Power and influence in
the United States are concentrated in three major sectors—government,
corporations, and Wall St. African-Americans have been successful at
using one of them—government—in our struggle for full participation in
this society. But if Robert Reich is right, the power sector we’ve been
leaning on is the wrong one for the 21st century. Reich is a
professor of public policy at the University of California at Berkeley,
and served as Secretary of Labor in the Clinton administration. In his
new book, “Supercapitalism: The Transformation of Business, Democracy
and Everyday Life” (New York, Alfred A. Knopf, 2007), he argues that
the forces of capitalism—corporations and Wall St.—are overwhelming the
forces of democracy—government, labor unions, and grassroots political
organizations—to the detriment of the common good. It’s a compelling
argument. And it does not augur well for African-Americans. Reich
defines Supercapitalism as a dramatic shift in the U. S. and world
economies to a ruthlessly competitive market system, in which consumers
and investors have been big winners. “Meanwhile,” he argues, “the
democratic aspects of capitalism have declined. The institutions that
undertook formal and informal negotiations to spread the wealth,
stabilize jobs and communities, and establish equitable rules of the
game—giant oligopolies, large labor unions, regulatory agencies, and
legislatures responsive to local communities—have been eclipsed.
Corporations now have little choice but to relentlessly pursue
profits…Democratic capitalism has been replaced by Supercapitalism.” Reich
traces the dawn of the era of Supercapitalism to the1970s, when
deregulation, the advent of global supply chains, and the migration of
powerful new technologies such as semiconductors, fiber optics, and the
Internet from the laboratories of the Pentagon to the world of business
sent the U. S. and world economies soaring. Following the
deregulation of the U. S. financial industry in the mid-70s, Reich
argues, Wall St. became extremely effective at aggregating the power of
investors to force corporate executives to maximize the market value of
their companies. If they failed to do that, he says, capital moved
quickly and efficiently to more profitable companies, with dire
consequences for the laggards. The power of consumers was aggregated
in much the same way. As investors, we like high returns in our
pension plans, mutual funds and 401ks. And as consumers, we’ve come to
expect great products at bargain prices, with high-quality customer
service available at the touch of a telephone or computer keypad. But
the consequences of Supercapitalism are not so benign for us as
citizens, according to Reich. Wal-Mart can’t offer the bargains we
find on its shelves without keeping its employees’ wages low and
cutting their benefits to the bone. Energy companies can’t heat our
homes and power our cars at today’s price levels without polluting the
environment and producing global warming. Corporations can’t maximize
profits without compensation practices that create a level of income
inequality we’ve never seen before in the history of this country. Reich
sees the problem as an imbalance in the widely differing efficacies of
capitalism and democracy in performing their separate and often
conflicting jobs. Capitalism’s job, he says, is
straightforward—to grow the economic pie. And, he argues, corporations
and Wall St. are performing that job superbly. Democracy’s job is much
more complicated: determining how the slices of the pie should be
divided up, and setting the rules under which capitalism operates. The
institutions of democracy, he argues, are failing in their performance
of those tasks. So what of African-Americans? Does Supercapitalism affect us any differently than it affects other Americans? SOURCE:EBONYJET.COM
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