Saturday, October 03, 2015

222.7 - The pursuit of profit is the baseline cause of economic injustices

The pursuit of profit is the baseline cause of economic injustices

And yes, that pursuit of profit distorts our economy and our society. The pursuit of profit is the baseline cause of income inequality, it is the baseline cause of poverty, it is the baseline cause of unemployment, it is the baseline cause of homelessness, it is the baseline cause of hunger.

The pursuit of profit does not allow for the common good, it does not allow for the advancement or the benefit of the community as a whole, it does not allow for "the needs of the many outweigh the needs of the few - or the one." In fact, the  pursuit of profit declares the opposite: not even the needs, but the desires of the one outweigh the needs of all the rest.

Just consider one example: The Wall Street Journal has reported on "a severe shortage of midtier apartments," meaning apartments with a rental cost range "aimed at the working class." This shortage has driven up rents for lower- and middle-income-earners, with a market segment average of $845 a month - a daunting amount for many of today’s part-timers and even many full-timers.

The reason for this is simple: It costs about as much to develop a luxury apartment complex for the rich and well-off as it does for one for low- or moderate-income people. But the rental income on the luxury apartments is, obviously, much higher, with rents nationwide averaging over $1700 a month - more than double those for people futher down the income scale. As a result, since 2002, the supply of cheaper apartments has shrunk by 1.6% - there are fewer less-expensive apartments than there were in 2002 - while the number of luxury units has gone up by 31%. Put all that together with ordinary population growth and you have more people finding fewer apartments with escalating rents which fewer and fewer can afford, to the point where any sort of housing becomes out of reach for them.

Which in turn leads to the estimate contained in the Department of Housing and Urban Development's Annual Homeless Assessment Report for 2014 that there are close to 580,000 people homeless on any given night in the US and the estimate by the Urban League that around 2.3 million Americans are homeless for some period of time at some point during the year.

At the same time, according to Census Bureau’s homeownership survey, in the first quarter of 2015 some 17.3 million housing units in the US were vacant, a figure that does not include those which are vacant only part of the year. That is about 7.5 empty places to live for every person who is homeless at some point in a year and 30 empty spaces for everyone homeless on a given night.

That state of affairs does not exist because of some force of nature or some ineluctable law of physics. It exists because of the drive for profit being placed above the needs of living, breathing human beings.

It is the drive for profit the generates unemployment, unemployment that is actually far higher than the supposed "official" rate. In fact, if you include those who are working part-time only because they can't find full-time work and an estimate of the number of "discouraged workers," those who dropped out of the labor force because they came to despair of ever finding work and so who are not counted in the unemployment numbers, unemployment is estimated at nearly 23%, Depression-era levels.

This is because corporations and their lackeys see employees as a cost, as something to be minimized. We've heard it so many times we can repeat the mantras from memory: "Businesses create jobs." No, they don't. Businesses incur labor costs in the pursuit of profit. That's why, despite the horrendous predictions of massive unemployment if the minimum wage is raised, such predictions have never come true in the past - because businesses do not make a practice of keeping employees they do not need, especially those lowly people at the bottom of the wage scale who obviously are unimportant because if they were important they would be making more money.

A full employment economy is possible; there certainly is enough work to do. Every four years, the American Society of Civil Engineers puts out a report card on the US's infrastructure, something I will say on my own behalf I was talking about before most politicians even knew what the term meant. The Society considered 16 areas of concern, such as dams, bridges, and public parks, under four categories: water and environment, transportation, public facilities, and energy.  Eleven of those 16 areas rated a grade of D, with only one getting as high a B-.

So yes, there is a great deal of work to do, but it's not getting done because there is no profit in it for private corporations and the rich are not willing to pay the taxes needed for the government to be able to afford to do it. The pursuit of profit not only keeps us unemployed and underemployed, it threatens our infrastructure and therefore our health and safety by its indifference.

And it keeps us poor.

Poverty in two states - North Dakota and Colorado - is at or below the level it was at in 2007, before the great recession. In every other state, poverty is above the level it was at in 2007. Between 2007 and 2014, median household income for non-elderly families dropped over 9%. Over essentially that same period, specifically from June 30, 2007 to June 30, 2015, corporate profits after taxes went up 37.5%.

Indeed, the pursuit of profit keeps us so poor that some 1.5 million American families subsist on as little as $2 per person per day, a 70% increase since the 1990s, people who are so far on the fringes, whose lives are so unstable, exposed to so many risks, going from one crisis to the next, that researchers said the stories of physical, sexual, and emotional abuse seemed like the norm rather the exception.

Those 1.5 million families include 3 million children, because as the pursuit of profit keeps us poor, it particularly keeps our children poor.

According to a study by the Urban Institute, 22% of US children, more than 16 million of them, live in households with income below the federal poverty line, a figure which itself is absurdly low: The federal poverty line for a family of four is $24,250, and research shows that, on average, families need an income of about twice that to cover basic expenses. What's more, nearly 40% of American children live in poverty for at least one year of their life before they reach the age of 18. And, it shouldn't be necessary to point out but I will, the figures were far worse for black children than for white children. All those children experience unmet needs, low-quality schools, and unstable circumstances that can damage their chances for success as adults.

That, too, is the result of the pursuit of profit. And what really tops this off is that in all too many cases, it's not even that some enterprise, some project that could provide employment and stability to a struggling family, is not profitable, it's because it's not profitable enough. It's not that the corporations can't make money, it's that they can't make as much as they want. Because the drive for profit, the thirst for profit, even overrules profit.

If we are ever to build a just society, or at least an economically just society, a minimally just society,
- a society in which there are jobs, decent jobs at decent pay for everyone who wants one,
- in which yes, there may still be rich but no one will be poor,
- in which yes, there may still be McMansions but no one will be without a decent place to live,
- in which yes, there may still be those who will indulge in various nips and tucks and facelifts and the rest of the vanities but no one will lack for adequate health care,
- in which yes, there may still be those who can pop off to Paris for the weekend but no one will lack for the means of travel and the opportunity for recreation and the arts,
- in which opportunities for life-long education will be freely available to all,
then we will have to accept that our economy, even our society, is built on a false premise, a premise that says profit is a goal rather than the very most it properly can be allowed to be, which is a means.

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