Building a More Equitable Society – Eddie Cross

via  Building a More Equitable Society – Eddie Cross February 4, 2014

Recently two academics co-operated in the production of a book which examined the aspect of what constituted equity in a society and then went on the give an assessment of every country in the world on this basis. Their conclusions were quite astonishing – the most successful countries in terms of development, social indicators (education, health, longevity, social services, productivity, per capita income) were all states that had deliberately pursued policies that had created more equitable societies since the Second World War.

Guess who headed the list? Japan, third largest GDP in the world, almost destroyed by the War, rebuilt with American help under the direction of one of the most astonishing leaders of the 20th Century – General Macarthur. Closely behind were the states that I would have put in that category – the four Scandinavian countries, followed by the Netherlands and Germany. Way down the list was the USA and the UK but the bottom was crowded with countries that all have rather nasty or mixed reputations. Brazil and South Africa were close to the bottom and among the most inequitable societies in the world, and both ruled by Parties that claim leftist credentials.

So why is equity important? It’s important because if you view humanity as God does, each person is a special creation that has value for its own sake and therefore has value and deserves recognition, care and respect. Giving people dignity and worth is a goal that is always worth pursuing – either as a society or as an individual. I well remember the night of the political convention in the USA when George Bush senior was selected as the candidate for the Presidency. Standing next to him and the family was a small Mongoloid boy – a grandson. This boy held his grandfathers hand on the platform in front of that huge crowd and showed no sense that he was any different or should not be there. Clearly, the most powerful man on the planet had a special relationship with that small boy. Simply on the basis of that relationship, I would have voted for Mr. Bush had I been an American.

When I was CEO of a major company, I always took time to treat every person on the staff with dignity and respect. In my view they all did important jobs and made my life easier. I recall the man who served tea in Head Office. To most staff he was invisible; a shadow that flitted in and out of the offices delivering tea and coffee. I called him in one day and said that he was no longer going to be employed – his face fell and he asked why? I said because he was now going to be self employed. We turned his job into a small business and within a couple of months he was serving cakes with the tea and coffee, the quality of both improved and he widened his services to include sandwiches. In the process he increased his income but the greatest impact was that we gave him dignity and purpose.

At the root of the process of building a more equitable and decent society is concern for those at the bottom of the pile. At the heart of Christianity is a concern for the poor and disadvantaged. Most in our materialistic and driven societies view this as charity, it’s not, its common sense and it’s the right thing to do and it can take many forms, all of them important. It also does not happen naturally. We are by nature selfish, self centered and acquisitive. Many attempts have been made to reverse these characteristics in our societies and nearly all of them fail. Many countries have attempted the socialist and Marxist route, basing their society on a political system that was supposed to create a more equitable society but have clearly failed; none of the most successful states in the world are socialist in an economic sense. China, one of the few remaining communist States, is now openly and brazenly capitalist but is reducing the number of the people under its care who are absolutely poor, very rapidly.

So what is required to achieve a successful and equitable, fair society in today’s world? Firstly, it would seem to me that you must have a representative Government, one that is accepted by the majority of the people and is responsive and accountable. In many ways, although it is not democratic in a modern sense, China fits this requirement. What is also clear, even to the Chinese, is that they will have to continue to reform the state in the years ahead to make the Government more representative at every level. It is clear that democracy is not always the solution in a pure form – in Thailand right now the people are struggling against a democratic regime that bases its power on the rural majority, but has failed to represent the needs and views of the growing urban minority.

Secondly, the state has to observe what has come to be accepted as the basic macroeconomic rules that govern successful economies. Limited budget deficits, managed inflation, sound monetary policies. All states now accept that if you violate these rules, you will pay the price and even be kicked out of the game. The global village is a reality that no state can ignore and survive and even thrive. In Zimbabwe we tried that route and came close to total collapse. No state is big enough to ignore the rules and no country is small enough to hide away from the consequences.

Thirdly, the state has to accept that it has to administer its affairs in an open, honest and accountable manner. In this respect no country is any different from a bank – who would use a bank that stole your money? Countries with a corrupt administration or who allows a criminal elite to operate without constraint, is doomed to failure – either by totally undermining development and growth or simply creating a nasty society made up of a small elite who are immensely wealthy in a sea of poverty. Russia became such a state after the collapse of the Communist Soviet Union and Putin is now trying to rebuild after he was forced to take radical action against the Oligarchs created by the way they dismantled to Communist State and adopted “democracy”.

Finally, the state must recognise its obligation to respect the poor and the disadvantaged and take deliberate steps to ensure that their basic needs are met and that they are given dignity and opportunity. Such a state must also take deliberate steps to create a more equitable society and economic system. This must include restraints on executive remuneration, minimum wages and progressive fiscal systems. When I became the CEO of a major corporation in 1979, I was earning a salary that enabled us to own a decent home, drive a decent car and send our children to good schools. I really did not have to think about money – that I left to my wife who handled the household. I do not think I even knew what my salary was! After Independence the state adopted policies which froze executive salaries while raising the wages of the lower grades of staff. I was not unhappy to see these policies adopted but they went too far and we started to lose senior, qualified and experienced staff. But in principle it was right.

Right now we are in the midst of a massive row over executive remuneration in state controlled entities. These disclosures have come about because of the dog fight going on in the administration between Charamba and Moyo. But they expose a huge weakness in government. We have no policy in this crucial area. In my own view salaries in the public sector should be about 80 per cent of those prevailing for similar positions in the private sector. I would like to go beyond that and say that executive remuneration should be restricted to 20 times the lowest paid employees in the organisation, with incentives for performance. But it all starts with having a heart for the poor in our midst.

Eddie CrossHarare 3/2/14