Monday, February 18, 2013

Separating Power from Privilege: Making Education Count (Part 1)

     We are living in an unusual time, where failure that makes powerful people more wealthy is presented as success, protected, even promoted at the expense of everyone else. This system is shrouded in a complicated web of policy accessible only to the inner circle of powerful people enjoying the greatest benefits of the system. Even our supposed regulatory agencies have executed their duties in a weak, toothless manner.

     A NY Times article from 2010 describes the unapologetic attitude of the investment pros that sank our economy and had the gall to shrug it of with something like "Hey...ya' pays yer money and ya' takes yer chances!" Especially aggravating was Lloyd C. Blankfein, unmoved by the knowledge that investment employees of Goldman Sachs knew the investments they actively sold were lousy, that there were G.S. employee  emails on record where they used expletives to describe how bad these investments were, and at the same time the firm made lots of money selling them. Mr. Blankfein made G.S. sound like a model of customer service: providing the opportunity for big risk/big reward (while not owning up to pushing big loss for their own big gain)

    It's understandable that the overall grease on the wheels of our economy is provided in part by the willingness of investors to support great ideas, great businesses, growing industries. Their activity can grow the economy, communities, and realize a return on their investment.                                                                             

Now we have a lot of work to do explaining to people what it is that we do." 
(Blankfein, With Charlie Rose, 2010)

     Sadly, in the recent downturn, the values and rewards were overly speculative and appear to have been ginned up by firms like Goldman Sachs, with the rewards (the money collected-in some cases from pension funds of regular Janes and Joes) going to the firm itself. While most of the country had been knee-capped by the games of the well to do, and while even in good times a 4% raise in wages was pretty decent for your average middle class salaried worker,

Goldman Sachs CEO Lloyd Blankfein received total compensation of $16.1 million in 2011, a 14 percent increase from the year before.

      To be fair, his SALARY was really only $2 million, with a $3 million bonus, and the rest in stock ($10+ mil) and various necessities (a car AND driver, incidentally at more than I make after 13+ years in public school teaching) including personal security. 

      Most interesting is the fact that Mr. B.'s security costs doubled from the previous year.  Something to be nervous about in that industry? Besides the money situation, anyway. THAT seems to be working out pretty well for them. 

      So why have public employees, public pensions, public schools...basically the public become the target of reform in recent policy? My guess is that the powers driving policy (investors/lobbyists) have more or less bled us. Their willingness to return to the country and society that made THEM wealthy has waned as they seek other opportunities to satisfy their insatiable greed, and they will happily sacrifice us all. To them the WORLD is their oyster and we are all just chowder.

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