News Section: Commentary
All Grossed Out
Increasingly, the global economy has come to rely on the misery and misfortune of many to fatten the bottom line for a lucky few. The term vulture capitalism has been coined to describe this sort of feeding frenzy that is quickly becoming the new normal. If we don't rethink the global paradigm, however, even those at the top of the pecking order might find themselves picking at cleaned bones before long.
Ralph Nader says, "We need to learn how to subtract." He is referring to the two indexes often cited to pinpoint our past, present and future economic status: the U.S. Gross National Product and Gross Domestic Product. Trouble is, neither recognizes the difference between prosperity and disaster, or sickness and health; so both are sure to turn tragedy, as well as productivity, into profit.
If an airliner crashes both indexes go up; a hurricane strikes, both indexes go up; when someone battles cancer, the costs of the treatment -- right down to the nails in the coffin -- are tallied on the plus side of both key economic indicators and again, both go up.
"Every time there is a car accident, the GNP goes up," says Nader. For decades Nader has raised concerns over how our economy increasingly depends on profits born to the misfortunes of others.
For the last 50 years the cost of health care has consistently gobbled up an increasing amount of our GNP. A 2012 study by Medicare and Medicaid Services indicated the nation's health care spending is vastly outpacing economic growth.
In 1960, U.S. healthcare expenditures consumed 5.3 percent of the GNP. Today it is a whopping 17.2 percent.
There is no evidence any government or corporate institutions have established a fiscal mechanism to deal with this ticking bomb that is quickly consuming our economic purse. Why would they? Unpredictable tragedies that produce unpredictable costs equate to very predictable profits.
There is a German term that best describes this perverse perspective: Schadenfreude (taking pleasure in the misfortune of others), and profits are often the pleasure.
“The Chinese use two brush strokes to write the word 'crisis.' One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger -- but recognize the opportunity.” ― John F. Kennedy
We live in a crisis culture of moving from one crisis to another, giving the vultures who feed on such misery little more to say than what's for dinner? Moral crisis; economic crisis; global crisis; environmental crisis; healthcare crisis; debt crisis … there is no end to the labeling, because a crisis is a game changer, and opportunity loves game changers.
It is not just what is calculated in our economic report card; but what isn't calculated that may be as or even more relevant in creating an accurate measuring stick to see what condition our condition is in.
But if we continue to feed more from catastrophe than creativity, more from plight than productivity, we will increasingly become our own economic trip-wire.
There must be a tipping point, a critical mass governing the portion disaster can play before a healthy economy will collapse. Many, such as Nader, feel we are already there.
Deep pockets stuffed with disaster profits
After Hurricane Katrina the country should have been ground zero for indulging goodwill, benevolence and compassion, but instead it became a platform and a launch for record profits.
ABC News reported that in the earnings quarter following the storm, ExxonMobil broke the all-time record for a U.S. company, announcing a net profit of $9.9 billion - up considerably from the $5.68 billion in profit the same quarter the year prior.
The next four largest oil companies all experienced similar jumps in revenue, and so did lumber companies, insurance underwriters and real estate developers.
In April of 2006, the Los Angeles Times reported that the companies that provide Americans with their homeowners and auto insurance made a record $44.8 billion profit in the year following Hurricane Katrina -- and that was after accounting for the claims from policyholders wiped out by Katrina and the other big storms of 2005 -- yet economic indicators rose up to five percent in 2006.
We already give billions of dollars more subsidizing special interests than we do to those in need: the sick, broke and/or homeless; you know, the ones many people refer to as the takers.
The total amount spent by the U.S. government on social welfare programs is $59 billion. Yet, from the other hand comes corporate subsidies, known as "corporate welfare" plain and simple; amounting to $92 billion. These subsidies go to giant insurance companies, the oil industry, banks and developers. And if that's not enough, many of these same global corporations find ways to benefit from the $14 billion in "foreign aid" the U.S. government provides to other countries. Those subsidies amount to far more than all of the country's indigent health care cost and government hand-outs combined.
Our federal, state and local leaders have failed to recognize the significant role sustainability will play in our future; and we the people have failed to elect leaders who have the talent and will to take us there. When without a crisis, ineffective government officials will look to manufacture one, and most situations become a crisis due to habitual neglect -- one of the few talents many officials do well -- so leaders are often quick to embrace what ever distracts them from having to perform the tasks that are best-suited for a community as a whole.
I am curious to why the Koch brothers haven't taken the lead in their effort to wean government from distributing all subsidies, including the ones in their portfolio. It would be interesting to know just how much of the $92 billion going to corporations ends up in their camp. I am sure they would at least agree to taking a pause on corporate subsidies.
Imagine redirecting the $92 billion to the National annual School Lunch Program, where the budget is $16 billion for producing a whopping 31 million lunches every school day. Add in the $59 billion for all of the U.S social welfare programs and there is still enough left to pick-up all of the adoption fees for all of the animals in shelters in the U.S. ($1.2 billion).
That still leaves $800 million, which is enough to pay for the Veterans Housing and Homeless Prevention Bond Act of 2014. The cost is $600 million and the dollars will go to assist both homeless and at-risk veterans, assist in housing, and aid those struggling with physical and mental injuries and substance abuse.
Currently that program is set to be funded from the sale of bonds; another tragedy presenting opportunity for banks to the tune of $100 million or more in profits for them (depending on the time it takes to buy them back). But that wouldn't happen if the dollars we have been giving to fatten corporate and executive profits go to a more noble cause.
I don't think that if the remaining $200 million went to getting the VA Hospital backlogs rolling forward, there would be many complaints. Here is an idea. How about just trying this switch of where the money goes for just one year? All of those programs would be funded and we would also reduce the annual federal deficit by just under 18 percent.
"Everything has changed except our way of thinking." ― Albert Einstein
Hazel Henderson, noted economist, author, futurist and consultant says, "One new indicator, the United Nations Development Program's Human Development Index (HDI) is a first step in challenging the narrow economic definitions of progress that make up the GNP index. The HDI, by incorporating widely available statistics on literacy, life expectancy and purchasing power, has energized the debate on reforming national indicators." She also said, "Recent efforts to redefine indicators of national wealth and progress, beyond the outdated model of the GNP index, may eventually depose economics from its current catbird seat in the policy arena."
Sustainable futures need a baseline of economic diversity and income distribution; not declining reserves, crumbling infrastructure or rising debt.
A paradigm change -- to how we care for each other -- may be in order if our society is to reach a sustainable position that can compete in the modern world.
We can do it. We just might have to work together to keep the vultures at bay.
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