I'MMA LET YOU FINISH
Income inequality is not just an equity issue: it also has limited economic growth. If median incomes had grown as much as the economy in the last 20 years, middle and lower income folks would now have a much greater capability of purchasing goods and services to grow the economy.
There is no shortage of investment capital now in the US; just no reason for businesses to invest it given existing overcapacity at current levels of consumer demand. Reversing government tax and labor policies that have contributed to growing income inequality may be one of the best remedies to promote higher levels of economic growth.
thanks Ben; that it is an important point. If you have any more material on this subject, I'd be interested in posting it.
I've often wondered if the uptick in growth in the last quarter of the first Bush administraion that later on was heralded as an indication that the recession was already over before Clinton took office, was in part due to the insistence by Democrats that jobless benefits be extended and extended and extended. That money undoubtedly got spent immediately.
Limiting income is a boon to the credit and banking industries. Prices go up, incomes remain flat, and consumers turn to credit cards and refinancing to bridge the gaps. Sure, those industries run the risk of losing big if the economy truly stalls, but in the long run the game is rigged in their favor via increasingly draconian bankruptcy laws. Almost makes you wonder what they contributed to Republican coffers over the last few years.
In a way, interest on credit card debt is the new tax of America, Inc™.
Numbers and faces, people.
As Ben says, normal folk are losing, plutocrats are winning.
Show me a Dick Cheney getting $100K. Alongside 100 teachers losing $1k each. Or two $50k cops laid off.
Or 10 Dick Cheneys and a hospital closing to fund their tax cut.
Tax cuts ain't free, voters are getting the bill, higher taxes or reduced services.
Tax Cuts = Service Cuts
Steven Roach of Morgan Stanley has consistently pointed out that the US and world economy suffers from an excess of supply given current levels of demand. While Roach doesn't provide a solution, his analysis of the situation makes sense (and was vindicated by the absence of the significant predicted recovery in 2002). From his latest missive:
"Similarly, the US and the world are still awash in the excess supply that was put in place in the late 1990s. That’s why businesses continue to complain about the lack of pricing leverage. In that context, it’s hardly surprising that the capital spending response has been muted and can be expected to remain so for some time to come.... In my view, the capex outlook is more about quantity than price -- far less dependent on cost of capital issues than it is on the sheer overhang of global capacity relative to expected demand growth...
But the task at hand is very different than recession containment -- it involves providing enough impetus to the real economy to push growth back up from the 1.7% pace of the past three and a half years to a 4% trajectory. Given the lack of pent-up demand and the lingering excesses of aggregate supply, that may be exceedingly difficult to achieve.... But, as noted above, the key objective for the authorities is to get the US economy back to a sustainable 4% growth pace -- and hold it there for several years. That’s the only way the deflationary gap between aggregate supply and demand can be closed once and for all. A temporary growth spurt won’t do the trick...."
">Steven Roach
The Economic Policy Institute has compiled interesting statistical data about the how poorly median income workers have fared over the last 25 years.
">Median Weekly Earnings
Note that the real median earnings for men actually declined from $677 in 1979 to $646 in 2000 despite substantial real economic growth.
Decline in Minimum Wage in 1999 Dollars
Again note that despite significant economic growth, the minimum wage has declined in constant real dollars from a high of $7.07 in 1968 to $5.00 in 2001. So not only has the minimum wage not kept up with economic growth (as it arguably should have), it has not even come close to keeping up with inflation.
Index of Related EPI Statistical Data
Corrected link for Roach analysis:
http://www.morganstanley.com/GEF...est-
digest.html
Steven Roach
Right click other (EPI) links in my post above and open them in a new window. Links don't seem to work otherwise for some reason.
Sorry, still doesn't work. Just cut and paste this:
http://www.morganstanley.com/GEF...est-
digest.html
Sorry, still doesn't work. Just cut and paste this:
http://www.morganstanley.com/GEF...est-
digest.html
Back to the social content of the Slacktivist's post. David Brooks, the obnoxious neocon commentator for _The Atlantic_, wrote an editorial awhile ago commenting on this very phenomenon, but in favor of it: he refers to a study that I'm trying to find, that shows that many non-rich Americans nonetheless identify with the rich: they believe they will be rich _someday_ (perhaps by winning the lottery). Brooks, who defends extreme hierarchy, is cool with this,
Ironically, when left-wingers actually make money and enter the wealthy or haute bourgeoisie, as happened to some under Clinton and the dot.com boom, Brooks tore into and ridiculed them,, in his excessively popular _Bobos in Paradise_. He seems to think that all leftists must live like Gandhi in order to be sincere. This belief is precisely what drives away many people from leftism because it makes them feel they must cease to enjoy themselves.
I don't believe this, but I do think that if you choose the path to wealth of the selfish individualistic capitalist, eventually you must budget not just for expensive backyard pools, but for security systems, razor-topped twelve-foot walls, and personal armed bodyguards and armored limousines. As is the case in Brazil today (maybe parts of LA).
Fear thus comes along with the wealth and luxury. I wonder if fear of "terror" (which, of course, is the warfare of the geopolitical poor) increases with your income.
P.S. Brooks really is obnoxious. I have seen and heard him on TV and facially his congenital smirk is somewhere between the Chimp's and Tony Blair's.
Slacktivist is the anti-Brooks and among the best bloggers in America or anywhere else. He has an ability to zero in on the moral core of an issue that sets him apart.. he is a Baptist and I'm an atheist but no-one else echoes my take on shit that happens with the same eerie correspondence. Read his archives.
Brooks is a selfish person in a class of selfish people and is adept, brilliant even, at defending and promoting this morally impoverished worldview. For his tribe, the individual is king, followed by all the individuals who resemble you, with the rest of humanity taking the minor placings. It is the Hobbesian ugliness Fred refers to in his piece. Fred by contrast champions the cause of 'losers'.. those left behind by the primacy of the attitude Brooks markets and catechises. He is therefore irredeemably a liberal, or even worse, a leftist. He actually possesses a heart to grace his sleeve.
Slacktivist embodies an American tradition of justice that is just as old as greed but one that is generally occluded by the power of wealth. Every so often that sober tradition of fairness breaks it's harness and remakes the American political terrain. I can feel the rumblings of such a movement but that could be wishful thinking. If it does happen, people like Slackie will have played their part, along with Atrios and all the rest, each with their own contribution to the groundswell. It appears the DNC is beginning to understand this too.
There has been a lot of pondering about Orwell lately.. what would he have said or done.. who would he have supported etc. My personal conviction is that he would have taken careful aim at the likes of 'Squealer' Hitchens and the dangerous ascendancy he works for and taken up residence in the less grand but more neighbourly tent that Fred lives in, along with you, me, Nelson Mandela, the Pope, et al.
Welfare reform, urban blight and "the haves vs. the have nots" are among the topics brilliantly observed in Michael Moore's "Bowling for Columbine."
Blogs are great for informing political junkies and sharpening arguments. However, blogs do not reach out to the unconverted. Television does that. "Bowling for Columbine" is the best progressive
presentation suited for the most powerful medium. What do you think?
I am committed to buying a "Bowling for Columbine" video and seeing to it that ten people see it. How about a grass roots effort to have the documentary run a dozen times one week on any cable station in lieu of the repeated showing of some action movie?
How about Eschaton reaching out beyond the choir and taking up this project? Someone of Atrios' stature might arrange for Michael Moore to make the documentary available on T.V. royalty free and line up a cable station. The size and diversity of this website's following is sufficient to make it happen one way or another. This project would have more bang for the buck than anything coming out of the DNC.
(BTW this is not posted by Michael Moore).
CMike,
Atrios is away with Mrs. A, taking a well-deserved vacation in an undisclosed location, which as of yesterday was only characterized by some mention of something called a Praedo. However, his take on Moore has always been a positive one.
I personally agree with you that Moore's greatest gift is a kind of guerilla reporting, informed by humor and passion; he's sketch artist, which explains why some of the material in his books is a sloppily rendered. I thought his news/comedy show on Fox was great, for all the reasons you discuss.
I'm not sure your idea is appropriate for Atrios; his blogging is so consumming a task, I think it's asking too much to expect him to be an organizer of sorts, too.
But I think the general thrust of what you're saying is spot on. That there are all sorts of smaller ways that individuals, and small groups of them can get the word out.
Sara:
I agree about Brooks; he's the mos dangerous kind of rightwinger because he seems so civilized and reasonable. His Bobos book was certainly an odd one; most reviewers read it as accepting of what he was describing. It had a lot of influence in Washington circles. He's certainly holds a special place in my pantheon of hate objects.
Glenn,
Slacktivist as the anti-Brooks is brilliant; I wish I thought of that for the post; probably more people would be tempted to click on the links. That's a lovely paragraph about that American tradition of Justice; I have a similar feeling about signs it may be on the cusp of a reincarnation.
mesk?
I actually dislike Brooks less than most other conservative commentators because, wrong though he may be, it appears he actually believes what he says. For an intelligent person though, his blind spots seem huge, and I suspect he was born into his conservate mindset and never really challenged it. Christopher Caldwell is another one I can tolerate even more.
Just one thing relevant to Leah's post: if you want to help in this critical fight for fairness, go to AlArise.org
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