Until now, I have refrained from stating my political and societal views on this site. There is, however, a disturbing trend gaining steam in the United States (and to a lesser extent in the rest of the developed world) that all of us should be aware of and (through careful consideration) guide our actions as citizens of this great country.
The trend I am speaking of is the expanding chasm between the economic upper class and those in the middle or lower classes. I was reminded of this again through an article by Joseph Stiglitz in the May issue of Vanity Fair. The title of the article was "Of the 1%, by the 1%, for the 1%" and was neatly buried on page 126. Even the editors of Vanity Fair felt that Rob Lowe, Golman Sachs and the Royal Wedding deserved more attention.
The title of the article is both catchy and correct. When 1% of the population is pulling in 1/4 of total income every year and has 40% of the total wealth of the country, you know that something is out of balance. You could argue that this is OK as long as the rest of the populace is also benefiting from an upward income and wealth trend. Unfortunately just the opposite is the case and has been so for years.
Although most of us working in the biopharmaceutical industry have been quite fortunate to make a comfortable middle class living, the trend is not headed in the right direction for us either. Witness the latest headline on the on-line CBS Interactive Business Network (BNET): "Teva Merger: Cephalon CEO Gets $5M for 3 Months’ Work; Staff Gets Layoffs."
In the latter article, we learn exactly what the headline says (i.e. CEO walks away with $5 million) and what is also implied (i.e. that layoffs are expected to save $500 million within 3 years). Although Teva is a first rate company and certainly better run than Cephalon, the layoffs from the merger are inevitable. Personally, I am not upset about the $5 million payoff even if Cephalon's President is getting it after only 4 months on the job. After all, we all would love to be in his position. Unfortunately, those getting laid off are in for a great deal of anxiety given current market conditions.
Disclaimer: I have personally done work for Teva in the past and completed a small engagement for them just this year.
As for the Stiglitz article, what cought my eye was the following penultimate paragraph:
"Alexis de Tocqueville once described what he saw as a chief part of the peculiar genius of American society—something he called “self-interest properly understood.” The last two words were the key. Everyone possesses self-interest in a narrow sense: I want what’s good for me right now! Self-interest “properly understood” is different. It means appreciating that paying attention to everyone else’s self-interest—in other words, the common welfare—is in fact a precondition for one’s own ultimate well-being. Tocqueville was not suggesting that there was anything noble or idealistic about this outlook—in fact, he was suggesting the opposite. It was a mark of American pragmatism. Those canny Americans understood a basic fact: looking out for the other guy isn’t just good for the soul—it’s good for business."
In short, it is natural as one gets richer and richer to have less and less empathy for your fellow man. The rationalisation goes something like this: "I worked hard to become successful. If the guy next door could not do the same, that's his problem." It is thus up to our government to recognize that hubris and arrogance must be held in check using legislative means and via social programs that adequately balance capitalism with the social good.
Given the current political climate I fear that not much progress will be made on this front in the coming years. And certainly not if Obama is defeated in 2012. So take heed, just as we now clearly know that our first Civil War was an economic vs. human rights issue pitting north versus south, if the gap between the rich and not-so rich widens further, our next Civil War will be a lot messier and will pit the 'haves' vs. the 'have-nots.'
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