The Question of Power
by William Greider, a "letter to kindred spirits" on the publication of his latest book,
INTENSE POLITICAL JUNKIES of the left and right may have trouble with this book and dismiss it as soft-headed. Where is my ten-point "action program" for legislative reforms? Readers will not find one in "The Soul of Capitalism: Opening Paths to a Moral Economy." I am trying go deeper into the matter of how Americans are governed in their lives. I am searching for more fundamental solutions.
I want people to look beyond the formal events of politics and elections and to recognize that the power to determine the shape of our country and its social conditions belongs, for better or worse, to business and finance, more securely than government. It is the economic system, not Congress or presidents, that now effectively decides the terms of the "social contract." Most citizens, though they are intimately affected, have very little to say in the matter.
My subject is American capitalism and how it collides destructively with society and with our deepest human values and aspirations. The subtext is about rearranging power in America. By power, I mean the capacity to participate in the decisions, large and small, that will define our lives, our society and its future -- an entitled voice that is supposed to be everyone's birthright in a political democracy. This book does not dwell on the decay and deformities in America's representative democracy or why most citizens are now deeply skeptical of the political system's regard for them and their views (my previous books covered that ground).
The subject is capitalism, not the dismaying politics we know. Americans know a lot of facts about politics, but only dimly grasp how capitalism actually functions. In the course of explaining things, I also explain its enduring strengths and virtues -- the reasons why it has prevailed over competing economic systems -- and the sources of its pathologies.
This new book offers a challenging proposition for American democracy: we are unlikely to revive a governing system that begins to resemble our democratic faith until we have confronted and reformed the malformed distributions of power within American capitalism itself. Though it may sound audacious, I think this is possible to achieve. In fact, I see glimpses of this great undertaking already underway in many places across the nation. Scattered and experimental to be sure, but these efforts are powered by brave pioneers who have compelling insights on how to rearrange the economic system so it will respect and support a far more humane and equitable country.
This is "deep politics" for the long run. As people gradually succeed in changing elements of their social reality (and I think they can), politicians will sooner or later take notice.
Yes, we are fabulously wealthy as a nation, but are we truly free? How can people be considered free when their daily lives are so closely regimented by the confinements imposed upon them at work, rules that tell them to turn off their brains and take orders, no back talk? The content and conditions of work for most Americans -- even in well-salaried positions -- are determined from above by a steep pyramid of distant managers, who are often brutally indifferent to the human consequences or even to what the employees know about how the company functions (and malfunctions). These confining circumstances, once associated with the assembly line, have crept very far up the job ladder.
Indeed, the satisfactions inherent in doing a good job -- intangible qualities of human fulfillment enjoyed by conscientious workers at every level -- have been steadily degraded in recent decades, even for many high-skilled professionals. Lots of Americans understand this has occurred. Why then does the subject remain taboo for politics? Because any serious political inquiry could not get very far without running up against the reigning operating values and power structure of business enterprise. When political leaders someday find the courage to talk forthrightly about the "politics of work," then we will know the country is on the road to reinventing capitalism.
My book poses such heretical questions across the main realms of the economic system -- work, capital investing, consumption and production, the corporation as principal form of business organization and the government as leading patron and protector of capitalist enterprise.
How can shareholders be celebrated as the "owners" of a corporation when they are utterly powerless to influence the insiders who control business strategies, who decide whether to discard social obligations or even to destroy the company itself?
Why are consumers said to be "king" when they have been safely insulated from the social consequences of what they buy and how it is made, distanced from any responsible influence?
Where is the economic logic of government subsidizing business sectors that improve their profitability by destroying nature or dumping other collateral costs on the public at the large?
The American system is rich in such contradictions. I explore them, looking for points of leverage. Despite honorable exceptions, most economists are not much interested in these questions. The orthodox perspective treats these matters as non-economic "social concerns," not relevant to the company's search for "efficiency" or the managerial techniques needed to maximize output and returns. But people care about them, so do communities. One way or another, they are rebelling in unheralded ways against the narrow-minded accounting that can put a price on everything, but fails to value all that people regard as priceless.
These engaged Americans have essentially reimagined themselves -- as workers, investors, consumers, managers, citizens -- and they grasp that people are potentially powerful in these roles, especially when workers and investors, consumers and communities learn to assert their leverage collectively in strategic alliance. My book tells many of their stories, from the promising performance of employee-owned companies to the remarkable power that emanates from rank-and-file investors when they collectively organize their capital for larger objectives.
In other words, people are taking back responsibility -- owning their own work or their own money -- and they are thus rewarded with more power in the decision-making (also typically with a greater share of the returns). This takes place within companies when employees become share owners and exercise a voice in management's strategies. It takes place in financial markets when people withdraw their capital from Wall Street's narrow-minded value system and instead invest directly in positive enterprises whose operating values they shape and support.
The magic word -- the touchstone in capitalism -- is ownership. Insiders have always understood that controlling ownership involves accepting risk and responsibility for the enterprise and its outcomes -- thereby claiming ownership of its entire profits and deciding who gets what share of the returns. Most people are cut out of that process, consigned to passive roles as supplicants, without influence and often without even a way to question the decisions. This arrangement is, likewise, a great engine of inequality in our society. It is one of the reasons why no amount of government assistance ever overcomes the gross and growing inequalities generated by the economic system.
Little by little, in myriad ways, Americans are figuring out that it doesn't have to be this way. Nothing in the fundamentals of capitalism requires a very steep pyramid of power or the malignant maldistribution of wealth and incomes. And the system demonstrably would work more effectively if these concentrations of wealth and power were gradually unwound.
Changing the standard arrangements is most difficult, of course, but as people examine the possibilities they discover that collectively the broad ranks of working Americans actually have enormous assets on their side. Indeed, despite vast inequalities in personal wealth, the broad stock market -- 60 percent of the 1,000 largest corporations -- belongs to the ordinary Americans, through their pension funds and the other fiduciary institutions holding their savings.
The greatest names in industry and finance draw upon this "collectivized wealth" for their capital. Why, we may ask, is this capital passively aligned with the business values that regularly do great damage to the very people who own the wealth? These are the kind of deeper questions this country needs to explore and I hope my book helps stimulate contentious conversations. In fact, I assert that people have the potential to exercise decisive influence within the system in behalf of deep reforms, once they learn to recognize where their pressure points are located. Some dream expansively of transforming American capitalism from the bottom up.
The question, one reasonably asks, is whether Americans have it in them. The broad public, I grant, doesn't look very promising, at least not the lumpy mass portrayed by the media. But people up close, like the folks I have encountered, represent the kind of purposeful minority that has always been the forerunner for deep change in our country -- inventive and optimistic people, willing to commit to something larger than themselves and with a radical kind of patience.
Cynics dismiss them. Most politicians keep their distance. But some leaders in high finance and major corporations are beginning to grasp that these people aren't going away. Their challenges are getting sharper, more strategic and sophisticated. Deep change sometimes advances without headlines.
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