The Tyranny of the “Moneymen”

Vince Cable, the British Business Secretary, is trying to shame executives of major companies in Britain to moderate their pay and bonuses. The British Guardian (23-June-2011)  is reporting on a speech he made to an audience of leading city investors in which he said: “It is actually outrageous that last year median earning for FTSE 100 chief executives rose 32%, whereas the share index rose only 7% – and average employee pay rose by less than 2%, barely half the rate of inflation.” Cable added, “Average pay for the bosses of the top 100 companies has leaped to 120 times that received by an average UK employee from 45 times in 1998”.

These figures are enough to enrage anyone with an ounce of humanity in their soul. So what does he propose to do about this nasty form of capitalism? His answer: new rules to compel companies to make public the pay packets of top bankers and top executives as a multiple of an average UK employee wage. Get real, Mr. Cable. They will not be shamed or deterred by exposing the obscenity of their wealth.

The dictionary defines empathy as “the capacity for imaginatively sharing in another’s feelings or ideas.” The “moneymen” have zero empathy with those struggling simply to survive the extreme hardship ordinary people are experiencing. Lest we forget, these “moneymen” are the ones who had the effrontery to demand huge bonuses to add to their massive salaries, after their institutions were rescued to the tune of billions of dollars by the taxpayer following the financial meltdown caused by their greed, incompetence, and casino-type banking.

Here is a suggestion for you, Mr. Cable, and the Chancellor to consider, which is progressive, fair and serves the interests of the ordinary citizen. Decide what multiple of the average pay of a UK employee is a fair wage for those masters of the universe, 10 times say. Any pay above that, tax at a punitive rate rising in very steep steps to a level of 90% or more. If this does not moderate the pay, it will have the effect of returning money to the government to help those most in need.

New research published by Merrill Lynch cited in the Guardian article shows that “the number of wealthy individuals in the world has reached 10.9 million – more than existed before the 2008 banking crises. Their collective wealth, $42.7 trillion, has also topped the levels it reached in 2007, before the crash and recession sparked by the crisis.” Isn’t that obscene? Ordinary people in their millions, in the US, Europe and beyond, are being told by those “moneymen” that they must tighten their belts, and accept austerity measures that are severely blighting their lives.

This is what happens when the tyranny of capital is unchecked. This is what happens when the voracious appetite of global corporations and the ultra rich for more power and wealth is not controlled, and allowed free reign to exploit and enslave millions worldwide.

The trajectory of this tyrannical form of capitalism is heading towards the slave-like exploitation of people in the third world, described by John Pilger in an excellent video made four years ago. It describes the exploitation of the poor in Indonesia under the banner of “globalisation” entitled The New Rulers of the World. The conditions presented in the video could equally apply to any poor third world country. He describes the pitiful working conditions in factories making designer brand goods (Nike, adidas, GAP, etc) destined for the US and Western markets. The workers were paid a dollar a day, the minimum legal wage in Indonesia. These workers live in labour camps with open sewers, no running water, with their children undernourished and prey to disease. A shocking statistic is that Tiger Woods was paid more to promote the Nike brand than the entire work force making the product in Indonesia.

He describes a wedding reception in Jakarta thus: “Here are some of the staggeringly wealthy. This is a wedding in Jakarta of the Indonesian elite; two merchant families are being united… We calculate that it would take an Indonesian worker like this waiter 400 years to pay for a wedding reception like this.” The gulf between the rich and the poor has become even bigger since that film was made four years ago, as the figures in the Guardian show.

It looks like the gap between rich and poor in the US and the West is accelerating towards the levels that are now prevalent in the third world. There are now families in the UK that are relying on charitable donations of food to survive. The tyranny and dictatorship of corporations and the ultra rich are causing levels of hardship and pain that, if unchecked, will lead to civil unrest, and crime, and threaten community cohesion.

Politicians take heed. Governments must find practical and effective ways of dealing with this extreme inequality in our society. Shaming and embarrassing the super rich into moderating their greed and wealth acquisition will not cut it.

Adnan Al-Daini (PhD, Birmingham University, UK) is a retired University Engineering lecturer. He is a British citizen born in Iraq. He writes regularly on issues of social justice and the Middle East. Read other articles by Adnan.