Tag Archives: Sweden

SYNDICATED COLUMN: Our Suicidal Ruling Class

Why Won’t the Rich and Powerful Try to Save Themselves?

I spent last week at Occupy Miami and Occupy Fort Lauderdale. One question came up several times: What if the system responds—or pretends to respond—to our demands? What if the political class agrees to create more jobs, help the unemployed, let distressed homeowners keep their houses?

Then the Occupy movement (and American progressivism) will be out of business. “President Obama could finish us off over night,” I said. “A speech would be enough. He wouldn’t even have to do anything.”

Obama could announce a big jobs bill, knowing full well that Congressional Republicans would kill it. It would probably increase his reelection prospects.

But don’t worry.

He won’t.

He can’t.

America’s corporate rulers and their pet politicians know that people are furious. They understand that their actions and policies are accelerating the pace of income inequality and creating a growing, permanently alienated underclass.

They know history. Sooner or later, the downtrodden rise up, overthrow and kill their oppressors.

It’s not a nice way to rule. Nor is it smart. So—if all it would take for America’s masters to save themselves from the raging mobs of the not-so-distant future are a few empty words, why not try?

There’s no doubt about the nature or scale of the problem. Economists from left to right agree that the United States suffers from high structural inequality. “At least five large studies in recent years have found the United States to be less mobile than comparable nations,” reported The New York Times on January 5th. According to a Swedish study 42 percent of American boys raised by parents whose incomes fall in the bottom 40 percent of wage earners remain in the bottom 40 percent as adults—a much higher rate than such nations as Denmark (25 percent) and England (30 percent), “a country famous for its class constraints.”

To be poor in the United States is not unusual. Half of Americans live under two times the poverty line. But the depth and persistence of poverty in America is unique among developed industrialized nations. The gap between the poor and the rich is bigger. Mobility—access to the American Dream—is less.

Born rich? You’ll more likely to die rich in the U.S. than in other countries. Born poor? You’re likelier to die poor.

“Miles Corak, an economist at the University of Ottawa, found that just 16 percent of Canadian men raised in the bottom tenth of incomes stayed there as adults, compared with 22 percent of Americans. Similarly, 26 percent of American men raised at the top tenth stayed there, but just 18 percent of Canadians.”

When family background determines your fate you look for other options. Like getting rid of the system that makes things that way for your kids and their kids. That’s what happened in France in 1789 and Russia in 1917 and China in 1949.

There is no better predictor of revolution than an absence of economic mobility.

Right-wing extremists dismiss empirical data with anecdotal evidence. “If America is so poor in economic mobility, maybe someone should tell all these people who still want to come to the U.S.,” Stuart Butler of the Heritage Foundation told the Times.

Someone should.

Most Americans are poor. They don’t need to read these studies. They’re living them. Which is why they want politicians to create big jobs programs, raise wages, establish permanent unemployment benefits (standard in Europe) and impose a moratorium on foreclosures. The polls are clear.

No one cares about Iran’s supposed nuclear weapons program.

Yet here we are in the heat of a presidential election year, and no candidate—not “liberal” Obama, not the weird Republican, Ron Paul, no one—is talking about the issues Americans care about.

During the 1930s and 1960s liberal leaders ended street protests by promising change. Why not now? Why isn’t anyone promising to address income inequality? They could lie and break their promises later.

First, the rich are feeling squeezed. The global capitalist system no longer has much room to expand. Emerging markets have emerged. Globalization is not only nearly out of steam, it’s allowing the weakest trading partners to drag down their healthier partners. Feeling squeezed, our rulers aren’t in the mood to be generous. They’d rather loot the scraps of the pending collapse than expand the social safety net.

Second, the ruling classes have fooled themselves into believing that they no longer need to exploit workers in order extract surplus value. They make their profits without us in massive arbitrage transactions that collect spreads from borrowed money. To be sure, it’s a bubble. It’ll burst. But it feels good now.

Third, the rich think they can insulate themselves from the roiling masses of the dispossessed, safe behind high-tech alarm systems inside their gated communities. Arrogance rules.

Louis XVI had good security too.

Finally, there has always been a division within the elites between enlightened liberals and hardass thieves. The liberals don’t like us; they fear us. So they try to keep us satisfied enough not to revolt. The thieves count on brute force—cops, pepper spray, camps—to keep the barbarians at bay. The balance of power has shifted decisively to the thieves—which is why figures like Obama can’t even pretend to care about the issues most important to the great majority of people.

(Ted Rall is the author of “The Anti-American Manifesto.” His website is tedrall.com.)

COPYRIGHT 2012 TED RALL

SYNDICATED COLUMN: Some Weasels Are More Equal Than Others

Liberal BS on Income Inequality

Everyone talks about income inequality, but no one does anything about it.

Lately they’ve been talking more than ever.

“The United States is the rich country with the most skewed income distribution, ” Eduardo Porter asserts in his upcoming book “The Price of Everything: Solving the Mystery of Why We Pay What We Do.”

Porter continues: “According to the Organization for Economic Cooperation and Development, the average earnings of the richest 10 percent of Americans are 16 times those for the 10 percent at the bottom of the pile. That compares with a multiple of 8 in Britain and 5 in Sweden. Not coincidentally, Americans are less economically mobile than people in other developed countries. There is a 42 percent chance that the son of an American man in the bottom fifth of the income distribution will be stuck in the same economic slot. The equivalent odds for a British man are 30 percent, and 25 percent for a Swede.”

For students of history and economics, this is shocking stuff. Europeans came to America in search of opportunity, for a better chance at a brighter future. How can it be that it’s easier to get ahead in Britain—famously ossified, rigidly class-defined Britain?

Yet it’s true. David Leonhardt of The New York Times writes: “Income inequality, by many measures, is now greater than it has been since the 1920s.”

According to Nicholas Kristof, also at the suddenly class-conscious Times, we live in a time of “polarizing inequality” during which “the wealthiest 1 percent of Americans possess a greater collective net worth than the bottom 90 percent.”

This, we are informed, is bad. Not just for us. Income inequality hurts everybody—including the rich.

Cornell economics professor Robert Frank notes the correlation between financial stress and social dislocation. “The counties with the biggest increases in inequality also reported the largest increases in divorce rates,” reports Frank. Children of divorce are more likely to become a societal burden, committing crimes against everyone, including the wealthy.

Frank argues that our quality of life is suffering across the board due to income inequality. For example, traffic jams are getting worse: “Families who are short on cash often try to make ends meet by moving to where housing is cheaper—in many cases, farther from work. The [U.S.] counties where long commute times had grown the most were again those with the largest increases in inequality.” Everyone sits in traffic, even millionaires.

The “middle-class squeeze,” Frank explains, pressures voters to vote against higher taxes that would support improvements in public infrastructure. We all pay: “Rich and poor alike endure crumbling roads, weak bridges, an unreliable rail system, and cargo containers that enter our ports without scrutiny. And many Americans live in the shadow of poorly maintained dams that could collapse at any moment.”

Is it wrong to giggle at the thought of selfish millionaires being washed away by a flood?

Citing the work of the British epidemiologists Richard Wilkinson and Kate Pickett, Kristof blames just about every societal ill on income inequality. Among the highlights: infant mortality, drug abuse, teen pregnancies, heart disease, even higher obesity among people who don’t eat more than others. This may be why high-unemployment Michigan has some of the nation’s fattest people. (The hormone cortisol, released when humans are stressed, increases fat retention.)

Porter notes that the income gap is increasing across the spectrum—including among high earners. One study shows that in the 1970s the top ten percent of corporate executives earned twice as much as the average exec. Now they get four times more. “This has separated the megarich from the merely very rich,” he says.

Rising income inequality means trouble. Not just for our waistlines, but for the system that has created the problem: corporate capitalism.

“If only a very lucky few can aspire to a big reward,” Porter warns, “most workers are likely to conclude that it is not worth the effort to try.” That would lead to less legitimate innovation, fewer new businesses. The best and the brightest will conclude, as they have in post-Soviet Russia, that crime is the only economic activity that pays.

So what is to be done?

Here the income-inequality-is-bad crew falls flat on its collective face.

Kristof’s prescription: “As we debate national policy in 2011—from the estate tax to unemployment insurance to early childhood education—let’s push to reduce the stunning levels of inequality in America today.”

Push? How?

Porter’s solution: “Bankers’ pay could be structured to discourage wanton risk taking.” But bankers aren’t the only culprits. How would this restructuring take place? Who would force bankers to accept it?

Frank’s answer: “We should just agree that it’s a bad thing—and try to do something about it.”

Workers of the world, try to do something about uniting!

I’m going to climb out on a limb here: The guys I’ve quoted are all smart. They know exactly what is causing this relentless increase in income inequality. Ruling elites have exploited globalization and technological advances to increase corporate profits through deregulation, union busting, and lobbying for federal subsidies and tax benefits. We’re witnessing exactly what Karl Marx predicted at the dawn of industrialization: capitalism’s natural tendency to aggregate wealth and power in the hands of fewer people and entities, culminating in monopolization so complete that the system finally collapses due to lack of consumer spending.

The pundits are also smart enough to know that there’s only one way to equalize income: revolution.

Increasing riches leads to increasing influence. No matter how nicely we ask, why would the rich and powerful give up their wealth or their power? They won’t—unless it’s at gunpoint.

Nothing short of revolution stands a chance of building a fair society. Not “pushing.” Not “restructuring.” If working within the Democratic Party and the election of Obama prove anything, it’s that reform within the system is no longer a viable strategy for progressives.

We’re way past “trying to do something about it.”

The sooner we start talking about revolution, the closer we’ll be to a non-BS solution to the social and political ills caused by inequality of income.

(Ted Rall is the author of “The Anti-American Manifesto.” His website is tedrall.com.)

COPYRIGHT 2011 TED RALL