Original writings by Tereza Coraggio available by permission of the author.
Ask and you shall receive!
Singer is both right and wrong. Here are some ways in which he's right:
To change suffering is the only life well-lived.
The most efficient way to change suffering is through donations to global charities.
Giving isn't charity, it's living in a way that makes sense.
Helping others has a cost.
As money has taken on this real value for me in lives saved, other purchases have gradually lost their appeal. The one time that my husband and I went on a cruise, we jumped ship at an island and swore never to do it again. Being trapped on a boat between stops for tourist shopping was the worst use of time and money we could imagine. And this was before we saw the Chinese immigrants working the 24-hour laundry in the bowels of the ship. My daughters, who earn their spending money through music practice, have discovered the joys of "vintage" clothing. I found that I was just as happy without gifts on holidays, birthdays and anniversaries, and the kids were just as happy with about a third of what I used to buy. We're nowhere near deprived, and there's still more waste and excess than I'd like. Every purchase is a compromise. But it's a compromise between the joy of restoring a life and the pleasure of an object or experience. We choose both and give up what's meaningless, which seems to be more and more.
As I've gotten more in touch with what money can buy, I wonder why others deprive themselves of the chance to live huge, in exchange for trivial tokens of status. For $100, we can be a true hero to a family in despair. The deepest hunger of the human heart, I believe, is to be needed and able to fill that need. Why do we feed our hearts on crumbs, when a feast of fulfilling awaits us? I ask the question in earnest, because the global poor are waiting for us to figure this out. If it's our nature to be generous, how is it being thwarted? Let's examine the American economy, and how it effects the ordinary working person.
The person who produces the item typically receives 1% or less of its retail value. In exchange for their labor to make 100 products, in other words, they get 1. Of the minority who produce in this country, most are "illegal" immigrants, and so are not eligible for any of the services we provide. If the consumer/producer exchange is measured in terms of money, the odds are stacked 99:1 in favor of the consumer. Every dollar that buys a product takes 99X the value it gives the producer. But if the exchange is evaluated in goods and services, the ratio is infinity:0. The Chinese factory worker labors 17-20 hrs a day for our benefit, in return, we do nothing for her. The argument is often made that the pittance they receive buys more in their country – well, of course, because they're buying labor at the rate to which we've devalued their lives. It's like comparing apples and raisins – we can't switch between money exchanged or goods and services exchanged whenever the rate's in our favor. If money represents trade, there should be an actual exchange that backs it up. The services exchanged are all within the consumer class, but the consumers simply take the goods from the producers with no services in return.
Therefore, a consumer society has to be committed to a foreign policy of violence, because no producer gives up laboring for their own lives without a struggle. Internally, a consumer economy has to be competitive by its nature, because of the distribution problem. In a decentralized producer society, if there were one, equality would be based on land and water rights – equal access to the means of production. There would be no goods distribution problem, because each person naturally owns the product of their own labor. I'm not suggesting there wouldn't be problems in distribution of resources, but distribution of goods would be moot. In a consumer society, distribution of goods is the central issue because there's no natural right.
Equal distribution of money as the means to equality is self-defeating in a competitive economy. It's like seeding an auction with money – all it does is drive the price of goods and services within the same economy up - housing, healthcare, education and retirement. Goods outside the economy become more devalued by comparison. When a family pays $1500 a month in rent or mortgage, it's hard to deny your kids a $5 toy. But in the real world, the toy costs more in new labor and resources than the house, which was built generations ago. As mortgage bidding drives the cost-of-living higher, productive jobs become more impossible to consider. Even small farmers who inherit their land have a hard time making ends meet. Silicon Valley fortunes are made in order to retire into "the simple life" and raise goats.
There are seven categories that I'd term necessities for a good life – shelter, food, goods, energy, education, healthcare and retirement. Food, goods and energy are commodities that can be imported or made by those who can be deported. But education, healthcare and retirement are services, and we haven't yet figured out a way to outsource them to India. Therefore, their cost is relative to the cost of living in our economy, which is relative to the cost of housing.
The word mortgage comes from the Norman words mort- death and gage- grip. Death grip. In exchange for the windfall profit to one generation, the next generation inherits the high water mark as the minimum cost of living. In a "boom" area, the generation no longer supporting a family receives an exponential return. The generation with children at risk inherits an exponential debt for the same house, two or three times greater than the cost, once interest and refinancing are calculated in. Any advance in income made by one generation is passed on to the next as debt. In example, when women won the right to work it was a boon to families. But when their daughters entered the housing market, it rose to the level of a DINK – double income, no kids. When they had kids, they could no longer afford to not work. The next generation expects to make the same kind of profit. But the profit will be paid twice again by their children. To go backwards is unthinkable. To go backwards is the next Great Depression. I don't know if the U.K., where Peter Singer lives, has reached this level of dysfunction in the generational transfer of housing. Perhaps they're handling this better, and that's why expenses aren't relative to income there.
The retiree needs to get the maximum profit from their house because her 401K plan has lost most of its value in the stock market. The stock market is legalized gambling, in fact, it's subsidized gambling stacked in favor of the brokerage houses. Less tax is paid on capital gains (passive income on money) than income tax (wages for labor). This makes no sense whatsoever except when capital is making the rules. The brokerage houses can drive the price of a stock up or down simply by buying or selling within their vast mutual funds. So a stock can be manipulated long enough for big players to sell their holdings. At the turn-of-the-millennium, increased activity may have artificially held prices up while brokers sold their own holdings, then let the market wave crash down on the unsuspecting public in February 2000.
Stock shares are purely gambling chips with no actual value backing them. If a company declares bankruptcy, only the venture capital has a claim on asset sales or uncollected debt. The traded shares are wallpaper. Again, the market hurts the individual investor either way – if the market is up, it drives the cost of living up and only those who've bought in can keep up. If it's down, you've lost money but the cost of living stays at the high water mark because mortgages are set for 30 years. So you can never save enough either way to feel secure.
Education is a means of keeping privilege in the monied classes, with a veneer of racial diversity over it that passes as equality. This veneer disguises the homogeneity of the participants as unadulterated consumers. The education we receive, from kindergarten up, is a ruling class education. It assumes that someone else will always be doing the work of providing for our needs. We couldn't provide for ourselves if our lives depended on it, which it would if money lost its ability to take the products of labor through deprivation of resources. Kids are so busy competing to get into college that cooking, cleaning or care of siblings are impossible impositions on their lives. Maybe you could get their attention if you instant-messaged them with a threat to impound their cell phone. A parent's fond hope for college is that it enables their kids to make money in something secure like engineering, finance or tax accounting. The upside isn't guaranteed, but the downside of not having a degree is a fairly sure bet. Agriculture and construction are only useful if you're going to manage the family business, with Latinos doing the real work. Otherwise, no skills are acquired by today's student for a world that doesn't run on money.
College costs have tripled in our generation, and are projected to continue to rise. The strike at the University here will trickle down into higher tuition, upping the ante to enter the race. The message to parents is clear – if you love your children, you can't possibly save enough for their education. Higher education is a competition just to get to the starting line. Its purpose is to eliminate the majority from the chance for a decent life. Like all competition, it serves the winners, which is why corporations will match donations to your alma mater, but not to Habitat for Humanity.
In the public schools, benefits rose 25% last year. The union said that it wouldn't negotiate on benefits until the district closed 1/3rd of the elementary schools, which didn't effect them since secondary teachers dominate the local union and administrative staff aren't represented by them. The district complied, then they went on strike anyway. Parents side sympathetically with the teachers and blame the district. But in a finite system, something has to lose for another to gain. Parents, who want small neighborhood schools, will lose because they're not organized into a union.
Labor unions developed as a way to balance the profit motive of capital. But schools are nonprofits. More money for teachers isn't a trade-off for profit, it means cuts somewhere else. Unions in nonprofits create an adversarial negotiating environment where we should be all on the same side. They prevent volunteer labor from replacing paid labor. The only solution they allow to understaffing is more money. The money is at the expense of homeowners, who are often the parents. Parents are then driven to work more, giving them less time to participate with their own children. It's a problem that won't get better until it falls apart completely, which it seems close to doing.
Liberal Americans have a knee-jerk response to be in favor of American unions. But our labor unions are special interest groups. They don't join in support of the ILO – the International Labor Organization – and refuse to buy products manufactured without worker rights. Fair trade isn't organizationally-promoted among unions like the Federation of Teachers. Their concern isn't for all labor, but to gain a negotiating advantage in a monetary system. But money itself is a conspiracy against the rights of labor, so "labor" unions in consumer cultures are a contradiction in terms and objectives. If unions in consumer countries stood with all labor, the exploiters of devalued labor would have no market, and exploitation of labor would begin to reverse.
Doctors are kept in artificial scarcity by licensing bureaus and medical schools, presumably protecting the high quality of service but incidentally protecting the high price. Competition will drive up any finite resource as high as the market will bear. So insurance costs have gone up as high as industry could pay, when the economy was good. Now, in the downturn, corporations are passing as much as possible onto employees. In turn, the pharmaceutical companies and providers are raising co-pays to as much as the market can bear. If there were no insurance and no administrative costs or malpractice suits in healthcare, would the co-pays, deductibles and employee contributions cover the cost of services? If we were paying for the services we need, rather than demanding the services we feel entitled to, it seems likely.
As a parent, food again places me in a dilemma. Do I pay $10,000 a year to send my kids to private schools, where I can band with other affluent, socially-conscious parents to serve nutritious, fair-trade meals? Or do I support the public-schools and exploit the resources and labor in over-packaged, over-processed foods that need no heat or refrigeration? Or do I drop out and devote my life to this issue, making healthy snacks in reusable containers, and let my kids deal with the social implications at a table of Lunchables and Cheetos? In the first pure scenario, that's 10K less that I can give to charity. In the latter case, I'm giving up my whole income and might as well home-school. The drive for moral righteousness works against the ability to give to charities.
The same dilemma appears for canned food drives. Aluminum smelting requires vast amounts of energy, which has been created by dams on the Congo River. The stagnant water left for the local population breeds the parasite that causes river blindness. So the metal in cans that feed our poor is blinding children who are even more poor. The food in these cans is also being harvested and processed by people who are more poor than the recipients. The resources depleted by the canned tuna industry and agribusiness are creating a future of greater poverty. Without an inclusive plan, compassionate Americans are at odds with their own purpose.
What precipitated all of this was not September 11, nor a sudden realization that Saddam was still a nasty guy, nor just the change in leadership in the United States. What precipitated it was Iraq's November 6, 2000 switch to the euro as the currency for its oil transactions. At the time of the switch, it might have seemed daft that Iraq was giving up such a lot of oil revenue to make a political statement. But that political statement has been made and the steady depreciation of the dollar against the euro since then means that Iraq has derived good profits from switching its reserve and transaction currencies. The euro has gained about 17 percent against the dollar since that time, which also applies to the $10 billion held in Iraq's United Nations "oil for food" reserve fund.
So the question arises, as it did for George Bush, what happens if OPEC makes a sudden switch to euros? In a nutshell, all hell breaks loose. At the end of World War II, an agreement was reached at the Bretton Woods Conference which pegged the value of gold at $35 per ounce and that became the international standard against which currency was measured. But in 1971, Richard Nixon took the dollar off the gold standard and ever since, the dollar has been the most important global monetary instrument, and only the United States can produce them. The dollar, now a fiat currency, is at a 16-year trade-weighted high despite record U.S. current-account deficits and the status of the U.S. as the leading debtor nation. The U.S. national debt as of April 4, 2002 was $6.021 trillion against GDP of $9 trillion.
Trade between nations has become a cycle in which the U.S. produces dollars and the rest of the world produces things that dollars can buy. Nations no longer trade to capture comparative advantage but rather to capture needed dollars to service dollar-denominated foreign debts and to accumulate dollar reserves in order to sustain the exchange value of their domestic currencies. In an effort to prevent speculative and potentially harmful attacks on their currencies, those nations' central banks must acquire and hold dollar reserves in amounts corresponding to their own currencies in circulation. This creates a built-in support for a strong dollar that in turn forces the world's central banks to acquire and hold even more dollar reserves, making the dollar stronger still.
This phenomenon is known as "dollar hegemony," which is created by the geopolitically constructed peculiarity that critical commodities, most notably oil, are denominated in dollars. Everyone accepts dollars because dollars can buy oil. The reality is that the strength of the dollar since 1945 rests on being the international reserve currency for global oil transactions (i.e., "petro-dollar"). The U.S. prints hundreds of billions of these fiat petro-dollars, which are then used by nation states to purchase oil and energy from OPEC producers (except presently Iraq and, to some degree, Venezuela). These petro-dollars are then re-cycled from OPEC back into the U.S. via Treasury Bills or other dollar-denominated assets such as U.S. stocks, real estate, etc. The recycling of petro-dollars is the price the U.S. has extracted since 1973 from oil-producing countries for U.S. tolerance of the oil-exporting cartel...Since it is the U.S. that prints the petro-dollars, they control the flow of oil. Period. When oil is denominated in dollars through U.S. state action and the dollar is the only fiat currency for trading in oil, an argument can be made that the U.S. essentially owns the world's oil for free.
So what happens if OPEC as a group decides to follow Iraq's lead and suddenly begins trading oil on the euro standard? Economic meltdown. Oil-consuming nations would have to flush dollars out of their central bank reserves and replace them with euros. The dollar would crash in value and the consequences would be those one could expect from any currency collapse and massive inflation (think of Argentina for an easy example). Foreign funds would stream out of U.S. stock markets and dollar denominated assets; there would be a run on the banks much like the 1930s; the current account deficit would become unserviceable; the budget deficit would go into default; and so on...
The anti-war ideology allows Americans to be morally innocent of violence while enjoying the life of an unproductive consumer. The lie that's at the heart of our culture is that it's possible for everyone to be a consumer. We see ourselves as helping the underdeveloped countries reach our level of industrial auto-pilot. But, of course, production isn't on cruise control, with elves making cookies. Consuming without exchange requires violence against the rights of producers. The peace movement allows us to have the best of both worlds: a consumer lifestyle with no obligation to give return value and no guilt for the violence that gives us that consumer lifestyle.
In Politics and Conscience, Vaclav Havel speculates whether the peace movement could be a plot by totalitarian powers to render the honest, free-thinking person completely ineffectual.6 It sets up "the simplest thesis possible, with all the apparent characteristics of a noble goal." But as a symptom, rather than cause, it's impossible to accomplish. If oppressed people would stop struggling, we could end wars tomorrow. Isn't that what the dominant powers would like also? To want peace without justice is like wishing that the woman being raped would stop screaming.
In turn, justice within a pre-existing system of inequality is only retributive justice – getting back at someone who doesn't respect the existing order of entitlement. Real justice is therefore only possible within a system of equality. Distributive justice is a system in which all people have the means of providing for their own lives. But in a system of distributive justice, our children are doomed. We can't provide for ourselves. We don't want to provide for ourselves. We've reduced the productive life to a miserable existence, as a byproduct of a system that favored capital over labor. Before we can want equality in the world, we have to make the world safe for equality. The way to make the world safe for equality is to give back the right to produce for your own benefit through global charities. So I am back to the Singer Solution.
Limiting the goal to a geography or a nationality gives us the illusion that it's achievable. But no disease can be cured by treating only a symptom. Rather, we should make our goal utterly idealistic, and count any action that moves us closer as good, no matter how small a step. One family, transitioned from dependency to self-sufficiency for $100, justifies our life. With a community that shares this goal, there's no limit to what we can do. The desire to be constructive is an entirely different mindset than the desire to be innocent. In seven generations, all our children can be morally righteous if we're willing to be kind to ourselves and accept our compromises, keeping the goal always in mind.
There's another alternative to the Singer Solution of an extremely arduous but morally decent life. This is the Robin Hood/ Fair Trade Solution, a merry life with three principles: 1) take from the rich, 2) give to the poor, and 3) buy or trade direct. Money is a conspiracy we all participate in, to defraud the producers of their product. But if we faced our complicity, we could enter into an economic counter-conspiracy to return the lives of the global poor. Those who work for corporations would become, not the villains, but valuable partners in the social siphoning of money down to the poorest. No one is more safe in reality than the most vulnerable among us. To make the world safe for equality, we need to start at the bottom. By cooperating economically, for the benefit of the global poor, we would also slow the competition among us. Perhaps, in time, we could reverse it and reclaim our own self-sufficiency.
A conspiracy for the global poor could look like this:
The Global Trust Fund – no-interest savings and IRA accounts that are loaned in no-interest mortgages through a credit union. With the monthly repayment, the borrower writes an equal check to a global charity. Both checks together equal the minimum payment on a 5.3% loan. Over 30 years, this generates the amount of the loan to charities at no extra cost.
Regenerative Economics – those who offer a service or product could give it for free with a donation of double its value to a global charity. In effect, the service-provider with time but no money matches the customer with money but no time. The customer gets double the tax write-off, and the provider makes double the donation at no expense.
The Divine Prostitute Way to Save the World – before a date with your significant other, give an equal amount to global charity. With a guilt-free night out, a wife can elicit her husband's willing cooperation as a Merry Man. Although not as much fun, the same principle can be applied by making an equal donation whenever the products of devalued labor are bought. By showing the true cost, fair trade becomes cost-effective.