COMMENTARY: Should BP’s compensation extend to global business?
COMMENTARY: Should BP’s compensation extend to global business?
Bill Radke: As I mentioned, BP agreed yesterday to set up this $20 billion fund for paying victims of the Gulf of Mexico oil spill. Well Marketplace’s economics editor Chris Farrell is wondering if the fishing industry workers of the Gulf Coast deserve to be compensated, what about the other victims of global business? Good morning, Chris.
Chris Farrell: Good morning, Bill.
Radke: Which victims of global business are you thinking of?
Farrell: Well Bill, when you look at the Gulf oil spill, we’re just all just shook by the workers who have lost their jobs, people who have lost their careers. But what I’m thinking about is how global competition and innovation, so many workers have lost their jobs and their careers to something we call that is good. So I think there’s a much bigger story in the BP oil spill, workforce suggests that we should take a broader picture, not a narrow look at the Gulf oil.
Radke: But Chris, an oil spill is a violation. I mean losing jobs to competition and innovation, isn’t that sort of the way it goes?
Farrell: Oh I know we call it creative destruction, but what I’m emphasizing is the destruction part of free trade and technological innovation. I mean Bill really, do you think it makes a difference if you lose your job to an oil spill or you lose your job to a new computer? I mean the reason why we focus on the oil spill is that we can see it every night on TV, it is a genuine tragedy. And when you lose your job to a computer, you know it’s a footnote in a report and a company will say, well we laid off 1,000 workers in our back office because we were able to replace them with Google, iPad, whizz-bang computer. But nevertheless, in both cases workers are losing their job to technical innovation and competition, and that’s what we need to focus on.
Radke: OK Chris, so how would you do it? How would you compensate the free-trade losers?
Farrell: You know there’s a lot of valued ideas out there but one that I like is let’s forget protecting the companies. You know, no more trade barriers or tax credits for the companies. Let’s just give the worker a voucher. This is one of my favorite examples — give the worker a voucher. They can use it in a university, a college, life coach training, whatever’s going to give them the skill and training they need, and they’re going to know better than anyone else what they need to get a new job, to get a new career. So don’t protect the companies, put the vouchers towards worker. And that’s the system that allows for free trade, technological innovation, the occasional disaster like the Gulf oil spill, and the worker comes out a head.
Radke: Marketplace’s economics editor, Chris Farrell. Chris, thank you.
Farrell: Thanks a lot, Bill.
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