The Way America Does Business

THERE is general agreement across the ideological spectrum that the U.S. economy is at a crossroads. We live in a time when, as the Italian philosopher Antonio Gramsci once put it, "The old world is dying, but the new refuses to be born."

Some observers are calling this an era of transition from an industrial to a post-industrial society. Others call it the change from a manufacturing economy to a service economy. Catholic lay theologian and social analyst Joe Holland more bluntly labels the current dislocation part of the shift from a welfare state to a national security state.

Whichever label we choose, and there is truth in all three, there can no longer be any question that fundamental changes are taking place in the way America does business. And those changes have sweeping implications for the daily life of the majority of the American people and inevitably for the rest of the world, too.

The symptoms of historic transition are all around us. The U.S. steel industry, once the backbone of our economy, has all but disappeared. The automobile industry is in serious decline. Official unemployment rates have been above 7 percent for five years now, and people without jobs are staying unemployed for longer periods of time, indicating the long-term nature of the problem. After 40 years of steady increase, the median income for a family of four in the United States has gone down by 16 percent since 1976. Similarly the percentage of Americans living in poverty has been steadily increasing since the mid-1970s to the current 14 percent.

Yet, alongside these grim realities, a giddy sense of boomtown affluence abounds in U.S. society. The tone set by Ronald Reagan's 1984 re-election campaign still rules popular perception: America is back, bigger and better than ever, and deregulated to boot. A few hours in front of a television and a stroll through the more fashionable downtown district of any city would convince you that playing the money market is now the national pastime, conspicuous consumption of electronic toys and imported luxury goods the national religion, and shopping for telephone and cable TV services the only remaining economic worry.

Such dizzying contradictions are bound to raise a few questions. In fact, one such question might be, are these two American economic realities a contradiction or a paradox? Is the real American future to be seen in Allentown or Georgetown? Or both? More concretely we might ask, who is making the decisions that are guiding this period of transition, and who is benefitting from them? On what values, if any, are those decisions being based? And, more specifically, what do people who claim to be rooted in biblical tradition and values have to contribute in such a time? Is there anything we can offer at this juncture that might help shape the economic future?

TO EVEN SPECULATE fruitfully about where we are, much less where we are going, we need to understand a little bit about where we have been. Our old economic world was largely the product of World War II. Wartime expenditures and production not only pulled the United States out of the Great Depression, but created the greatest industrial machine in human history. The United States emerged from World War II as the pre-eminent military and political power on earth. Because the war was fought on distant continents, the U.S wartime productive capacity was still intact, and the Bretton Woods agreement which set the ground rules for postwar international finance made the U.S. dollar the universal medium of global trade.

This combination of unparalleled military, political, and economic power gave the United States free access to the markets, raw materials, and work forces of the Western European nations, Japan, and their former colonies in the Third World. The stage was set for a period of unprecedented prosperity.

The old world of American postwar prosperity, often pointed to as the ultimate triumph of free-market economics, was not brought about solely by the invisible hand. It was heavily assisted by government expenditures ranging from continued war-level military budgets and the Marshall Plan to veterans' housing and education benefits and the interstate highway system.

This confluence of forces created the America in which many of us grew up. It was an America centered on basic industrial production (steel, petrochemicals, auto, military, etc.). It created a large population of working-class families, also called the "new middle class," who could reasonably expect to own a home and at least one automobile, enjoy a level of discretionary spending unknown to their forebears, and help their kids through college, all on one income.

In many ways that wasn't such a bad world. Life expectancies went up with standards of living. Some of life's drudgery and discomfort was alleviated for many Americans. The opening of college education to a larger strata of society created a class of young people, especially women, more likely to challenge the status quo. The sheer quantity of goods and services available even made it possible to expand the benefits of the welfare state.

But it had its drawbacks. For one thing the rewards of prosperity never reached the bottom rungs of the social ladder. Even at its peak, the affluent society never had room for the vast majority of black Americans. Millions remained as sick, hungry, and destitute as ever. And their poverty was worsened by their marginalization in a country that assumed all its economic and social problems were solved.

The global base of American affluence also brought global entanglements in the affairs of other peoples. As the United States took over the colonial role previously held pre-eminently by Great Britain, we chose to continue the economic vampirism of that old order. Thus the oppressions of colonialism had to be maintained, often through bloodshed. Once the symbol of democratic hope, the United States became the despised oppressor.

In addition to the military requirements of world-policing, successive administrations also found it convenient to wrap economic planning in the flag and use the military budget as a politically safe way to stimulate economic growth. As a result we developed a permanent and virtually uncontrollable military establishment. As early as 1960, one of the leading military men of the century, President Dwight D. Eisenhower, recognized that what he called "the military-industrial complex" not only made social progress impossible through its drain on our national resources but also represented a threat to American democratic values.

But even as Eisenhower spoke, the fabric of American democracy was weakening in ways that only a few radical social critics seemed to notice. The U.S. economy was becoming more and more centralized. In the postwar era, a very few enormous transnational corporations came to dominate every aspect of American life. This centralization of wealth and power, and the resulting disappearance of classic market restraints on business, was most obvious in the big industries like energy, steel, auto production, and agribusiness. In each case the significant players can be counted on one's fingers.

The power that accrued to corporate giants like Exxon or General Motors was not just the economic power to fix high prices for second-rate or unnecessary goods. It was also the political power to elect or remove U.S. presidents and overthrow foreign governments. Earlier in this century, every American city was home to an independent auto manufacturing concern. And coincidentally every American city once boasted a lively chapter of one or several radical political parties. By the 1950s there were neither. The constriction of choices in the economic market was mirrored in the marketplace of ideas.

Corporate centralization reached into the very fabric of daily life. The mom-and-pop grocery became the Southland Incorporated Seven Eleven. The corner diner became McDonald's. The long inexorable decline of the family farm and the farm community began. Cities that were once a patchwork of relatively self-sufficient and communal neighborhoods were remade in the image of the automobile industry with distant compartmentalized work, shop, and sleep places connected only by miles of federally funded highways. In short, almost all of the institutions that facilitated ordinary people's direct participation in economic, political, and cultural life were uprooted and replaced by new corporate institutions in which the people participated only as consumers.

THAT WORKED WELL enough as long as a constantly expanding economic pie put a vocation of consumption within at least the potential reach of most Americans. But today, despite the high media visibility of ultra-consumptive, information-industry professionals, that is no longer the case for most of the so-called middle class. The family that makes it quite comfortably on one income is a thing of the past. Even with two incomes, most American families can no longer afford to own a home or reasonably expect to ever own one.

For the first time in almost 50 years, most Americans don't expect that life will be better for their children. The widespread perception that American affluence is back is just that—a perception carefully engineered by the Reagan administration with the enthusiastic collaboration of the news media and various culture-mongers. Things are better than they were in the worst days of 1982, but the underlying reality is still that, for a large majority of our people, the American pie is no longer expanding.

One major reason for that is the disappearance of the high-paying industrial production jobs that were the core of our old economic world. Contrary to the official mythology, the decline of basic industry in the United States was not caused by lazy workers, union contracts, or environmental regulations. It was caused by a combination of factors, including the inevitable resurgence of Western European and Japanese industry and the industrialization of some Third World countries, especially in Asia. But these historical changes could have been dealt with in ways that wouldn't have traumatized a large portion of the United States.

For instance, U.S. companies consistently failed to adopt new, more efficient industrial technologies, because our tax laws made it more profitable for them to continue writing off the depreciation of old equipment and invest instead in overseas production plants and speculative diversification. Many of the steel plants shut down in the last 10 years were not unprofitable; that's why workers are now trying to buy them. Instead they weren't profitable enough compared to the easy option of buying steel produced by Koreans earning a dollar an hour. It should be obvious that in the long run such a policy doesn't benefit either Korean or American workers. It is equally obvious whom it does benefit.

Another important change in the current U.S. economy is in a way a corollary to the internationalization of industrial labor and capital. That is the rapid development of new computer technologies.

Computer communications have greatly facilitated the international mobility of U.S. capital. Imagine the logistical nightmare it would be for a corporation to have its production, management, and marketing process for a single product scattered from Tennessee to Mexico to Hong Kong and back to New York without computers. And as applications of the technology proliferate, computer manufacturing is becoming a major "basic" industry in its own right, albeit one involving considerably lower capital outlays and wage levels than the older industries.

Over the next few decades, computers will increasingly become the means of production and communication. In and of itself, computer technology is like most such developments. Its application brings the threat of dehumanization, already clear in the indiscriminate collection of personal information on people via computerized financial transactions. But the new technology can also be used to make life a little less trying for everyone on earth.

BY NOW THE OUTLINE of a new technological order in the United States can already be seen taking shape. And it is not one devoted to the expansion of human potential. Instead the ascendancy of the "information industries" is creating an increasingly wealthy and isolated managerial and professional elite and an ever-larger class of the permanently left-behind who will either be unemployed or channeled into low-pay and low-dignity "service" jobs.

The impact of these changes has been felt first and most intensively by those who already bore the additional burdens of racism and sexism. Black unemployment is consistently twice that of whites. And the emerging structure of the U.S. economy, the cutback of federal supports, and the current retreat from affirmative action all combine to leave most blacks in the United States with no way out of ever-deepening poverty.

Women's participation in economic life has always been limited by sexist stereotypes and consistently undervalued. Women were supposed to depend on men for their economic well-being, but today poor and working-class men are often unable to perform the support function, and more affluent men are often unwilling. Women, and their children, are being left without economic resources in a society that still denigrates the value of "women's work" in the home and outside it. The result has been dubbed the "pauperization of women." At present two out of three poor adults are women, and the majority of poor families are headed by women alone.

In addition to being economically left-behind, a large percentage of low- and moderate-income Americans may in the years ahead become politically and culturally disenfranchised as the spread of information and ideas increasingly takes place through technological channels, like cable television and home computer networks, which are financially closed to them.

This future of two nations unequal and increasingly separate is not one that the American people have chosen. The decision to gut the manufacturing sector of the U.S. economy was never debated in the halls of Congress. Instead it was the result of investment decisions made in corporate boardrooms. The most important decisions about the life of the nation, short of a declaration of war, are routinely made by a tiny group of wealthy white men essentially accountable to no one and interested only in quarterly profit statements.

The political trend of the last 10 years has been toward removing the few existing restrictions on corporate power, whether in the form of indirect pressures like taxation or overt environmental or anti-trust regulations. At this point there is no serious source of countervailing power to the power of corporations. Labor unions, always weak in the United States, are now steadily shrinking under an all-out government and business assault. Communities are fragmented and disenfranchised. The Democratic "opposition" has never really opposed corporate interests in the past and is not about to start now. And the dissident politics that do exist are mostly limited to single-issue moral appeals that generally fail to connect in any sustained or substantial way with the interests and values of most Americans.

What passes for economic debate in the United States today is mostly about technical questions like trade policy, the deficit, or the mechanics of taxation. No one would deny that these are issues that must be addressed. But which technical solutions to such questions are chosen finally rests on a chosen set of values and assumptions about the nature of economic and political life in the United States.

The changes currently taking place in our country raise, or should raise, those deeper questions in disturbing ways. But they are going largely unaddressed. Before us are questions about the function of economic activity in our society; the roles that workers, consumers, local communities, government, and business play in it; and even more basic questions about our identity as citizens, and as a people, and the fundamental covenant among us that holds society together. Our economic questions today are also political, moral, and even spiritual questions. They are, at heart, questions about values, vision, and community.

CLEARLY THOSE ARE the kinds of questions to which religious people and institutions should be uniquely qualified to speak. The question of human beings' relationship to material goods and the establishment of just economic patterns in society looms large throughout biblical history and teaching.

Some years ago a member of the Sojourners staff did a survey which found that one out of every 16 verses of the New Testament contains direct teaching on questions of wealth and poverty. In the synoptic gospels, the ratio is one out of 10. He found that Jesus addressed economic questions more frequently than he did violence, sexual morality, or heaven and hell.

The most fundamental principle of biblical economics, and the one that sets the biblical view most radically apart from all contemporary systems, is the notion that economic activity is not an end in itself but exists to serve higher purposes. Whether by direct teaching or clear implication, most contemporary societies (capitalist or communist) place economic activity at the center of their definition of humanity; one's primary identity is either producer, consumer, or owner. The biblical view puts the human relationship to God, expressed in community, at the center of its definition of humanity; one's primary identity is child of God, and as sister or brother to the rest of God's children.

The biblical emphasis is not so much on the mechanics of producing and distributing material goods as on how such activities reflect a right relationship to God and one's neighbors. Within that overall emphasis, some fairly specific biblical principles for economic activity can also be discerned. One is that the creation and all its fruits belong to God and are made available to humankind in order to meet the needs of all, which is to say that human ownership of property is not absolute and cannot be allowed to take precedence over human need. The primary standard the Bible gives us for judging any economic system is the priority of the poor. The righteousness of a people is to be seen in how they treat the weakest members of society.

The Hebrew prophets proclaimed that the true worship God desires is that we secure justice for the poor. And Jesus went so far as to teach that by meeting the needs of the poor, we are directly serving the Son of God, and, conversely, that to turn away from the poor is to reject Christ.

The prophets declared that excessive accumulations of wealth were the result of exploitation. In the book of James, holders of great wealth, as a class, are categorically denounced as the oppressors and persecutors of God's people. The jubilee year was promulgated in order to periodically cancel the effects of exploitation and level the distribution of wealth.

In addition, Jesus repeatedly taught that great wealth, however attained, was in itself an impediment to the whole and righteous life God desires. The practice of economic sharing in the early church ensured that there were no rich or poor among the early Christians.

Biblical teaching also requires that economic activity consider not only the welfare of human beings but also the rest of creation, including animals and the land itself. The sabbath was a day of rest for the farmer and also specifically for the oxen. It was mandated that every seventh year the land be left fallow so that it could regenerate itself.

All of these biblical teachings and principles have clear, and often damning, implications for the way economic life is conducted in the United States today. One can only imagine the rage of the prophet Amos at the prospect of $60 billion in corporate tax cuts paid for by cutting infant nutrition programs. Or the weeping of Micah and Isaiah at our country's $300 billion military budget at a time when millions of the world's people are starving. The injunction to be good stewards of the earth is mocked by acid rain and our reckless production and careless disposal of an endless variety of toxic chemicals.

The last five years have seen many expressions of moral outrage from the Christian community over such policies. And thousands of churches and individual Christians have joined in service to the hungry and homeless victims of Reaganomics. But in the long run, moral outrage, and even compassion, are not enough. In the long run, we need a workable picture of how the U.S. economy could function more justly. And we need to put forth that vision in a language that expresses both the concrete interests and deeply held values of ordinary Americans.

DESPITE THE CURRENT claims of some free-market enthusiasts, the Bible doesn't contain a blueprint for the conduct of late-20th-century industrial, or post-industrial, economics. But in addition to the fundamental principles of justice, equity, and sustainability already mentioned, the biblical tradition does hold some rich resources for our situation.

One of the most important is the notion of community, which boils down to the simple principle that people are interdependent and need each other. In scripture this principle is established at the very beginning with the creation of the first woman and man. And the entire biblical story is that of God's desire to create a people whose life together displays the just, compassionate, and loving nature of God.

In the biblical view, one's relationship with God and the attainment of a fully human life on this earth are tied up with one's relationship to a community of people. The emphasis of all biblical teaching on economic and social behavior from the Mosaic law to the Pauline epistles is on the collective well-being of the entire people. A life devoted to individual gain at the expense of others is considered a hollow and sinful distortion of the human vocation.

The value of, and need for, the experience of community is not just an abstract doctrine of religious teaching or ethical thought. It is deeply embedded in the human heart. Even the most rudimentary forms of human society are impossible without some sense of shared identity and communal responsibility. But almost everything about the organization of economic life in the United States is destructive of such human solidarity—from the laissez faire and Horatio Alger enculturation of civics classes and television to the architecture of our cities and the nature of our labor laws. The frequent testimony of community organizers in the United States is that before it is even possible to do their primary job of helping a community mobilize around its own interests and needs, they often must spend most of their time working to rebuild a sense of community.

Despite all the atomizing forces in American life, people still seek a sense of community. Given half a chance, they place high value on it and miss it when it is gone. At great pains and against overwhelming odds, steelworkers and their families are even now organizing to try to reopen shut-down plants and run them themselves. Partly those campaigns are a matter of survival, but they are also explicitly fueled by a love for the community of co-workers and neighbors that has grown up over the decades in those plants and the towns around them.

A couple of months ago in Houston, Texas, I sat in a church gymnasium with 1,500 black, white, and Hispanic members of a city-wide citizens' organization based in local churches. One purpose of the gathering was to celebrate the victories that they, in conjunction with allied organizations in six other Texas cities, had won in the 1985 session of the state legislature. Among the bills they had helped get passed was an indigent health care program which guarantees that no one in Texas will go without basic medical care just because they can't pay for it.

Some of the people in that gathering would probably benefit from the program. But most, especially the whites, would not. But white, ostensibly middle-class Texans had joined in the lobbying for indigent health care and joined that night in cheering its passage.

The people who make a living studying and manipulating citizens' political behavior would tell you such a thing was impossible. But it happened. It happened because through their organization all those people had come to recognize their interdependence. And because their organization is rooted in their churches, they were coming to see their broader self-interest as being inextricably linked with what one of their leaders called "fundamental Judeo-Christian values of justice."

The need for community and interdependence can be a powerful force for countering an economic direction that places corporate profit before people, families, and neighborhoods and fosters growing inequality. And a political strategy and language that emphasizes community can help point the way toward the long-term creation of economic institutions that bring people together to meet the needs of all in the workplace and neighborhood, and at the regional and national levels.

ANOTHER VITAL ELEMENT of biblical teaching that speaks directly to the U.S. economic context is the set of themes that forms the core of recent theological reflection from the Third World. These teachings stress the fact that God's redemptive activity is not limited to the spiritual or otherworldly realms but includes the arena of worldly human history. Third World Christians have seen, quite correctly, that the God of the Bible is on the side of the poor and oppressed and that an integral part of God's saving activity is to break the bonds of political and economic oppression and dehumanization that prevent people from living the free and abundant life that is intended for all God's children.

In practice this theological foundation has led the church to emphasize organization and action that empowers the powerless. One phrase used in Latin America describes this as a process of helping people who have been the "objects" of history become the "subjects," or active shapers, of their own history.

The Third World theologians always insist that these basic biblical principles have to be adapted differently to the cultural and political context of each society. In the United States, there has been a great deal of interest in liberation theology in the seminaries and among Christian social activists. And its influence is being felt in the black churches where, in fact, an indigenous theology of liberation has been a vital force for centuries. There has also been some important work by feminist theologians applying the insights of liberation theology to the pervasive oppression of women. But for the most part, the reflections of Third World Christians are still treated in the United States as a set of imported ideas.

That is mostly because the U.S. context is so drastically different from the one in which liberation theology was born. In a Third World country, the vast majority of the people are desperately poor. Their oppressors are generally U.S. corporations and the U.S. government, along with a very small local elite. In that context, to speak of a preferential option for the poor is to speak of an option for the majority. Liberation is the empowerment of virtually the entire people.

In the U.S. context, those who are identified as poor are only one-fifth of the population. Among the North American majority, talk of the preferential option for the poor may call forth a response of self-sacrifice, relinquishment, and solidarity. That is clearly a faithful and appropriate response for most U.S. Christians, especially when we see ourselves in the global context.

But "the preferential option for the poor" in middle-class North America can also bring the response, "What are we supposed to do for 'the poor'? We're barely making it ourselves." While that response may sometimes be a matter of self-justifying avoidance, in many cases it is either objectively true or at least understandable.

In the global context, most people in the United States could be considered quite affluent. But in the world in which Americans live their daily lives, the median income of about $19,000 for a family of four doesn't feel rich. It is certainly true that in the long run global justice requires changing many of the elements of the North American lifestyle that result in our current levels of consumption. But given what it currently takes to have a decent life in our society, the majority is not wallowing in excess. In fact, they are increasingly feeling the economic squeeze.

In addition, material well-being is only one component of a decent human life. Another equally important component is the ability to participate in the decisions that affect one's life, to be a "subject" in history.

We in the United States have more opportunity than most of the world's people to influence our government through voting, lobbying, and exercising our first amendment rights—though the real value of those political rights is severely diminished by inaccessible government institutions and dominant corporate interests. But in the "economic" arena, where we spend most of our lives, we have no access at all to decision-making power. No one except corporate board members gets to vote on questions like the shutdown of a factory that employs most of a town or the location of a toxic waste site. Only in the smallest or most exceptional of workplaces is there any open discussion of how the work process can be most efficiently and humanely organized.

In our economic life, consumption is the sole arena of choice, and even there we are only free to choose among goods and services produced by a few virtually monopolistic corporations. Nowhere in the process is there any kind of public input regarding what kind of goods should be produced to make best use of our resources in meeting our real needs.

THE NEED FOR POPULAR control over corporate power is at present a virtual non-issue in our national politics. But that is clearly not because people are pleased with the status quo. Public opinion polls have consistently shown that most Americans think that corporations have too much power in U.S. society. At the local level, numerous battles are raging over issues like plant closings and environmental hazards, and hundreds of neighborhood, tenant, and community organizing projects are bringing people's power to bear on decisions ranging from zoning laws to rent control.

In recent years some of the most important new initiatives to exert social control over corporate behavior have come from women's groups, including efforts to organize female office workers and the fight that is just beginning for comparable-worth pay scales. These grassroots feminist struggles are among the very most important harbingers for the future, because the shift to a service-oriented economy, as currently envisioned by business, is heavily dependent on women as a cheap labor pool.

Alongside these confrontations with corporate power, the many ongoing experiments in new economic forms—from a community land trust in New England or a worker-owned packing plant in Iowa to the untold number of food-buying clubs in church basements—are all, in effect, a form of direct action by people trying to gain a measure of control over their economic life.

In addition to these overt rumblings of discontent, a less-defined dissatisfaction, bred by a sense of powerlessness, can be seen all around us. It is the major reason that half of the American people don't bother to vote. In the absence of constructive alternatives, the frustration of the powerless can also lead to self-destructive patterns like alcohol and drug abuse. Or it can be turned outward into the sickness of racism and anti-Semitism, as is starting to happen among some Midwestern farmers who despair of understanding, much less affecting, the real causes of their plight.

From the time of the prophets, the empowerment of the powerless has been part of the vocation of God's people. It is also a felt, if not always named, need on the part of an enormous section of the U.S. population. All the uprisings and vague discontents just mentioned are at heart reflections of the democratic impulse in American life.

This country was founded on the idea that the people can and should rule themselves. The idea quickly proved more powerful than its framers intended as first white working men, then blacks, and then women demanded inclusion in its promise. In the United States, democracy, meaning simply rule by the people, has been the name for "liberation." And it still is.

NO ONE REALLY KNOWS what an economy based on the principles of community and democracy would look like. But the beginnings of such a vision can be found in the works of a variety of thinkers ranging from the decentralist "small-is-beautiful" school to the more orthodox "reindustrialize-America" species and in the many small-scale cooperative experiments. Many of the best ideas center around the possibility of a market economy loosely planned by elected local, regional, and national boards.

The economy could be made up of a mixture of worker-, community-, state-, and privately-owned enterprises, whichever form of ownership was most appropriate to ensure the goals of efficiency, equity, and participation. All such enterprises could be chartered with certain requirements for internal democracy and representation in decision-making for other affected groups such as consumers. Some of the beginning steps for moving toward these goals that have been suggested include federal chartering of interstate corporations with requirements for worker, consumer, and community participation on the boards.

The growth of worker-, consumer-, or community-owned and -controlled enterprises could be encouraged through the establishment of national and state banks using government treasury deposits and pension funds to invest in viable innovative businesses. If all this sounds terribly unwieldy, it is in large part because we are unaware of the wasteful, haphazard, and hidden economic planning process that currently takes place through corporations.

Unfortunately, there is plenty of time to work out the details, since even the most tentative steps toward economic democracy are not going to be on the national agenda for at least several years. There is, however, considerably less time for a new spirit and a new way of thinking to begin entering public debate and public consciousness. President Reagan is successfully selling the American people on his policies and economic worldview, despite their many glaring flaws. In the moral desert of American politics today, Reagan's "Opportunity Society" is the closest thing to a social vision most people know about. The crying need at present is for a new sense of what is possible for us as people and as a nation.

The churches can play an important part in that task. In their teaching role they can point out the structure of power in our society, identify the pharaohs, and counter them with a biblically rooted vision of community and democracy. But more can be done than talk.

In the long haul, one of the best contributions the churches could make toward setting our country on a new course might be the adoption of community organizing as a primary social justice strategy. Such organizations are not the stuff of revolutionary romanticism. They help show people the way out of silence and isolation and into action and solidarity. And once underway in the lives of ordinary people, that process has often proved explosive.

Danny Collum was an associate editor of Sojourners magazine when this article appeared.