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Audience at World Economic Forum, Davos
Attendees to the annual World Economic Forum in Davos, Switzerland. As the founder of the Economic Policy Institute, author Faux argues that it is this small, influential global elite which are driving globalization, enriching the few, impoverishing the many. PHOTO: U.S. State Department

Towards a Global Social Contract

C-Span Book TV broadcast of 'The Global Class War' author Jeff Faux on the roots of the world's growing economic divide.

By EV World

Jeff Faux sees the need for a global social contract that secures the rights of the world's "ordinary people" from exploitation by what he calls the "Party of Davos", referring to a small, but powerful elite made up of multi-national corporations and politicians. While all this sounds a bit "conspiratorial", Faux makes a persuasive case for his assertion in this 1-hour Book TV talk and its follow up Q&A sessions, both of which you can listen to or download in MP3 audio format using the links at the right.

Faux outlines four key points in his talks:

  1. The global economy is creating a global class system
  2. This class system -- he calls the Party of Davos -- has allowed America's elite to disconnect from their social responsibility in this country.
  3. This disconnect will "inevitably" lead to lower living standards in America.
  4. This necessitates the need for a global social contract benefiting all mankind.

For Faux, the insights and inspiration for his book, provocatively entitled, "The Global Class War", came on Capitol Hill during the NAFTA debates of the Clinton Administration when a corporate lobbyist told him in an exasperated tone, "We have to help (then Mexican president) Salinas; he went to Harvard. He's one of us".

"She was appealing for class solidarity," Faux explained, noting that the woman had never been to Harvard, and Faux had only briefly attended.

"Harvard was a metaphor for her."

 
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"The solidarity of us, who were professional, mobile people connected to this new global economy, who she thought had an obligation to help major corporations to disconnect from the anchors that held them to the various national societies, freeing them from obligations to workers and their communities."

In the wake of the Great Depression and Roosevelt's New Deal, a new social contract was struck in this country that implied that management and labor, employers and workers needed each other, Faux said.

"General Motors needed the UAW workers in order to make the cars and in order to buy the cars, and the workers needed General Motors to organize the production and invest."

However, he notes that his social contract has begun to gradually erode over the last two decades as the global economy began to emerge.

"Corporations don't need the workers as much as they did," he said. "If you can get your labor cheaper someplace else, you go someplace else.

"The whole incentive structure of the global economy undercuts the social contract."

This eroding river social accountability can be felt and seen throughout the United States and much of the rest of the Western world. Faux notes that as long as a decade ago the then CEO of Ford Motor Company was saying it's no longer an American company, it's a global company. And why it and General Motors continue to face staggering financial losses in their U.S. operations, their foreign -- especially in China -- operations are doing well.

Faux returns to the impact of the "Party of Davos" and it's impact on the auto industry in the Q&A session, so be sure to also listen to and/or download that MP3 file as well.

"We need to create a politics in this country where our leaders worry more about how to bring healthcare to Baltimore than Burger Kings to Baghdad. And maybe if we can figure out (a new social contract) here, maybe at sometime in the future, we Americans will have enough wisdom and enough experience to then go around to the rest of the world and say, we've got a model that works. Right now we don't," he concluded.

This is a very thought provoking program, so be sure to listen to both parts in their entirety. This is the kind of dialogue America needs to be having with itself as we look beyond 2008.

Times Article Viewed: 6241
Published: 22-Mar-2006

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