This is where the Rules Change Project comes in. It began in 2013, in Amherst, Mass., when a small group gathered to consider how to respond to the challenge of fixing the game in an increasingly unequal and undemocratic nation. They adopted a vision statement. The Rules Change Project spotlights, amplifies and broadens support for economic and corporate rules change efforts. It is an informal, non-partisan collaboration – of individuals and independent groups – fostering a national conversation to help America to follow its democratic ideals. It illuminates how average Americans are finding answers to the tough questions, in hopes of stimulating even more Americans to follow.
If you talk to the people in Washington, D.C., who are in a position to make or change policy, they’ll tell you don’t look to them for initiative. They’ll say create public pressure on an issue and make that pressure visible.
Rules are changed by individuals who come together and refuse to accept the norm. Rules are changed through grassroots movements that grow from the ground level upwards, gaining power and influence as more and more people feel compelled to pursue change. This has been seen from the very inception of America, from the colonies that united in Revolution, to the Civil Right’s movement, to women’s suffrage, to the environmental movement.
The rules Change Project seeks to make change in cities, town states and regions more visible to Washington. One way to do that is to find examples of people and institutions sticking their necks out, above the crowd, to create change in the way we regulate, manage, or do business with corporations. So we’re looking for giraffes. Have you seen any?
In that effort, we collaborate with and link to the work of Pulitzer Prize-winning author, journalist and documentarian Hedrick Smith, and his Reclaim The American Dream initiative.
We need to take time to examine how the rules of capitalism and free markets — formal and informal – have evolved over the last 40 years. One approach is not to end or replace the game, but to reset the rules to make them fairer to all stakeholders – employees, customers, citizens, communities, the Earth – and stockholders.
Effective change is needed in (1) government policies, (2) the way corporations govern themselves, and (3) in our communities and relationships. The Rules Change Project recognizes mainstream ideas for changes in the way large, public corporations are regulated, managed and compete in at least six key categories: influence, measurement, ownership, accountability, governance, and sustainability.
We spotlight efforts to teach corporations and managers — by example, by regulation or by consumer power — to serve society and the planet rather than focusing solely on short-term profits to shareholders. We look for examples of greater tax and wage fairness as well as equity in how the regulations are applied. We believe that natural resources should be valued because they belong to all of us, shareholders and stakeholders alike. We advocate access to information that empowers all citizens and exposes activity, behavior and incentives that are not only illegal but ethically wrong. We are watching for electoral reforms that restore faith in our democratic process.
In order to achieve these goals, the “rules change giraffes” we’re looking for will exhibit behavior framed by one or more of these issues:
Lessening the power of money
Holding businesses responsible
Getting people involved
Leveling the playing field
Securing a sustainable world
Intentionally or otherwise, some actions of the people who run and invest in global corporations tend to divide and marginalizing those who challenge those actions. The Rules Change vision identifies and promotes our common ground. It seeks to expand the pool or resources and tools that support collaboration and citizen impact.
Many researchers find that Americans feel the way corporation’s operate is failing us. Everyone has heard — and many believe — the refrain that America is unequal. We have heard the familiar slogan, “We are the 99%.” The reality of income inequality in America is staggering. CEOs earn 331 times as much as the average worker and 774 times as much as those earning minimum wage.[1] In a 2007 report distributed to across the US, on average people imagined that the average CEO made $500,000, when in reality the number was $14 million.
This is occurring, in large part, because of the shifting corporate mindset. Large companies used to focus on stakeholders, taking into account the interest of the employees, shareholders, community, the environment and even the country. The companies had an eye towards sustainability and long-term profits. This has shifted to the ubiquitous notion of shareholder value maximization, where solely short-term profits for shareholders matter. Wealth for the few propagates even more extreme wealth for the even fewer.
As a result, the middle class is being squeezed, as quality jobs disappear only to be replaced by contingent and retail jobs that simply do not provide enough for the employee.
America is not working for all of us. The Rules Change Project aims to spotlight efforts to increase oversight of large public corporations and financial institutions, and watchdog big-money domination of Washington politics. It serves as an open forum and coalition for those who agree that the rules need to be changed. Our goal is to foster solutions, not point fingers.
[1] Dill, Kathryn. “Report: CEOs Earn 331 Times As Much As Average Workers, 774 Times As Much As Minimum Wage Earners.” Forbes. Forbes Magazine, 15 Apr. 2015. Web. 07 July 2015.
WILLIAMSTOWN, Mass. — Hedrick Smith’s long journalism career began covering civil rights in the American South, traversed to dissecting Kremlin policy in Moscow, to producing award-winning documentaries for the Public Broadcasting Service — along with multiple books along the way. Now the Pulitzer Prize-winning octogenerian is off to another frontier — a search for the people, ideas and institutions that might help “reclaim the American Dream.”
Smith talked about his new quest during a videoconference seminar March 3, 2015 with three Williams College seniors. They were emerging from their Winter Study research experience at a local initiative called the Rules Change Project. The effort was arranged through the campus Center for Learning in Action and Rules Change Project organizers are seeking to recruit student volunteers for additional research. Smith is author of the 2012 bestselling book, “Who Stole the American Dream.” The former Washington bureau chief for The New York Times continues to document America’s epidemic of economic inequality and consider how it might be cured.
“Rules Change and the American Dream: A Dialogue Across Generations,” brought together Smith with Williams seniors Mitch Prevot, Jack Atchue and Tom Cabarle. They gathered for a two-hour talk, discussion and town meeting-style dialogue with the audience. The whole event, featuring Smith “Skyping” from his Washington, D.C.-area home to a large screen in Brooks-Rogers Recital Hall — was video recorded for public use on the web and via WilliNet, Williamstown’s public-access cable service.
From left, Prevot, Atchue and Cabarle
The Rules Change Project is at the intersection of journalism and public policy, according to longtime Williamstown resident and former jounalist and publisher Bill Densmore. “Our tag line is ‘solutions reporting about capitalism and the common good’,” says Densmore. “Our aim is to spotlight institutions and individuals who are helping to examine — and perhaps change — the relationship between corporations and government, and among corporations and key stakeholders besides stockholders — employees, customers, communities and the envirionment.”
Prevot, Atchue and Cabarle spent January reviewing hundreds of articles and resources collected by Densmore over two years and reflecting aspects of the Rules Change vision. Each then took on the task of preparing profiles of two people (a total of six among the three of them) they judged to be Rules Change “giraffes” — people and institutions sticking their necks above the crowd to foster analysis an action that will make our participatory democracy more just and open. In dialogue with Hedrick Smith, they’ll talk about their research, their designated “giraffes,” and how their January research may have affected their own thinking about reinventing the American Dream for the Millenial generation.
For two years since the publication of his book, “Who Stole the American Dream,” Smith has been crosscrossing America talking crowds large and small – in some prestigious locations – and he has gotten an earful of concern from those audiences. He’ll set the scene for the Rules Change challenge – telling us why the public feels powerless. He’ll lhave some suggestions for what to do about it, including 10 steps for reviving the American Dream. (Water Street Books will also have his book for autographed sale in the Brooks-Rogers lobby).
In his 1960s-era book, Capitalism and Freedom, and a now-famous 1970 New York Times Magazine essay, the free-market economist Milton Friedman wrote: “There is one and only one social responsibility of business–to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud. Fifty years later, things have changed. U.S. Sen. Elizabeth Warren often speaks about today’s economic “rules of the game” as being “rigged against the little guy.” Exactly which rules are rigged? And if so, what will it take to change them?
At the same time, legal scholars such as Lynn Stout are revisiting Friedman’s now-assumed dictum, launched by Friedman, that the only purpose of a corporation is the maximize profits. In fact, Stout writes in her book, “The Shareholder Value Myth,” there are equal values at stake – involving customers, employees, communities and the environment.
A chance to be heard – March 3
After Smith’s half-hour talk about what he’s learned from speech audiences, and the discussion with the three seniors, students and community members in the Brooks-Rogers audience will be asked to speak about their aspirations for the American Dream, about whether the “rules of the game” are rigged (for and by whom), and their ideas for involvement and change. What is the state of the American Dream? What does that mean to audience members? And how do we restore it, or reinvent it?
For more information about the evening, or about volunteering to do web-based research and writing for the Rules Change Project, email Bill Densmore at wpdensmore@gmail.com or call 617-448-6600.
The changing relationship between corporations and society is at play in the evolving investing strategies of pension funds.
CalPERS CEO Ann Stausboll
Rather than electing to exclusively pursue the strongest possible financial returns, some pension funds are investing with other concerns in mind. When CalPERS adopted a set of investment principles Amanda White reported on the announcement. In 2013 California’s largest pension fund published a list of formal investment principles that included an expanded definition of fiduciary responsibilities.
According to CalPERS chief executive Ann Stausboll, “The fiduciary responsibility of pension funds should extend to issues outside the parameters typically understood as being directly related to beneficiaries’ financial interest, says to CalPERS chief executive Ann Stausboll. “It is our job to make sure investors, businesses and policymakers are responding aggressively and creatively to the opportunities associated with climate change and other sustainability issues.”
In step with companies such as Patagonia, CalPERS has emerged as a bold innovator by adopting a more comprehensive view corporate purpose. Patagonia uses “flex hours” in order to enable employees to live active lifestyles. As CalPERS, Patagionia, and other companies continue to broaden their corporate philosophies beyond exclusively serving the interests of shareholders, policymakers also evaluate the existing rules in order to accommodate the changing understanding of corporate purpose.
“As an industry — and indeed as a global society — we have become trapped in our own rhetoric. We need to learn how to be comfortable with articulating purpose and reject the idea that money is the only effective measure of all things or that the free market is the only sorting mechanism.” — Elisabeth Murdoch, executive.
“There is one and only social responsibility of business — to use its resoures and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.” — Milton Friedman, economist.
Friedman’s line of thinking has informed the beliefs of many of the titans of capitalism who claim that, no matter the negative impacts of their businesses, they are merely playing their part in the capitalist system. Titans such as Rupert Murdoch, the telecommunications giant who is currently #69 on the Forbes Billionaire List with a net worth of $13.8 billion. Murdoch has found himself in the headlines in the past for engaging in questionable practices in the pursuit of profits as his newspapers were investigated for hacking the cellphones of British celebrities, royalty and even regular citizens.
It is instances like this that cause one to challenge Friedman’s concept that the pursuit of profits are businesses only responsibility. However, there are business leaders who offer an alternative to this concept, some of whom come as quite a surprise. One of them is Murdoch’s daughter, Elisabeth, and the CEO of Shine Limited, which stands for more than the pursuit of profits. In 2012, Ms. Murdoch delivered the keynote address at the GuardianMedia Edinburgh International Television Festival and surprised many with the message she sent. Her overall thesis can be best summarized by her quote that, “Profit without purpose is a recipe for disaster.” The speech can be found in it’s entirety here. She said: “As an industry — and indeed as a global society — we have become trapped in our own rhetoric. We need to learn how to be comfortable with articulating purpose and reject the idea that money is the only effective measure of all things or that the free market is the only sorting mechanism.” She added:
“Do we have such faith in the imperatives of the market that we need have no will of our own other than to succeed on its terms? It is increasingly apparent that the absence of purpose — or of a moral language — within government, media or business could become one of the most dangerous own goals for capitalism and freedom.”
It is important to keep in mind that in 2011 Elisabeth sold Shine Limited to her father’s News Corporation. She said the sale was necsary to achieve scale in the increasingly digitized media industry. Murdoch is seen as the possible future head of her father’s empire.
One of the world’s richest men — Warren E. Buffett — has been a surprising advocate of “tax the rich” proposals.
In a Nov., 2012, New York Times’ op-ed piece entitled, “A Minimum Tax For the Wealthy,” Buffett stressed the need for higher taxes on the rich. According to Forbes research data, the 400 wealthiest individuals in the United States earned a total of $1.7 trillion in 2012. Buffett argues the rules on tax policy need to be changed to ensure that wealthy help get the United States back on a fiscally sound path. Buffett puts forth viable tax rate changes that can help create a sustainable future without calling for reform of the entire tax code.
Among Buffett’s suggestions:
Eliminate the Bush tax cuts for high-income taxpayers – cut off around $500,000
Enact a minimum tax on high incomes – Buffett suggests 30% of taxable income from $1 million to $10 million, and 35% on any amounts greater.
Buffet stresses that such rules changes will, “block the efforts of lobbyists, lawyers and contribution-hungry legislators to keep the ultra rich paying rates well below those incurred by people with income just a tiny fraction of ours.”
Williams College officials are looking to make history in their pursuit of the LEED Living Building Challenge. The Living Building Challenge is a certification ascribed to buildings by the U.S. Green Building Council, and requires that the building is 100% energy independent. Only four buildings in the United States to date have been granted a Living Building Certification. (Learn more about LEED.)
The Kellogg House was built in 1794 as a home for the Williams College president. If it achieves the Living Building Challenge it will be the first historic building in the United States to do so. Projects of this nature force designers and stakeholders to consider the real life impact of the design, construction, and operation of a building. More importantly, they show the community the future of construction and how things should be done rather then how they’ve always been done. The Kellogg House was set to open in March, 2015.
This is where the Rules Change Project comes in. It began in 2013, in Amherst, Mass., when a small group gathered to consider how to respond to the challenge of fixing the game in an increasingly unequal and undemocratic nation. They adopted a vision statement. The Rules Change Project spotlights, amplifies and broadens support for economic and corporate rules change efforts. It is an informal, non-partisan collaboration – of individuals and independent groups – fostering a national conversation to help America to follow its democratic ideals. It illuminates how average Americans are finding answers to the tough questions, in hopes of stimulating even more Americans to follow.
Williams College officials are looking to make history in their