In his quest of make the University of Kentucky a top twenty research university, entrepreneur-turned-university president Lee Todd appeared before the Appropriations and Revenue Committee in Frankfort last year pleading for money. To bolster his case he referenced Thomas Friedman’s best seller “The World Is Flat” as if everyone in the room accepted this defense of capitalism’s global reach as the word of God. Kentucky must interact with the fast changing international market, according to Dr. Todd, by building a world-class university to serve the needs of corporate globalization.
Not so fast, says Dr. Fred Goldstein, author of the recent “Low-Wage Capitalism: Colossus with Feet of Clay.”
Goldstein’s well-researched work offers a clear understanding of what has lately counterpunched capitalism, leaving it sprawled on the mat. Much of the current pain we are all feeling, according to Goldstein, is related to three major shifts in the last twenty years: the collapse of Communism, the free hand of corporations and the lack of leadership and focus among workers.
With the fall of the Soviet Union and its satellites as well as the transformation of China since the late 1980s, the globe’s supply of workers exploded. Over 1.5 billion workers entered the work force exerting downward pressure on wages and working conditions for U.S. and Western European workers.
The big corporations, which control much of the flow of legislation in Washington and other major Western capitals, responded to the swelling ranks of workers by pushing down trade barriers, sending work to the least expensive sites on earth, regardless of the human and environmental costs. The corporate titans have gotten very rich and the workers are left to underbid each other for sinking wages and diminishing benefits.
The resistance to the collapse of the barriers has been minimal, according to Goldstein, because the workers are either not organized or lack leaders with enough bravura to challenge the power of corporations.
Goldstein is not kind to union leaders, accusing them of caving in to corporate demands time and again, leaving the workers with massive layoffs (the UAW membership went from 725,000 in 1979 to 178,000 in 2008, prior to the shutdowns announced recently by GM), or, for those who remain, smaller and smaller pieces of the pie.
Belief in the right to a job as well as rights to healthcare, a house and a living wage frame the arguments in Low-Wage Capitalism. These rights, according to Goldstein, supersede the hunger for profits of corporate leaders. The current wreckage of laissez-faire capitalism makes reading this book timely. One comes away with arguments not heard in mainstream America. For confirmed believers in the free market system, like Dr. Todd, this book offers challenging ideas that need an airing, if for no other reason than to force a reexamination of what most of us take for granted as the “way things are”.