Don’t Pee on Me and Tell Me It’s Raining: Why Trickle-Down Economics Doesn’t Work.

The concept of trickle-down economics has been around for years.  Its precepts are usually trotted out whenever a government is announcing huge tax-cuts to big business and the rich.  The basic idea is that companies who have more profit will spend that profit increasing the business, thereby creating jobs and improving the economy.  It works like this:

Mom and Pop own a store, which they work themselves, struggling to survive.  After a few years, profits are up, and they hire some help, creating a job.  After a few more successful years, they now have a staff of 4 (not counting themselves) and add a deli counter.  A few more years of growth, the store has become a neighbourhood supermarket employing 20. 

But now they are in a new tax bracket, which means that they cannot add the bakery this year.  In fact, it takes them 5 years to save enough to add the bakery.  The pro-tax-break people suggest that if business taxes were lower, that bakery could be added now, creating another 5 jobs.  And next year, the butcher shop.  Then the gift store.  And so on.  More profit means more money for growth and more money in the community.  After all, Mom and Pop don't want to work so hard if they can hire others.  They want to give little Tommy a summer job so he can go to university.  They like being an essential part of their community.  If they have lots of ready cash, why Mom and Pop would have the biggest store in town, employ hundreds, and stimulate the local economy!

That’s the argument.  And, as far as that argument goes, it is more or less correct.  People like to be a part of their community, want to be successful, and will turn profit into growth.  At least, Mom and Pop will.

The same is not necessarily true for big business.

Let’s say Mom and Pop have had a great business life.  They now own ten stores employing a thousand people.  Managers have been hired, so Mom and Pop don't have to work so hard.  Still, life is getting on and Mom and Pop would like to enjoy what's left of it.  So they sell their business to a national grocery Chain and move to Cottage Country.

Then the same old story continues: Chain 'consolidates' their operations by closing five of the stores and letting go 500 people, arguing that this improves their business.  Chain argues that the area really only needs five stores anyway and in reducing waste, they can provide better service.  Profits are put towards building a new, bigger store, with a restaurant and gym.  Within a few years, Mom and Pop's ten stores have become a single big-box retailer.  1000 Employees have become 150.  The promised restaurant and gym are delivered by renting space to other existing chains.  Profits are high but Tommy can't get a job.

We have seen this time and again.  The proponents of trickle-down theory use Mom and Pop to justify the plan and their logic is sound, but the effects don't ever appear to meet expectations.  Opponents to the theory never seem to be able to explain why things don't work out; at least, not in the same simple terms used by proponents.

That reason, however, really is very simple: community.

Mom and Pop, no matter how mercenary they may be, still live in the community.  They see the direct impact that their business has, both in serving the customer and in employing staff.  Mom and Pop know that closing a store will have a direct negative impact on their community.  So unless there is a really good, profitable reason for doing so, their business will remain stable or expand.  The profits Mom and Pop earn will either go back into their operations or into their own pockets - trickling back down with their personal purchases of cars, houses, and so on.  Either way, the money stays in the community.

Chain does not belong to the community.  Chain is a publicly traded company.  Its headquarters are far away, the owners are all over the world.  Investors expect to get paid.  Profits are not just for growth, they also pay the shareholders.  The people in charge do not see their impact on the community because they are not in the community.  And neither is the money.

Once ownership passes away from people living in the community, there can no longer be community responsibility.  Owners and shareholders demand ever-increasing profits.  Local services and employment are only considerations if they have an impact on profit.  Money which would have trickled down from Mom and Pop's wallets is now sent to far-away lands, to trickle into somebody else's economy.  Once the community store stops achieving high-profits, Chain will put it on the auction block and not look back.  Chain is out to make money, not friends, no matter how many charity funds it has established.

And that is why trickle-down economics does not work.  A large corporate entity has no morals, no ethics, no responsibility, and no sense of community.  It cannot have those things because it is not a person.

One thing we know works is regulation.  Regulation forces corporations to at least act like they care.  For example, if government offers tax-creaks to companies which contribute to local charities, then by-golly, companies start building playgrounds, buying medical equipment, and writing cheques.  Remove those tax incentives and watch the swing-sets rust.  That is an indisputable fact: corporations only behave responsibly when it serves their interest.

Unlimited growth is not in their interest.  Mom and Pop will roll-over their profits in a quest to become bigger and better and more important.  They get visceral pleasure from being important to their community.  Corporations do not get that pleasure.  They only get profit.  The bigger the company, the less likely it is to expand further, and corporations are massive companies.  They don't want another 1% of the local market if it means losing 2% profit for the next year; 2% less money for their shareholders.  Expecting a corporation to behave like a person is like expecting a rock to fly: pretty silly.  Yet this myth is what we are constantly sold by the proponents of trickle-down economics.

Since they can only adequately prove trickle-down theory as applied to mid-size and smaller companies owned by individuals, then logic dictates that the tax breaks should go to those companies in order to stimulate growth.  As we can show that big business only acts with community responsibility when regulated, then any tax breaks applied to corporations should reward for community action.  Rather than giving tax cuts in the hope that big business will create jobs, why not give breaks for the jobs they create?  Give breaks for charity, employee profit-sharing, money spent within the community.  Apply tax penalties on funds transferred out to corporate head-quarters.  Reward good behaviour; penalize bad; just as you would teach a child to become a good person.  Giving rewards and expecting the corporation to figure it out on its own is no way raise a good corporate citizen.

On Exposing the Vancouver Rioters

(This was sent to Cross Country Checkup today.) 

The issue of naming rioters has become convoluted because of the shaming.

Initially, the point of posting videos and pictures online was to identify riot participants.  That is a perfectly reasonable response by Citizens who watched the G20 riot last year.  Canadians watched as those who looted and destroyed property went unidentified; observed the number of ‘responsible’ people who stood by and let such destruction happen.  During the past year, we have become more aware of a ‘somebody else’s problem’ attitude rampant in our society, where we expect the police to do all the work and blame them for their lack of success.

The posting of these images as an attempt to identify participants is a good way for Citizens to help our police do their jobs.  As citizens, we are not only entitled to look after our communities, but we are also required to do so.

Shaming, on the other hand, is taking control back from our trusted legal institutions.  It is too easy for a picture to be misinterpreted and incorrect conclusions drawn.  The Riot Couple appeared to be engaging in sex when in fact, the woman was injured and her boyfriend assisting her.  This is why we have experts to investigate.  The gathering of information by the public is helpful, but leave the actions to the experts so that justice will be served and we will live in a fair society.

Regards,

Jeff Rose-Martland

President

Our Duty

Longtime-Nowrite: Why I Suck At Blogs

It's now becoming July and it's been ages since I wrote anything on here.  Not that I haven't been writing, just that I have been writing elsewhere.

As every writer will tell you, if you are actually writing-writing, that is, work writing, then you don't have much creativity left for updating blogs.  Add to that my work with Our Duty, veterans, the election campaign, and about a dozen different things, and finding inspiration for a blog is very difficult.

Also, I have never quite been sure what the point of a blog is.  Surely, no one is interested in my minute-by-minute day (and those that are can watch me on facebook).  I'm not much of a journal keeper and mostly my inspired rantings wind up in my writing.

But lately I have found a need to express my opinion on a bunch of items in the news, my thoughts of Canadian society, and generally do some soap-box ranting.  So what better place for that then here?  (I think I may have figured out the point of a blog after all).

So there will be some posts coming (until I get busy elsewhere again, I suspect).

Women's Group Blocks Equality

Ref: CBC's On the Go

Here's some information about me, to give you an idea where I am coming from: I was raised by two working parents, where both cooked, both did housework, both did home repairs, both chopped firewood. There was no 'man's-work, women's-work' in our house. There was just work. I have worked side-by-side with women and men in retail, warehouse, technical theatre, broadcasting, and call centres and throughout that work, it has never even occurred to me that there is a difference between the sexes, as far as work is concerned. Physically, I have worked with strong women and weak men. I have worked with creative men and non-creative women. What has always mattered most to me is a person's ability to do the job, not their gender.


Currently, I am a stay-at-home-Dad (homemaker it would be in game show land). My wife works; I look after our son.

On The Go interview with Daphne Hart of the Women in Resource Development Corporation

Things to listen for:

Ted's statistics about women earning less than men. The comparison he cites is for full-time employment, i.e., men working 40 hours a week earn more than women earning 40 hours a week. The implication of this statistic, as cited, is that women earn less than men for doing the same work. In fact, this disparity does not arise directly from gender differences, but from job differences. The fields in which the majority of women are employed - retail, clerical, caring professions - are lower paid careers. Men working in those fields receive exactly the same pay. Some content that these job are low-paying because they are traditionally women’s work. Others, me included, maintain that this is because, as a society, we do not value that work. But whatever the cause, Ted's presentation of those statistics is misleading and implies widespread gender bias where none exists.

Daphne's anecdotes about women being passed over in favour of men, implying that this is something that only women face. Daphne's presentation focuses on how to get women working in skilled trades, with statements implying that men don't want women on the job site and that companies don't want to hire them. What she totally neglects is the lack of women going into training for these trades. While she doesn't actually use the word 'equality', she clearly sends the message that women are being kept down by men. She also clearly says that companies need to prioritize the hiring of women. In other words, hire women because they are women. Is that not every bit as biased as not hiring them because they are women?


My Reaction

NOTE: When I was listening to the On The Go interview, I was taking the snowblower to my driveway. So initially, I wasn't paying rigidly close attention to Daphne's message. Second, I didn't actually catch her name or her groups name. After the fact, I couldn't find out either, but I assumed the speaker was with Women in Non-Traditional Employment Roles (WINTER). Obviously, this is incorrect, but I don't feel it negates any of my arguments.

If you want a specific comment for WDRC: presumably most of the administrative assistants in Resource Development are women. What is the WDRC doing to encourage more men to enter that field?

Ingrid Fraser reads my email

(And does an amazing job with it!)

Text of Email:

Dear Ted,


I listened with interest to your interview regarding Women in Non-Traditional Roles. And, I must admit, with a certain amount of disgust.


As long they focus solely on one gender, this organization is actually perpetuating inequality. They are drawing a line between women and men, continuing the gender division, not eliminating it. If they are serious about equality, then what is this organization doing to promote men in non-traditional roles? Does the organization think to promote the cause of men who wish to be nurses, or kindergarten teachers, or daycare workers, or florists? Or are they operating on the assumption that a man can get any job he wants?


If so, then they are very mistaken.


I myself have been denied jobs in service and retail sectors because they only hire women. Gender bias goes both ways. My son’s kindergarten teacher is male and interacts wonderfully with the children. Yet his colleagues are almost apologetic when discussing him. Their tone, and sometimes statements, say ‘Yes, the teacher is a man, but he’s a good teacher,’ as if this is a shameful fact or his gender needs to be justified to some.


We, as a society, can not truly embrace equality so long as groups such as this one continue to divide us by our gender. If this organization was actually working towards equality, it would be called People in Non-Traditional roles.


Best Regards,
Jeff Rose-Martland


The Following Day...

According to Ted, my email helped set off a 'firestorm of reaction'. The call they played, apparently supporting me, didn't. It was a guy who seized the opportunity to rant about how everyone would like to stay home with the kids but men have to go off to Alberta and work. Well, I heartily disagree with that. I know plenty of women who hate staying home with the kids. I enjoy it, but its hard work and annoying and not everyone is cut out for it.

Besides, my point has nothing to do with who does what. My point is that if we are truly going to have equality between the genders, then we have to stop thinking of the sexes as different. When sorting job applications, no one should be thinking 'man...woman...man..." no matter what the job is. This should be the goal of these groups: the achievement of equality where all that matter is job skills, not sex. By promoting the advance of a single gender, these organizations stand in the way of that achievement.

Not to mention that should one attempt to start a group dedicated to the advancement of men, I suspect there would be massive hue and cry about sexism and possibly charges for violating the Charter of Rights.

Busy with the Veterans

If you've been trying to follow this blog and discovered that I haven't been updating, here's why:  Since September 2010, I have been involved in lobbying for veteran's benefits.  See htttp://ourduty.org for what I've been up to.  This is a very important issue and it more or less pushed writing to the background.  As I am trying to keep that lobbying separate from my other concerns, there's not a whole lot here about it.

Meanwhile, a new issue has arisen!  See next post.

Peace & War

As most of you know, I've spent much of the past 3 months working hard on the campaign for Veterans' Benefits. It's been tiring but worth doing.  If you want to know more about that, visit here.

I've consequently spent a lot of time with veterans and I've learned several things:
1 - Owing to US media domination and an underfunded Canadian TV & Film industry, we really know very little about our Forces & RCMP - what they do, how they do, where they go, and why. 
2 - A very high percentage of veterans are writers, of varying skill levels, many of them working on books.
3 - Veterans sure do talk a lot.  Unless you have a clear agenda and are prepared to rigidly enforce it, a meeting will quickly disintegrate into a veterans' storytelling circle.

So I've decided to open my blog up to the vets!

Veterans of Canada: tell us your tales!  Tell us about the funny thing that happened that time, or the horrible thing you witnessed, or the things you have thought about, or the places you have been.  Write anything: short story, poem, essay, email, even just a joke.  Don't worry about keeping it clear or family friendly: we want to hear all the dirty ditties and harsh realities of your experience.  Talk about war, about keeping peace, about winter exercises, about domestic deployment, about walking a beat, about getting shot.  The most common statement I have heard over the past few months is "You civilians don't understand."  My counter is this "Us civilians don't know."  So tell us and perhaps we will understand. 

There's no minimum word count.  Try to stick under a 5000 work max, just to keep the posts of reasonable reading length.  You can post here as a reply, or email me: rosemartland@gmail.com with questions, or if you would rather remain anonymous.

Who knows?  If there is enough interest, I may look into releasing them as a book. (In which case, author's would be contacted regarding publishing rights, etc.)

NOTE: Please no VAC horror stories.  This about your service experiences.  You can send yourr VAC complaints to me via Our Duty.

Igor, Turn Out Those Lights, I'm Ready

When we first moved in together, my wife was confused by all the emergency gear I had, a pityful amount at the time.  As I added oil lamps and propane burners, setting aside canned food, she grew concerned that I was preparing for the apocalypse.  I told her, "No, not the apocalypse, but if that happens as well, I want to be ready."

I grew up in the rural community of Hr. Grace, on top of a big hill overlooking the bay.  Very scenic.  Also very windy.  We would lose electricity 3 or more times a year and lose the water at least twice annually.  Our house was heated by woodstove, an economic decision in the energy-crisis 70's; my parents were avid campers - the kind that actually camp, not drive a camper; and my father had inherited some 100+ year old oil lamps, from back when they knew how to make such things.  So when a storm hit, we were well set up.  Blizzards, hurricanes, or just over-taxed power grid, a few flicks of matches and it was business as usual at home.

After I moved to St. John's, I hadn't given much thought to emergency gear.  The city is more stable, after all, and I was alone.  But during a couple of big storms, I found myself wishing for the security of being prepared.  Rummaging through a box in the dark, trying to find those pillar candles I bought on sale but never used; trying to heat a can of creamed corn with a propane torch (don't do it, there's a plastic coating on the inside of cans which melts and makes the food taste funny); shivering in my bed, realizing that I did possessed neither enough blankets nor candles to warm up the room - all these events made me vow to get better prepared.  So, after I found a steady job and a significant other, I started building up the supplies. 

It was slow at first, a few purchases here and there.  Candles, also used for romantic purposes.  An old kerosene heater conned from Dad when the price of oil doubled over night (he was back on the wood stove again).  A couple of flashlights, a few more blankets, the 'accidently' bought extra canned goods which languished in the back of the cupboard.  I could justify all those purchases without revealing my fixation on preparation.

When I bought the first propane burner, the truth came out.  She demanded an explanation, which I gave.  She didn't understand.  She had mostly grown up in cities and, as her parents were corps officers in the Salvation Army, they never had to face many emergencies without supplies.  She agreed to ignore my preparations, as long as a) I didn't 'waste' too much money and b) didn't start constructing a bunker.

We had a few blackouts after that, but she still didn't really see the point.  She would observe that we could have eaten sandwiches, that the power was only off for a few hours, that the candles were useful all the time.  Then came the X-mess blizzard, when our son was almost 2.  The city was dark for 20 hours.  She was at work when it hit and came home to find me shovelling the driveway.  The house was fully lit, our son safely playing in his pen, hot food and coffee in the kitchen courtesy of the propane burned, house warm and toasy from the kerosene heater.  The following day, she was a convert to being ready.

So when Hurricane Igor hit, preparations focused on preventing the porch from leaking (failed) and coping with the flooding basement (until the power, and, hence, sump-pump, failed).  As dark came on, out came the 2 burner camp stove, hurricane lanterns, candles.  We had a normal meal with boiled coffee to follow, played and read and listened to the battery-powered radio, and went to bed on time, as normal.  But nor before I went next door to check on how our new-parents neighbours were faring.  They were trying to figure out how to heat up formula for their 2 month old.  I returned with my spare propane burner and sorted them out. 

The next day, while our electricity was on, large parts of the city were still out.  She had heard about crowd of people buying flashlights and remarked that it was awful late in the game to be buying that stuff.  And that was the final evidence that she completely understands the my obsession isn't, that it is just good thinking.  We have the basics covered, but I will keep expanding our equipment.  Right now we can get through a couple days, but I'd rather be able to handle a week without problem. 

During times like this, you never want to be worrying about basics.  Being prepared doesn't take a lot of effort or money, just a few purchases here and there.  Here's a brief list, for those of you who want to start getting ready:
1 - Light - flashlights are OK but batteries decay rapidly.  Candles have a much longer life, but make sure you are aware of the fire hazards they present.  Your safest and best solution is oil lanterns.  You can get them for $5-$10 anywhere they sell camping gear and, while they sell special oil for them, they will also burn any flammable liquid.  I once ran mine on paint-thinner. Lanterns have glass-globes protected by wire, making them difficult to break and also have handles so you can hang them up.  More expensive options: propane lanterns, white-gas backpacking lanterns.
2 - Heat - just about anything you burn for light will produce heat, so if you follow the previous suggests, your house will stay tolerably warm.  You can also pick up some wool blankets at thrift stores for $5-$10 each and even threadbare they are great insulators.  They also will keep you warm when soaking wet.
3 - Cooking - you can get a single propane burner which screws on to a tank for around $15.  Tanks are $5. It's difficult to cook anything big on that, however.  They can handle a small saucepan or frying pan and that's about it.  Bear in mind that you may need to boil all drinking water.  The single burner is a good starting place though.  If you can afford the extra expense, you can get a propane camp stove, which has 2 burners and can handle large pots.  They fit nicely on your existing stove top.  If you own a gas BBQ, that will do in a pinch, but you probably won't want to be grilling in a gale.  Of course, if you already cook with gas, this is all unnecessary.
4 - Food, Water.  Shouldn't be too hard to sort, as you are likely to have food in your cupboards anyway, and all that stuff in the freezer will need to be cooked if the power's off for more than a day.  Still, good sense says to have some extras laid in.  Suggestions: canned hams/chicken, stew, mixed veg.  For water, get a big jug of sealed spring water and keep it in a dark place.
5 - Information and entertainment.  Make sure you have a battery-powered radio with fresh batteries or, better still, a hand-crank one.  Keep a few decks of cards or board games around, especially if you have kids.

There's a lot more you can add: power inverters for the car, gas generators, tools and supplies for making repairs, and so on, but that list of basics will get you through most minor events and and some major ones.  Try to keep everything together in the same closet or a large box so that you won't have to go searching in the dark.

Remember, the problem with a high tech world is that it runs on electricity.  Mother Nature doesn't need electricity and doesn't care about your cel phones, video games, or general welfare.  Look after yourself and, hey, look after someone else too.