This is the third posting dealing with the relationship
between two federalist values, equality and justice. To date, this blog has claimed that justice
is a derivative value, stemming from equality.
The blog provided a definition for each value:
·
Equality is a social quality based on
the belief that despite inequality in talent, wealth, health or other assets,
it calls for equal consideration of all persons’ well-being, that all have an
equal right to maintain their dignity and integrity as individual persons.
·
And justice is the
commitment to give everyone his/her due based on a realistic view of dispersed
or accumulated advantages.
Finally, the blog made a further claim: equality provides the substance and
motivation for justice.
In the last
posting, the blog applied these ideas to a proposition. That is: should the Purple Heart award be granted to
war veterans suffering from PTSD? This
posting analyzes another situation; one that dealt with this nation’s
government response to the financial crisis of 2008-09.
In that case,
the nation’s economy and that of the world’s, was just short of
collapsing. Predictions and post
analyses both stated that if the financial system – mostly the large banks and
certain insurance companies – fell into bankruptcy, the resulting depression
would have made the Great Depression of the 1930s a second-rate catastrophe.
That earlier debacle caused a decade
long misery with millions unemployed, businesses left and right, going under, and
a psychological dispiritedness that affected that generation for the rest of its
lives. Many blamed, in part, that economic
disaster for the onslaught of World War II with its death rate of tens of
millions (one estimate as high as 85 million) and costs of $4 Trillion (equal
to, if this writer’s calculations are right, $54.5 Trillion in 2017 dollars).
In short, a lot was on the line in
2009. In writing about that financial
crisis, Michael J. Sandel summarily traces the activities that led to this
scary situation – a lot of chancy lending practices – and certain determining factors
are beyond question.[1] The question that does occur to Sandel and
deserves the attention of those who need to understand, for example civics
teacher, is: how was justice or
injustice involved?
Specifically, his question is: should one see those activities as the
product of greed or was it the product of failure? Now, greed is not a federalist value. As a matter of fact, it is antithetical to
that construct. However, greed has been
given a legitimizing push under today’s dominant mental construct – the natural
rights view – with its promotion of individual rights. There is that famous quip in the film, Wall Street,[2] “Greed
is good” uttered by Michael Douglas’ character, Gordon Gekko. It became a meme and not all who use it, use
it with a negative characterization.
The concern in 2009 among many
Americans with the bailout plan the Obama Administration devised: given the role the financial officials played
in causing the emergency, were they not being rewarded by the administration’s
plan? Were those government officials
not rewarding greed? Sandel points out,
bank and insurance officials were greedy before the crisis began and no one
seemed concerned then; why in 2009?
The point is, their “sin” was not greed,
but it was failure. And that seems to be
a more productive sense of concern. For
one guided by federation theory, how does this “go down?” It goes down as another, albeit an important,
example of what needs fixing, but in the meantime, liberated federalism needs
to accept certain realities as just that, realities.
One such reality is that intrenched
in the culture of the financial world has been the “animalistic” fever
associated with profit-making opportunities.
In addition, that fever has little concern for the common good. Yet, it usually leads to productive
investments when timid souls avoid them.
Hence, the need for regulations – a la federalist principles – to keep that
fever under reasonable limits. The regs
should aim to avoid unequal government policy that while having the fate of the
economy in their hands, cannot just do what they want to do.
For example, these banks need to have
enough reserve funds to weather developments as those that led to the
crisis. They also need to be prohibited
from certain practices, for example, the bundling of mortgages and then
splitting up their titles for investment purposes. This posting will not spell these out – that
would take up too many words for the purposes here. The point being made here is that unequal
treatment, under certain conditions, is necessary to better approach justice.
Yes, the Obama Administration did not
treat everyone equally. Those who lost
their homes, their jobs, their well-being were not – to any great degree –
provided a bailout, but large banks and insurance companies were. Why?
One can have various answers to that question. The official answer is legitimate; i.e., the
collapse of the system was unacceptable.
To the extent it is true, this writer cannot responsibly judge – he
doesn’t know enough.
The official answer cites the overall
health of the economy – under the emergency – and, therefore, the health of the
society was at stake. Given the example
of the Great Depression, one can feel fortunate the more recent crisis is
referred to as the Great Recession. Federalist
values holds societal health – especially when existential dangers loom – as
the trump value, because all else that is valued becomes susceptible to being
unattainable.
