Saturday, July 24, 2010

BP, Bonuses and Other Issues: Maybe a Bit of Socialism Would be a Very Good Solution

by Norman Markowitz

BP aka British Petroleum aka the Anglo-Iranian Oil Company is still at the center of a sinister soap opera, fixing a truly horrendous leak which resulted from drilling that never should have been permitted; not fixing it; trying to make its case through commercials on TV,;slammed by the Obama administration and Congress, not to mention public authorities in the Gulf region. 
Citizens are learning something about oil rigs, the science of the oil industry, and that is all to the good.  But no one is speaking about an old fashioned, long established serious solution--public ownership of energy resources and public planning to develop those resources. 
That will be called socialism and it really is a socialist policy--and socialism is a good thing, since it is first and foremost  economic policy in the interests of the people first, not any class of owners, investors, or for that matter self-aggrandizing officials, public and private. 
If a nation as  developed and as significant in the global economy would undertake instead of opposing public ownership of energy resources---emember the CIA's "bailout" of what later became BP when it overthrow the Mossadegh government in Iran in 1953 for nationalizing Iranian Oil and turning to the Soviet Union for aid when Britain with U.S. support sought to strangle it economically for doing that--- this would make many things possible in the 21st century that are impossible under capitalism. 
For example, a rational energy development policy which would prevent the corrupt and criminal actions of Enrons and BPs before they occur  If the United Nations or some truly international authority were involved, production and pricing policies  could be established to balance the needs of developed and developing nations.  Also, ecological policies designed to address questions like global warming with no profiteering transnational corporations around to serve as a roadblock to such policies. 
 In the world, Americans have a not so good reputation as whiners(I must admit that I personally whine about a lot of things) and muckrakers, that is, very good at gathering information, exposing abuses, as Karl Marx once noted about U.S. economists gathering valuable economic statistics while their European counterparts dwelled much more in a world of abstract theory.  But Marx also noted that the Americans pretty much stopped there, and exposures  and criticism without serious policy solutions over time become counterproductive, making more and more citizens cynical. 
If what has been exposed about private oil, private energy, what deregulation has specifically has fostered over the last thirty years, then comprehensive regulation is a necessary  albiet not sufficient solution,  Public ownership(in the U.S. the successful model of the Tennessee Valley Authority, despised by capital and blocked from expanding to the rest of the country after WWII by conservative politicians who used the political climate of the cold war to demonize anything, real or imagined which could be called "socialist" is perhaps the best example) is woud be both sufficient and  the best solution.  Certainly TVA was a much better solution for the Tennessee Valley than attempting through regulation and rate policy to have have private companies develop the region.
Another interesting story concerns the Obama administration's criticisms of and attempts to reign in bonuses to executives  who  brought on the fiscal crisis and whose banks  have received hundreds of billions in public funds to keep them afloat.  Kenneth Feinberg, the administration's special master on executive compensation has issued a report that 17 major "financial companies" aka institutions of finance capital paid  out 1.58 billion in "unwarranted bonuses" to their "top earners" in 2008 and 2009 while the financial system was plummet ting  hundreds of billions in investment and pension funds were being lost and the government was pouring in hundreds of billions to hold back a global 1930s style depression.  Here we see a lot a whining again.  Everybody is against these kinds of bonuses pretty much but besides arm twisting and threats, now body is really dealing with the larger questions and suggesting solutions.
Virtually all of us who work for wages and salaries have no relationship to the bonus system,even sales people who work on commissions.  Why should the system exist in its present form to  begin with,\.  What does it mean when   "top earners" of parasitic investment banks and brokerage houses are given bonuses greater than what most workers will have as net income in a lifetime to  make money for their firms by inflating  stock prices, amassing  debt, carrying out policies that do little to advance and much to ;undermine increases in  productive capacity, decent jobs,  and general living standards. 
In the 19th century, the American radical reformer, Henry George, attacking landlords and real estate interests for profiting for from the increase in property values created by industrialization and then charging higher and higher rents which in turn blocked further progress and impoverished workers, advocated a "single tax" that would tax away the }unearned increment" represented by the huge increase in land values.  George gained support from workers by calling for that "single tax" to be used to finance various social reforms.  Maybe one way to deal with this entire bonus system would be to initiate something like a "single tax" of 50% on bonuses of 100,000, 90% on bonuses over 1,000,000  and 100% on bonuses over 10,000,000.  While George was no socialist, that would certainly be a solution to the bonus question, one that would redistribute wealth to the people(conservatives always call such programs socialism) in a good way, instead of redistributing wealth from the people to the rich, which the bonuses are of course about(conservatives call that freedom) 
In any case, these are some thoughts I had while I looked at the news of the day.  I also had  some anger when I read about  Hilary Clinton criticizing the government of Vietnam for its "human rights" violations while in Vietnam and taking credit for her husband's "normalization" of relations with Vietnam during his second term.  even Robert MaCnamera admitted  3.4 million Indo-Chinese perished in a war that the U.S. government fought as an ideological holy war with a strong racist component.  Whatever criticisms might be made of Vietnam's internal "human rights policy," no U.S. government today or in the forseeable future has any real right to make them, unless of course it would really engage the Vietnamese government and come to terms with what was done during the Vietnam War

No comments: