Bemeficent Society: Chpt 9


 Howard grew up, or at least attempte to, under the negligent care of his drug-addicted, slovenly, verbally-abusive parents.  Thus he was launched into the world with every predisposition to failure that was in their power to inflict upon him.  And, obligingly, fail he did.  Our subject descended down a cascading series of criminal activities that, at the tender age of seventeen, earned him the enmity of a judge who sentenced him to ten-years confinement.



Thus we begin Howard’s tale the day of his arrival on Rehabilitation Island after four days at sea.  He and his fellow inmates disembarked their ship and then marched a quarter mile to a meeting hall for the warden’s orientation talk.

After a few words of welcome, the warden took a few minutes to recount Newcapia’s former mode of punishment.  He claimed it was incredible that it took so long for society to admit just how counterproductive imprisonment was.  When released from jail, ex-convicts were even less likely to adopt a normal lifestyle than when they went in.  They tended to be embittered, likely penniless, and incapable of earning an honest living.  The truth was, the old justice system actually reinforced criminal behavior.  Little wonder that recidivism was the typical result.  Then too, there was the appalling cost of detention.  And, on top of all that, there was the deliberate injustice to the victims of crimes who received no compensation for the failure of law enforcement to protect them.  The most the victims could hope for was that, in the unlikely event that their perpetrators were caught, they would derive some satisfaction from the painfully slow workings of the justice system.

“Rehabilitation Island,” said the warden, “was designed to reverse the mistakes of the past.  Here you are no longer convicts.  You are ‘islanders,’ and those of us in government are called, ‘mainlanders.’  Instead of being caged behind bars, you will be free to come and go as you please anywhere on our sixty square miles and associate with whomever you please among your five-thousand fellow islanders.  In short it is our intention to enable you to live, as much as possible, as you would on the outside.  Holding a job, purchasing whatever you need, making your own arrangements for room and board, and gradually paying off your indebtedness to those you’ve harmed.

“After lunch, our director of employment will fill you in on the details.  So I’ll conclude with just a couple of comments that I hope you’ll keep in mind.  Picture your days here as pages in your diary.  In the old prison days, all you could do with those pages was tear them out, one-by-one, and throw them in the wastebasket.  On Rehabilitation Island, you will have the ability to turn those pages into records of accomplishments.  You can learn a trade, take courses in our night school, read up on your interests from books in the library, and join any one of our clubs.  In other words, you can walk out of here with a diary you can be proud of, more competent, more confident than the day you arrived.

“But the freedom we offer provides other choices.  You’ve screwed up in the past and you can do so here.  After this afternoon’s talk, you will be handed a copy of our rulebook.  We don’t have a lot of rules but we expect the ones we have to be obeyed.  Violate any one and you’ll be sent back to prison with no chance whatsoever of returning here.  It’s as simple as that.  There are no hearings here, no lawyers, no judge, no juries, no appeals.  It pains me that the ship that brought you here will leave later this afternoon with four locked staterooms occupied by very unhappy ex-islanders.  They’re not the first offenders to be sent back and, I’m afraid, they won’t be the last.  I hope none of you will be among them.  Please, stay out of trouble.

“Thank you, my friends, for  your attention.  I’m sure I’ve left a lot of your questions unanswered but, I suspect, they’ll be covered by our employment director in this afternoon’s session.  So please meet in this same room an hour and a half from now.  In the meantime, enjoy your lunch in the cafeteria down the hall.  You are adjourned.”


Howard, who all his life had been skeptical of authorities, felt sure the warden had painted a rosier picture of Rehabilitation Island than was justified.  He’d get the real scoop from his some of the veterans.  Like which guards could be paid off for drugs or cushier assignments.  That’s the way the world always worked.  Rehabilitation Island couldn’t be that different.

A surprisingly good lunch left Howard in a somewhat less suspicious frame of mind.  He’d hold off forming an opinion of the place until hearing the bad news the warden left up to the next guy to deliver.



The director was even more brusque than the warden had been.  “Let’s talk about jobs,” he began.  “You’ll need one right away.  Around here, no money, no food.  I mean that literally.  We’ve no soup kitchens, no pantries, no free handouts anywhere.  If you’re too sick to work, turn into sick bay.  Otherwise, find work.  So first thing tomorrow morning, get your ass in gear and start looking.  You’ll see a lot of ‘Help Wanted’ signs down Main Street because the ship you came on will have taken back quite a few islanders who’ve served their time.  Some businesses are expanding so they’ll have signs up too.  If you have a skill like a machinist or know wood working or commercial art, apply anyplace you think you’ll fit in whether they’re hiring right now or not.  Maybe they’ll take you on as an apprentice.  If not, leave your resume.  We’ll work one up for you if you’ve got anything to brag about.  There’s farm work too, if that will suit you.

If nobody else will hire you, the labor  pool’s a last resort.  They’ll take on anybody, anytime.  Lousy pay for hard work but filling pot holes beats starving to death.  And meantime you can keep looking for something better.

“Whatever you do, don’t lie about anything.  Word gets around an island like this real fast and a rotten reputation will kill your chances of ever landing a decent job.  Probably won’t get asked why you’re here, but if you are, spit it out.  The person asking you is an ex-con too, you know.  Funny thing the way it works, the longer your sentence—in other words, the worst crime you’ve committed–the better your chances of being hired.  Nobody wants to keep training short termers.  And nobody’s worried about your being a psycho or something cause you’d never be sent to Rehabilitation Island in the first place.

“Okay, now let’s talk about money.  To begin with the rulebook we’ll give you contains enough coupons for food and lodging to last you a week.  After that you’re on your own.  Just remember when you’re trying to land that first job, beggars can’t be choosers.  You can always ask for a raise or change jobs later on.  A couple of other things you need to know is that ten percent of your wages will be withheld to pay off what you owe to your victims.  And there’s a five-percent sales tax on everything to keep this place running.  Newcapia’s attitude is that you guys and gals broke the law so law-abiding citizens shouldn’t have to pay for your upkeep.  Fair enough if you ask me.

“On the bright side, down the road some of you will be released from Rehabilitation Island stinking rich.  Who will rake in the dough, I don’t know, but it’s a safe bet that it will be some of you sitting here today dead broke.  How?  Some of you stingy bastards will just sock away enough of your wages over the years to accumulate a pretty tidy bundle.  Some of you will get rich starting your own businesses.  Like that madam who left here a couple of years back with, what the magazines called, a small fortuen.  And her girls did okay, too.  Anyway, the theory is to make the island a free enterprise community so you can learn how to make the most of it on the outside.  Whether you do or not is up to you.

“Next, communication with the mainland is highly restricted.  We’re trying to immerse you in a law abiding society which means you can’t be doing business with old chums on the outside.  No phone calls to the mainland, no packages.  Letters to and from are censored.  And no Internet cause it can’t be controlled.

“But, there’s no getting around it.  Just the same as it was before.  A sentence on Rehabilitation Island is hell on family life.  We do provide a conference center where families can get together electronically as often as once a week and conjugal visits are allowed if spouses pay a nominal charge for their passage.

Any questions?  No?  Don’t forget to pick up your rulebooks.  Vans are standing by to take you to a downtown rooming house.  They have lockers to store your things.  Good luck!”

In his talk, the employment director made finding a job a relatively straightforward matter—almost automatic.  That wasn’t Howard’s experience the following morning.  Time after time he was promptly rejected.  No explanations were given, but the facial expressions and body language confirmed what he feared all along—his shabby command of English, verbal and written, made him unemployable.  By noon, he gave up and enlisted in the labor pool.

The labor pool’s odd jobs were varied, occasionally taxing—hand digging pipe trenches—but more often simply boring—weeding flower beds and the like.  In either case, the pay was minimal.  No more than barely enough to keep him fed and lodged in a miserable room.  At the urging of his foreman who pronounced him not as stupid as he sounded, Howard enrolled in a remedial English, night-school course and, six months later, emerged literate.  Buoyed by this initial success, he endured the painful coaching of a speech instructor to become reasonably intelligible.  Now armed with these new skills, he acquired a job as a stock clerk at twice his labor pool pay.  And not long after, his shop-owner employer was so impressed by Howard’s work ethic and accuracy in filling orders that he promised him an office job provided he completed a couple of business courses.


The rest of Howard’s history could be considered legendary.  At a bar nearby his workplace, Howard made friends with a fishing boat owner of about the same age.  One evening the boat owner invited Howard to dinner and arrayed before him some prepared samples of his catch including a platter of sardines.  Howard partook of these heartily.  He had grown to like them as a kid when they had been part of the family fare probably, he now guessed, they had been so cheap.  Howard’s host was agreeably surprised.  Whereas he personally liked them as well, the ship owner explained, there was no market for sardines on the island.  He regularly disposed of the sumptuous hauls of perfectly good sardines left in his nets by dumping them back in the ocean, reserving just enough for bait and for his personal table.

Fast forward two years, during which Howard had inhaled a whiff of entrepreneurship from his night school education and put it to work.  The letters he had written to cannery owners in the States explained that Rehabilitation Island offered an exceptional opportunity to expand their business.  The supply of good quality sardines was virtually unlimited off its coast as was the source of willing, dexterous hands—both at bargain prices.  As plant manager of their operation, he would see to it that a steady flow of profitable product would keep coming their way.  Since the island already had a reputation for profitable offshore ventures, Howard’s proposals were taken seriously and delegates dispatched to verify his claims.

Not long thereafter, capitalist gears turned and the makings of a cannery began arriving at Rehabilation Island.  Sheds were built and, within weeks, a fully operative plant—bursting with retorts, sealers, and seemingly miles of conveyor—stood ready to go.  Along with the equipment came an experienced plant manager who, after months of instruction, decreed Howard competent to run the plant on his own.

In the years remaining of his sentence, Howard evolved into a staid member of the island’s community and proud possessor of a family and a respectable bank balance steadily augmented by annual company bonuses.  By the time he and his family were discharged from Rehabilitation Island it would not be amiss to think him, not necessarily wealthy, but prosperous.



In the days preceding his release, Howard excitedly followed the debate over a proposed new approach to reduce the mainland’s  unemployment roles.  If enacted into law, he realized, it offered a chance to advance his own business career.

The issue had engendered spirited arguments within Newcapia’s government circles.  Whereas there was general agreement that handouts to the unemployed just prolonged the problem, an alternative policy, at first, eluded them.  Ideally, a genuine solution would be a bottom up approach that would enable unemployed individuals to lift themselves up by their own bootstraps.  Unfortunately, it seemed that no comparable program existed in the States or elsewhere, nor could one be even imagined.  Until, that is, an audacious newspaper columnist wrote an article pointing out that just such an example existed under the lawmakers’ very noses.

The article went on to describe this hitherto unrecognized phenomenon as being made up of mostly of young males, who had once been part of the hardcore unemployed, but who now enjoyed good steady incomes that would be the envy of many professionals.   Even more surprising, these young men were not the beneficiaries of some generous government program, but instead experienced nothing from it but relentless interference.  Then to dispel the mystery, the columnist revealed he was talking about the noble practitioners of the drug trade.

Finally, the writer went on to say that he was not advocating solving the unemployment problem by handing out free bags of crack to everyone out of work and sending them onto the streets.  But, setting aside the distasteful nature of the drug trade, it did serve as living proof that a combination of the universal drive for material gain, a merchantable product, a free market economy, and an absence of governmental regulation inevitably resulted in self-sufficient commerce.

That truism could be taken advantage of, the columnist argued, by harnessing the unemployed vast resources of latent talent, business experience, technical expertise, and unbounded motivation.  Why not, then, release that potential by favoring it with the same economic freedom bestowed on the drug trade?

Influenced by this article, Newcapia’s open-minded lawmakers authorized a new type of short-lived corporation called “Ucorp” that gave the unemployed a chance to get on their feet.  The legislation relieved Ucorps of all but the bare minimum of governmental restrictions necessary to protect public health and worker safety.  It exempted them from minimum wage, workman compensation, corporate income tax and unemployment insurance requirements.  Furthermore, it led to the creation of a comprehensive set of open-software tools for small businesses.  And cognizant of tendency for governmental branches to overreach, the law stipulated a strict hands-off policy preventing them from financing, advising, and/or favoring, either directly or indirectly, an individual Ucorp or group.

As previously mentioned, Howard had reason to avidly study the law’s   provisions:

  • Term:  the maximum life of Ucorps to be five years at the end of which they would have a choice of liquidation or conversion into a regular corporate structure.  For its operations to be acquired by a regular corporation prior to its five-year termination date, a Ucorp would first have to be dissolved.
  • Requisite officials: president, treasurer, secretary, and general manager.  No board of directors.  Company records to be kept in a professional manner and made fully available for inspection by any employee upon request.
  • No more than two officers could be related to each other and none could have a criminal record or been recently bankrupt.  No particular qualification or experience would be required except for the treasurer who would be expected to have verifiable experience in bookkeeping or accounting.
  • Ownership: entirely employee owned.  Common stock not transferable.  Only one class of stock.  Ucorps could borrow money but could not pledge company stock as collateral.
  • Personel: must have been officially unemployed for at least six months before being eligible to join Ucorp.  Screened at entry by computerized application form.  Ucorps to be non-union.
  • Compensation:  Employees including the founding officers agree to work their first month without pay.  Compensation of executives to be no more than five times that of the average worker salary exclusive of executive pay.  Dividends, bonuses and commissions not permitted.  Every payday each employee to receive a number of shares equal to the dollar amount of his or her paycheck.
  • Upon any change in the status of the Ucorp whether on account of its sale, dissolution or merger, the company’s accumulated profits to be divided in accordance with each employee’s share holdings.  Employees who leave the company for any reason must surrender their shares at current book value.
  • Ucorp required to contribute one-percent of its total compensation to the nongovernmental Ucorp Association.  Association to provide services for the industry including acting as an ombudsman in governmental affairs, handling arbitration cases, furnishing consulting services, promoting the industry image, and refereeing complaints.
  • Ucorps given immunity from civil prosecution.  Financial disputes resolved by compulsory arbitration or by a small claims court.
  • Ucorps would be prohibited from displacing existing operations.
  • Establishing a Ucorp would be no more difficult than completing an Internet-based questionnaire with a unique name for the new identity, its address, and the identification of its four officers: the president, treasurer, secretary, and general manager.  The purpose of the proposed corporation would not be questioned nor would any fees be assessed.
  • If accepted, the new Ucorp would be officially registered and be given without charge a commercial bank account at a nearby bank, and automatic membership in the Ucorp Association.  In addition, the new Ucorp would be provided a free, easily customizable website containing pages for its description, the marketing of its product and services, the posting of positions available, “FAQ’s,” and contacts.


The following hypothetical accounts are included to give the reader an idea of the scope of the Ucorp program and its human dimensions.

Case 1:  An existing company, Acme Furniture, Inc. designs its products in the US but relies on China for their manufacture.  This arrangement normally works out well, but is judged impractical for Acme’s proposed new customized line.  The company anticipates it would no longer be able to depend on its Chinese suppliers for its new endeavor’s special requirements such as close supervision, short-runs, timely deliveries, and, frequent, last-minute changes.  Instead, Acme spins off a low-cost, US based Ucorp and, in its name, builds and equips a factory close to its main offices.  For the next five years, the employee-owned Ucorp operates under a contract with the company.  When the Ucorp is forced to liquidate after this period, its staff shares the accumulated profits and most elect to stay on the job as company employees.

Case 2: Several Hispanic ex-employees of Circle Design have, for months, been meeting regularly at a local coffee shop to share their grievances.  Intimately aware of Circle’s failure to expand into Latin America, they band together and present their former employer with a proposal to act as their distributor in Central and South America.  Having found this trickle of orders from this area more trouble than their worth, the company readily agrees to their proposition and provides a start-up loan for the new Ucorp.  Thanks to aggressive marketing by the Spanish-speaking group, the arrangement proves so successful that, in three years, Circle offers a handsome buyout package that the Ucorp’s employees share along with the accumulated profits in their dissolved outfit.

Case 3:  Elmer Hodgkins, a victim of the downturn in the construction industry, had neither business experience nor professional connections.  On the other hand, he had been impatient with sitting around all day and was energized by the possibilities Ucorp offered.  Enlisting his wife and two friends—the former bookkeeper and office manager of their now defunct employer—Elmer applied for and was awarded incorporation despite having no clear idea as to how to make it work.  Without a dime to spare among them, the new Ucorp’s officers scoured the city’s businesses and governmental offices for any kind of temporary work.  Given their zeal and modest hourly pay, odd jobs were found.  They mopped floors, filed papers, reorganized storage areas, and the like—each assignment gaining them references and experience.  By the end of their Ucorp’s second year, they were earning more  than they did when originally employed.  After another year they were able to hire others and add company profits to the income they were earning directly.

Case 4:  Georgiana Polankitz long believed many would relish the tasty  ethnic pastries handed down by her grandmother.  When she lost her sales job with a department store, she briefly considered trying to earn a living selling these but a cursory review of  the city’s prohibitive food regulations scotched the ambition.  However, under her Ucorps banner, she kept the city at bay while satisfying prospective buyers as to the cleanliness of her kitchen with a video made by daughter.  Concentrating on wholesale distribution to local bakeries, she managed to break even her first year and operated profitably every year thereafter.  From this modest start, she used the Internet to grow her sales nationwide and employ fifteen people by the time she was forced to convert it into a normal subchapter S-corporation.

Case 5:  After being let go as an auto mechanic, Don Axelsmidt tried turning his hobby of making radio-controlled model airplanes into a profitable business.  Enlisting three friends to serve as silent partners, he formed a Ucorp and used his savings to get started.  Unfortunately, he was forced to close down after two years when he simply could not compete with foreign competition.  Not every Ucorp , after all, was successful.


Not surprisingly, the Ucorp system met with opposition.  Although, the unions recognized that the small scale of the Ucorps made their unionization  impractical, nevertheless they strenuously objected to them on the grounds of principle—the specifics of which were left undefined.  And governmental agencies, likewise excluded from Ucorp operations, added their objections ostensibly on the grounds of public safety but, in reality, out of fear that Ucorp successes would throw into question justification for their existence.  This being Newcapia, however, more rational minds prevailed and Ucorps weathered the criticism and kept growing in number with favorable economic impact.

As an immediate consequence, the unemployment rate was reduced as was the human misery it exacted.  Moreover Ucorp produced dramatic savings in the cost of federal and state unemployment insurance and in the cost of related entitlements generally.  And, although it was impossible to measure, the proliferation of innovative Ucorps gave a preceptible boost to innovation generally.

Shortly after his release, Howard set to work fulfilling an ambition he had nursed ever since the cannery took shape on Rehabilitation Island.  Staking his savings as seed money, he was able to convince enough other investors to form the Savory Sardine Company for the purpose of acquiring the Rehabilitation Island facility from its original owners.

Under Howard’s aggressive management, Savory’s volume and profitability grew to the extent that, when it was forced to disolve as a Ucorps, Howard could sell out his position and retire now, without question, among the ranks of the wealthy where we may leave him with the assurance his remaining years would be devoted to charitable causes.


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