Page 26 - The Green Building Bottom Line The Real Cost of Sustainable Building

NARRATING VALUES, SHAPING VALUES, CREATING VALUE 5

democratic ideology based on the individual were joined. It would take over two
centuries for this bond between capitalism and democracy to unwind. In the early
going of the new republic, individual property rights including the right to quiet enjoy-
ment were balanced against the government’s right to regulate land use in the public
interest. The legal doctrine of sic utero tuo ut alienum non laedas (“use your own so
as to cause no harm”) held sway. Over time, though, two critical changes tipped the
balance, with individual rights superseding those of the polis and corporations slowly
developing rights of their own synonymous with those of the individual. The tipping
point was probably the 1886 Supreme Court case Santa Clara County v. Southern
Pacific Railroad, which held that a private corporation is a natural person under the
U. S. Constitution. The decision, which would assist greatly in the growth and matu-
ration of capitalism in the United States, would in many ways lead to the pendulum
swinging strongly in favor of business to the detriment of larger social interests.
The final years of the nineteenth century were marked by the growth of huge corpo-
rations such as J. P. Morgan and Sons, Carnegie Steel, the Standard Oil Company, and
Chase Manhattan, ushering in unprecedented economic growth but also fostering prob-
lematic social conditions (sweatshops, child labor, unsafe working conditions). Of the
Fortune 500 largest corporations today, more than half were founded between 1880 and
1930. The growth of a largely unaccountable business sector briefly raised discussions
(and some legislation) as to how capitalism might better serve the populace. By the
mid-20th century, America settled in to what might be termed a modus vivendi between
business and government. Most business sectors were dominated by oligopolies, gov-
ernment played a role in regulating jobs and wages, a third of the workforce was rep-
resented by unions that tended to work closely with management to avoid strikes, and
top corporate executives played a role as “corporate statesmen,” responsible for bal-
ancing the claims of various stakeholders (stockholders, employees, the public). During
the post-World War II period until the mid-1970s, economies of scale were large, with
a high degree of productivity and profit. Tens of millions of steady jobs were created.
There was a wide distribution of profits to blue-collar workers and others, and a grow-
ing middle class helped fuel this economic growth through increasing consumption of
goods and services. It was, perhaps, the high point of democratic capitalism.
From the 1970s on, however, the picture has changed dramatically. Old oligopolies
have given way to intense competition on a global scale. Manufacturing in the devel-
oped world has given way to a service economy, with manufacturing relocated to over
seventy developing countries, primarily in the 1,000-plus free-trade zones abroad,
where environmental and labor regulations are lax, where workers’ wages of eighty-
seven cents per hour are a fraction of labor costs in the U.S., and where production
costs can be cut to a minimum. Domestically, such changes have resulted in the growth
of a temporary work force by 400 percent since 1982, as 83 percent of America’s
fastest growing companies are now outsourcing part of their work. Only 8 percent of
the American work force is now represented by unions. The average corporation
replaces its entire workforce every four years. Abroad, the creation of manufacturing
jobs that can quickly move in and out of export development zones in search of the
cheapest available labor has had the effect of creating uncertain, unstable employment.