May 2007 – The price of sugar

On a flight back from Antigua last week I saw a film called The Pursuit of Happyness featuring Will Smith in the biographical story of Chris Gardener, a homeless and all but penniless salesman whose ambition was to land a job on the trading floor of Dean Witter, the Stockbroking firm.

When the film came to the UK it was premiered by the Prince’s Trust, the charity established by Prince Charles to help young people from disadvantaged backgrounds set themselves up in self-employment.

The film would have been seen by many in the US as inspirational because it had all the rags-to-riches ingredients of an Horatio Alger novel. In the late 19th century Alger wrote more than a hundred stories, all of which followed the same theme: taking a down-and-out boy and setting him on the path to wealth through virtuous conduct and hard work.

In the film, set in the 1980s, Gardener is admitted to a 20-strong class of unpaid interns, only one of whom will win a coveted trading job. Estranged from his wife and evicted from his home, he must queue for a place with his son every evening in a downtown hostel while studying for exams and searching for clients.

Gardener is black and, while there is no overt racial message in the film, the way he is singled out by his immediate supervisor as an errand boy only emphasises the differences in perceptions among those who enjoy Ivy League backgrounds and those who live on the streets.

In fact it is the indifference to his circumstances among his corporate superiors that is particularly striking. In one scene a senior partner borrows $5 from him for a taxi, leaving Gardener without the fare to get down to the hostel, thus condemning him to ride the subway all night long with his child.

It is not often that a film makes me angry but this one did because it never raised the possibility that there could be a contradiction between the pursuit of happiness and the pursuit of wealth.

Perhaps it was because I had spent part of the previous week learning something about the origins and workings of Antiguan slave plantations in this the 200th anniversary year of the abolition of the slave trade.

It is impossible to spend time in this former slave colony without feeling for the injustice of the slave trade and the way it was maintained for hundreds of years in order, as an Antiguan historian, Paddy Simon, put it, to “sweeten the tea and put clothes on the back of Europeans.”

Yes, it was all a long time ago, but for Antiguans in contemporary society the psychological scars of slavery remain. “We were stripped of our tongue, our diet, our culture and our God,” says Simon. “It has left behind a copycat society where we look to others for ideas and inspiration.”

Today the sugar plantations have disappeared from Antigua. As tourism grew to become the mainstay of the economy, labour could not be found to work the sugar fields that were allowed to revert to scrub land.

Cutting sugar cane was neither desirable for those engaged in the work nor necessary for those who consumed the product of the labour. Sufficient sugar had always been present in our diet. The slave trade enabled increased sugar production that led to addiction, dental decay and increasing levels of diabetes. Sugar is used also in cigarette manufacture, both as a tobacco additive and as a flavour enhancer on cigarette wrappers.

Did a mountain of sugar make the world a better place? Antiguan society is slow moving, sometimes frustratingly slow. I saw Americans almost tearing their hair out as they waited for breakfast in my hotel and began wondering whether stress was the biggest US contribution to gross national misery.

It took William Wilberforce 20 years to persuade Parliament that the slave trade had to end. Even when it did end, slavery continued in the British colonies until 1834. It was replaced by low-waged labour but the order of society did not change much until most of the British plantation owners sold up and left in the 1930s.

During the slave years wealth was sucked out of the economy in sugar exports. Today it is sucked out in tourism dollars since most of the hotels are US-owned. So poverty continues and the people of Antigua continue to be exploited in service jobs for the hotel trade.

Slavery was bad. We can all see that now. People knew it was bad at the time but its evils were overlooked because of the enormous wealth it earned for those holding the whip hand. Today wealth is earned through continuing efficiencies and the suppression of wages in the cause of maintaining competitiveness.

Yet at the top of the earnings hierarchy those dynamics are reversed and competitive forces are increasing wages within the so-called “war for talent”. This talent is usually associated with the money markets and financial institutions. Rarely today is it possible to make the same kind of salaries in manufacturing as can be made in professional services, consulting and financial trading.

Adam Smith’s pin-making economics – based on the pursuit of efficiency, labour organisation, wealth creation and the cash nexus – continue to prevail but labour markets have become strained and I wonder for how much longer even relatively well-off people will be prepared to tolerate a system that celebrates growing inequality.

Among the people I met last week were hedge fund managers who couldn’t believe their good fortune and some former investment bankers who were glad to have moved on. The former investment bankers – all women – had built up sufficient personal wealth to make a lifestyle choice and each had opted for new careers that they argued delivered better intrinsic rewards. One of the women was working now in the cosmetics industry where she had a genuine interest in the product.

Today, in the UK at least, people have the legal right to investigate part-time working possibilities with their employers. As final salary pension schemes continue to dwindle the incentive to work full-on up to retirement is on the wane. And, as the age-discrimination law makes enforced early retirement more difficult, the scope for more variable later careers is increasing.

In the early part of the industrial revolution when people were encouraged to formalise their working weeks around daily shifts the phenomenon of “St Monday” was widespread as many people chose to match the financial returns from their labour against subsistence needs for food, clothing and shelter.

Consumerism destroyed that equation since it created material desires that continue to fuel what dominant US thinking translates in to the pursuit of happiness. It seems extraordinary in a world exposed to growing environmental threats that this equation should prevail without challenge. Where is the “economics of enough?”