In my blog of December 9, 2010, I pointed out how our capitalist society suffers from dramatic up and down cycles that rob the middle class of their wealth and earnings. I suggested 10 points that would very much moderate these cycles and bring about a far better capitalist society. This is the 6th of that series.
Point # 6 We Have to Fix Capitalism
The duties of persons leaving the private or the public sector for the other sector.
There seems to be little understanding of the difference between earning money as an individual, and the selflessness of serving in the public realm. The definition of when a person can shift from one sector to the other, and the obligations of a person to the sector he/she is leaving have escaped us. The result is bad policy that protects the status quo.
How Can Government Attract the Best and the Brightest
This is a difficult subject. On the one hand, the private sector produces the best and the brightest and government always needs people of this caliber to help govern the country, to create appropriate laws and regulations.
These people understand the sectors from whence they come. They have insight into what is wrong and what is right. They know what to implement to bring greater prosperity to the country and to the world.
Yet there is something wrong with the morality of how this is done.
An Issue With American Culture
Perhaps it is the American culture that notionally encourages each individual to seek as much gain as possible. Perhaps it is the lack of stigma that attaches to people that move to Government and then back to private industry, and use their government contacts to enrich themselves.
Here is the problem – when a person moves to a government post, he/she knows they will be in great demand by the private sector when they finish their government term. They cannot afford to alienate those people that they govern when they are in the public sector. They will in a few short years, be again working side by side with those very same people.
Outrageous Executive Bonuses Rewarding Inappropriateness
Abuses occur, and some of those abuses are astounding in their magnitude. A recent example is the bailout of the financial institutions with the public’s money and then the chutzpah of the financial executives to give themselves enormous bonuses. You and I know that the bonuses were in reality, a bonus for screwing the government and the people out of enormous sums of money.
The people in government who authorized these enormous payouts, were former, and future executives of those companies receiving the payouts. Yes – shake your head. It is quite remarkable in its obscenity.
The capitalist system encourages these types of abuses. In this particular case, I do not have a clear answer as to how to stop these abuses. I would like to say to people – have a look at your own standards of morality. You should scorn people that move freely between the sectors only to protect their buddy’s interests. They should be reviled like O J Simpson, like Bernie Madoff.
A Moratorium on Service
At a minimum, there should be a moratorium of time following government service, when a person who has moved to a government position, cannot return to the private sector.
A Pension Reward
Perhaps government should provide a full 5 year pension at an attractive rate, with the provision that the person in order to get this pension, cannot rejoin the private sector in any capacity for those 5 years.
Making Money Without Shame
In some cultures, executives fear public exposure and the shame of exposure. In America, there is little shame of success, regardless of how achieved. We eagerly buy books written by convicted felons. We seek out the companionship of famous people even if that fame came from notoriety – think of O J Simpson, or Michael Jackson.
Perhaps our society is too diverse to have a historical culture that causes us to avoid people that have been shamed.
Oh well, this is a problem that is difficult to address.
Point #7 of 10 comes soon, and it is much easier to cure. Our society exists because the economy produces income and this income is taxed by the government. The proceeds of this taxation creates society as we know it.
We punish petty criminals. We honour those that cheat society by illegally using so-called tax havens. More to come.
