Ultimately, to arrive at a better understanding of this issue we must examine the issue of who decides the value of labor in New York or Lagos, Nigeria. Why is it that the labor value of an AIG insurance worker worth just a small fraction of the value of corporate management responsible for the company’s mismanagement that so far has resulted in $150 billion bailout of taxpayer money? Milton Friedman always answered that the market decides. But who decides about the market, God or those who control the market? This is an issue that European and US governments are addressing as they are handing out trillions–wealth expected to be produced by the middle class and workers–to corporations to save the system that the financial elites (the not-so invisible hand of the market) have bankrupted with the state’s considerable acquiescence.
Every generation believes that it lives in unique times, and we are no different in this epoch of anxieties as Paul Tillich and Carl Jung so brilliantly observed about 20th-century man. There are very serious structural problems in the market economy and appearances to the contrary, government responses to this crisis will not and cannot simply be limited to bailouts of banks and other industries only to revive them so we find ourselves right back where we are now with the same institutional and social problems. To lessen the length and breadth of inevitable cyclical recessions in the market economy, systemic readjustments will be needed that include every sector from defense and security, to health, education, and environment. Above all, of course there will be, as it must to avoid serious problems in the future, a reexamination of the fiscal structure currently designed to redistribute wealth from the bottom 90% to the top 10 percent of the population. Such concentration is the source of the problem today as it was in previous economic dislocations.