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A lot of people are talking about inequality

InequalityThere has been a spate of articles about inequality, even from a food commentator in the New York Times. The gist is that during the last 30 years (since the 80’s, if not even the 70’s), most of the economic gains went into the pockets of the wealthy. Then, since the 2008 Great Recession, all of the economic gains went to the wealthy, especially the 1%.

But people are starting to talk and saying that this can’t last without serious social consequences. I think the impact of the Great Recession really made people sit up and take notice. Right now I’m not really seeing much but it feels like an underground upwelling of discontent. We do need to rethink our value system and move away from the “greed is good” ethos and redefine what capitalism is all about. Capitalism can’t be about shareholder value alone – it needs to incorporate all stakeholders, including the workers.

Remember, the source of innovation comes from your people, not machines.

I would hazard a guess that most innovations do not come from the poor (too busy surviving) or from the wealthy (they got it made so life is easy – think Paris Hilton), but from the striving middle class. But if the middle class is gone, who is going to be innovative?

Remember, your customers come from your base of workers. If your workers or other companies’ workers do not have jobs or decent paying jobs, then your customer base declines. Walmart is seeing that now.

Remember, your future leaders will come from your current workforce but if you are not hiring or training or providing them opportunities, then your company will not have a future. Look at manufacturing sector who has been complaining that they can’t find skilled people. Well, I say, look in the mirror and see what you’ve been doing the last 30 years. You’ve sent the message that you don’t want Americans so they turned elsewhere.

Remember, people came to America because they wanted the opportunities it offered. But they are recalling of the period between the ’50’s and ’70’s, the hey day of the middle class. So if you are thinking of America the great, you are probably thinking of that time period. That time period provided opportunities to everyone and the pay was distributed to everyone, not just to the select few, like it has for the last few years. We’ve experienced great productivity increases since the 70’s, but the economic gains have not been distributed.

If you want America the great, you have to rethink the meaning of capitalism.

To read the interesting article from the food commentator: “Is It Bad Enough for You?”

 

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