Losing Our Moral Bearing: A Growing Economic Divide 1-25-12

Anderson, South Carolina

Protected by five thousand Swiss soldiers on the ground and restricted airspace, sixteen hundred economic and political leaders, including forty heads of state and government, are enjoying the life of luxury reserved for the gilded class as they converge at eastern Switzerland's upscale Davos resort in Graubünden for their 42nd annual five-day World Economic Forum. The costs of security measures shared by the Forum foundation and Swiss cantonal and national authorities have been frequently criticized in the Swiss national media. The foundation sponsoring the Forum is funded by a thousand member companies, the typical one a global enterprise with more than five billion dollars in turnover, although the latter can vary by industry and region. The majority of these privileged elite control empires worth billions.

Klaus Schwab, host and founder of the World Economic Forum declares "Solving problems in the context of outdated and crumbling models will only dig us deeper into the hole. We are in an era of profound change that urgently requires new ways of thinking instead of more business-as-usual. Capitalism in its current form has no place in the world around us. We have a general morality gap, we are over-leveraged, we have neglected to invest in the future, we have undermined social coherence, and we are in danger of completely losing the confidence of future generations”

This loss of confidence may have already taken place. Last month a New York Times poll found Congress' approval rating fell to an all-time low of 9 percent. Meanwhile, a recent Gallup poll found 11 percent of people found polygamy "morally acceptable." Additionally, 30 percent of Americans expressed approval of pornography. Another poll shows 11 percent of Americans in favor of communism.

Former White House economist Nouriel Roubini reminds us that today we are "back to the inequality of 1929 and the Great Depression." High unemployment and the failure of wages to keep pace with living costs are resulting in widespread unrest against elites. As much of the world struggles with increasing economic inequity and decreasing standards of living, rising discontent is powering waves of revolution. Many governments are toppling in the streets. More ominous for us is the potential toppling of the prevailing model of economics powering Western commerce for centuries – capitalism.

Evidence amasses daily suggesting Western models of industrial capitalism are creating increasing disparity. Many propose the middle class is disappearing from numerous nations. There is objective data to suggest this is becoming true in the United States. Political observers and sociologists find much agreement on the role of the middle class in creating and maintaining political, economic, and social stability. History is replete with staggering examples of national consequences when this role is ignored.

The inequity existing in the United States almost defies description. Robert Creamer, a political strategist, describes this in lucid fashion. In 2009 “the CEO of the average company in the Standard and Poor's Index made $10.5 million. That means that before lunch, on the first workday of the year, he (sometimes she) has made more than the minimum wage workers in his company will make all year. That translates to $5,048 per hour or about 344 times the pay of the typical American worker. Most people would consider a salary of $100,000 per year reasonably good pay. But the average CEO makes that much in the first half-week of the year. And that's nothing compared to some of the kings of Wall Street. In 2007, the top 50 hedge and private equity fund managers averaged $588 million in compensation each -- more than 19,000 times as much as the average U.S. worker."

When a presidential candidate is willing to buy and tear down a $3.5 million house and build a $12 million palace in its place, something has gone amuck. Someone who makes $60,000 a day off investments earned from what has been described as ‘vulture capitalism’ might just have a hard time gaining credibility with rank and file voters in the street. “In the eyes of many workers, and especially young people, the business community has lost its moral compass,” trade union leader Sharan Burrow pointed out in opening day debate at the Forum in Davos. "We must redesign the model. We must reset it,” she urged. One can only wonder if a business leader who spent years dissecting corporations can guide a nation back onto a moral high road which includes fair economic opportunity for all.

I just spent a day roaming through the largest house in North America, all 175,000 square feet of it. Does it make moral sense for one individual to build a single house equivalent to one hundred average American houses, just to have a place for his gilded parties? I personally know a good number of people living four to a room in the ghetto, sleeping on small bunks made of two by fours; I see extremes of disparity most every day of my life, the disparity that topples governments and economic systems.

Has our ability to find acceptance and contentment in life been corrupted by our addiction to ‘just a bit more,’ sometimes immensely more. In my daily work with recovering alcoholics and addicts, I’m sometimes bewildered at the intensity of craving some of them experience, but no more so than by anyone believing they merit $588 million for doing essentially nothing but taking risk; no more so than by those willing to use pepper spray on fellow shoppers at a Wal-Mart holiday sale. The market for high-end luxury goods suggests addictions of all sorts are rampant. As drug lords and hedge fund managers accumulate inconceivable wealth I am reminded of the question once posed to the probate lawyer handling the Rockefeller fortune. “How much did Rockefeller leave?” The lawyer replied simply, “All of it.”

“For what is a man profited, if he shall gain the whole world, and lose his own soul? or what shall a man give in exchange for his soul?"