Daily Archives: June 18, 2020

Social commons: the social protection we want

Universal basic income would offer a deadweight subsidy to low-paying employers. The route to security for all lies in the concept of ‘social commons’.
By Francine Mestrum – The coronavirus crisis has put ‘basic income’ once more on the agenda. It is understandable, since the crisis has hit all vulnerable people in our societies particularly hard. Many in precarious working conditions have lost their job and joined the ranks of the poor. These people deserve help. Ergo, give them some money, without conditions.

Sure, but let us be clear what we are talking about.

Once again—even more than in the recent past when the debate previously erupted—there is an enormous semantic confusion. Sometimes authors speak of the universal basic income as proposed by Phillippe Van Parijs or Guy Standing. But, in most cases, what is meant is some kind of minimum income, only paid to those who need it. This is the case, for instance, with the ‘basic income’ now introduced in Spain.

The first option, the ‘real UBI’, has to be rejected, as earlier explained. First, if one wants to solve poverty, there is no need to give money to the rich, who most often do not even pay taxes. Secondly, if one wants to improve mental wellbeing—as mentioned in the Finnish report on the brief experience with ‘basic income’ there—there are many ways to achieve this. Income security can indeed be a very important factor for wellbeing but the former is not synonymous with a universal basic income.

Thirdly, it seems rather contradictory to seek a fair tax system with contributions from big corporations, if at the same time the state allows companies to lower wages and offers to complement these wages with a basic-income subsidy—a kind of negative income tax. That would, at best, be a zero-sum game, for the state as well as for the corporations.

A UBI can only be acceptable if it can guarantee a decent standard of living, complementary to social protection. But then it becomes a very serious financial problem—far too expensive, as Van Parijs and Rutger Bregman admit. more>

Updates from McKinsey

The value of value creation
Long-term value creation can—and should—take into account the interests of all stakeholders.
By Marc Goedhart and Tim Koller – Challenges such as globalization, climate change, income inequality, and the growing power of technology titans have shaken public confidence in large corporations. In an annual Gallup poll, more than one in three of those surveyed express little or no confidence in big business—seven percentage points worse than two decades ago. 1 Politicians and commentators push for more regulation and fundamental changes in corporate governance. Some have gone so far as to argue that “capitalism is destroying the earth.”

This is hardly the first time that the system in which value creation takes place has come under fire. At the turn of the 20th century in the United States, fears about the growing power of business combinations raised questions that led to more rigorous enforcement of antitrust laws. The Great Depression of the 1930s was another such moment, when prolonged unemployment undermined confidence in the ability of the capitalist system to mobilize resources, leading to a range of new policies in democracies around the world.

Today’s critique includes a call on companies to include a broader set of stakeholders in their decision making, beyond just their shareholders. It’s a view that has long been influential in continental Europe, where it is frequently embedded in corporate-governance structures. The approach is gaining traction in the United States, as well, with the emergence of public-benefit corporations, which explicitly empower directors to take into account the interests of constituencies other than shareholders.

Particularly at this time of reflection on the virtues and vices of capitalism, we believe it’s critical that managers and board directors have a clear understanding of what value creation means. For today’s value-minded executives, creating value cannot be limited to simply maximizing today’s share price. Rather, the evidence points to a better objective: maximizing a company’s value to its shareholders, now and in the future.

Recently, the US Business Roundtable released its 2019 “Statement on the purpose of a corporation.” Dozens of business leaders (the managing director of McKinsey among them) declared “a fundamental commitment to all of our stakeholders [emphasis in the original].” Signatories affirmed that their companies have a responsibility to customers, employees, suppliers, communities (including the physical environment), and shareholders. “We commit to deliver value to all of them,” the statement concludes, “for the future success of our companies, our communities and our country.” more>

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Updates from GE

Air Blockchain: This App Could Help The Airline Industry Recover Faster
By Brett Nelson – The aviation industry has weathered severe turbulence before — consider the oil crises in the 1970s and 9/11 — but the COVID-19 pandemic has inflicted damage of a different magnitude.

The number of passengers per year, on a steep climb for the last decade, has plummeted so dramatically in recent months that it looks like someone fell asleep plotting the graph: In 2020, the number of worldwide passengers will drop by anywhere from 2.3 billion to 3.1 billion — between 40% and 53% of seats offered by airlines — erasing $300 billion to $400 billion in their revenues, according to estimates in a June 5 report from the International Civil Aviation Organization.

As planes are once again getting ready to taxi down the runway, the industry is enlisting powerful new technologies like blockchain to help passengers feel safe and get to their destinations as soon as possible.

Take, for example, a new mobile application developed by GE Aviation with TE-FOOD, a company that uses blockchain to track goods moving through the food supply chain. The aviation app is using blockchain to help monitor whether planes, crews and passengers have cleared specific health and cleanliness checks before takeoff. The solution, enabled by Microsoft Azure, is available now, and demonstrations are underway with airlines, airports and industry groups.

“GE Aviation’s business model is predicated on airlines flying GE engines,” says David Havera, general manager of GE Aviation’s blockchain solutions. “Therefore we are doing everything we can to get passengers back into the air as soon as possible.”

Blockchain technology is the highly secure, record-keeping framework beneath cryptocurrencies like Bitcoin, but it has myriad other applications, too. With blockchain, companies can store and trace a virtually infinite number of digital records, as if stringing together unique chains of building blocks. more>

Updates from Adobe

The Future Is Now
By Laura Staugaitis – Dramatic, intriguing, thoughtful, and beautiful: Seoul-based creative Giseok Cho crafts powerful images, but he says he doesn’t consider his photographs to be art. “I think I’m doing it to express beauty from my perspective,” he says. The photographer builds careful compositions filled with rich colors and luxurious textures that surround solitary figures. His mysterious portraits blur boundaries of time, culture, and gender, leaving the viewer to wonder about the worlds his ephemeral characters come from—what moments have just passed, or are about to arrive.

When asked about how he wants viewers to relate to the characters in his photographs, Cho counters that he doesn’t necessarily have goals like that in mind. “I just want to do what I want, and want people to think that person does his thing.” Rather than making individual statements about his subjects, Cho prefers to keep his imagery more conceptually high-level, reflecting the complexities of Korean culture, the fickleness of fashion, and the ambiguity of beauty.

The photographer’s carefully staged portraits draw on his background in the fashion industry. Cho has worked as a graphic designer, set designer, and art director, crafting imagined worlds to bring Korean fashion to life. He continues to use fashion as a powerful means of expression, taking advantage of the ever-changing aesthetics. “Fashion has so much to offer to express beauty, and it’s dynamic, so there’s a lot of variety. It’s fun for me.” more>

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