The problem with our economy is that business decision-making today is based primarily on fear. Executives are afraid of being sued, blamed, demoted, fired or pilloried by the media. And they have a lot to lose.
According to the AFL-CIO, between 1980 and 2011 CEO pay rose from 42 times the average blue-collar worker to 380 times. The wealth of our country has been drastically concentrated at the top 1 percent (it peaked at 23 percent in 2007).
A great example of fear in business is defensive medicine. The practice of defensive medicine costs the United States $650 billion to $850 billion annually, according to Jackson Healthcare and Gallup.
Doctors at least practice medicine. CEOs avoid communicating publicly. According to a recent article on Mashable.com, only 18 percent of top CEOs at the world's 50 biggest companies are personally on social networks. They fear a public misstep.
Those are the same "job creators" (my new favorite oxymoron) who are quick to congratulate themselves for their leadership skills. Current wisdom holds that management is about planning, organizing and coordinating while leadership is about inspiring and motivating. We're now paying the cheerleaders more than the quarterbacks. Yet the cheerleaders are afraid to cheer in public.
American business leaders have always lionized themselves as hard charging, risk-taking mavericks and innovators. That might have been true at one time, but these days they're risk-averse plutocrats hellbent on maintaining the status quo. And their efforts appear to be working. Median income since 1980 has only risen 15 percent, according to Wikipedia.
If our economy is to evolve into a system that will allow everyone to grow and flourish, not just those already on top, then the time for change is now. And the time for fear is over.
MICHAEL SEINBERG
Altamont