PRODUCTIVE AND JUST COMPETITION

Many of civic related concerns have to do with maintaining cooperative behavior between citizens by maintaining sufficient feelings of solidarity. Using federal language, the challenge can be described as counteracting social forces that tear at or encourage disunity within a federal association. This challenge can affect families, businesses, communities, cities, states, nations, or international associations (for example, NATO). There are a variety of sources for such challenges. There are jealousies, misinformation, conflicting aims and goals, corruption, use of excessive coercion, and so on. One source that is particularly subtle is competition. This last source is subtle because competition, per se, is not divisive. Ideally, competition can be a process by which the highest level of talent and other assets in the association come to bear in its striving to attain its goals. It can become divisive, though, if certain transcending rules governing competition are not adhered to. And what are those rules? One, given the context of the competition, is that it has to treat all the competitors as equals – equal in the sense that each competitor has an equal opportunity to win the competition. Two, the processes and standards by which the competition is conducted and evaluated need to be logically related to the prize for which the competitors are striving to attain. Three, the process needs to be as transparent as possible. And four, the competition itself needs to advance either the survival of the association and/or to advance the legitimate goals and aims of the association. This last rule needs to be explained a bit more.

For one thing, the consequences of a competition within an association might accrue short term positive results. In the long term, though, it might result in consequences that are not only negative, but also seriously threatening to the health of the association. And in this, lies the purpose of this posting. Take for example, the competition between states to attract businesses. This competition has taken many forms, but a common way is to put in place policies that lower the wages of workers by, for example, undermining the influence of labor unions. Recently, Indiana illustrated this by becoming a “right to work” state in which unions can no longer negotiate to become the sole representative agent for the workers of a business – that is, workers do not have to belong to a union in order to land a job. Consequently, in many states such as Indiana, that have been hostile to unions, collective bargaining has either become less effective or more difficult to conduct. Probably more than any other factor in the last three to four decades, this strategy has been responsible for the average median wages of workers to have first leveled off and then to have actually gone down.¹ The result is that inequality has been increasing during a time when production and productivity have increased. This, in turn, has resulted in the top income groups garnering ever higher percentages of the national income. The point is: this competitive activity by states is undermining a central goal of our nation. We are in effect less equal in terms of not only economic well-being, but also in terms of political influence. Our whole claim at providing equal opportunity has, with these developments, become less and less believable.

Really? Am I just rationalizing in order to excuse the shortcomings of some? Well, I have just become aware of how this competition between states is affecting even the ability of young people from lower income families to attend state universities. In the past, many states, through the efforts of their higher education offices, have provided financial assistance so that academically talented youths from lower income families could attend state universities. Through the reporting of Catherine Rampell,² I have become aware of organized efforts to dry up such assistance to poorer kids and expand the help to richer kids. “The share of state aid that's not based on need has nearly tripled in the last two decades, to 29 percent per full-time student in 2010-11. The stated rationale, of course, is that merit scholarships [exclusive of consideration of need] motivate high-school achievement and keep talented students in the state.”³ Rampell provides enough statistics to back up her claims – for example, about 1 in 5 rich kids (from households making over $250,000 a year) get assistance while only 1 in 10 kids from households making less than $30,000 a year get similar assistance. But my point is that this practice is a form of competition between states, not to attract talent, but to keep talent. The thinking is that these richer kids can easily shuffle off to highly respected universities in other areas of the country; they move to those universities and they don't come back. If, on the other hand, states can keep these students in their home states for their college education, they are more likely to stay in the state after they receive their degrees. At least, that's the thinking. The evidence, though, doesn't support this eventuality. It is needless to point out that the success rate for these wealthier students is much higher than for lower income students, although even richer kids don't do as well at these state schools than those who do go off to the more expensive, farther away schools. So, this form of competition, one that betrays our national commitment to equality, has become counterproductive. While the aim of the policy doesn't seem to be materializing, the policy will still be in effect for years. In the interim, how many poorer kids will be denied a real chance at economic success because they will be deprived of the financial assistance to attend state schools that at one time was there? Besides, one can justly question the sincerity of the stated justification for such a policy change. Is it just a way for those with influence, the wealthy, to get more of the resources that a state government is willing to distribute? Who knows?

Irrespective of its justification, I would judge such a competition contrary to the stated goal of equality that our nation claims it has. There is nothing intrinsically wrong with entities in a federal union competing. Competition motivates people to work hard and it increases the chances of entities developing their potential skills. In turn, such developments make it possible for organized people to do what it is they want to do successfully as long as the competition is productive and just.

1I claim this factor to be primary because I feel that all of the other factors, such as transferring work assignments to foreign workers, are negotiable developments that unions could have moderated and made less effective in lowering wages. I must admit a lack of expertise in this, but the decline of wages among American workers mirrors, in terms of timing, the decline of union membership.

2Rampell, C. (2013). Freebies for the rich. The New York Times Magazine, September 29, pp. 14 and 15.

3Ibid., p. 14.