The Cruelty of Humanity

By, Prachi Sharma

December 10, 2008 marked the 60^th anniversary of the signing of the Universal Declaration of Human Rights.  While this day was celebrated by the United Nations as a reminder of progressive movements that have shaped the modern, globalizing world, it does, in no way denote the progression of human nature. UN Secretary General Ban Ki-moon himself stated that, “the challenges we face today are as daunting as those that confronted the Declaration's drafters."

Today’s top stories include those of government bailouts, stock market downturns and failures in the auto industry.  Many top political analysts see these issues at the forefront of both the next U.S. administration and international relations, but are these really the ‘daunting challenges’ that plague the next four (hopefully eight) years of the U.S. administration and the future of the 21^st century?

Second in line to these stories are those international emergencies that are important enough to be publicized and discussed by political experts—the tragic Mumbai bombings and the ongoing religious and territorial disputes between Israel and Palestine, for example.

However, in the past six months we have also overlooked a myriad of other international crises—power struggles and a cholera outbreak in Zimbabwe leaving thousands brutally murdered or left on the streets to die, Somalia nearing a ‘total famine,’ and fatal school collapses in Haiti that killed more than fifty and left several injured in addition to the ongoing rapes in the country’s slums to name just a few.

Although some of these events have had media coverage, they have been mere snippets of news articles or inserted as hollow commentaries from news anchors, reporting what “horrible travesties these nations face.”

Why is it that we—as Americans, as Westerners, or more importantly as human beings—revert to this sort of behavior?  Is it justified to pay more attention to those with closer U.S. ties, to simply ignore that part of our conscience that says otherwise in order to sleep better at night?

Thomas Hobbes’ human analysis of the ‘state of nature’ (human nature, that is) in constant conflict without the sovereign state, on the other hand, has valid consideration.  Rules and regulations are essential to stability and are undoubtedly grounded in the basic principles of the modern global political system.  It is not always prudent, for example, to send diplomats or aid workers to a region where the results would cause more danger to the local population and those who are sent to help.  This mentality creates a desire to preserve one’s own life (or the lives of a State, a people, or a cluster of nations sharing similar ideals).  It is, therefore, clear why more emphasis would be put on Mumbai or Israel—the principle of practical rationality, that people should adopt what they see to be the necessary means to their most important ends (Stanford Encyclopedia of Philosophy).

The signing of the UNDHR was a groundbreaking event, but a contract is not a panacea to conflict and the human condition.  It is reassuring to see that the media, be it through television, newspaper, internet, or films as the wonderfully inspiring “Slumdog Millionaire,” acknowledge and bring to life some of the worst conditions that people all over the world (mostly the developing world) must face.  But we have come to point in history where acknowledgment is just not enough.  The word “change” can not simply resonate in a speech for the duration of a campaign.  It is time to permanently instill the belief of “all are equal” in our minds and to act now. “…We live in an important time.  It is now time for you to wake up from your sleep…The ‘night’ is almost finished and the ‘day’ is almost here…Let us live in a right way, like people who belong to the day” (The New Testament, Romans 13:10).

References and Further Reading:

“World marks UN Human Rights Day” BBC News

“Mugabe crisis 'infecting' Africa.”BBC News

“Somalia nearing a 'total famine.” BBC News

“Deadly school collapse in Haiti.” BBC News

“Rape looms large over Hait slums.” BBC News

“Hobbes's Moral and Political Philosophy.” Stanford Encyclopedia of Philosophy

"CHANGE HAS COME TO AMERICA."-President Barack Obama

By, Danoosh Kapadia

The time has come. President Obama is in office and CHANGE has come to America. Obama may be a savior, but what can one man really do? The truth is, America is already in the midst of a revolution and Obama is merely the instrument for realizing this change. This New America comes from an internal revolution within each citizen—not just the election of a savior.

Economically speaking, 2008 was one of the gloomiest years in recent history. In the first six months, gas prices doubled. This drove the price of basic commodities (like milk which crossed $4 a gallon in July) through the roof. In the latter six months, the foundation that held the American economy as the anchor of the world fell to pieces. America taught the world how to invest—and the investment banks failed. Ford taught the world how to manufacture cars—and the automakers failed. So it’s not without reason that many Americans are anxiously awaiting the new presidency and its promise of economic reform.

In the eyes of the world, the average American was obnoxious and over consuming. Americans ate too much food, guzzled too much gas, and shopped too much. Nowhere in the world did people spend money as frivolously as they did in America. It seemed there was a bottomless pool of credit; which is why the baby boomers lived and died in debt. Twenty-something’s (who were up to their eyeballs in student loans, car loans, and credit card debt) thought nothing of paying upwards of $200 for a pair of jeans or $50 for a bottle of vodka. When it was possible to buy a home without putting a penny down, it became clear that something was drastically wrong. Clearly there was an urgent need for change—a change of mindset, a change of attitude.

Although American markets were put through the wringer in 2008, the world markets are in even worse condition. Amid all the doom and gloom, the U.S. still remains the world’s largest economy—a heavyweight title it isn’t likely to relinquish without a tough fight. Europe and Asia are still waiting on the dollar to regain its strength to boost their own flailing economies. One thing is certain: after an unprecedented $850 billion-dollar government intervention, the virtual nationalization of many industries, and a massive shakeout of many sectors ranging from finance to print media, the post-recession economy is not going to resemble the pre-crisis one by any measure.

The recession, however wrenching, will lead to the restructuring of many sectors. Thirty million dollar bonuses in the finance industry and $0 down mortgages will likely be a thing of the past. Many industries, such as aerospace, technology, and pharmaceuticals are expected to remain competitive. After all, the world still wants its iPhones and a cure to cancer. The U.S. will still be a big market for cars, but hopefully we will soon see the demise of the Trailblazer and the Hummer.

The new stimulus package should create jobs and get consumers back in stores. General trade should not change too much either. America will continue to sell airplanes to the Chinese, who will in turn ship back inexpensively manufactured apparel. But if American consumers stick to their new, thriftier ways the biggest loser in all of this might be the retail sector. As consumer confidence dips and the pressure to cut prices and trim losses increases, more chains might join the fate of Circuit City.

Mauro Guillen, a professor at Wharton School of Business said it best; “The U.S. economy is dynamic and technologically advanced, and that won’t change. The U.S. will continue to be ahead.” China may have mastered low cost manufacturing and India may be the land of the call center, but the new ideas that make it all happen still come from the land of innovation—the United States of America.

The Red, White and Blue

By, Danoosh Kapadia

General Motors (GM stock price) was once the world's largest corporation and still holds its place in the top 10 largest corporations of the world according to the Fortune 500 list. What was once heralded as the symbol of American Capitalism has now been reduced to Rick Wagener (CEO) taking a begging bowl to Capitol Hill. In light of the current economic meltdown, it is time to re-visit the very concept on which America as we know it was built – Capitalism!

RED:

Whichever way you look at it, America is in the Red. One industry after another is not only taking a hit, but is virtually collapsing without government "bailouts." First we saw the mortgage industry collapse, then came the financial industry, and now, the auto makers. And now, the numbers don’t look very sanguine for the big players in retail and the print media industry.

The big question this year has been whether the government should continue bailing out businesses or let them fail? When the government injects money to save an industry giant from falling, it often comes with numerous regulations and strings attached. This goes fundamentally against the free market concept and in fact moves towards that of an over-regulated market. According to the free market theory, when the going was good, corporations prospered, and CEO's made millions in bonuses. By the same measure, when things go south, shouldn't the CEO's be accepting no salary and paying the price? And shouldn't the companies be forced to file for bankruptcy, regroup, break free of contracts and trim themselves into shape? If this fails and there's no hope of future profits, then shouldn't they be forced into liquidation and pay the price for poor decision making and inept management? The tragic part is that economics is theoretical, but reality is a different ballgame.

WHITE:

The white collar workers are coming under the gun day by day. They made millions when free markets reigned – even as the companies took a nose dive into the ground. Rick Wagner (CEO) made $15 million last year (a 65%increase from the previous year) as his company was consistently losing market share to Toyota. Merrill Lynch CEO, John Thain had the audacity to suggest he get a 2008 bonus of as much as $10 million even though his company lost $10 billion this year. Isn't this ludicrous? I believe in capitalism and agree with the fact that these CEO's have earned their right to a substantial pay. They went to the best schools, put their shoulder to the wheel and sacrificed their personal lives for their careers. But isn't $10-$15 million ridiculous amounts to ask for in troubled times? Its one thing to get an enormous bonus when the company is doing well, but in troubled times, shouldn't this be the first cost cutting factor before a single job is cut?

When the financial industry collapsed, the government scrambled, shored up the cash and threw it at Wall Street without a question. The financial industry is largely viewed as white collar, and in comparison the auto industry is largely viewed as blue collar. It has been deeply questioned as to why money was thrown at the white collar workers, but the blue collar workers were made to beg in Washington and every aspect of their plans had to be laid out in detail before they would get a penny in bailouts. The justification by Washington is that the companies that were bailed out had the potential to make profits in the future and sustain or even create jobs. The corporations were falling more because of unavailable credit, than poor performance. The automakers (A five year history of GM and Ford's stock price) on the other hand had poor management and foresight in consumer needs and have been consistently losing market share to foreign auto makers like Toyota. A bailout to them would essentially be a band aid, and the root of the problem would not be solved.

BLUE:

As we have historically seen, when things go bad, it seems that the blue collar workers end up paying the price. However, they also deserve some portion of the blame. If it weren't for the UAW (UAW homepage) making lofty demands and tying the big three into iron clad contracts at a time when business was good, this problem would have never come about.

GM was inclined to give the UAW what it wanted in 1976 because it was selling everything workers could make. Today, GM is staggering under a combined $114 billion in retiree health liabilities shouldered as workers hold the union and companies to the promise of a pension and lifetime health care. GM's share of the U.S. market has tumbled from 46.9 percent in 1976, when those contracts were negotiated, to 23.6 percent today. How is it possible to provide the same benefits when they have half the market share?

In the 70's these workers believed they could do anything since they owned the automobile industry. They indulged in drinking and drug abuse during work breaks, because they were protected by the Union and couldn't be let go easily. They became complacent and this showed as the quality of cars coming out of Detroit was steadily declining. In the mean time Toyota was perfecting its manufacturing technique and streamlining its process to minimize waste and maximize quality. Moreover each worker was trained to do only one task, so error was minimized. Bankruptcy is a terrible option for the UAW as it will nullify the union contracts. Unions have captured a significant portion of the Democratic Party and they rightly sense they can get a better deal from the Democrats in power than from a bankruptcy judge. Some people argue that it's management calling for the bailout, not the union. Well, the individual interests of management and the UAW seemed aligned perfectly. It may be management doing the lobbying, but its union muscle that's opening doors and gaining audiences.

Where has the spirit of capitalism gone in all this? Why did things reach this stage? The CEO's of the big three went to Washington with a tin cup saying if they weren't doled out cash, they would bleed to death at their doorstep taking millions of jobs, costing taxpayers over $100 billion, and plunging the economy into a depression with them. Where was the vision? The leadership that gets paid $15 million? Where was the American spirit of innovation? When they first came, they came with no plan, when they came a second time they came with a loose, ineffective plan basically telling congress it was now their problem to save the industry.

If the very platform and ideology that made this country what it is; is now failing? What hope is left? White collar and blue collar workers need to get together and re-structure. This is not the problem of the CEO's or the UAW or Congress; it's a problem of attitude, foresight and vision. Look at Toyota (Toyota's stock price) and Honda (Honda's stock price) – why are they not in the same boat? A 'Car Czar' looking over the big three bailout operations is free market sacrilege. It's time for the Red, White and Blue spirit to prevail, time to regain the capitalist spirit and that's the only way to get out of this mess and return these corporations to their former glory. Or has capitalism really failed, leaving us on the brink of another revolution?