Thursday, November 5, 2009

Solidarity Contract

A friend of mine presented his thoughts regarding the transition to me. First he explained the concept of the "Generation Contract" to me.

The generation contract marks an accepted social consent, which is to secure the financing of the old age pension. The employed persons pay the pensions of the generation retired from the business life, and thereby obtain the right to receive similar benefits from the following generation. In other words, this month's tax withholdings on the working generation are used to pay next month's pension to the retired generation.

The term is quite popular in Central Europe. E.g. in German it is called Generationenvertrag and used in the political system of Austria and Germany. The tax that is deducted from one's paycheck is not saved by the state until one retires and then handed back to one. No, the money is handed from one generation to another (with the government as middleman).

Our economy should not be based on growth any longer. It is futile to attempt perpetual growth. At the same time, given our technology and methodology today our society is in a situation where the basic needs of every single individual of society can be covered. Full employment is the goal of all politicians, but it is the wrong goal. As a matter of fact it should not be our goal, we are not born to be workers. We should work to cover our needs, but we should not be servants to work. We should not be enslaved. Most countries are far away from full employment. Unemployment (e.g. 20% currently in Spain in real terms) is seen as something nasty, something undesirable, something shameful. It should not be that way. If we can produce all the goods and services required to fulfill the basic needs of all individuals with 50% or 25% percent of the population, this should be celebrated. And if we can do it with 25% of the population even better.

Full employment will and should not be our goal for the future. And with the population distribution changing to generations with less young people capable of working and more elderly people in need of a pension, we must rethink the concept of the generation contract in particular, and the distribution of resources in general.

My friend's thoughts are to replace the current generation contract that basically distributes from the "working" class to the "non-working" class. He suggests that we must strive for -- what I termed -- a solidarity contract. The class "with financial resources" must give to the social class "without resources". Or simpler: we need a social contract where the rich voluntarily give to the poor. While you have more than you need you give to those that have less than they need. We have so many super rich that are not even capable of spending all their money in their life time. And we have many rich that have wealth and goods far beyond what is needed to cover the basic needs. This must be the class to give. Separating the classes in "working" and "non-working" makes no sense anymore in a well-planned 21 century. The rich must have compassion and show solidarity and realize that it is to be benefit of all -- them included -- if they reduce the wealth divide. My friend stresses that the giving should be voluntary. The point is that we all but in particular the rich must realize that their wealth will not serve them if we go to war or if their behavior creates a revolution. You can only build walls around your castle so high. The not-giving might create social unrest, war, diseases and more. Even a 30-foot wall will not be a protection in such cases.

So much what my friend voice to me. And he asked me if I would be willing to give. For the first 15 seconds I didn't quite know what to say. I think I am willing to give, but I would only do so with many strings attached, meaning only if certain conditions are met. Would I give money to the current government so they can redistribute it as they see fit? No. I see the current government as corrupt and influenced by big industry and I would feel that the money would not end up in the right hands, and I would consider it even possible that it would be used to make the rich richer independent of the promises of the politicians. Would I give if others don't give? No. I could give money today to non-profit organizations in Africa, but I don't. Why? Because it is not a solution. The system has to be changed. Giving food to a starving child is admirable, but it does not get rid of the corrupt military government on his country, does not stop the civil war in his country, or stop the big international companies exploiting the oil and water resources in his country. I think the implementation of the "solidarity contract" has to go hand in hand with many other social, political and economic changes in order to be successful. I see it as a desirable goal. I see it as something that I would support, but like with many other issues I don't see an obvious way to get there. I would give but the system has to be fair, and safe from manipulation from politics and industry.

How do we implement it? That is the tough part. My friend suggests to talk to the rich and to convince them. I feel that we need to do more. Again I see that everything is so intertwined. We need to shift the power, that's a minimum.

After "creating" the term "solidarity contract" in my head I got curious and searched the term. There is an article on Social Solidarity on Wikipedia that links to a document entitled "Toward a social contract on world-wide scale: Solidarity contract" by Guy Ankerl. So, the term was used already in 1980. But with less than 2,500 hits world-wide it is a term hardly ever used. Maybe we should give a new life to this term: solidarity contract.

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