Citizen Action Monitor

In a crisis, will elite decision makers act in your best interests? Here’s how to tell.

No 109 Posted by fw, January 30, 2011

“I would like to see the rich suffer even more and — and the politicians suffer even more. . . . because they would then be motivated to solve all our problems, and they wouldn’t have the sense that, ‘It’ll be okay for us.” Jared Diamond, in a Feb. 13, 2009 PBS NewsHour interview (A streaming video and transcript of this fascinating 4:28 minute interview is accessible here: Society’s ability to weather crisis largely depends on leaders’ positions).

(Jared Diamond is a Professor of Geography best known for his book, Collapse: How Societies Choose to Fail or Succeed (2005). It examined a range of past civilizations in an attempt to identify why they either collapsed or succeeded, and considers what contemporary societies can learn from these historical examples).

The question that eventually prompted Diamond to utter the startling statement cited above in the 2009 interview, was this: “Of all the cultures you’ve studied that have tried to deal with severe economic dislocations, what’s the marker of resiliency?”

It’s the elite decision-makers that determine happy versus unhappy outcomes

“It seems to me that one of the predictors of a happy versus an unhappy outcome has to do with the role of the elite or the decision-makers or the politicians or the rich people within the society. If the society is structured so that the decision-makers themselves suffer from the consequences of their decisions, then they’re motivated to make decisions that are good for the whole society, whereas if the decision-makers can make decisions that insulate themselves from the rest of society, then they’re likely to make decisions that are bad for the rest of society.”

Compare crisis reactions in New Orleans and the Netherlands

“One could ask, why is it that, for 10 years, people around New Orleans dithered and they wouldn’t adopt these plans for a few hundred million dollars to build the dikes? And part of the reason is that there’s geographic segregation in New Orleans, where the rich people live on the higher ground and knew perfectly well that they were less exposed to problems from flooding. There aren’t any mansions on top of [Netherlands’] dikes. Everybody is living down below in the polders. And they know — the politicians and rich people know that, if the dikes failed, they would drown.”

When pressed to make his own economic prediction of “what’s going to happen”, Diamond replied:

“No . . . because it depends so heavily on peoples’ choices. And I don’t know what people are going to choose to do. I don’t know, for example, whether Obama is going to be able to pull the country with him or whether quickly we’re going to revert to infighting and a stalemate. People often ask me to make predictions, and my usual answer is that it depends upon the choices we make, and I don’t know what choices we will make.”

It’s two years later and Obama has made his choices

Today, almost two years later, the evidence strongly suggests that Obama has made his choices — Wall Street over Main Street, Big Corporations over Small Business, and the wealthy-and-getting-wealthier over the poor-and-getting-poorer. And clearly, the Republicans and Democrats have reverted to infighting.

Elite decision makers continue to be insulated from the rest of us, says U.S. economist Simon Johnson

“Many of the people who control the world’s largest corporations are quite comfortable with the status quo post-financial crisis. This makes sense for them – and poses a major problem for the rest of us. The thinking here is fairly obvious. The CEOs who provide the bedrock of financial support for Davos have mostly done well in the past few years. For the nonfinancial sector, there was a major scare in 2008-09; the disruption of credit was a big shock and dire consequences were feared. And for leaders of the financial sector this was more than an awkward moment – they stood accused, including by fellow CEOs at Davos in previous years, of incompetence, greed, and excessively capturing the state.” Simon Johnson, in his article: Davos: Two Worlds Ready or Not, truthout, January 29, 2011.

Johnson points to “gap between CEOs’ world and the real world”

“The gap between the CEOs’ world and the real world should be bridged by the official sector. But where are the politicians and government officials who can explain what we need and why? Who can confront the CEOs in the highest profile public forums, and push them on the social responsibility broadly defined? . . . To the extent the U.S. or eurozone official sector showed up at all, it continued to demonstrate the deepest levels of intellectual capture. The reasoning seems to be: As long as we do what the big banks and big firms want, everything will turn out all right. . . . Corporate Davos was borderline exuberant.

Even if a deeper crisis looms, does the global business elite really care?”

Should the rest of us be worried? You betcha!

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This entry was posted on January 30, 2011 by in leadership, sustainability and tagged , , .
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