Very High Quality Bullshit

Over at the Huffington Post I saw a sarcastic headline: Breaking News: The Rich Discover Inequality. I had to take a look. The article was by Jeff Faux, author of The Servant Economy (2012). This is great stuff.

After forty years of rising income and wealth inequality, some of America's rich seem worried that maybe things have gone too far. In a recent New York Times Op Ed (August 9), for example, Peter Georgescu, CEO emeritus of the multinational public relations firm, Young and Rubicon, wrote that he is "scared" of a backlash that might lead to social unrest or "oppressive taxes."

The Times was so impressed with such enlightened views from this prominent capitalist that a few days later they devoted another long article with his answers to questions submitted by readers.

We should, I suppose, be grateful that Georgescu seems to understand that the gap between the rising value of what American workers produce and the stagnation of their wages has channeled the benefits of economic growth to shareholders (and, he might have added, but didn't, corporate CEOs).

But if you are waiting for him and other members of his class to get serious about the problem, don't hold your breath.

We won't, Jeff.

When Faux gets into the details of Georgescu's view of things, we recognize the telltale signs of extraordinary bullshit. (I discuss the prevalence and nature of bullshit in the third Flatland essay.)

Georgescu writes that he would like to see corporations pay their workers a fair wage. But with few exceptions, they don't. He doesn't tell us why, but the reason is obvious — paying workers less has made their owners and top executives rich.

So, what to do?

OK, here we go.

We could, suggests one of his readers, stop the offshoring of jobs, which has undercut the wages of American workers. No, Georgescu responds, that would be "protectionist." End of discussion.

Naturally I wanted to see what Georgescu actually said to compare it with Jeff's terse summary. Here's the relevant Q & A (follow the link above).

Q. Nice to see someone with some ideas other than “let them eat cake”. I would like to add to your list (1. increased compensation, 2. business invest in productivity and innovation) that business should stop sending the work to Asia. — KO, First Coast

A. Very grateful for the question. Globalization and technology create the proverbial two-edged sword.

Focusing on globalization first, we need open markets for our products and services. Now free enterprise is great as a concept but hardly ever is it totally free: Subtle (or not) local protectionist policies or human-rights issues (often appropriate) add complexity.

OK, Jeff Faux is right. Not sending jobs to Asia is off the table. But Peter G. is not done. He changes the subject.

For the last couple of decades, the scale of low wages mattered to the overall cost of production and thus global competitiveness.

Say what? Does that sentence mean anything?

As technology advances, low wages are becoming less critical in the overall price of goods produced.

Ah, I think I've got it! The global economy was built on the backs of low-cost workers, but, now, thanks to technology, we can manufacture cheap goods ... wait a minute! I still don't know what he's getting at.

As a result, we are seeing manufacturing coming back to our shores. This trend is likely to increase. So, in this case, technology is a friend.

Well, at least here we can say that America's alleged manufacturing renaissance doesn't exist. However, we are glad to know that technology is our friend. Or is it?

Your suggestion that companies invest much more in R&D and innovation (presumably, rather than stock buybacks and excessive dividends) is vital to our future competitiveness. Technology takes away traditional jobs, but can create new opportunities, new ways to manufacture or create new or improved products.

And how will American workers take advantage of all these hypothetical opportunities?

So the other critical piece to the puzzle is education. Here I mean more than just four-year college degrees. We also need to teach and train for specific existing and new skills. Trade schools for the young and retraining those who lose jobs is key. Private industry with help from local or state and federal governments will be a vital initiative to both keep us competitive and create the new jobs critical for economic growth and well-being.

Summing up, what did Peter Georgescu just say in response to that offshoring question? He seems to think we can solve our wage disparity problems by cheerleading for the status quo—yes, technology takes away traditional jobs, but it also creates "new opportunities." 

So I guess he said technology will resolve our wage inequality problem as long as people get the education required—take on boatloads of student debt—to take advantage of those new opportunities.

Our understandable confusion about what Mr. Georgescu is actually trying to say here indicates that we are dealing with very high quality bullshit. I decided at this point to trust anything Jeff Faux said about Peter Georgescu. Back to Jeff.

Another reader suggests we raise taxes on the rich. Certainly not, says Georgescu; government is too big and inefficient to give it any more money. And besides, "many wealthy people use their wealth wisely"; their contributions (tax subsidized, he omits to note) "help make this nation a more civilized place."

OK, here's the best part. Are you ready?

So what is our compassionate plutocrat's "free-market" solution?

Businesses he says should get tax subsidies to increase the wages of people making less than $80,000.

In other words government should pay a corporation every time it gives a raise to a low to middle income worker. With a straight face, Georgescu assures us that this would not be "an increase in government support."

And where, in the absence of taxes on the rich and in lieu of government borrowing, which he also denounces, would we get the money for this new program of corporate welfare? A deafening silence.

You can't make this shit up. Really, you can't. The answer to wage inequality is not technology + education, as I surmised above from Peter Georgescu's answer to the offshoring question. That was just some bullshit Peter came up with to rationalize shipping more jobs to Asia.

No, Georgescu wants the government to  subsidize higher wages for corporate workers.

As Jeff Faux said, the New York Times was so impressed with this bullshit that it devoted a Sunday editorial and a follow-up Q & A to this policy recommendation. This is the highest quality bullshit there is. The word "self-serving" doesn't even begin to describe it.

Jeff Faux finishes up.

Despite all the hard thought and study Georgescu claims he has put into this problem (he's writing a book on it), he is also silent on the central role that his own corporate class has played in undercutting the bargaining power of the majority of Americans who work for a living. For these past four decades, CEOs have waged a relentless political war against trade unions, minimum wages, labor market regulation and public sector programs that in the past helped offset the natural advantages of capital over labor in a market economy.

Georgescu is thus a prime example of the liberal rich, who would prefer to see a somewhat fairer society, but not if it requires any reduction in their own wealth and privileges. And, if in the name of fairness, their corporations could tap into another vein of cash at the U.S. Treasury, so much the better.

It's easy to see why Georgescu was in the public relations business. Getting the Times to give him all that free space was a piece of high-class P.R. But do not be fooled; it's mostly B.S.

Whaddaya mean "mostly" bullshit, Jeff?

For the true aficionado of bullshit, Georgescu's "arguments" are like Michelangelo's Sistine Chapel—an unsurpassed work of art. Not only did Georgescu fend off various existential threats to America's corporate hegemon, but he also suggested (reasonably enough for the New York Times) that the government further empower it. This is simply breathtaking.

Here you can see why I think Homo sapiens is hopelessly and terminally confused. Humans bullshit mindlessly and spontaneously, and have no idea what they're doing or why. That's just the way it is.

I'd try another planet if there was one.

Comments

[Alexan der Ac]

Hi Dave,

sometimes,it confuses me how is it possible, that we have built quite a complex society working at so many levels... but at the same time, with so few conscious people who see further than the tip of their nose?

How was that possible? Isn't the precondition of a complex society some kind of deep insight into the human nature? or is it really just about the ability to outperform someone else for own's purposes?

If humans were long-term planners with altruistic nature, could the planet and us survive together a bit longer?

Best,

Alex