betraying their traditional character, community, and employees. Such betrayal is now advocated as good business, and any who cling to higher ethics will be left out of the global economy of the twenty-first century. I find it very troubling that this penchant for betrayal has apparently become universally accepted as a good thing among global thinkers. They act as though there will be no bitter consequences to this disturbing trend.

The consequences are already being felt, and they aren't good. We have more people on welfare than we had in poverty before the "New Frontier," "Great Society," and "War on Poverty" were instituted. Drugs and crime have become a way of life for an increasing number of embittered young citizens. The numbers of functionally illiterate high school graduates have been increasing dramatically ever since the Department of Education was crammed down our throats. We have broken the world's all-time record for the number of citizens incarcerated in penitentiaries. (How could this possibly be true in a supposedly free and democratic nation?) For the first time in our history citizens are taking it upon themselves to organize armed militias. Not against the possibility of external aggression, but because the people perceive that their government is betraying them. And it is all so unnecessary.

We seem to be engaging in a form of national renewal program akin to our disastrous policies of the sixties and seventies that destroyed most of our great industrial cities. Let's take stock of what we already have before we destroy it. We declared national independence in 1776. Let's make it stick rather than betraying our national heritage by marching to the drumbeat of the ideological descendants of our former masters.

Thomas Jefferson once wrote, "My God! how little do my country men know what precious blessings they are in possession of, and which no other people on earth enjoy. ...I will venture to say no man now living will ever see an instance of an American removing to settle in Europe and continuing there."

In a nation of government of the people, by the people, and for the people, the people are the only real stockholders in the nation. Where big capital commands the overwhelming wealth producing power of that nation, the concept of stakeholder equity in the nation's collective business ought to be recognized as vital to a just and somewhat egalitarian society.

Camden

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