Yesterday, I had a guest lecturer
at my policy class. Steve Rocco, the Co-Founder of Mission Markets.
Mission Markets is a
next generation financial services firm that supports the world’s first
comprehensive, FINRA compliant marketplace specializing in the impact and
sustainability sectors.
The group works to:
With an outpouring of support for Occupy Wall Street
indicated in polls which suggest a majority of Americans believe income
inequality is too severe, Rocco talked about how we have gotten
here. “A generation ago management split
profits 50/50 with workers. Today,
management takes 80 %, and the workers get 20%.
The problem is management is one guy and there are 50 workers. When that happens over and over again you
have the situation we find ourselves in.
And there is obviously little to no demand on the market. I don't know if the 80/20 split is
accurate and don't know if it was ever 50/50. But we do know that the ratio between CEO pay
and his average employee has gone up a lot.”
Today, Chief Executive Officers earn 343 times more
than average workers.
Fifteen
years ago, my little brother wrote a paper at the London School of Economics
arguing that our economic models were not sustainable. He argued that
capitalism as we know it is carcinogenic.
The school rejected his argument.
For far too many years, far too few have paid attention to countless
indicators which suggest what we are doing is no longer sustainable. If only he could turn the paper in today. Today, many seem to understand that current
economic models represent a model of growth which supports uneven development,
environmental disrepair, and expanding inequality. Today’s New
York Times reports:
The
genius of the OWS movement is that it has helped take what were once boring pie
charts showing distributions
of wealth and helped turn this data into movement to change this. Today, unions, social workers, anarchists, homeless
and health care advocates are
translating the movement’s critique into policy proposals for reforms,
including extending the millionaire’s tax in New York. Our governor is supported by Koch Brothers, #
three and four on the Fortune 400 list of the richest Americans. They want him to create more tax breaks for
the one percent. The task facing the
governor is will he support the one percent who fund him or the other 99% who
want to continue the millionaire’s tax in New York state. Already
police upstate are supporting the 99% and abstaining from cracking down on the
movement. Next Tuesday, a rally is
planned as a March on Governor Cuomo "1%". “Meet at 5th Avenue and 41st Street @ 12pm we
will march from Byrant Park to the Governor's office. Let's tell the #1
Politican (Cuomo) to make the 1% pay their fair share.”
While
reforms are in the air, many are suggesting this crisis offers a moment to
create a smarter more sustainable form of capitalism. Today, many realize there are smart ways of
supporting community economic development.
Keeping money in credit unions, buying and selling local so cash flow
stays in neighborhoods and generates economic movement – these are just a few
of many simple practical approaches.
My first
social work job in New York was with Greyston Foundation.
The
organization is part of a community
economic development movement which supports organizing, sustainable capital
development, and job creation. Already
groups, such as New
York’s Housing Works, have built on the lessons of this model. Housing Works supports a broad range of
organizing from direct action to direct services, job development, housing and
harm reduction for low income populations coping with the dual epidemics of
HIV/AIDS and homelessness.
The
movement for sustainable investment has already turned a
supportive eye toward OWS, suggesting the two movements are fundamentally
aligned. Just last week, Zevin Asset Management, pioneers in socially
responsible investing, issued a statement of support for the OWS movement.
In this
time of declining living standards and high unemployment, many people feel
bitterness and disappointment. And justifiably so, as overwhelming
evidence demonstrates the rich have gotten richer at the expense of the
middle class, the working poor, and the unemployed. The rising differential
between executive and worker incomes and the disregard exhibited by many
corporations for their local communities and the environment are symptoms of a financial system which
rewards short-term destructive gambling instead of focusing on the long-term
sustainability of our economy. As socially responsible investors, we seek the
same goals as those protesting. Therefore we stand alongside the Occupy
movement, supporting freedom, transparency, human dignity, and responsibility.
We hope that the voices of the 99% will bring much needed changes in government
policy to help address excessive corporate greed, greatly weakened
environmental and financial regulations, the housing crisis, crumbling
infrastructure, shrinking schools and libraries, and a disappearing social
safety net. There is no reason for so many to be unemployed when there is so
much to be done.
The point of course is that a
sustainable community and economic development is dependent on full participation
of everyone in the community. This
includes those who have turned to social protest and direct action as a way to
push their message back into the public sphere of debate usually dominated by
the richest of interests. Sonia Kowal,
the director of socially responsible investing at Zevin, explains that social
action is an important part of the larger conversation about sustainable
development.
"We try to look at things like social unrest from a top-down point of view when we are choosing companies and regions for investors to invest in," Kowal told SocialFunds.com recently. She described social unrest as "this spirit of everyone figuring out that they've been done over by the establishment and trying to regain some control over things that have gotten away from people," and said, "That worries us a lot, but at the same time we almost think it's necessary for things to move forward. In the States it's a particular issue given the corporate personhood problem that we have" following the Supreme Court's Citizens United decision.
We wrote investment commentary on inequality last year, on declining living standards and declining employment for everybody except the top income earners. We don't think it's good for the economy in the long term."
"We put a lot of blame on our government for being complicit, for bailing out bankers and companies while giving short shrift to everyone else," she added. "But it's not only our current administration. It goes back a long time."
This income inequality is bad for
business. It is bad for capitalism and
communities. The point of this movement
is that we are all dependent on each other.
Interdependence
means we all need each other. We are all
connected. By interdependence, Benjamin Barber
suggests:
This, of course, the message of the
global justice movement as it has dovetailed into OWS. Does the movement have goals – most
certainly. Already Adbusters, which put
out the first calls for the OWS movement, has submitted a proposal for a
financial transaction tax which would both curtail the culture of risk and
gambling on Wall Street and generate capital for economic recovery. The group has called for a global march for
such a tax on October 29th.
Reducing risk and creating accountability for Wall Street would be first
step in reducing the privatizing of profits and socializing of risk which has
so enraged a generation. Crises are
opportunities for capitalism to either crumble or reinvent itself in a
sustainable way. Unless we get to the
point where we can move away from a culture of greed toward a culture of
interdependence, then we will find ourselves coping with the former. And we will see more of what is happening in Oakland repeat itself in cities across the country.
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