May 29, 2011

The problem

The problem is simple. In my lifetime, the disparity between rich and poor has consistently widened. We have now passed the 1920s and are now in an era of unprecedented inequality, one which has no parallel elsewhere in the developed world. Plantation America, the project pursued so industriously by the Cheney administration, is right on track.

(Oh, did you hear? Tiffany is doing great. The latest quarter was terrific, record earnings, thank you for asking. But with such powerful friends, how could they not?)

Last year, Timothy Noah at Slate wrote an excellent briefing on this topic. Although it's a bit unclear on who should be blamed, one of his key conclusions was that the deterioration in K-12 public education has been a major factor:
During the Great Divergence, the education system has not been able to increase the supply of better-educated workers, and so the price of those workers (i.e., their incomes) has risen faster relative to the general population. At a time when the workforce needed to be smarter, Americans got dumber. Or rather: Americans got smarter at a much slower rate than they did during previous periods of technological change (and also at a much slower rate than people in many other industrialized democracies did). That was great news for people with college diplomas or advanced degrees, whose limited supply bid up their salaries. It was terrible news for everyone else.

America's coal industry wants to help with that. They're sponsoring a "teaching tool" called The United States of Energy that really explains to kids just how important it is that we burn as much coal as possible indefinitely to keep our nation strong. That is to say, they sponsored it until that ungrateful publisher killed the project under pressure from meddling liberal interests.

Noah says that "If we were to compile a list of the ways in which the United States has made both itself and the wider world a better place, then at or very near the top would be its commitment to universal education." I imagine that almost anyone who subscribes to a value system that aims to help the less-fortunate would find the point persuasive.

But I think the point is equally persuasive from a nationalist perspective. Like all countries, America has a story for its people, and the story is nothing without upward mobility. One thing our country has historically done right is get people through college, e.g., the G.I. Bill. But today, according to David Leonhardt of the New York Times, "at the University of Michigan, more entering freshmen in 2003 came from families earning at least $200,000 a year than came from the entire bottom half of the income distribution. At some private colleges, the numbers were even more extreme." Amherst aside, the elite schools are now just basically for sale. Forget fairness for a moment - think of the cost to society of those wasted human resources. You can't throw away half of the best brains and expect to win, not when there are eight bright Chinese and Indian kids for every one of your own. If the poor and weak have no shot, we're just Argentina with worse weather.

At the same time they are working to replicate the British class system in America, the elites' loyalty to the host organism is wavering. I'm not saying we shouldn't have elites. As much as I believe in fairness and the American Way, it is also true that America was founded by rich, well-educated property owners, and you really can't have a civilization without an upper class that cares about it.

It's the caring part worries me. The book Richistan documents the separation of the rich from the rest of us. We don't see them much - they don't fly commercial, they don't live where we live, their kids go to special schools (not the crappy $40,000 per year private schools the dentists use). They are not the Millionaire Next Door, they're the billionaires who really don't live anywhere and don't have much allegiance to any particular nation.

And it's not just the billionaires. Large corporations are increasingly trying to disconnect themselves from their country of origin. There used to be a company called Andersen Consulting. They renamed it Accenture, then incorporated in Bermuda so their taxes wouldn't be so high. When that got too hot, they switched to Ireland. Meanwhile Cisco, its CEO fresh off his role as McCain's co-chair, holds cash offshore and won't bring it back to the U.S. unless we promise not to tax it. I think these folks have the right idea.

No one admits to wanting such massive inequality, or for our country to run such gross, unnecessary risks with its future, but it's obviously working better for billionaires and large corporations than for the rest of us.

As I think about it, several options come to mind:
  • Education über alles. Especially you, Democrats. You really need to get serious now. California's education system is a disgrace, with more cuts coming. Meanwhile, City Hall looks like this.
  • Tell the rich to pick a side. Here's the thing about mediocre elites: they're easily replaced. Tell the rich: if you don't like America, turn in your passport. The Cayman Islands are right there, go be there with your money. We will muddle along without you.
  • Same with companies. You're a global company that "just happens" to do business in America? Fine, you're also a global company that "just happens" to never get another government contract.
I'm not sure if these steps would work, or what else to do, but we need a new...what's the word I'm looking for? A new set of options? A new program? A new paradigm? It'll come to me.

But this has to be addressed. Continuing on the current course won't work for anyone.

9 Comments:

Blogger VMM said...

Where oh where is the left-wing populism in this country? Missing in action.

May 29, 2011 at 7:06 PM  
Blogger JAB said...

A superlative essay.

I would add : what has been so horribly and successfully assaulted in the United States since the election of Reagan is the whole American public culture. The attacks on the egalitarian, the democratic, the public culture is what is behind all of this. It has been deliberate, vicious, remorseless, all but sociopathic. It is meant to concentrate wealth, regardless and even hostile to, the national interest, and waves the flag to rally its cause.

A book on this later.

May 29, 2011 at 7:51 PM  
Blogger Undersecretary to the Deputy Commissariat said...

Wait. What happened to the notion that massive social instability - rioting in the streets, and all that - is kind of bad for the moneyed classes, and the foreign investors who prize our stability?

Are the smart folks who made all this money that dumb?

May 30, 2011 at 5:29 PM  
Blogger JAB said...

Don't you understand that empathy is always weakness?

May 30, 2011 at 5:57 PM  
Blogger The Other Front said...

To your point, Undersecretary, that's why the detachment of the upper classes concerns me. Rioting is only an issue if you have to put up with it. If you can just jump in the Gulfstream and go to your place in Montreal to avoid the unpleasantness, you're no longer really connected with the fate of the country.

Since (thanks to outsourcing) earnings are rising nicely, and rich people don't pay taxes, they really don't have much stake in the social catastrophe that's unfolding.

I would think with a little ingenuity we could implement policies that would...

a) encourage them to care more and participate in the life of the nation, or,

b) encourage them to emigrate to Luxembourg (or wherever) so they could be replaced with a more conscientious ruling class.

If we're going to have a plutocracy, I want plutocrats who are worth a damn, not this crowd of hacks, hedonists, and Hair Club rejects.

May 30, 2011 at 6:55 PM  
Blogger Undersecretary to the Deputy Commissariat said...

This comment has been removed by the author.

May 31, 2011 at 2:17 AM  
Blogger Undersecretary to the Deputy Commissariat said...

Perhaps this is a hackneyed idea, Other Front, and it certainly doesn't strike me as very ingenious, but a thought occurs to me that might address both of your policy goals: make the Rich pay enough taxes that they notice.

Not that I have any illusions that such a law could pierce the phalanx of lobbyists and other allies of the rich that now guard the gates.

May 31, 2011 at 2:19 AM  
Blogger Undersecretary to the Deputy Commissariat said...

Here's the formulation I was going for above. I don't recall hearing it anywhere before:

(Don't the rich realize that) If they win the class war, they lose.

May 31, 2011 at 2:50 PM  
Blogger The Other Front said...

They think they can separate and isolate themselves from the disaster. "I got mine" is a powerful drug.

June 3, 2011 at 1:26 AM  

Post a Comment

<< Home