Last week’s contribution was about the need to redefine the profit motive in businesses. In today’s economy, after nearly a decade of difficult economic times in most parts of the world, where the few have gained and the very many have suffered, we need a new social contract to guide relations between business and the rest of society.
Two events this week seem to point to such a need.
In The Times (UK), it was reported that Amazon was facing charges of ill treatment of its employees in Scotland. The report says that Amazon threatened its employees at its warehouse in Scotland with sacking them for taking sick leave or slow packing of products.
The US-based online retail giant is also facing allegations that staff are so poorly paid that some have taken to sleeping in tents near their workplace to avoid transport costs and make ends meet.
We cannot continue measuring economic success only by how much we have but also by what we are and our social relations
Another significant event that points to the need for a new social contract is the nomination by the US President-elect Donald Trump of Rex Tillerson, CEO of ExxonMobil, as the new Secretary of State (the equivalent of the Foreign Minister).
He is reported to have close business ties with Russia. Moreover his company has billions of dollars in oil contracts that can go forward only if the US lifts sanctions against Russia. One wonders what the subject of discussion would be when he and Russian President Vladimir Putin sit round a table.
A very poignant comment by one political analyst is that the world’s largest political superpower has become a business. It would seem that this analyst was proven right when one also considers the nomination of an anti-climate change campaigner to head the Energy Department. He also picked up a person who believes that climate change is a hoax as the head of the Environment Protection Agency.
It is worth asking: if businessmen take over the political administration of the world’s largest superpower, will the profit motive become the dominant factor in American politics, and as a result of the political debate with the rest of the world?
We should not be oblivious to all this in Malta because we have not suffered a severe economic recession, or because we do not have businessmen/politicians who cannot keep the two roles separate.
This week President Marie-Louise Coleiro Preca sounded a warning against greed. She highlighted that a society such as ours cannot put profit before people. There are a number of examples of greed in our country and I believe that even in Malta there is the need for a new social contract that defines relations between the business sector and the rest of society that takes into account environmental needs, welfare needs, family needs, solidarity needs.
We cannot continue measuring economic success only by how much we have but also by what we are and our social relations. It may be said that an unbridled profit motive is a negative externality in today’s economy.