Regarding the 47 Percent
Who’s a maker and who’s a taker?
That’s been the discussion of the week following the release of a video clip of Republican presidential candidate Mitt Romney, who told supporters that 47% of Americans would be voting for Barack Obama no matter what because these are folks “who are dependent upon government, who believe that they are victims, who believe that government has a responsibility to care for them.” They are also, Romney added, “people who pay no income tax.”
As always, we’ll try to leave the politics to others. But the question of dependency is one that Peter Drucker explored extensively in his work, and it took him to interesting, sometimes unexpected, places.
One thing that would have struck Drucker is how different the debate has become over the years. For a long time, it was the businessman, as much as anyone, who was considered the “taker.” In The New Society, published in 1950, Drucker noted how many workers viewed their manager as “a fat parasite in cutaway and striped trousers, clipping coupons.”
Nor was such a view limited to the worker. “The early economist conceived of the businessman’s behavior as purely passive,” Drucker wrote in Management: Tasks, Responsibilities, Practices. “Even if he was not considered a parasite, his contributions were seen as purely mechanical: the shifting of resources to more productive use.” (Of course, Drucker, for his part, believed that effective managers were extraordinary “makers.”)
Image credit: Stanley Thomas Clough
Yet Drucker would also be sympathetic to the idea that it can be dangerous to become dependent on government. In Managing In a Time of Great Change, Drucker passionately condemned the failures of the welfare state. “Modern welfare destroys,” he asserted. “It does not build competence; it creates dependence.”
This view didn’t apply only to the poor but, rather, to some degree to all of us. This is why government budgets are so hard to tame. “No government dependent on votes for its existence has been able so far to convince its constituents that it should ‘shoot Santa Claus,’” Drucker wrote in The New Society.
Ultimately, however, when it came to questions of “make” and “take,” Drucker seems to have felt most at home with the ideals of Confucius and the notion of interdependence. Rather than think in terms of who gives more or less, or who has rights and who has power, we should adopt a mindset of obligations—one that applies to worker and employer, to parent and child, to leaders and the governed.
“In the ethics of interdependence there are only obligations, and all obligations are mutual obligations,” Drucker explained in The Changing World of the Executive. “In a relationship of interdependence, it is the mutuality of obligation that creates true equality, regardless of differences in rank, wealth or power.”
Or tax bracket.
What’s your view? How should we think about “making” and “taking” in our society today?
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13 Comments
Richard B Mann, PhD
September 21, 2012All welfare, subsidies, and stimulus payments create moral hazards, which weaken the character of the recipient, and the society in general. True costs can only be achieved in a free market where a willing buy and a willing seller agrees on price. Interference by a government creates bubbles in the economy. The TARP and similar programs keep the bubble inflated. The economy is like water and seeks its own level. Sometimes dams are beneficial because of the benefit from the water seeking its own level can create electrical power, But this benefit has no applicable metaphor for the economy. If there is one. let me know.
Elizabeth Cline
September 22, 2012“All welfare, subsidies, and stimulus payments create moral hazards, which weaken the character of the recipient, and the society in general. True costs can only be achieved in a free market where a willing buy and a willing seller agrees on price.”
I agree with you – the corporatists, the oligarchs have basically turned our country into a government ruled by them, for them, of them with their unlimited access to government through obscene lobbying funds. Let us not be intellectually dishonest here. There are parasites on both sides of this argument and if we look at stagnant wages over the past 20 years and the increasingly trickling UPWARDS of the wealth of the nation you will have to at least acknowledge that what I am saying is true.
The character has surely been weakened when you could have the manipulation of the markets, the sophisticated hedge fund derivatives, the total unethical and immoral greed demonstrated by Wall street.
Yes there are buyers and there are sellers. What the foolish masses who buy, buy, buy have failed to understand is that the sellers are extremely good at squeezing every extra cent from us through their sophisticated design of fees, etc. Unfortunately we have been seduced into not reading the fine print in our phone agreements, credit card agreements, etc. We have allowed ourselves to be lulled into easy credit with the false sense that we too are becoming one of the wealthy and well off.
Please let us not talk about dependency without taking into consideration the massive tax loopholes that the corporations and the wealthy enjoy. Somehow when the ordinary citizen makes use of loopholes they are dependent.
Give me a break please. Read David Cay Johnston’s “Read the Fine Print”
Richard B Mann, PhD
September 22, 2012I agree, Elizabeth:
Our legislators work for the lobbies of big business, big unions, big foreign interests, etc. not for us. They all become rich from favoring those entities. They appeal to the voters with benefits they promises but never deliver. They win by demonizing their opponents, not by being honest.
I never listen or believe them. I search for facts and results. I also never vote anyone for a second term!!! They must do what they promise the first term. I adopted this rule after voting for Carter. The present situation reminds me of that mistake.
Alba Patricia Valencia
September 21, 2012We should say ‘no more Neoliberal politic’. The Neoliberal trick is to privatize profits and socialize losses. Bankers invest in them, they risk and if successful, the profit is theirs. If goes wrong they wash their hands and that the State is the one who pays.
We are victims of our inventions and we are destroying ourselves.
Nosotros debemos decir ‘no más política Neoliberal’. El truco Neoliberal consiste en privatizar las ganancias y socializar las perdidas. Los banqueros invierten, arriesgan y si sale bien, la ganancia es para ellos. Si sale mal se lavan las manos y que pague el Estado.
Nosotros somos victimas de nuestros propios inventos y nos estamos destruyendo por nosotros mismos.
Richard B Mann, PhD
September 21, 2012In my haste I made a slight error. I should have said, True costs can only be achieved in a free market where a willing buyer agrees on a price, and a willing seller agrees to accept that price. This is market equilibrium.
Yes, there are some people who need help at times, but they should follow what Confucius proposed, and endorsed by Drucker, and participate in mutual obligations in an interdependent society. The moral hazard starts when the recipients get the idea that they are entitled to get something for nothing without contributing something, even if they only become volunteers to help society in general to do something that is not being done, like picking up trash, cleaning up graffiti, maintaining parks, etc.
Mike Grayson
September 21, 2012Richard, nicely said.
jean sanders
September 22, 2012some individuals have never studied Jeremy Bentham. I don’t know if Drucker wrote about him at all but I do believe the philosophy that Drucker represented would support the philosophy of Bentham.
quote “Without government, life is nasty , brutal and short.” Bentham tried to spell out what government could do to ameliorate the cruelty and the vicissitudes of this world we live in (whether it is natural causes or whatever). ‘Nough said. I won’t dispute with anyone because I am firm believing in the Benthamite world view and won’t be persuaded by cynics or persons who tell me otherwise I guess cause I hold this as a religion. U.S. has taught extreme viewpoints for the last two generations . It was drummed into my head about Ayn Rand from the time I was 12; i left all churches behind because of this. On the other hand, we were trained as nurses, nuns, teachers and we were taught it is good to give back to the community to BUILD community. Even this guidance for young women has changed. There is an “identity society” that says be who you are (as an individual) not who you will BE AS a role model (teacher, doctor etc). In the 70s it became the leading influence in psychotherapy; if you are happy your children will be happy and it was justified for many divorces. Leave your family behind, you will be happy and then they will be automatically happy. It is “screwed up” logic pardon my french. I am 73 and have seen the generations changing and also the way that U.S. took the psychology of pigeons and behaviorists and neglected the psychology of the British school. Influenced education, schools, churches etc with too much of the same old stuff.
It was only in graduate school where the Benthamites were discussed and the British school of psychology . Only the Russian literature of Pavlov was translated in the 1960s. The other Russian schools of psychology that would be similar to the British influences were neglected. U.S.
built the whole foundation on Ayn Rand who was an extreme reaction from the Russian societies that embraced Pavlov. The stream of psychology/philosophy represented by other views was totally neglected for two or more generations in the U.S. so we have this extreme viewpoint built on a “straw man” that Ayn Rand brought out of Russia with her paranoia. I will discuss and clarify and make correctionsn in my viewpoint but , as a religion, I won’t change it…
Richard B Mann, PhD
September 22, 2012Taking an economic philosophy as a religion is dangerous Jean. What Bentham and Mills proposed was a utilitarianism based on pain or pleasure experienced. GoTo:
http://www.princeton.edu/~reinhard/pdfs/100-NEXT_HOW_ECONOMISTS_BASTARDIZED_BENTHAMITE_UTILITARIANISM.pdf
Read the full article and other research that lead to Consequentialism, here is brief quote:
Consequentialists hold that the merits or demerits of human acts – business decisions, legislation, crime and punishment – should be judged strictly by the pleasure or pain, or both, that these acts visit on human beings (or animals), rather than by some other intrinsic merit or demerit of those acts (e.g., some religious stricture).
Bentham called the attempt to value the total consequences of pleasure and pain of an act as the felicific calculus. You have had occasion to engage in felicific calculus on some your homework assignments, and some day you will hire economists who will perform it for you. You used it in what we have called “welfare analysis,” when we added up triangles under demand curves and above supply curves to calculate what we have called “social surplus.” In fashioning their normative dicta, economists seek to maximize this mysterious something called “social surplus.”
Horst Lehrheuer
September 22, 2012I wholeheartedly embrace an “ethics of interdependence.” However, most, if not all of us (including me), do not know all of the profound implications of such an ethical viewpoint for and in our lives. I asked myself, why is this so difficult for us humans? Here I found one insightful answer from the late physicist and cybernetician Heinz von Foerster (who was also born in Vienna, like Peter Drucker): we mostly live according to a view of reality (and truth) that uses an observer-independent view of reality, i.e. we live our lives as if we are looking through a peephole, which cognitively separates us from the world we live in. I call this simply “apart from” thinking (vs. “part of” the world thinking that is in sync with the concept of interdependence) resulting in “apart from” actions that are not, in their extreme, attached to any obligations (a “Everyone for Themselves” or “YOYO” [Your On Your Own] world). This, to me, is the basic starting point (theory of knowing) of Romney’s attitude you describe in your article above.
Maverick18
September 22, 2012Romney was making a valid point like the experienced businessman he is. Simply, the sheer numbers are getting to us. Our benefit/entitlement programs, in particular, are unsustainable in consonance with our tax system and substantial changes are long overdue. To some extent it doesn’t matter if some of the 47% are rich while most are poor. The fact is that the 47% is increasing. Will collapse occur at 50%, 60%? The issue is social, philosophical and even religious, e.g. why do we subsidize unlimited procreation? But someone has to pay, and there are no longer enough someones to make up for the non-payers.. If you hadn’t noticed, the US peaked politically and economically during the Truman administration and has been sowing the seeds of its ultimate collapse ever since. Strange that Romney has been so criticized for pointing out the obvious problem and chastising the present administration for making it worse.
Elizabeth Cline
September 22, 2012Cognitive dissonance when you have someone who shelters his money overseas so as not to pay into the coffers of the country he wants to govern. All legal, but not quite ethical as far as I am concerned.
There are philosophical, religious and social arguments to be made. The same people who decry dependency are the same people who believe it is quite OK to deny accessibility and even use of contraceptives (although contraceptives are used for reasons other than pregnancy.) The same people who want less government totally abandon that belief in proposing some of the most intrusive, unwanted actions on a woman’s body.
We cannot discuss the 47% without understanding clearly who that represents. Once we do that we need to pay closer attention to our military industry complex and ask ourselves what do we owe our volunteer miliatary. Just what is the meaning of “supporting our troops.” They make up a huge portion of the “dependency” you speak about.
Are we prepared to made different decisions about the elderly and sick in our society? What does it mean to be a civilized society and who partakes of that civilization? Do we lay our elderly and sick aside – especially those who have played by the rules that were laid down – work hard, save, pay into social security, medicare, etc. and then reap those benefits at a later date? Do we value life at the beginning so that a baby born with challenges are kept alive regardless of the cost? We have not answered those questions yet and so we throw out numbers willy nilly.
We ignore the loud sucking sound that occurs when you have corporations who because of their government dependence pay no taxes, their CEO’s are paid enormous salaries and golden parachutes even when that CEO messes up. You guys want to talk about government dependence? The actual number of people who pay absolutely no taxes is around 7% – not 47%. Let us be at least more factual.
I would love to pay less taxes as would most people. However, I think this argument about makers and takers and the paranoid Ayn Rand philosophy is a false one especially when we are reluctant to dig below the surface numbers to get the real picture.
The sad fact is that regardless of parties our government by the people, for the people, of the people is a mirage.
howie mandel
September 22, 2012At least 60% of the women having babies in America today can not afford the baby. They require Medicaid or are totally un-insured. 28% of the babies born in the State of California have emergency Medicaid (MediCal) and are undocumented Americans. Is it any surprise to us that these women need WIC, food stamps and later free meals in our public schools? Whether one is progressive, liberal, conservative, libertarian, Democratic or Republican unless we deal with the economic realities, the cost of these entitlements will grow parabolically.
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