The Looting of America

August 31, 2020 (643 words)

Another irony is that the financial institutions whose CEOs are now taking a kneel in solidarity with Black Lives Matter, and pledging $500 million over four years to combat these issues in the communities they serve, are the very ones that have become ever-more predatory in their day-to-day operations.

These practices undermine the middle-class existence of whites and blacks alike, and prevent the black underclass from ever gaining a foothold in middle-class America.

As many have noted, an ideological coup has transformed American society over the last fifty or sixty years, by fundamentally altering the rules of the market. The fortunes of the financial economy – and its agents like private equity firms – have dramatically improved, at the expense of the real economy experienced by the rest of us.

This coup was launched on the belief only unfettered markets can ensure social justice and enhance personal freedom, since only the profit motive can dispassionately pick winners and losers based on their contribution to the economy.

Its iron logic holds the private sector can do everything better than government.

The heralded magic of the market has indeed lived up to its promise of turning everything into gold – if you are a wealthy investor. This windfall occurred via widespread deregulation which created a winner-take-all, debt-fueled market. And just as importantly, a growing cultural acceptance of purely profit-driven corporate managers.

As Professor Mehrsa Baradaran explains in the short essay, “The Neoliberal Looting of America:”

“Private equity firms use money provided by institutional investors like pension funds and university endowments to take over and restructure companies or industries. Private equity touches practically every sector, from housing to health care to retail. In pursuit of maximum returns, such firms have squeezed businesses for every last drop of profit, cutting jobs, pensions, and salaries where possible.

“The debt-laden buy-outs privatize gains when they work, and socialize losses when they don’t, driving previously healthy firms to bankruptcy and leaving many others permanently hobbled. The list of private equity’s victims have grown even longer in the past year, adding J. Crew, Toys ‘R’ Us, Hertz, and more.

“In the last decade, private equity management has led to approximately 1.3 million job losses due to retail bankruptcies and liquidations. Beyond the companies directly controlled by private equity, the threat of being the next take-over target has most likely led other companies to pre-emptively cut wages and jobs to avoid being the weakest prey.

“Amid the outbreak of street protests in June, a satirical headline in The Onion put it best: ‘Protestors Criticized for Looting Businesses Without Forming Private Equity Firm First.’ Yet the private equity take-over is not technically looting because it has been made perfectly legal, and even encouraged, by policymakers.”

Professor Baradaran closes her essay as follows:

“We can start fixing the big flaws propagated over the last half century by taxing the largest fortunes, breaking up large banks, and imposing market rules that prohibit the predatory behaviors of private equity firms.

“Public markets can take over the places that private markets have failed to adequately serve. Federal or state agencies can provide essential services like banking, health care, internet access, transportation, and housing at cost through a public option. Historically, road maintenance, mail delivery, police, and other services are not left to the market, but provided directly by the government. Private markets can still compete, but basic services are guaranteed to everyone.

“And we can move beyond the myths of neoliberalism that have led us here. We can have competitive and prosperous markets, but our focus should be on ensuring human dignity, thriving families, and healthy communities. When those are in conflict, we should choose flourishing communities over profit.”

(Mehrsha Baradan is a professor of law at the University of California, Irvine, and the author of “The Color of Money: Black Banks and the Racial Wealth Gap.”)

Robert J. Cavanaugh, Jr
August 31, 2020

A Hue and Cry across the Land

August 27, 2020 (542 words)

It seems every organization in America, from acting troupes to tech firms, has felt compelled to issue a statement in recent weeks condemning racism and supporting diversity and inclusion. The consensus being expressed is so compelling one wonders how the problem could have ever developed in the first place, let alone become so ingrained. The impassioned declarations of artistic directors, university presidents, and some of corporate America’s leading CEOs, are bracing and cathartic. It’s why some are calling this a “transformative social justice moment.” But talk is cheap. The only way to make a dent in the under-representation thing is for leaders who are now publically prostrating themselves to actually hire more minorities. The thought of a hiring or admission quota is anathema to many whites, but we’ve tried letting nature take its course and that hasn’t worked. Despite years of reassuring lip service about improving diversity from the likes of Silicon Valley and Wall Street, the percentage of blacks in executive roles still doesn’t even hit 5%, when it should be three times that number. To complain that someone is not up-to-snuff and only got their position by being a “minority hire” pre-supposes every white male executive, every white employee, is a stellar top performer. There is a lot of dead wood in many large organizations, so why should we get overly worked up if some of that dead wood turns out to be from minority stock. The cream usually rises to the top. And if the cream is prevented from rising, if it is given only token responsibility, or if it is boxed out via office politics, that cream will move on, and possibility start their own enterprise, as so many white entrepreneurs have done in the past. But we’ve got to get a representative number of blacks into the system, and give them a chance to acclimate themselves and bring their skills to bear. As for how the problem ever developed in the first place, that’s easy. It’s our commitment to “personal freedom”. It’s the way we have enshrined “self-interest” as the best possible operating principle for society. This may not have the bite of other’s cultural analysis, and it may strike you as overly simplistic. But what we are grappling with now on the thorny subject of race relations is nothing less than the unintended consequences of our founding creed of “life, liberty, and the pursuit of happiness.” The uniquely American concept of human flourishing through an “absence of obstacles” was contingent on everyone starting out from more or less the same place. Since most blacks initially arrived here in chains, never did they even remotely occupy the same place as whites in American society. The spirit of secular modernism, embodied by our every-man-for-himself system of commerce, has compromised the religious orientation white Americans have historically claimed for themselves. This lapsed orientation should have mitigated the all-too-human tendency toward prejudice and bigotry that has produced the social and economic inequities now being scrutinized. Once again we confront the fact that Christianity is incompatible with capitalism. At least with the version of capitalism we have been practicing for the last couple of centuries. The irony is well-meaning and well-off white Christians are among the last people to recognize this.

Robert J. Cavanaugh, Jr
August 27, 2020

A Lack of Skills, and Confidence

August 23, 2020 (523 words)

Of course not every black man of limited means is violent, or traffics in criminal activity. But there is a generation of law-abiding African-American adult men, now in their thirties and forties, who seem to have no discernable skills whatsoever.

And they also seem to lack confidence in themselves.

In my admittedly limited, anecdotal experience, there is a marked passivity to many of these guys that comes off as their having no instincts on how to do anything. It’s as if they don’t think themselves good enough, or smart enough, to function in a white man’s world. Even though they are every bit as intelligent as the whites they may be working alongside of.

The black men I am describing are ones I have encountered in a blue-collar work environment. They are affable gentlemen for the most part, though a few have become frustrated with their lot in life, and express that as rage at “the system.”

In my amateur analysis, their lack of confidence was hatched long before any of them entered the workforce. What might be described as the missing piece of their character development was the absence of a father in so many of these men’s lives.

In my up-close, first-hand experience with upwards of twenty African-American men over the last couple of decades, it’s not that the father skipped town. He was around, but chose not to live with his off-spring, at least not during the formative years. He was a tangential presence, at best, in his children’s lives.

As most of us have come to know, mothers are in charge of nurturing their children and making sure they feel loved. Fathers, on the other hand, are in charge of acclimating their children – and especially their sons – to the realities of the outside world. This is the very component so many black men of my acquaintance are clearly lacking. This is the source of their lack of confidence.

Again let me state the control group for my little behavioral study consists of guys “from the neighborhood” who were unable to score anything other than minimum wage jobs, before joining my small operation as warehouse workers and delivery drivers. They tend to come and go after a few years, which is why I’ve encountered such a sample size.

(Another side note: In my line of work I don’t get to hang out and rub elbows with African Americans who are Ivy League professors, investment bankers, or research scientists. Such men no doubt are brimming with confidence, and can think rings around the likes of me.)

By comparison, working-class whites have historically benefited from growing up as part of intact nuclear families. These white fathers have always had their pronounced flaws, especially when operating under financial stress, which seems to be most of the time.

They may not have been shining examples of concern and caring when it came to executing their parental duties. But more often than not they managed to get their children – and especially their sons – ready to face the outside world, just by virtue of being there and grinding it out every day.

Robert J. Cavanaugh, Jr
August 23, 2020

Why do Blacks fill our Jails?

August 18, 2020 (301 words)

This summer’s “day of reckoning” kicked off with the May 25 death of George Floyd in Minneapolis, MN, while in police custody. It was the latest such incident in recent years – flagrant examples of police brutality inflicted upon blacks. Police departments around the country need a major re-think of how they interact with their minority communities. And they certainly need to dismiss the bad actors that have been allowed to retain their jobs after multiple citations for inappropriate behavior. But the over-representation of blacks in the criminal justice system cannot be solely attributed to unwarranted zealousness on the part of mean-spirited whites with a chip on their shoulder. While prejudice may be a contributing factor, it only accounts for 15% or 20% of the discrepancy, according to high-profile social commentator Glen C. Loury. The rest is due to the indisputable fact blacks are committing more acts that can be punished with prison. Mr. Loury is a tenured professor of economics currently affiliated with Brown University. As an esteemed, 71 year-old African-American academic and author, he is being called on quite a bit for comment during this, our summer of discontent. He is of the opinion the determinist argument that “if you have poverty, you are going to have crime” let’s black perps off the hook. This defense of crime in poor neighborhoods leaves out “human agency,” and it leaves out morality, according to Professor Loury. Doesn’t law enforcement have a responsibility to do its job, even when the crimes take place in a black community? The apparent overuse of force when policing in minority neighborhoods needs to be reviewed and reined in. But that said, don’t black people deserve the same protection from the criminals in their midst as do whites, even when those criminals happen to be black themselves?

Robert J. Cavanaugh, Jr
August 18, 2020

Personal Habits and Success

August 15, 2020 (475 words)

A lack of cognitive ability, or possession of a lesser degree of cognitive ability, can be an obstacle to securing viable employment. But this condition – like the blessing of inherent dignity, native intelligence, and even genius – is found among all races and ethnic groups in similar proportion.

It’s not as if the white population is any smarter, on average, than the black population. (As a white man i can assert this with absolute authority). There are plenty of white guys who are not exactly the brightest bulb in the pack, but who have nevertheless managed to remain gainfully employed down through the years. Their main attributes consist of showing up on time, keeping their nose clean, and mastering a routine.

So when faced with the fact so many black men are just scraping by financially, one has to consider the profligate way some of them have chosen to conduct their personal lives, and how those choices have impacted their employment prospects in a negative way.

The phrase “no Justice, no Peace” is regularly invoked to explain outbursts of anger and even civil unrest that occur in the black community on occasion. And it does make for a compelling argument that has always resonated with me.

But the level of injustice experienced here in the United States is relative. Even in our poorest communities, most everyone has a place to sleep, and enough to eat. Indeed, smart phones proliferate even in the ‘hood, do they not?

The “islands of concentrated poverty” many inner city blacks are forced to inhabit may not be pleasant, and may have been created by residential housing segregation known as red-lining.

As business writer Holman W. Jenkins, Jr. notes, what are now obviously broken communities have been further condemned to failure by public housing subsidies and a welfare system that fixes people to their current, broken down address. So, yes, the political class may want to re-think the place-oriented way they currently allocate federal dollars to address intractable problems like economic and social injustice.

But why did these communities become broken in the first place? Is being poor a direct corollary to not taking care of what little one has? Does living in poverty inevitably result in crime and violence?

Not receiving one’s “fair share” is certainly enough to get worked up about, and is a good reason to complain. But does that justify wonton violence in one’s own community, and the destruction of property? Doesn’t such self-inflicted mayhem make the poverty that much harder to bear?

Put another way, is systemic racism the reason black men shoot each other as frequently as they do? Is it the reason they don’t marry the women who bear their children? Living an indulgent lifestyle dilutes one’s effectiveness on the job. Living a criminal one removes a person from the “employable” category altogether.

Robert J. Cavanaugh, Jr
August 15, 2020

Education is the Key, Right?

August 12, 2020 (321 words)

There is a broad consensus that improving educational opportunities is the answer to the current unemployment problem, among blacks and whites alike. We have to start training young people for today’s hi-tech jobs, according to the experts. But not everyone is predisposed to do such work, either intellectually or temperamentally, even if the specialized training were to become readily available. Ongoing attempts to reform under-funded and under-performing inner city schools should help the black and minority children forced to attend them. Giving these children access to a better education will no doubt increase their chances of finding suitable employment down the line. But let’s not overstate what “a good education” can accomplish in the way of enhanced job prospects. Not every child, black or white, is going to become “a leader of tomorrow.” The majority have a much more modest aspiration: A steady job that can establish them as a functioning member of society. Every race and ethnic group is blessed not only with inherent dignity, but with its fair share of native intelligence, and even genius. If given access to better educational opportunities, the same percentage of black children can blossom and earn an exalted place in the professions, in government, and in the corporate world as do their white counterparts. On a side note, my own little neighborhood passel of white elementary school classmates from half a century ago was nothing special, and we came from parents who were for the most part just plugging along. We had as many as seventy in a classroom back in the 1960s, as I recall. Some of us were rambunctious and unruly. Despite such overcrowding, and daily disruptions to learning, a fair share of our unremarkable gaggle grew up to become doctors and lawyers and Indian chiefs. But that still leaves the rest of the group, the overwhelming majority of both black and white communities, in search of some place to work.

Robert J. Cavanaugh, Jr
August 12, 2020