A bloated overclass can drag down a society as surely as a swelling underclass (Barbara Ehrenreich)

[marmar]

from The Nation:


comment | posted June 12, 2007 (web only)
The Trouble With the Super-Rich

Barbara Ehrenreich

This article originally appeared on Barbara Ehrenreich's blog.

Twenty years ago it was risky to point out the growing inequality in America. I did it in a New York Times essay and was quickly denounced, in the Washington Times, as a "Marxist." If only. I've never been able to get through more than a couple of pages of Das Kapital, even in English, and the Grundrisse functions like Rozerem.

But it no longer takes a Marxist, real or alleged, to see that America is being polarized between the super-rich and the sub-rich everyone else. In Sunday's New York Times magazine we learn that Larry Summers, the centrist Democratic economist and former Harvard president, is now obsessed with the statistic that, since 1979, the share of pretax income going to the top 1 percent of American households has risen by 7 percentage points, to 16 percent. At the same time, the share of income going to the bottom 80 percent has fallen by 7 percentage points.

As the Times puts it: "It's as if every household in that bottom 80 percent is writing a check for $7,000 every year and sending it to the top 1 percent." Summers now admits that his former cheerleading for the corporate-dominated global economy feels like "pretty thin gruel."

But the moderate-to-conservative economic thinkers who long refused to think about class polarization have a fallback position, sketched out by Roger Lowenstein in an essay in the same issue of the New York Times magazine that features Larry Summers' sobered mood. Briefly put: As long as the middle class is still trudging along and the poor are not starving flamboyantly in the streets, what does it matter if the super-rich are absorbing an ever larger share of the national income?

In Lowenstein's view: "...whether Roger Clemens, who will get something like $10,000 for every pitch he throws, earns 100 times or 200 times what I earn is kind of irrelevant. My kids still have health care, and they go to decent schools. It's not the rich people who are pulling away at the top who are the problem..." .......(more)

The complete piece is at: http://www.thenation.com/doc/20070625/ehrenreich2

[Phredicles]

1. Barbara Ehrenreich kicks unbelievable ass.

[LSparkle]

2. It's time the rest of us start fighting back against this CLASS WARFARE

that's been waged on us since 1980. Reagan started the class war and since then his minions have continued the crusade by branding anyone who DARES to call it what it is as "Marxist" or "unpatriotic" or "anti-capitalist" or just plain unseemly. I say it's time to using the phrase again -- if the "global war on terrorism" can be called a "war" then what we're seeing economically in this country surely also qualifies.

[lostinacause]

10. Using "class warfare" to describe the situation, in my opinion, leads to the wrong ideas

about the nature of the problem and how to solve it. People respond to the economic environment and the institutions in place that create it. Given that the companies are responding to the institutions our focus should be on addressing the problems with the institutions.

The notion of class warfare also gives a false idea of the actions that are going on. Companies will “fight” other companies improve their outcome just as they will “fight” individuals. People in employment situations often work to undermine their coworkers as well.

Finally, labeling the situation “class warfare” creates a sense of a false dichotomy of choice. There are certainly sets of policies that make everybody worse off and so long as the economy is not efficient there are other sets of policies that make everybody better off. My experience is that people with class warfare mentality are more likely to support policies that are of the first type and are less interested in pursuing policies of the second type. Where is the general goal of society should at the very least be at a point where no set of policies of the second type exist.

[LSparkle]

13. Point taken -- using that verbiage probably won't help

but internally we need to know that that's what's going on. There has been a systematic effort made to weaken the middle class and to strengthen corporations/CEO class for decades yet when anyone even mentions that policies need to change in order to combat income inequality/unequal wealth distribution, they get shouted down. There needs to be an effort made to educate people so they don't continue to vote against their own economic best interests, and although "class warfare" may be too strong a term, we shouldn't hide behind "racism" and "ageism" and other terms when in many case what's going on is "class-ism". Perfect example is Katrina -- yes, most NO residents were black but they were also POOR ... George Bush doesn't care about black people ... and he REALLLY, REALLY doesn't care about poor people, either (he likes Condi and Colin just fine, thank you very much).

[lostinacause]

15. There has not been "a systematic effort to weaken the middle class"

as "to" implies intent. The intent is for each company and person is to get policies put in place whereby they make more money. An unintended consequence is to weaken the middle class. The distinction is critical because of the moral consequences of the distinction and the ability to effectively convey your point to those who do not believe you. A "systematic effort to weaken the middle class" would be seen as sinister and a punitive response would be in order whereas pursuing one's own self interest is less sinister and would just warrant implementing efficient wealth transfer policies. When failing to make the correct distinction one tends to loose credibility in the mind of those who are less convinced that the situation is happening. People would tend to look at the error and misjudge the validity of the cause. Thus there are consequences of misrepresenting the situation.

How the situation ought to be represented is to look at what has happened to the income over the last twenty or thirty years. Over that time period there have been large increases in the incomes of high income earners yet very little change in the incomes of the low income earners. This means that despite significant growth over that period the low income demographic is as bad off as they were before yet the high income group is significantly better off. In that time there have been a number of policies put in place based on economic efficiency such as privatization and the implementation of multilateral trade agreements. These policies tend to transfer wealth from the poor to the wealthy, yet there have been no policies in place to make it so that the average citizen receives any benefit from these policies. (and so on)

[Warpy]

3. Barbara, I'm surprised at you

I'd think that you, of all people, would recognize that the bloating of the overclass is what causes a swelling underclass. Shoveling money toward a wealthy few impoverishes the many. It's one of those simple equations everybody ought to be able to grasp.

The underclass does the work to create the wealth. The overclass collects a percentage of all the wealth they create. If that percentage is small and the underclass shares fully in the wealth they create, the society is generally a healthy one. If that underclass is kept impoverished by an overclass that keeps all the wealth to itself, the society becomes sick and then unstable. Bad things happen.

It's a funny way to put it, but the cause of poverty is extreme wealth. Deal with the latter and you'll automatically cure the former, or at least reduce it to a level that doesn't imperil the society as a whole.

The pump works from the bottom up.

[Demeter]

4. What Warpy Said! And Much Better Than I Could!

[glitch]

5. Ditto. nt

[Zodiak]

9. Yup...was gonna post a rant

then I realized Warpy's was much better than my baroque ramblings.

We've been in class warfare for nearly three decades, and the middle class and the poor are not winning.

The middle-class abandoned the poor in the 80's to suck up to the rich and their policies, buying into the trickle-down theory. How is that working out for them?

The biggest bane to the rich is when the middle-class and the poor look to each other and realize they've both been had.

We are nearly there, now.

[tblue37]

11. She SAID that. It's exctly what the article is about. (eom)

[Morgana LaFey]

12. I'm missing something. How do you think she failed in her

assessment. From what I can see, you're both saying pretty much the same thing.

[Brigid]

6. I love Barbara Ehrenreich.

And yes, it does matter if the middle class is merely trudging along and the poor are just this side of starving in the streets. Have we so quickly forgotten the lessons of Katrina? I still remember one writer vividly stating that the poorest of the Katrina victims, long ignored by TPTB and by everyone else before the storm, were literally flushed out of the shadows and into national attention -- for a while.

Unequal economic conditions are just setting us up for some major class conflict eventually if the problem is not addressed. It has happened many times throughout history. what makes anyone think it can't happen here?

My mother calls me a radical. I guess I'll just have to start wearing that label with pride.

[Bonhomme Richard]

7. And we have both. n/t

[Brigid]

8. Yes, we do.

Absolutely.

[Wiley50]

14. "Guillotine! Guillotine! Eat The Rich!

Seriously, this is a festering sore that WILL come to a head.

And the sooner, the better

[DIKB]

16. I often tell others

that THIS country needs it's own "Bastille Day"

How many in prison are from poverty? The majority of which for crimes related to "escapism" i.e. drugs, alcohol, etc. Compare that to how many wealthy people get away with crimes regularly.

Top 5% should give up their wealth, and have it distributed equally, or we take it from their corpses.

If these people are so savvy that they made their own wealth, it shouldn't be too hard for them to do so again.

[BridgeTheGap]

17. Blue Collar Roots - White Collar Dreams - great book

by Alfred Lubrano - highly recommended to gain an understanding of these two differences in class:

http://www.spinninglobe.net/limbo.htm

[MountainLaurel]

19. A great book

I gave it to my husband so that he could get a sense of where I've come from and why I do some of the things I do.

[BridgeTheGap]

18. "The Rich are more oblivious than you or me" NY Times edit

Op-Ed Contributor
The Rich Are More Oblivious Than You and Me
By RICHARD CONNIFF
Published: April 4, 2007
Old Lyme, Conn.

THE other day at a Los Angeles race track, a comedian named Eddie Griffin took a meeting with a concrete barrier and left a borrowed bright-red $1.5 million Ferrari Enzo looking like bad origami. Just to be clear, this was a different bright-red $1.5 million Ferrari Enzo from the one a Swedish businessman crumpled up and threw away last year on the Pacific Coast Highway. I mention this only because it’s easy to get confused by the vast and highly repetitious category “Rich and Famous People Acting Like Total Idiots.” Mr. Griffin walked away uninjured, and everybody offered wise counsel about how this wasn’t really such a bad day after all.

http://tinyurl.com/29tpd6