Help Poor Struggling CEOs!

Washington should step in to help out needy CEOs

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December 18, 2013 | By Ian Williams

The US has wage lessons to learn from England

Back in 1795, when Britain was fighting Napoleon, there was a financial crisis entailing an oversupply of labor and a shortage of food: bread prices rose, and wages fell.

The orthodox view was that the English peasantry were largely in earnest when they happily intoned, ‘God bless the squire and his relations/And keep us in our proper stations.’ While some might have said that in church on Sunday, however, in reality many of them donned masks at night and went out with flint and tinder. In eighteenth-century England – and indeed in the US – people had quaint traditional customs that included what one historian called ‘collective bargaining by riot’: if food prices went up, the local magistrates’ mansions and hayricks also went up – in flames.

By ancient law, the magistrates could fix the wages of local laborers, but the Justices of the Peace of Speenhamland in England, an area afflicted with serious rioting, decided not to. Instead, they used local taxes to supplement the wages of farm workers so that all taxpayers subsidized the payroll of the most affluent landowners, and paid extra cash to workers depending on the price of bread.

Two centuries later, the jury is still out on the motives of the JPs. On the one hand, their policy did save poor families from dire deprivation and actual starvation. On the other, magistrates tended to be rich farmers, so in effect they were subsidizing themselves while buying tangential arson insurance.

These days, we often maintain old traditions. University of California researchers claim chains like Walmart and McDonald’s use public money to subsidize their Scrooge-like pay policies. The minimum wages they pay are not enough for their employees to live on and are feasible only if society as a whole picks up the balance of the tab with food stamps, rent subsidies and state-provided healthcare; the researchers estimate that this government backing of the fast food industry amounts to $7 bn a year.

Those numbers can be multiplied by much more, as it seems 60 percent of new US jobs since the recession have been similar low-paid service sector jobs. As with the gentleman farmers of yore, paying low wages and letting everyone else pick up the tab is good for the bottom line.

But new times mean new problems. Nowadays, it is clear the bigger problem is that the growth of executive salaries is not accelerating the way it used to. Companies cannot afford, politically or financially, to keep executive compensation increasing the way management so manifestly deserves. If CEOs – those on whom our economic survival and continued prosperity depend – are paid less than their peers, it reflects badly on the perceived prosperity of their companies and thus on their shareholder value. This in turn affects market indices and thus the financial prosperity of the nation. It is essential, therefore, that our industrial leaders are seen to be paid well.

In view of such a national challenge, Washington must rise to the occasion just as those rural English magistrates did: it is imperative the government step in to supplement executive compensation. The essential ‘cost of ostentatious consumption increase’ could be met by granting tax credits that would provide needy CEOs with annual percentage increases tied to the rise in the average remuneration of their Fortune 500 peers.

Naysayers might argue that this is inherently inflationary, but it has sound precedents: most board compensation committees cite comparable CEO pay to justify rises for the boss who appointed them, and of course the rises they then award are taken into account by all the others. ‘Speenhamland for CEOs’ might be an esoteric slogan, but it is surely centuries-old wisdom whose time has come!

Saudis Out -Israelis in UN Securitty Council?

WRMEA, December 2013, Pages 24-25

United Nations

In Rejecting Security Council Seat, Saudi Arabia Acknowledges Realpolitik

By Ian Williams

Members of Saudi Arabia’s U.N. delegation confer during the General ­Assembly’s Oct. 17 ­election of five new non-permanent members of the ­Security Council. (UN Photo/Paulo Filgueiras)
On the surface, Saudi Arabia’s decision to refuse its Security Council seat is as idiosyncratic as one would expect from a  monarchy. Diplomats view a seat at the Security Council as the apogee of their careers, so foreign ministries tend to take elections to it far more seriously than most other parts of their governments. Saudi Arabia is a founding member of the United Nations and has in recent years sought and won seats on the Human Rights Council and other bodies.
Sometimes governments desperately want to shape Council discussions on certain issues—Morocco, for example, with Western Sahara, or Indonesia in times past with East Timor—so they exert great efforts to be elected. In a fit of heroic wishful thinking, Israel has announced its interest in being a candidate in 2020 for the “West European and Other Group” seat—more about which later.
The “unofficial” procedures for elections to the Security Council vary from region to region. The temporary rotating seats often are earmarked years in advance. Africa, in particular, rotates its seats among smaller subregions, deferring every now and again when the giants like Nigeria or South Africa want to be on the Council.  That is why Rwanda keeps popping up in the Council at inopportune moments, like during a genocide at home, or intervention in neighboring Congo.
Clovis Maksoud, the distinguished former ambassador of the Arab League, takes credit for devising the current system, almost Ptolemaic in its complex epicycles, that ensures Arab representation. The Arab group is split between Asia and Africa, so he arranged that the Asian group would cooperate to alternate with the Africans so there would always be an Arab seat.
To be elected to a temporary seat, countries need to get two-thirds of all the secret ballots in the General Assembly. But more often than not that is almost a formality, because the regional groups vote in advance for their nominees and ensure that the number of credible candidates matches the number of vacancies. Saudi diplomats had spent two years working on their candidacy, canvassing and doing what they do, so the Asian group already had given its blessing. A country really has to rile a lot of nations for one-third of the world to actively block its candidacy, and the Asia group is the U.N.’s biggest region.
The last time Riyadh had made a bid for U.N. glory was in 1991, when its then U.N. Ambassador Samir Shihabi ran for president of the General Assembly, overturning the expected candidate, Papua New Guinea. The success of that election, however, showed the dilemma for a Saudi government trying to look after its home constituency and yet pander to its essential foreign backers. Shihabi took the U.N. very seriously, and set up the association of former presidents to perpetuate his moment of glory. One of his first tasks as president, however, was to preside over the special meeting of the General Assembly called by George H.W. Bush in 1991 to rescind the U.N.’s “Zionism is Racism” resolution. Himself Palestinian by birth, Shihabi absented himself from the meeting—as, in fact, did the Israeli ambassador, whose government saw the move as Bush’s desperate attempt to win over American Jews after he had refused the loan guarantees Israel wanted to build its illegal settlements.
That hints at the reasoning behind the surprising decision. Saudi diplomacy by its very nature has to be somewhat contradictory. Riyadh wants Iran hobbled. The government is displeased that the U.S. backed off threats of military strikes against Syria in response to its alleged use of chemical weapons. It’s unhappy with U.S. policies in Egypt. On the Israeli issues it would have to confront its existential ally, Washington, and there are many more issues where its domestic base would be unhappy if the Saudi representative voted the Foreign Ministry’s head rather than the imam’s heart.
So we can take with a sack of salt the idea that Riyadh’s refusal of the seat was solely to protest for Security Council reform, or on behalf of the beleaguered Syrians, let alone the Palestinians. After all, if the Kingdom were truly, deeply concerned about the latter, it could have turned off the oil pipelines many times over the decades before the U.S.’s recent achievement of energy self-sufficiency. If the concern was more about Syria, then a seat on the Security Council would give the Kingdom far more leverage with other members of the Council—with, for example, China, which has just become a bigger customer for its oil than the U.S.
The king simply was more astute in recognizing the realities of the regime’s position, which is predicated on keeping Washington as an ally. The U.S. may be a diminished superpower, after two disastrous stalemated military interventions and the financial crisis, but it still has more military clout than the rest of the world put together, and probably just enough influence over Israel to stop it from attacking and humiliating the land of the two shrines.
The sordid realities of global realpolitik and U.S. domestic politics put the Kingdom in an invidious position. It has contributed positively—since it is, after all, the “Saudi Plan” for Middle East peace that has been adopted by the Arab League and endorsed by almost every other player—except, of course, Israel. Washington’s verbal support for the formula has been correspondingly undercut in reality by its essentially unqualified military, diplomatic and financial support for the self-proclaimed Jewish state.
Recent reforms to the U.N. Human Rights Council were in part intended to lessen the over-emphasis on Israel compared with other members. A crucial improvement introduced by human rights supporters was the Universal Periodic Review, under which every member’s human rights behavior is scrutinized. This year, however, Israel was the one and only country to refuse to turn up for the review, which puts into sad perspective its supporters’ perennial claims of persecution. As we go to print, it has an opportunity to turn up, but the suspicion is that it will not.
Considering grandiose aspirations and hypocrisy, thoughts naturally move back to Israel’s declared intention to run for a temporary Security Council seat in 2019/20. To twist Groucho’s words, why does Israel want to be in a club that it has so consistently reviled and criticized over the years—let alone one that has so consistently condemned it in the past and would still be doing so were not for the automatic U.S. veto. So what would Israel gain from a seat, since it certainly would not have a veto as a temporary member? Well, other countries, like Morocco and Indonesia, as mentioned above, have sat around the Security Council chamber unblushing at defying resolutions against them.
Israeli diplomats, just like their U.N. counterparts, love the idea of grandstanding in the Security Council and pontificating on the behavior of the rest of the world. So they also overlook their prejudices against the institution and announced their bid. Unless Israel signs a peace treaty satisfactory to the Arabs and the Palestinians before then, however, their chances are minimal. Since the Asian group wouldn’t have them, and nor would any other regional group, U.S. pressure led the West European and Other Group to accept the state, eventually. For strange historical reasons having to do with the old British Empire, Canada, Australia and New Zealand are the “other” in this title. And just to even out the anomalies, Cyprus joined the Asia group.
WEOG, as it is known in U.N. parlance, is the only regional group at the U.N. that has genuinely competitive candidates, who are not appointed by the group, but go to the general membership for election. So Israel, not particularly popular in Europe, would have to persuade serious contenders to stand down. They have not done so for others in the past. And then it would have to go to the General Assembly for an overall ballot, and get a two-thirds majority of the votes from diplomats who have fairly consistently demonstrated their antipathy to the state.
It would take a miracle of Biblical proportions to overcome such hurdles, and it is unlikely to be forthcoming. Indeed, the state of Palestine might be a better bet for gamblers!

The Curse of Canonization

 pub 8 December, Huffington Post.

When Nelson "Madiba" Mandela came to New York the first time we met, he exuded charisma combined with a rare modesty. He chuckled when I told him that he was responsible for my current career path, since a group of us were suspended and expelled from Liverpool University for occupying the Senate House in protest against the university's investments in South Africa. It was indeed edifying to be, in no matter how small a way, a comrade in arms of such a palpably heroic figure.
However, my skin crawled as I listened to the portentous yet vacuous platitudes that surrounded the announcement of his death. Once dead and canonized, our heroes' real lives fly out the window. Neither the media nor the public have time for feet of clay at the opposite end from the shimmering halo round the head. This cartoonish "goodies and baddies" view of the world is an understandable human foible, but it does become creepy when politicians and other public figures try to usurp the benign energy of those whom they would have had reviled, imprisoned, or even killed while they were alive.
British politicians revered Gandhi, after fighting his struggle for independence and locking him up. People speak unctuously of his passive resistance without mentioning that it was the British government, not least the equally revered Winston Churchill, whom he was resisting, who interned him during the war against fascism.
In the U.S. those who fought most bitterly against the socialist, anti-Vietnam subversive strike leader Martin Luther King once had nightmares but now, wow, they too have a dream. They even overlook King's philandering, just as they tend to forget that we know about his affairs because the genuinely reptilianly evil Edgar J Hoover was on his case.
Mandela's eulogies and epitaphs highlight what an awful curse it is to be canonized! You give your life for a cause, and then find your life distorted, rewritten and usurped to support people and causes that you reviled.
He was a charismatic, charming, humble, inclusive and forgiving leader who was prepared to embrace the former enemy and bring peace and progress. But forgiveness should not be confused with forgetfulness. He might even have been somewhat too forgiving of the behavior of his friends Fidel Castro and Muammar Gaddafi at home. But gratitude is a virtue no less than courage, and being locked up for decades and oppressed for a lifetime surely enhances ones appreciation of those who supported you. It could equally incline you to doubt the moral authority of regimes like Washington's that puts you on a terrorism watch list.
Landing in Washington at an airport named after Ronald Reagan could easily make anyone question the good faith of a country that canonizes the president who crashed the economy, unwound the New Deal, traded with Iran to back the Contras and backed the Apartheid regime to the hilt.
The media eulogized the saintly Mandela, and imbued him retrospectively with an absolute commitment to non-violence, but it could not be farther from the truth. The Liberation leader did indeed advocate respect for the results of elections -- once the oppressed had been enfranchised, but he was actually the leader of an armed resistance group whose mandate was to force those elections upon the minority. Mandela's commitment to the Palestinians, like that of Archbishop Desmond Tutu, is rarely mentioned by the usual suspects because they cannily appreciate that any mud they throw at such towering figures is more likely to splash back at them, and more likely to bring attention to his views. All those commentators intoning platitudes about Nelson Mandela would be the first to join the ritual stoning of and casting out as "anti-Israel" any African American politician who had the temerity to support international law in the Middle East.
In that sense, Saint Madiba was indeed anti-Israel, and perhaps one reason that no one called him on it is that in doing so it might have brought up issues which are considered best buried. Mandela knew that Israel broke international sanctions on Apartheid, was the main conduit for laundering and cutting blood diamonds from South Africa and armed the regime there -- right up to an including nuclear weaponry.
Mandela was a giant of a statesman, whose passing leaves us with pigmies at the helm of most countries. But when someone dies after giving a lifetime to humanity, we should at least pay them the respect of addressing what they said, even if we disagree with them.

 

This Blogger's Books from

Rum: A Social and Sociable History of the Real Spirit of 1776 by Williams, Ian published by Nation Books Hardcover

The Alms Trade: Charities, Past, Present and Future
by Ian Williams

 

 

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An ethical foreign policy?

  I use Grammarly's plagiarism checker because it shows me who is copying my work!

 Sanity prevails over Iran

by Ian Williams

Tribune Monday, December 2nd, 2013

Iran’s nuclear agreement recalls Robin Cook’s statement about foreign policy having an ethical dimension, often misquoted as “an ethical foreign policy.” Cook realised that ethics was just one of several dimensions. The Iran imbroglio almost has as many tangled dimensions as string theory – with the ethical one hard to find. Even the Israeli stock markets bounced upwards on news of the Iranian accord, showing the invisible hand in a better light than the long faces of Benjamin Netanyahu and his ideological supporters in the United States Congress at the reduced prospects of Armageddon in the Middle East.
Sanity is to be treasured wherever it can be found, not least because it seems a rare commodity. Barack Obama and John Kerry deserve congratulations for standing up against Netanyahu and his supporters in Washington.
One does not have to love the ayatollahs and their theocracy to sympathise with Iran, whose pariah status in its own right could be considered hard-earned, not least over its immoral and expedient support for the regime in Damascus.
But any objective perspective on Iran has to step back to include its opponents in the overview. Why is it that the loudest yelps against Iran’s alleged nuclear capability come from Israel, a state that itself has a large nuclear arsenal? Why do the claims that Iran is a threat to peace come from the same state which has noisily and repeatedly threatened to attack Iran, in between inciting the US to do so?
The West backed a bloody invasion of Iran by Iraq under Saddam Hussein, involving the proven use of chemical weapons and gas. When Saddam invaded Kuwait, the Western powers rammed through the punishing reparations to the Gulf States, which are still being paid by Saddam’s victims, the people of Iraq.
A United Nations commission determined that Iraq was the aggressor against Iran, which was scarcely needed, since it was so obvious. However, when I asked an Iranian diplomat at the UN why it did not leverage that aggression finding into first dibs on the Iraqi compensation payments to the Gulf States, he said that all Iran wanted was the vindication. It puts in context Teheran’s punctiliousness about international recognition of its legal right to have a nuclear enrichment programme, even if it agrees not to exercise it. It is a pattern that befits a theocracy.
India, which is not a signatory to the Non-Proliferation Treaty, developed its nuclear weapons and then voted at the International Atomic Energy Agency to refer Iran to the Security Council for a civil nuclear programme that was within the NPT terms. In return, the US, in effect, gave up nuclear sanctions against India, with its declared arsenal, to enlist support against Iran, which has repeatedly declared it has no ambitions for a weapons programme and whose supreme leader has actually issued a fatwa against them.
Incidentally, while there is undoubted repression of journalists and dissidents in Iran, I actually told Iranian television, live, that even if the Iranians had the legal right to, they should not have a civil nuclear programme because it was environmentally damaging and economically devastating. They have had me back on their screens often since.
One can sincerely doubt whether any country, let alone Iran, needs a civil nuclear programme. Certainly, the costs that British consumers have been saddled with for electricity from the planned nuclear generators should raise questions about how economic such power is.
The cost of energy is clearly a factor in all this. I pointed out on Iranian TV that Iran was importing refined petroleum products because it lacked the technology to process the oil it was pumping.
The Gulf States, whose treatment of religious minorities, women and dissenters makes the ayatollahs seem positively liberated, have been supporting Israeli and the US bellicosity – behind the scenes, of course, since it ill befits the custodian of the two shrines to incite a unbeliever’s attack on a Muslim nation. Would Obama have dared thwart them and the Israeli lobby at the same time if natural gas had not relieved the US from its long-time energy dependence?
We can be pleased that Obama and Kerry have pulled off a deal and averted the immediate threat of war. But why should common sense be such a long-winded process? And how did shallow expedience so often hold it up?