Thursday, October 27, 2011

Class warfare...but who started it?

When President Obama proposed raising taxes on big earners, Republicans quickly called it class warfare.  The only problem is that their name-calling was pointed in the wrong direction.  Don’t’ get me wrong; I’m not suggesting that they should have been pointing at themselves.  Truth is that, their vastly different approaches to governance notwithstanding, Republicans and Democrats alike are merely tools and themselves victims of profound class warfare.  It is one that, even after the big bust of 2008, continues to be shamelessly and systematically waged by a group of individuals and corporations whose greed and bounty has reached unprecedented heights. 

It is a war in which a tiny minority of Americans have used their wealth and leveraged the complacency of others to tilt public policy in their favor.  Whether wealth is itself corrupting or not, unfettered wealth has been employed to corrupt the system, rendering much of our government effectively dysfunctional.  Money determines who will occupy public office from county sheriff to the Supreme Court.  It should not escape our attention that the controversial Citizens United decision, agree with it or not, reflected a harsh truth.  Corporations are not really organizations but the personal fiefdoms of their absurdly overcompensated and empowered upper managements — individuals — supported by far from independent boards.  This is not meant as a generalized anti-business assertion, but to deplore what so many of our businesses have become — what we have let them become.  It is a system uncontrolled and corrupted.

Let’s just consider the wage gap between those very few at the top and their company’s employees.  In 2009 average CEO compensation was $8.47 million, the average worker just over $32,000.  For Viacom’s 2010 fiscal year Chief Executive Philippe Dauman was awarded salary, stock and other benefits totaling $84.5 million.  Sure these are leaders with great responsibility, but do they work that much harder and smarter than everyone else?  While there are good reasons to respect and admire him, Warren Buffett made about $62 million last year.  Was his work worth more than say the President, whose decisions impact on all of our lives, and who received a comparatively paltry $350 thousand (plus a $50K expense allowance)?  Let’s not even talk about the failed chief of Hewlett Packard Leo Apothekerther who walked off with about $25 million for less than a year on the job.  What was it that Willy Sutton said?

As documented in a just released CBO study, the top 1% of the population have increased their wealth by 275% in the last thirty years.  These same people have also seen their portion of after-tax income rise while most Americans have suffered a decline.  That will come as no surprise to the average family.  I’d venture, that in many of those companies where CEO compensation has escalated and cash on hand ballooned, overall payroll is down.  Jobs have disappeared.  Those who glibly talk of class war piously decry income redistribution.  Hello, what do you call the statistics I just cited?  Redistribution can go both ways and guess whose coming out ahead.  In the class warfare that has engaged us for three decades the very rich can comfortably claim victory and they won’t be blowing smoke.

The problem is that our political leaders, regardless of party, don’t really get it — or if they do, can’t afford to say so.  The opposite is true for those at the barricades of Occupy Wall Street and similar protests across the globe including the tent cities that were erected in Israel (the subject of an earlier post).  University of Chicago political scientist Bernard E. Harcourt, writing in an October 13 NY Times Stone essay characterizes what’s happening in Zuccotti Park as Political Disobedience.  He calls it a paradigm shift and, while still early, I think it runs far deeper than what we’ve experienced before.  It’s about time.  Further, I’d suggest that what we’re witnessing here is not the instigation of class warfare, but a reaction to it. 

Paul Krugman and others have suggested that Occupy Wall Street is finally pointing in the right direction both figuratively and actually.  Others say the protest is vague with no cohesive list of grievances or demands.  Harcourt addressed that issue in his excellent Times piece, so I won’t try to repeat it here.  Rather let me try to put these protests and expressions of outrage in context.  In various postings I have suggested (as have others) that the problems we face today are systemic.  That makes them, as the President constantly reminds us, very hard to address, much less solve — certainly with any dispatch.  But more important, if they are systemic than it’s difficult, and perhaps unproductive, to apply conventional norms — including making specific demands — to the protest.  Doing so would imply that addressing this or that detail would suffice, make things all better.  The problem is that the system to which such conventions apply is itself so deeply flawed.

In that regard, even the idea of class warfare seems inadequate to describe what we — and that includes the vast majority of us — are experiencing today.  We usually think of class as a closely defined and homogeneous group, say the rich, the middleclass, the poor, the educated, blue collar, white collar etc.   In fact virtually all of those, people with very different backgrounds and even aspirations, find themselves in the same boat.  So the OWS protesters most recent expression 99% may express it best.  It should serve as a wakeup call, as if we really needed one.

We Americans pride ourselves on building a great democracy and creating an economic engine that has powered our own success and that of many others around the world.  We have set forth the notion that both dreams and fulfillment are within the reach of every citizen.  For sure that doesn’t work for everyone, but it has for more individuals and families than has been the case in most societies.  Sadly the past doesn’t insure the future.  Current trends are, to say the least. discouraging.  They are discouraging, but we need not fall victim to them.  Occupy Wall Street, if only as a material expression of outrage transformed into activism should give us some hope.  The question is if the rest of us are ready to face where we are, not the dream of it, and do something to get us back on track.  Remember those inalienable rights?  They need to be exercised.