Progressive Capitalism
JACK
One of the great issues today is the American addiction to oil, and what is happening as the price climbs and we seemingly have no control over how high it will go. When President Bush took office the price of oil was $17 a barrel. We are now paying over $140 a barrel. This has had a tremendously negative effect on our economy, and has brought many Americans into an emergency mode. It has become a question as to whether we can put as much gas as we want into the car, or whether we can buy food, medicine, clothing, etc. We are stunned by the massive profits of the oil companies. In the last reporting period Exxon reported the highest earnings of any company in the existence of the world. We can only guess at the amount of money taken in by Saudi Arabia and other large suppliers of oil.
President Bush makes the blanket statement “we are addicted to oil,” as he shrugs his shoulders helplessly. In my mind, every administration since President Carter is responsible for getting us into this current mess. It’s amazing that in our democracy after some 40 years of complaining, we really have done very little to improve our position. Many solutions have been proposed, but in 2008 we are more victimized than ever.
Last week, I heard somewhere a proposal that we go to a 4-day workweek. It makes sense to me since as we enact this kind of program we get immediate relief. There are millions of cars that are used for people to commute to work, and they use millions of gallons of gasoline. Just think of the massive improvement if we can take those numbers down by 20% merely buy changing our working hours. The state of Utah is about to go to the 4-day week, yet I have heard nothing else about this program, which has been under examination in certain quarters for more than 30 years.
HILLARY
I find this concept fascinating. I can’t think of anyone that I’ve ever worked with that wouldn’t rather work 10 hours four days a week versus 8 hours five days a week. When I would discuss this with co-workers I never thought that it would help the environment, and conserve gasoline too. It seems like a no brainer from the employee standpoint, but what about employers, Jack?
JACK
As an employer, I see no reason why it cannot be structured to work for the benefit of the company. As a matter of fact, I can see many ways that it would reduce costs and improve productivity. I recently heard an expression from Joel Silberman, a good friend and a media consultant. Joel coined the phrase “Progressive Capitalism”. These two words brought together encompass my old feelings of the need for a progressive agenda with a practical business base. In infers to me we can create a concept that embraces our capitalistic way of life that has produced the highest standard of living in the history of the world. It sounds like an oxymoron, but the words “progressive” and “capitalism” can fit very nicely together to produce an even better standard of living for all people. An idea like the four-day workweek would fit within the scope of many ideas that would contribute to a higher and a healthier standard of living. There is nothing wrong with making a profit on a concept that benefits every body.
HILLARY
Do you have any other ideas of what could be done to help our citizenry in your Progressive Capitalism model?
JACK
It is hard to be an instant genius, but I can certainly think of the many companies with which we have all be familiar over the past few years that have had great success and are of continuing benefit to its work force, customers, and management. My definition would include such well-known companies as Google, Apple, and Microsoft. Their position in the commercial world have helped to make the American economy as powerful as it is, without destroying anything in the process. These three immediately come to mind, but I’m sure that there are thousands of others whose model we can follow. These are companies that found a huge need and were able to structure the answer to fill that need. Instant information, immediate communication around the world, and innovative software are American in concept and execution. Successful American business operates to provide a profit for its stockholders, a user-friendly working place, and products and services that are needed.
I would really love to see a new President harness the creative juices of people like
Larry Page, Steve Jobs, and Bill Gates. And I would classify all of them as Progressive Capitalists. My years of experience tells me that these ideas do not have to be original and I make no such claim, they just must be pertinent to the time in which we live.
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You are making this much more complicated than is, since it’s simply a matter of oil supplies being unable to keep up with demand, mostly because of a long history of “progressives” enacting policies that reduce energy production (e.g., fighting nuclear power, preventing more refineries, barring drilling in desolate Alaska, etc). Higher prices will spur demand for alternate sources of energy when the they are more cost efficient than oil.
As the price goes up, the market will self-correct, as demand will diminish (all around the world, not just in the US). Conversely, most “progressive” policies — since they are economically illiterate — have the unintended consequence of driving up demand, which raises prices. People have already altered their behavior, and are taking fewer and shorter trips. Plus, the SUV market is dead. Why anyone would purchase a gas guzzling car — even two years ago — is beyond me, but why should we care about their stupidity? Why is it our problem that other people make bad economic decisions?
The price of gas at the pump has almost doubled since the “progressive” Pelosi congress took over. One reason is that they have no desire to address the underlying problem of supply, in the hopes that high gas prices will translate to even more power for them and their economically retrograde “progressive” policies in the fall election.
Thus, the Pelosi congress have now abandoned all plans to bring energy legislation to the floor of the House. Why? For fear that any effort on their part to offer energy legislation would be met by Republican amendments to permit domestic drilling for oil and gas, and actually address the real problem of supply.
This would force Democratic Congressmen to take a position on whether they want to do something serious to bring down the cost of gasoline, as an overwhelming majority of Americans want. The Democrats are locked into a blind, ideologically-driven opposition to doing what is necessary to meet America’s energy needs. Some things never change.
Curious George 07/11/08 @ 8:44 amAlso, oil companies make, what, only 8 cents on every dollar of revenue? I’m wondering if you would be willing to put your money where your mouth is, and give to the government any profit your company makes in excess of 8%? If not, why not?
Also, there have been years when oil companies didn’t turn a profit. Should the government subsidize them in order to make sure that they neither make “too much” or “too little” money?
Curious George 07/11/08 @ 10:03 amThe theme of Progressive Capitalism seems to be the inverse of Charlie Wilson’s famous dictum that “what’s good for General Motors {or Electric, I forget which} is good for the country”. PC maintains that what is good for the country is good for business. Greed alone cannot dominate the marketplace. The price of oil is a good example. The cost of producing a barrel of oil has not changed significantly in the past few years and yet the selling price has gone though the roof. The price reflects what the producer can get from users who have no alternative. In a PC economy there would be some regulatory body to prevent a monopolistic producer from gouging buyers, which in the long run will work to the detriment of the producers as the users will eventually either find alternatives or resort to violence (i.e. Iraq)to insure an adequate supply. Limiting uses such as a 4 day week is a good way to reduce demand and to allow users to deal with the high gas prices but I do not see it as helping to lower prices which are arbitrarily determined by the producers. In the absence of alternatives we need some sort of global regulatory body to stabilize prices , production and allocation. It is better than war.
David Braun 07/11/08 @ 11:21 amI would add that it’s a generally accepted fact that increased oil drilling will not lead to reduced gas prices - and certainly not in the short term. Most estimates indicate that it would take about 10 years before any resources obtained from new drilling could be turned into productive gasoline. Plus, the amount produced would not last long enough to be worth the trouble.
I would also take issue with the fact that someone who buys an SUV - or otherwise uses excess amounts of gas — does not effect the rest of us, and only displays their own “stupidity.” People who use unnecessary amounts of harmful substances hurt the planet, which harms all of us, and future generations. Instead of INCREASING the supply of these harms, on the hope that it might lower gas prices, why not look at possibilities to reduce the amount of gas we use? Especially when it could have other effects, such as fewer car accidents, more time for people at home with their families, etc. Progressive Capitalism should be applauded.
Scott 07/11/08 @ 12:03 pmHillary and Jack - this blog represents exactly the type of thinking we need during these difficult environmental and economic times. Thank you. I couldn’t agree more with the idea of moving to a 4-day work week. I would, however, add one thought. If we shift people’s hours from 5 8-hour days to 4 10-hour days, while it could help with some problems, it may create others. I would worry about trying to cram 5 days of work into 4 days. With an hour for lunch, people would be at the office for 11 hours. When you add the long commutes that many people have, you are talking about 12, 13 or more hours per day away from home.
I think this could lead to sleep deprivation, fewer time for people to spend with their families. etc. Instead, I would like to see us keep the 8-hour day for 4 days, and have the 5th day be one where employees can work from home.
We are fortunate to live in a day and age where most, if not all, of many people’s job responsibilities can be completed at home. With conference calls, e-mail, etc., people can stay connected from different places. If we can keep cars off the road 20% of the time, it would be a fantastic achievement, and could have long lasting benefits for the planet.
In fact, companies may find that employees could be just as productive, or more so, coming into the office 3 days a week, and working from home 2 days. The greater the flexibility, the happier, and more productive, our work force will be.
Thanks for all of your helpful insights!
Scott 07/11/08 @ 12:11 pm“Oil Falls $9.26 Per Barrel as Bush Champions Expanded Drilling in Speech”
Supply, demand. Present, future. Why, someone could make a mark in this world suggesting these concepts were somehow linked in some fashion.
Just remember: capitalism is about the creation of wealth; “progressivism” — AKA socialism — is about the redistribution of wealth. Which always results in less of it. Put it this way: only in America are poor people fat.
Curious George 07/15/08 @ 6:02 pmFYI, the global warming hoax is falling apart, so there’s no need to worry about that.
Curious George 07/18/08 @ 8:32 amHi guys.
What amazes me most is that it is the very first time that America wakes up. We have been suffering from those energy prices for years with about 1€5 for a liter!
My husband who works in Philly just reorganized the workweek of his cocoa factory, instead of having them turned seven days a week, people work only five days a week so it is less expensive for them to go back and forth from home to work and it is less expensive for the company as well. so it is a win win situation.
I do think that Mr Bush’s friends (remember the beautiful family pictures with him and the Bin Ladens after 9/11?)in the oil industry has work a big deal to find a way to help them. That has been and still is the only thing he has been doing, helping his friends in all types of industry, look at what happened with the SUV lobbyists. Once again they won whereas American scientists proved to Mr Bush that the environment, OUR planet, HIS daughters and HIS grandkids to come is in danger, but hey, don’t listen and don’ care….
I think it is sad of course for countries like China or India which are starting an amazing industrial development, not to take into consideration the environment BUT it is not sad but Inadmissible for a country like the US not to listent to its own environmentalists and scientists who are screaming that our planet is in danger and to take the necessary measures that needs to be taken!
kisses from Paris.
Sophie Morel 07/21/08 @ 1:32 amsoph
I am delighted with the action and the comments on Progressive Capitalism.
First to Curious George, your comments show that you are more of an ideologue than a pragmatist. I can never agree that progressive and socialism are the same thing. I am a card carrying capitalist. Your comment about the oil companies ONLY making 8 cents on every dollar has no meaning. I have been in businesses where 5% profit was excessive (brokerages of all kinds) and 15% was too low because of excessive risk. The real profit yardstick is on investment and risk. So in answer to your question, I think a total of 40 billion dollars profit for Exxon when the average American has to pay over $4 a gallon for gasoline is excessive. Exxon then spent 32 billion dollars to buy their own stock rather than put a sizable percentage of profit into exploration.
I appreciate your comment, Soph, and once again as stated above, there is a great variation by industry. I like your husband’s idea of the work week at the cocoa plant. I have absolutely no excuses to make for Mr. Bush’s attitude toward the Bin Laden family.
Jack
jack nadel 07/21/08 @ 11:15 am