Economic security for all ensures the prosperity of the wealthy and the middle class while creating opportunities the poor and destitute can potentially access. Opening opportunities to the impoverished, conversely, fosters economic security and prosperity. As such, it is necessary for business and other community leaders to cultivate socioeconomic environments that foster prosperity and financial security in order to ensure one’s own prosperity. That said, cronyism, cut-throat competition, and corruption are also ways to enrich an ever-narrowing power elite, yet the abusive pursuit of one’s own financial and other interests at the expense of others has costs.
In many underdeveloped countries where poverty is widespread, including 2016 Olympics host Brazil, the wealthy elite are under such an extreme threat from the impoverished majority that they must barricade themselves in compounds and devote much of their time to securing their wealth. In oligarchic Russia, the beneficiaries of corruption live in luxury, yet their wealth can be seized at any time as they are under perpetual threat of reprisal for political dissent, mistakes, or even the very act of aging. To safeguard their affluence, self-serving elites enslave themselves to unforgiving kingpins while denying the Peoples of entire nations economic security, freedom, and opportunity. Clearly, fostering prosperity for all is a better option.
In the modern age of a globalized economy, the global wealthy and middle class are often the beneficiaries of public policies and economic practices that neglect the needs of a growing majority. Not only does this neglect imprison people across the globe in a perpetual struggle to survive in the modern economy, it encourages both civil unrest and economic instability, which also threaten the financial security and wellbeing of the global affluent. To defuse this threat, the global affluent, through private industry and government, must open opportunities to the lower socioeconomic classes in order to foster prosperity for all.
People need jobs, which are sustainable and capable of supporting a modern lifestyle, or the ability to start businesses, which can succeed and return viable profit in a timely manner. Clearly, job and business opportunities exist, but the world needs many, many more of these opportunities to accommodate the basic needs of 7.5 billion people. There are things governments and private industries do, or do not do, that block people from accessing opportunities. Far too often, government policies distort the economy in detrimental ways while it does very little to actually alleviate poverty as its main focus is subsidies. Toxic competition on the private sector-side, in turn, undermines the creation of opportunities.
In the US, for example, social welfare dollars sustain the poor, but do little to help the poor prosper. So-called “welfare to work” reforms tied benefits to work status. Assuming beneficiaries are able to find jobs and employers hire them, welfare benefits act as a subsidy for the worker’s income. En mass, this subsidy works as a subsidy for employers, thereby making it easier to pay their workers less. Education is pivotal to accessing opportunity, yet proposals for free education at public colleges do nothing to increase the availability of jobs. If anything, it increases the competition among degree holders by increasing the supply of educated workers, which is problematic when it comes to unconnected poor who lack a competitive advantage in the job market. Subsidizing public colleges over private schools encourages students to attend public colleges, thereby short-circuiting constructive competition and undercutting higher quality education.
The way in which government taxes, regulates, and spends distorts the economy. Because government subsidies favor high-calorie, nutrient deficit corn over “specialty crops,” including vegetables, corn-based junk-food has become more affordable and, therefore, more available. Favoring the incomes of the wealthy investors via a reduced capital gains tax, over earned income, has the same effects. Similarly, tariff-free free trade fosters degenerative competition that suppresses the price of goods as well as the quality of goods and the pay of workers. Unnecessary regulation raises the cost of being in business while under regulation favors bad business practices by disadvantaging socially responsible companies.
Furthermore, the private sector’s ravenous addiction to degenerative competition and scarcity-mentality has fostered a dysfunctional environment where big economic actors cannibalize off the rest of the economy to attempt to fuel perpetual group. The financial services sector, a.k.a. Wall Street banks, is a prime example where profit-taking to show growth has pumped up stocks, yet driven money away from production and workers, who happen to also be consumers. The pressure to continually grow profits has also forced all businesses to suppress prices and suppress competition to the point fewer can expect to success. As the likelihood of success shrinks, even as the cost of success rises, opportunity becomes more of a rarity.
The principle way in which the private-sector fosters new opportunity is through lending. Access to credit is pivotal to prosperity, but loans also raise the cost of doing business. When the economy continually suppresses the ability to make a viable profit in a reasonable amount of time and competition stamps out startups, loans do little to create opportunity. In India, for example, micro-lending created crushing debts that lead to a rash of shame-driven suicides, even though the practice had a constructive impact on poor communities. Where low to no-interest loans of small sums opened opportunities to the desperate, profiteering lenders set borrowers up for failure by offering high-interest, unregulated, multiple loans that could not be repaid
To secure the world economy, as well as the wellbeing of the wealthy, middle class, and poor of the world, people need greater access to opportunities. Government and private-sector entities can help by addressing the policies and practices that foster dysfunctional economic behavior and environments. The affluent of the world can start by introducing those most in need of economic opportunities to those who can capitalize on their potential. The economy exists to distribute the world’s limited resources in the most efficient means possible so unmet needs can be met through production. This can only be accomplished by pursuing prosperity for all.
Read old posts