When there are cuts to be made in America to help the economy out of a slump, you can be sure the cuts will be made on the factory floor and not in the offices upstairs. There are a lot of reasons for that, but I like Kathleen Parker's suggestion at the Post this morning: we need a perp walk.
Meanwhile, same-old-same-old chugs along tinnily at Detroit. The Post's Steven Pearlstein writes:
Last week, General Motors and the United Auto Workers announced agreement on a new two-tier wage structure that would allow the automaker to produce its next-generation subcompact car in Michigan rather than in South Korea. Sixty percent of the workers at the Orion plant, those with the most seniority, would continue to be paid $28 per hour, while the least senior 40 percent would have to settle for $14. For the company, that works out to an overall 20 percent reduction in wages.
This story provides a interesting prism through which to think about the U.S. economy.
The fundamental economic challenge facing the United States is to get what we consume more in line with what we produce after years of living beyond our means.
Obviously there are two ways to correct this imbalance - increase production or reduce consumption - and given the magnitude of the adjustment, it's likely we're going to have to do both.
Why should the guys on the factory floor take the cuts while their bosses are doing better than fine? We-the-people are beginning to realize that top CEO's aren't so much more brilliant than the rest of us, just luckier and better protected. After all, this year they've been given full license to buy elections.
Jena McGregor, also at the Post, hints that the imbalance these cuts reveal, can't go on forever.
The collective executives of Wall Street are on track to pay their employees $144 billion, shattering the record payout for the second year in a row. Their defense? What else? "If they don't adequately compensate employees," banks told the Wall Street Journal, "they risk losing top talent."
That implies, of course, that individual performance, skill and talent is what generates the increasing revenues for these companies. This, after all, is the bedrock upon which all performance plans today are based, both inside and outside the confines of Wall Street's canyons. "Pay for performance"--the mantra of CEOs, directors, HR executives and pay consultants the world over--starts with the assumption that employees have control over how well they perform, and that individual performance is a result of innate talent and irreplaceable skills.
But what if they're really just more lucky than good?
"Lucky" like having their job depend on a compliant board of old college or industry friends? Lucky because the rules about cheating are looser at the top than at the bottom? Lucky because they own more of Washington than the rest of us put together? Something like that.
Kathleen Parker goes to the movies. No, not the latest Gecko. She is impressed by Charles Ferguson's latest film about the crash and its origins.
The most forgiving American will want to seize a pitchfork and march on Wall Street. Or Harvard Square. Or in front of the White House. There are so many despicable parties, it's hard to pick a favorite. Is it time to reconsider the Axis of Evil?
She's being a little humorous but perhaps not so much. This documentary evidently knocks both government and big finance right out of the park.
...We see that the same people who created policies that ultimately led to these abuses are still -- or were until recently -- running the show. Notably missing from the film, declining to be interviewed, are Larry Summers, Tim Geithner, Hank Paulson, Alan Greenspan and Robert Rubin.
This is not to say that what benefits Wall Street necessarily hurts average Americans or that all bankers are corrupt, but the system clearly enabled the abuses that have led to current circumstances. The attitude seemed to be that everyone was doing it.
America keeps being urged to retain some tolerance of the people at the top. That's just the way capitalism works. After all they...
After all, they've been getting away with it for years, so why make a fuss now? You some kind of socialist or something?
You'd not be wrong to conclude that there is a direct line between Bush's lies, wars, and lavish spending and the early days of the anti-Washington tea party movement.
There is something that could help take the aggression and frustration out of our partisan politics, though. The left has known it for years (and is disillusioned by Obama's inaction). Kathleen Parker say it straight out.
The film is so well done and presented so factually that no Hollywood prodding was needed. Anyone who sees this movie will be furious. Thus, the only remaining question is why some of these people aren't being prosecuted for fraud or at least shirking fiduciary duty.
It would seem as never before that the White House should hire a special prosecutor. Ferguson's movie, which the president and his economic team had best watch -- and soon -- could use a sequel: "The Perp Walk."
We can afford to lose some of the worst political perps from both major parties along with the worst of Wall Street. Bring 'em on! Nothing like some effective prosecutions and punishments dealt out to the most "untouchable" of the perps at the top to bring the angry right and the angry left together in one giant, national sigh of catharsis.
