Archive for the ‘Inequality’ Category

The passing scene: Links and charts 8/9/2020

September 9, 2020

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Some graphs and comments by Tony Wikrent on Ian Welsh’s blog.

UNITED STATES OF INEQUALITY: 2020 and the Great Divide on Capital and Main (Hat tip to Bill Harvey)

Adolph Reed Jr. on identity politics

July 1, 2020

This Bill Moyers interview with Adolph Reed Jr. was aired in 2014.

Adolph Reed Jr. is a retired professor of political science and a Marxist.  He thinks that what is called identity politics is a way of maintaining structure of inequality.  The purpose of this post is to call attention to his critique of identity politics and provide links to some of this work.

Identity politics is based on an analysis of how dominant groups oppress marginal groups.  Some examples:

  • Whites > Blacks  [racism]
  • Men > Women  [male chauvinism, mysogyny]
  • Native-Born > Immigrants [xenophobia]
  • Anglos > Hispanics [xenophobia]
  • Straights > Gays [homophobia]
  • Cisgendered > Transgendered [transphobia]

These are not made-up problems.  It is a fact that white job applicants or loan applicants get preference over equally-qualified or better-qualified black applicants.  It is a fact that shocking numbers of women are sexually harassed on the job.  No-one should be denied basic rights by reason of race, gender, national origin or LGBTQ identity.

The problem is when disparities between groups are used to distract from the structure of wealth and power in society as a whole.  According to economist Gabriel Zucman, one percent of Americans own 40 percent of the nation’s wealth, up from 28 percent in the 1990s.

Reed says that, within the multicultural framework, this would be okay if the upper one percent were 50 percent women, 15 percent black and the appropriate percentages Hispanic, GLBTQ and so on.

Ideas of equity can be used to promote inequality.  Ideas about oppression of minorities can be used to divert attention from exploitation of the majority by the minority.  The ideology of multiculturalism can be used as a technique to divide and rule.

Honoring diversity doesn’t bring about full employment, living wages, debt relief or an end to America’s forever wars

Honoring multiculturalism can leave members of all the different groups divided among themselves and equally exploited, along with straight white cisgender males, by employers, bankers, landlords and corrupt politicians..

LINKS

Public Thinker: Adolph Reed Jr. on Organizing, Race and Bernie Sanders, an interview for Public Books.

An interview with political scientist Adolph Reed Jr. on the New York Times’ 1619 Project on the World Socialist Web Site.

Nothing Left: the long, slow surrender of American liberals by Adolph Reed Jr. for Harper’s Magazine (2014)

Adolph Reed: Identity Politics Exposing Class Division in Democrats, from an interview on the Benjamin Dixon Show (2016)

The Trouble With Uplift by Adolph Reed Jr. for The Baffler (2018)

What Materialist Black Political History Actually Looks Like by Adolph Reed Jr. for nonsite.org.

The old radicalism and the cultural revolution

June 24, 2020

The old-time left-wing radicalism, which sought economic change, is being replaced by a new radicalism, which seeks cultural change.

The old radicals thought the basic problem is that a tiny elite monopolizes wealth and power.  The new radicals think the basic problem is that dominant groups, such as whites and males, oppress marginalized groups, such as blacks and women.

The George Floyd protests show how the new radicalism has taken hold.  They are bigger and involve more people than anything in my adult lifetime, including the late 1960s and early 1970s.

A real and great evil, the abuse of black people by police, is opposed not only by black people, but by middle-class white people and, nominally at least, by corporate America as well.

Ross Douthat wrote a great column in the New York Times about Bernie Sanders as the last representative of the old-time radicalism and his eclipse by the new radicalism.

Here are some highlights:

[It was argued that a] left that recovered the language of class struggle, that disentangled liberal politics from faculty-lounge elitism and neoliberal economics, could rally a silent majority against plutocracy and win.  The 2016 Sanders primary campaign, which won white, working-class voters who had been drifting from the Democrats, seemed to vindicate this argument.

The 2020 Sanders campaign, however, made it look more dubious, by illustrating the core challenge facing a socialist revolution: Its most passionate supporters — highly educated, economically disappointed urbanites — aren’t natural coalition partners for a Rust Belt populism, and the more they tugged Sanders toward the cultural left, the easier it was for Joe Biden to win blue-collar votes, leaving Sanders leading an ideological faction rather than a broader working-class insurgency.

Now, under these strange coronavirus conditions, we’re watching a different sort of insurgency challenge or change liberalism, one founded on an intersectional vision of left-wing politics that never came naturally to Sanders.  Rather than Medicare for All and taxing plutocrats, the rallying cry is racial justice and defunding the police.  Instead of finding its nemeses in corporate suites, the intersectional revolution finds them on antique pedestals and atop the cultural establishment.

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Thomas Piketty on inequality in education

June 5, 2020

In the present-day USA, young people are told they have no economic future unless they have college educations.  Unless their parents are relatively affluent, the only way they can afford tuition is to go into debt—debt that literally can follow them all their lives.

Many of the top jobs in management, academia and government are only open to graduates of prestigious colleges.  So the educational system reinforces inequality.

Thomas Piketty

Thomas Piketty, in his new book Capital and Ideology, shows that this pattern exists across the Western world, including his native France.

It wasn’t always this way, he noted.  During the decades following the Second World War, the progressive and socialist political parties opened up higher education to working people in a way that hadn’t been done before.

Many of the beneficiaries of these programs became leaders of the moderately progressive and socialist parties.  They became what Piketty called the Brahmin Left, an educational elite, which, according to him, lost touch with the wage earners without college degrees.  He said in an interview:

If you look at education policies, in the 1950s, 1960s and 1970s, there was a relatively egalitarian platform of investing in primary and secondary education for all and bringing everyone to the end of secondary school. Gradually, in the 1980s and 1990s there was the rise of higher education, but this egalitarian platform has been abandoned in some cases.

There is a lot of hypocrisy in terms of access to universities. I show in the book that if you look at a country like the United States, there is data now available on the relationship between parental income and access to education that shows if your parents are poor, you still have a 25% chance to enter higher education, but when your parents are rich, you have a 95% chance.

Actually, this is understating the impact on equality of opportunity because of course the universities that those with rich parents have access to are not the same as the universities that those with poor parents have access to.

If you look at the amount of education investment, you find that even in a supposedly more egalitarian public system like France, the picture is unequal.

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Thomas Piketty on equality through taxation

June 4, 2020

Thomas Piketty’s Capital and Ideology is the most comprehensive study I know about the causes of economic inequality.  He gathered a vast amount of data and made sense of it.  To read my comments on his research, click on this, this, this and this.

In the last chapter, he outlined proposals for a “participatory socialism” to make society less unequal.  He saw three main ways to do this: (1) taxation, (2) reform of corporate governance and (3) educational reform.  This post will be about taxation.  I will take up the other two later.

His plan is based on steeply graduated income taxes, inheritance taxes and new taxes on wealth.  These were to be used to finance a wealth endowment of 60 percent of average wealth to every citizen at age 25 and a guaranteed income of 60 percent of average income.

He does not make absolute equality his goal, but he would allow a much narrower band of inequality than exists today.

I’ve long been indignant at the growing extremes of inequality in my country and the abuses of power of the very rich.  Reading Piketty forces me to think about just how much equality I want and how much I would give up to attain it.

Piketty wrote in earlier chapters of Capital and Ideology about how higher taxes have often been the key to greater national power and wealth.

One of history’s mysteries is how it was that European nations could defeat great Asian empires, such as the Ottoman Empire, the Mughal Empire in India or the Manchu (Qing) Dynasty in China, when, prior to the Industrial Revolution, they were equal in wealth and technology to the European nations.  It was the Chinese, for example, who invented gunpowder.

Piketty’s answer is that the Europeans gained an advantage through a higher level of taxation.  Tax revenue across Europe and Asia prior to the modern era was roughly 1 to 2 percent of national income.  This gave a king or emperor enough revenue to reign, but not to exercise tight control over his realm.

This changed in Europe, during the wars of the 16th and 17th centuries, when military competition forced kings to increase their revenues to 8 to 10 percent of national income.

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The greater revenue enabled kings to become absolute monarchs, exercising almost as much control over their citizens as a 20th century president or prime minister.  It also enabled them to put armies in the field that the Turks, Persians, Indians, Chinese and Japanese could not match.

Western governments’ revenue was bumped up again in the early 20th century, to 30 to 50 percent of national income.  This made possible the total wars of the early 20th century.  But it also gave governments enough money to pay for universal public education, old age pensions, public health and the other services of the welfare state.

This was only tolerable because the Western nations had grown rich enough that their people could give up a big fraction of their incomes to government and still enjoy a high material standard of living.

It would not have been possible in, say, France in the time of Louis XIV.  The taxes he levied to finance his wars reduced the peasantry to misery and, in some cases, starvation (because the nobles enjoyed most of the national income, but paid no taxes).

The same conditions may exist in poor African countries today.  But in rich Western countries, it is technologically and economically feasible to raise taxes revenues to 50 percent of national income, which is necessary for PIketty’s program.

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Piketty’s stats and the problem with class conflict

May 28, 2020

The late Saul Alinsky used to say that politics is a struggle among the haves, the have-nots and the have-a-littles.  He said the outcome usually depends on which side the have-a-littles choose.

Reading Thomas Piketty’s big new book, Capital and Ideology,  reminded me I’d forgotten this important truth.

The USA and much of the rest of the world is governed in the interests of a political and economic elite and not a majority of the public.  I want a politics that represents the interests of the majority of the population.

But there are objective reasons why this is harder than it seems.  If you look at economic class in terms of a top 10 percent in income or wealth, a middle 40 percent and a bottom 50 percent, you see that there is a difference between the middle class (the have-a-littles) and the lower class (the have-nots)

I had come to think that the big problem of American politics is that so much of it is a conflict of the top 0.1 percent of income earners with the next 9.9 percent, leaving the rest of us behind.

The top 0.1 percent, in this interpretation, are the millionaires and billionaires that Bernie Sanders denounces.  The next 9.9 percent, very roughly speaking, are highly paid professionals, the “professional managerial class,” who tend to be more socially liberal, but whose economic interests are different from the majority.

Matthew Stewart wrote a good article about this in The Atlantic a couple of years ago.  The conclusion is that we the American majority have to stop thinking we have to choose between the plutocrats and the PMC and unite in our own interests.

That would make sense if economic inequality were the same as it was in Britain, France or Sweden around the turn of the previous century, as reflected in the chart above (taken from Piketty’s book)

But it’s not.  There is now a big middle class, in between the top 10 percent and the bottom 50 percent, as shown in the chart below (taken from an article co-authored by Piketty).

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In western Europe and the USA, the middle 40 percent aren’t doing too badly.  They’re open to the politics of a Margaret Thatcher or a Ronald Reagan.

Instead of claiming a larger share from the haves, they’re told they need to worry about the claims of the have-nots.  Even in parts of the world where economic inequality is greater than in Europe or the USA, there is a middle class with something to lose.

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Thomas Piketty and the politics of inequality

May 27, 2020

Reasonable people differ on the amount of economic inequality that is tolerable.  But I think almost anyone would set some upper limit.

In today’s USA, a single individual, Bill Gates, is wealthy enough to buy the city of Boston for the assessed value of its property.  The size of Jeff Bezos’ wealth is almost unimaginable.

Meanwhile four in 10 Americans lack enough cash on hand to meet an unexpected $400 expense without going into debt.

Why is this acceptable?  I’ll describe the ideas of the great French economist Thomas Piketty in his new book, Capital and Ideology.  Then I’ll discuss some of the things Piketty left out.

Piketty said the fall of Communism in the Soviet bloc and China discredited egalitarianism and validated the market economy.  Leaders of Western capitalist countries felt they were in a position to tell the working class that there is no alternative.

Even before that, the economic stagnation of the late 1970s discredited the welfare state.  The USA had both high unemployment and high inflation, which was considered theoretically impossible.  One diagnosis was that the welfare state had reached its limit, that it was in a state of deadlock because of the inability to satisfy all claimants.  This had been predicted by Friedrich Hayek in The Road to Serfdom.  He said that only a fascist dictator would be able to break the deadlock.

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Ronald Reagan and Margaret Thatcher presented a different answer.  Dial back to welfare state, cut upper-bracket tax rates and allow rich people and corporations to accumulate wealth.  They will invest that wealth and the workings of the free market will assure that this works for the benefit of all.

As Piketty pointed out, none of this worked out as promised.  Cuts in marginal tax rates did not result in job creation, economic growth or anything else that was promised.

So why do Reaganism and Thatcherism still prevail?

One reason is that the historic left-wing parties abandoned the working class.  The Democrats in the USA, the Labour Party in Britain and the French socialists came to represent an educated elite rather than laborers and wage-earners.

Politics in these countries has come to be a conflict of elites, between what Piketty called the Merchant Right and the Brahmin Left.  It is like the conflict between the nobility and the clergy in the European Middle Ages and the conflict between landowners and business owners in 19th century Britain.

In the USA, many progressives see today’s politics as a conflict between the plutocracy, whose power is based on wealth, and the professional-managerial class, whose power is based on their academic credentials and their positions in organizations.  Wage-earners are not represented.  Piketty showed that the same conflict exists in other countries.

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Piketty on the sacredness of property rights

May 27, 2020

When English settlers first dealt with American Indians, there was a fundamental misunderstanding of the nature of property rights.

The Indians had no idea of buying the exclusive right to use a tract of land, keep everybody else off it and sell the land to someone else.

Thomas Piketty pointed out in his new book, Capital and Ideology, that, in fact, this was a fairly new idea even for the English and other Europeans.

The idea of absolute property rights did not exist in the European middle ages. Someone might have a hereditary right to grow crops on a certain tract of land, a second person the right to 10 percent of all crops grown on the land, a third person the right to grind grain produced on the land for a fixed fee, and so on.

Furthermore the right to land use was not so much bought and sold as inherited.

Medieval France was what Piketty called a “ternary” society—a society in which political power and property ownership were divided between a hereditary noble class who “fought for all” and a priestly class who “prayed for all,” leaving very little for a lower class who “worked for all.”

The “ternary” system existed in the Islamic world, India and many other parts of the world, and it casts its shadow over the present world.  Saudi Arabia and the Gulf states (mostly Sunni) are ruled by hereditary monarchs while Iran (mostly Shiite) is ruled by clerics.  In India, the descendants of Brahmins (priests) and Kshatriyas (warriors) are richer and more influential than the Vaishyas (farmers, craftsmen and traders) and Shudras (laborers).

In Europe, uniquely, priests were celibate.  They could not found dynasties.  This mean that the Roman Catholic institutions had to be corporations.  They had to have a continuing existence that was independent of who was in charge.  It’s not accidental that business corporations originated in Europe.

The French Revolution overthrew hereditary property rights and established what Piketty called “proprietarianism” or “the ownership society”—the idea that property rights were sacred, provided that the property was acquired through legitimate purchase.

The accepted story in France is that the revolutionaries divided up the aristocrats’ estates among the peasants and turned France into a nation of small landowners.  In fact, according to Piketty, the revolutionaries made arbitrary distinctions between land that was owned through hereditary privilege and land acquired through voluntary contract, and, in many areas,  property ownership remained almost as concentrated as before.

Piketty wrote that the revolution was one of history’s “switch points.”  He thinks it could have been more radically egalitarian than it was.

In fact, concentration of wealth in France at the beginning of the 20th century was even greater than at the time of the French Revolution.

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Piketty’s new book on economic inequality

May 26, 2020

The French economist Thomas Piketty made a big splash with Capital in the 21st Century (published 2013, translated into English 2014).  He showed why, all other things being equal, the rich will get richer and the rest of us will get less.

In different countries in different historical periods, the rate of return on income-producing property exceeded the rate of economic growth.  This was true whether the income-producing property was real estate, government bonds, corporate stocks or something else.

What this meant was that, in the absence of revolution, war or something else that wiped out the value of their assets, the rich would get richer and everybody else would be left behind.

Piketty’s new book, CAPITAL AND IDEOLOGY  (published 2019, translated 2020), is more ambitious and complicated.  He thinks it is an even better book that its predecessor and I agree.  It is a great work.

He looked at all the forms that economic inequality has taken in the past few centuries and all the different ways that inequality has been rationalized.  While his earlier book was based mainly on data from France, Great Britain and the United States, the new book tries to be global in scope.

He said it is important to understand not only the forms of economic inequality, but the reasons why people accept them.

His book covers several kinds of “inequality regimes”:

  • “Ternary” societies in which most wealth is controlled by hereditary kings and aristocrats and an established church or religious institution.
  • “Ownership” societies in which property ownership is regarded as a sacred right, superseding everything else.
  • Slave and colonial societies.
  • “Social democratic” societies, which limit the rights of property owners.
  • The hyper-capitalism of today, which is a backlash against social democracy and Communism.

The degree of inequality in any nation or society is not the result of impersonal economic law, he wrote; it is the result of choices that could have been different.  History does not consist of class struggles; it consists of a struggle of ideas and a struggle for justice.

To understand inequality, he wrote, it is necessary to understand the reasons for choices at various “switch points” of history—the French Revolution, the British constitutional crisis of 1911, privatization in Russia after the fall of Communism.

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The new lockdown-induced poverty

April 5, 2020

If you deny people the right to provide for themselves, you have a responsibility to provide for them.

Lockdowns are preventing millions from going out and earning a living.  The fact that their jobs may be deemed nonessential doesn’t lessen their need to pay for food, rent and utilities.  There are more serious problems in the world than boredom.

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The U.S. government will provide some minimal relief—one-time-only checks to be mailed to households, extension of unemployment compensation benefits, etc.

But it doesn’t appear as if it will be enough to offset the coming lockdown-triggered recession.  I think a recession would have happened even without a pandemic, but the lockdown will bring it sooner and make it worse.

Deaths and infections from the coronavirus are doubling every few days.  The lockdown is necessary.  A lot of people are going to die in U.S. states who would have lived if their governors had ordered lockdowns sooner.

At the same time, I can understand why those governors hesitated.  The governors who’ve waited longest are, in general, the governors of the poorest states.

Usually, when huge numbers of people suddenly lose their jobs and are plunged into poverty, they take to the streets to protest and strike.

But under lockdown, it’s illegal to take to the streets.  Repressive governments suppress uprisings by, among other things, ordering curfews.  Because of the pandemic, these curfews are already in place.

If a government orders a lockdown, it has a duty to make it possible for everyone, no matter who, to observe the lockdown without fear of hunger or homelessness.

Leaders of some countries realize this.  Others don’t.  The ones that don’t can expect an explosion of mass defiance sooner or later.

LINKS

Somebody’s Screwing You and It Ain’t China by Caitlin Johnstone.

Location Data Says It All: Staying at Home During Coronavirus Is a Luxury by Jennifer Valention-DeVries, Denise Lu and Gabriel T.X. Dane for the New York Times.

Jobs Aren’t Being Destroyed This Fast Elsewhere – Why Is That? by Emmanuel Saez and Gabriel Zucman for the New York Times.

New Inequalities and People-to-People Social Protection by Nora Lustig and Nancy Birdsall for Vox & CEPR Policy Portal.

Services Sector Falls Off Cliff: First Data Points from the Eurozone Where Lockdowns Started Earlier by Wolf Richter for Wolf Street.

‘I just want to go home’: the desperate millions hit by Modi’s brutal lockdown by Hannah Ellis-Peterson and Shaikh Azizur Rahman for The Guardian.

The fading American dream

February 21, 2020

A team of researchers at Stanford University, led by an economist named Raj Chetty, took advantage of newly accessible data from the Internal Revenue Service and studied the ebb and flow of American wealth and income across the generations.

They concluded that 90 percent of children born in 1940 went on to earn more than their parents, but only 50 percent of children born in the 1980s did so.

That’s not because the U.S. economy stopped growing, although growth did slow, they wrote.   It is because more and more gains were captured by the ultra-rich.

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Piketty on the merchant right and Brahmin left

September 24, 2019

The French economist Thomas PIketty is famous for his best-selling book, Capital in the 21st Century, which explained why inequality constantly increases.

Thomas Piketty

The explanation is the formula r>g.  It means that the rate of return on assets over time exceeds the rate of economic growth.  That means the wealthy get an ever-larger share of the economic pie until and unless something happens to destroy the value of their assets—war, revolution or a financial crash.

Piketty has just published a sequel, Capital and Ideology. in France.  It will be published in English translation next March.  Reviewers say it takes a more global view than the first book and advances more radical ideas for reducing inequality.

The part that’s getting the most attention is Piketty’s notion that politics in the USA, UK and France are polarized between a “Brahmin left,” representing the highly-educated, and a “merchant right,” representing great wealth—two elites who have more in common with each other than with the majority of working people..

Initially, left-wing parties represented poorly educated wage-earners, while right parties represented owners of capital and the professional classes.  Over time, left-wing parties helped children of wage-earners advance into the educated middle class, and their children supposedly became the liberal elites, whom Piketty calls the “Brahmin left.”

The Brahmin left occupy high positions in organizations—government, corporate, educational, “non-profit”— based on their educational credentials.  Their counterparts, the merchant right, have power based on their ownership of businesses and financial assets.

Both believe their power and position is based on merit.  Both embrace global competitiveness, immigration and dismantling of trade protections and the social safety net, which leave working people with lower wages and greater insecurity..

This has produced a nationalist backlash.  Americans elected Donald Trump as President, the British voted to exit the European Common Market and Marine le Pen’s National Rally has a substantial following among French voters.  What they have in common is opposition to globalization and immigration.

The nationalist backlash is not yet a serious threat to the financial elite.  But it has driven immigrants and racial minorities into the left-wing parties in all three countries.  By championing minority rights, the Brahmin left can convince themselves they are still on the side of the underdog.

Piketty thinks the “Brahmin left” and “merchant right” may merge, and true workers’ parties may emerge in opposition to them, as the original British Labor Party emerged in opposition to the Conservative and Liberal parties in the early 1900s.

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Protest and dissent in Putin’s Russia

August 27, 2019

In Russia, the Fight Is Alive by Ilya Matveev for Jacobin.

An elite that dare not call themselves elite

August 12, 2019

Natalia Dashan attended Yale University on a scholarship.  She was one of the 2 percent of Yale undergraduates whose parents are in the bottom fifth of American income earners.

She recently wrote an essay about something that struck her about some of her well-to-do classmates..

They lived and acted as if they in fact were poor.   They looked for reasons to think of themselves as oppressed.  They were in a near-constant state of rebellion.

Yale University Shield

But the rebellions were not over anybody’s material interests.  They were over whether how things were named or what someone said was appropriate—for example, whether “master” was an appropriate job title for the head of a college or whether a faculty member was out-of-line for scoffing at worries about racial stereotyping in Hallowe’en costumes.

Dashing also was struck by how quickly the faculty and administrators caved in to student protests, no matter how foolish their demands might have seemed to someone outside the academic environment and even in the absence of evidence that the protestors represented anybody but themselves.

The historic role of Yale, Harvard and other Ivy League universities has been to educate upper-class Americans to take on the responsibility of leadership—that is, for being a member of a ruling class.

Dashan concluded that the elite—defining the elite as those who grow up with the expectation that they and their children will attend Yale, Harvard or the equivalent—no longer want to assume the responsibility of leading and ruling.

So young people born to wealth and power look for ways to define themselves as oppressed, and older people, who should be their mentors, fear to appear in the role of oppressor.

The problem is that it is largely a performance—what I like to call psychodrama, but which more accurately could be called live-action role-playing.  It is tolerated because it is no threat to anybody, except the unlucky individuals who get caught in the crossfire.

Why this loss of confidence?  Dashan thinks it is fear of responsibility.  I think that is a large part of it.  But I think the more important part is a decline in belief in the values that gave confidence to earlier generations of elite Americans.

When I read Edmund Morris’s The Rise of Theodore Roosevelt, I was struck by how different the Harvard he attended was from the Harvard of today.

The goal of Harvard University in the 1870s was not only to provide an intellectual education, but to shape students’ character based on ideals of patriotism, Protestantism and manliness.

Young men were expected to participate in footfall and other contact sports to toughen them up, but also to teach ideals of sportsmanship—doing your best, but obeying the rules and not whining if you lose.  Attendance at morning prayers at Appleton Chapel was compulsory.

It is true that these ideals excluded a lot of people—Catholics, Jews, freethinkers and women, not to mention un-athletic men.  I would have felt this morality very restrictive if I had lived then.  Evidently many others over the years felt the same.

The unanswered question was:  What do you put in the place of these ideals?  Young people need to believe in something.

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Climate, migration and border militarization

March 13, 2019

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The two agencies of the U.S. government that take climate change most seriously are the Pentagon and the Department of Homeland Security.

They foresee droughts, floods and storms on a scale that will create global political instability and millions of climate refugees, mainly from countries already ravaged by war and poverty.  While other parts of the government dither and deny, they have spent billions since 2003 preparing for the coming emergency.

Their preparation, however, is not aimed at preventing or slowing down climate change, nor is it principally aimed at relieving distress.  Rather it is in protecting the U.S. homeland and American business interests from the desperate masses.

A journalist named Todd Miller did a good job of reporting on this in STORMING THE WALL: Climate Change, Migration and Homeland Security, published in 2017.

He attended a Defense, National Security and Climate Change conference in Washington, D.C., in 2015, attended by top military brass and government and corporate officials.  A NASA representative told how the Space Shuttle and F-35 fighter required chrome, columbium and titanium, which are sourced from South Africa, Congo and Zambia, all threatened with political instability due to climate change.

“If these stressing factor result in increased migration,” he said, “it will just increase the potential for instability and conflict,” which would affect the U.S. ability to obtain elements “critical to the alloys we need to support the system.”

It was at that meeting that Miller for the first time heard the expression, “military-environmental-industrial complex.”  Billions of dollars are being spent to, on the one hand, wean the U.S. military itself from dependence on fossil fuels and, on the other, maintain the political and economic status quo in the face of climate-driven upheaval.

He devoted several chapters of the book to migration from central America and Mexico into the southwest USA.  He showed that the border is not a line on the map separating the United States from Mexico.

The border area extends 100 miles into the interior of the United States, where Immigration and Customs Enforcement (ICE) acts like a military occupying force.  Miller noted that an order by President Obama against racial profiling specifically exempted the Department of Homeland Security.

It also extends down through Mexico into Central America, where there are a series of checkpoints, aided by U.S. military advisers and U.S. military equipment, designed to intercept migrants on their way.  There are fewer arrests nowadays at the international border, but this may not mean that fewer people are trying to cross the border.  It may just mean that more of them are intercepted before they get close.

The U.S. Coast Guard nowadays does more than guard the coasts.  After the 2010 earthquake, the Coast Guard patrolled the coast of Haiti, turning back anyone who tried to flee, and even set up a detention center at Guantanamo Bay.

Migrants leave their home countries for many reasons—commonly poverty, war, tyranny or crime.  But, in the words of a Marine Corps general, climate change is a “threat multiplier.”  Events such as the 2015 drought in Guatemala, Honduras, El Salvador and Nicaragua make all the underlying social problems worse.

The United States is not unique.  The new “smart border” between Turkey and Syria has a new tower every 1,000 feet, a three-language alarm system, and “automated firing zones” supported by hovering zeppelin drones, Miller wrote.

Experts say floods and a rising sea will cause millions to flee Bangladesh.  India has a 2,000-mile ‘iron wall” on its border and soldiers with orders to shoot to kill.  More than 1,000 Bangladeshis were killed between 2001 and 2011 while trying to cross the border.

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Storms, floods and climate apartheid

March 6, 2019

An extreme city, according to Ashley Dawson, is a city in which extremes of rich and poor render it unable to deal with extreme weather events.

In case of storm and flood, the rich people on the high ground almost always get priority over the poor people down by the waterfront—what Dawson calls climate apartheid.

And the people who live in rich places, such as Houston, who are mostly lighter-skinned, get priority over the poorer places, such as Port-au-Prince or San Juan, who are mostly darker-skinned.

Beyond this, Dawson wrote, the incentives of a market economy will almost always favor real estate development over public safety.

The best way to protect cities from high water is to pull back from the shoreline and create or expand wetlands to sponge up the high water.

But property developers, not to mention individual homeowners, want seawalls to protect their investments and enable them to recover their sunk costs.  Our economic system is based on continued growth.  There is no incentive system for pulling back.

Dawson said this is as true of New York City, where he lives, as it is of any city in the world.

This is no small thing.  Nearly half the world’s 7 billion people now live in cities.  Virtually all of them are on ocean coastlines or other bodies of water.  In the Global South, drought is driving increasing numbers of poor people off the land and into urban slums.

Dawson does not view global warming as a doom we can avoid if we try hard enough.  He sees it as an emergency that is already upon us, and that most of us are unprepared for.

He does not view it as merely a scientific and technical problem.  He says it is a social justice issue—a question of who drowns (usually the poor and dark-skinned) and who is saved (usually the rich and light-skinned)

Click to enlarge

When Superstorm Sandy was about to hit New York City in 2012, the city government told residents of the potential flood areas to evacuate.  Soon after subway service was shut down, which meant that those without cars were stranded in their neighborhoods.  Soon after high water left thousands without access to electricity and heat, or to essential supplies.

The first responders were volunteers, including veterans of the Occupy Wall Street movement, who reconstituted themselves as Occupy Sandy.  They did whatever it took to provide food and water and rescue stranded elderly and disabled people on upper floors of apartment buildings.

The official disaster relief agencies showed up only a few days date and, according to Dawson, were happy to make use of Occupy Sandy and other volunteers, but reluctant to help or share information.  The reason, he said, is that the official organizations are engaged in a dog-eat-dog competition for funding and don’t want any of their rivals to gain an advantage.

Dawson wrote that when Mayor Michael Bloomberg showed up at the flood-stricken Red Hook neighborhood in Brooklyn, the only people he wanted to talk to were the business owners.  They were the ones who got the funds to rebuild.  The neighborhood and Occupy Sandy leaders were brushed aside.

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The U.S. inequality problem in one graph

February 28, 2019

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This is an updated version of an Economic Policy Institute chart I’ve posted before.  It shows that from 1948 through 1979, the hourly wages of American workers rose almost as fast as worker productivity.  From 1979 on, productivity continued to rise, although at a slower rate, but wages hardly increased at all.

If you include the increased debt, including student debt, that most families have taken on, the average wage-earner’s buying power may be even less than in 1979.

What happened?  The EPI cites three things:

  1. A greater share of national income to holders of financial assets and a smaller share to wages and salaries.
  2. A greater spread between wage-earners and highly paid managers and professionals.
  3. A greater increase in the prices of things wage-earners buy (consumer goods and services) than in the things they product (consumer goods, but also capital goods.

What is the answer?  The EPI says the U.S. needs stronger labor unions and enactment of pro-labor government policies, including a higher minimum wage, higher taxes on top incomes and a jobs program based on repairing the nation’s infrastructure.

LINKS

The Agenda to Raise America’s Pay by the Economic Policy Institute.

First Day Fairness: An agenda to build worker power and ensure job quality by Celine McNicholas, Samantha Sanders and Heidi Shierholz for the Economic Policy Institute.

Understanding the Historic Divergence Between Productivity and a Typical Worker’s Pay: Why It Matters and Why It’s Real by Josh Bivens and Laurence Mishel for the Economic Policy Institute.

The Survival of the Richest by Nomi Prins for TomDispatch.

Left-wing parties win college grads, lose workers

October 10, 2018

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Left-wing parties in the UK and France, as well as the USA, are gaining support of the educated classes while losing support of blue-collar workers.

The French economist Thomas Piketty said politics in these three countries is a conflict between the “Merchant Right” and the “Brahmin Left,” a high-incom elite vs. a high-education elite.

I don’t know about the specific situation in France, but it’s clear to me that the leaders of Democratic Party in the USA and the Labour Party in the UK care more about the material interests of a professional class than they do about the material interests of workers.

LINKS

Brahmin Left vs. Merchant Right: Rising Inequality and the Changing Structure of Political Conflict by Thomas Piketty.

How the left stopped being a party of the working class by Simon Wren-Lewis for his Mainly Macro blog.

John Lanchester on the financial crisis

July 7, 2018

John Lanchester

The financial crash of 2008 was worldwide, and the failure of governments to address the causes of the crash also was worldwide.  Because the same thing happened in different countries under different leaders, the reasons for failure are systemic, not just the personal failings of particular leaders.  The solution must be systemic.  A mere change in leaders is not enough.

John Lanchester, writing in the London Review of Books, wrote an excellent article about the crash and its aftermath.  I hoped to call attention to it in my previous post, but, as of this writing, there has been only one click on the link.

I know people are busy and have many claims on their attention.  If you don’t want to bother reading the full LRB article, here are some highlights.  If you’re an American, bear in mind that, even though so much of what he wrote applies to the USA,  his focus is on British policy.

The immediate economic consequence was the bailout of the banks.  I’m not sure if it’s philosophically possible for an action to be both necessary and a disaster, but that in essence is what the bailouts were. 

They were necessary, I thought at the time and still think, because this really was a moment of existential crisis for the financial system, and we don’t know what the consequences would have been for our societies if everything had imploded.  But they turned into a disaster we are still living through.

The first and probably most consequential result of the bailouts was that governments across the developed world decided for political reasons that the only way to restore order to their finances was to resort to austerity measures.  The financial crisis led to a contraction of credit, which in turn led to economic shrinkage, which in turn led to declining tax receipts for governments, which were suddenly looking at sharply increasing annual deficits and dramatically increasing levels of overall government debt.

So now we had austerity, which meant that life got harder for a lot of people, but – this is where the negative consequences of the bailout start to be really apparent – life did not get harder for banks and for the financial system. In the popular imagination, the people who caused the crisis got away with it scot-free, and, as what scientists call a first-order approximation, that’s about right.

In addition, there were no successful prosecutions of anyone at the higher levels of the financial system.  Contrast that with the savings and loan scandal of the 1980s, basically a gigantic bust of the US equivalent of mortgage companies, in which 1100 executives were prosecuted.  What had changed since then was the increasing hegemony of finance in the political system, which brought the ability quite simply to rewrite the rules of what is and isn’t legal.

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Deaths of despair in America

March 1, 2018

Economists Angus Deaton and his wife, Anne Case, are authors of a study showing the increase in the rate suicide, and also of other “deaths of despair,” among middle-aged white Americans.

The mystery is why there’s no such trend among black and Hispanic Americans, or among Europeans, even though many of them are struggling economically as much or more than white Anglo Americans.

Deaton and Case, in an interview shown in the video above, saw the rising suicide rate as a failure of social and spiritual bonds, and not just a failure of public policy.

They speculated that some white Americans are failed by their religion.  He said many evangelical churches downplay social support because they believe salvation is an individual relationship with God.

I think this is a stretch, and they don’t provide any evidence for this.   My impression—admittedly based on limited experience—is that strict conservative churches provide at least as strong social support as mainstream churches.

The isolated ones would be the ones who think they don’t need a church community because they have an individual relationship with God.   This was true of J.D. Vance’s troubled family, which he described in Hillbilly Elegy.  When trouble comes, his family didn’t have any support system beyond each other.

Of course, all other things being equal, unbelievers suffer just as much or more from lack of a church community.

I think we white Anglo Americans are brought up to think that society is basically fair and that anything that happens to us is our own fault.   We’re taught to keep trying despite setbacks, and not to give up.  This is good—up to a point.

My guess is that black and Hispanic people on average are more aware that life is unfair and that they don’t invest so much of their self-esteem in being breadwinners.

My other guess is that life is more meaningful to those who join in solidarity with others to fight for change.

In an interview linked below, Deaton said the problem is not economic inequality as such.   It is fairness, he said.  It is not unjust for someone to get rich by creating something of value.   What matters is how you get rich.

He said the problem is that so many of the economic elite get rich through what he called “rent seeking”—extracting money from people without contributing anything of value.  The health insurance industry is an example of this.

Monopoly or “oligopoly” (control by a small number of firms) are a big part of the problem, he said.  Lack of competition results in lower inflation-adjusted wages, higher prices, fewer jobs and slower productivity growth.   Self-described progressives and conservatives ought be able to in fighting monopoly.

LINK

Angus Deaton on the Under-Discussed Driver of Inequality in America: “It’s Easier for Rent-Seekers to Affect Policy Here Than in Much of Europe”, an interview for Pro-Market, the blog of the Stigler Center of the University of Chicago Booth School of Business.

Mortality and morbidity in the 21st century by Anne Case and Angus Deaton for the Brookings Institution (2017).   This is their most recent study of “deaths of despair.”

Front Row kids and Back Row kids

January 13, 2018

[Updated 1/15/2018]

Photojournalist Chris Arnade believes American society is divided into a Front Row, which is doing well, and a Back Row, which is being left behind. The following is from his Twitter feed.

The prevailing culture honors the Front Row, and public policy rewards it.

The prevailing culture disrespects the Back Row, and public policy ignores it.

LINK

The View From the Back Row, an interview of Chris Arnade for Current Affairs.  [Added 1/15/2018]

Chris Arnade on how the other half lives

January 13, 2018

This includes two updates

Half the world doesn’t know how the other half lives.   (old saying)

Chris Arnade spent 20 years as a Wall Street investment banker, then quit in 2011 to start a new career as a photojournalist, first interviewing and photographing drug addicts and prostitutes in the Bronx, then traveling across the country to talk to working people and poor people who’ve been left behind in the new economy.

Arnade said that what he concluded was that addiction is the result of isolation, isolation is the result of rejection and the chief source of rejection is the U.S. educational system.

The U.S. educational system, he said, teaches that the way to achieve success is to go to a good college, leave home and devote yourself to achievement in your professional life.

Those who do this successfully are the elite in American life.   The problem is that not everybody is able to succeed this way, and not everybody wants to do this.

Some people put family, community and religion first.  In this respect, he said, there is little difference between black people and white people, or between Anglos and Hispanics.

Arnade calls the first group the Front Row and the second group the Back Row. The Back Row are not only disrespected, Arnade said.  The economic system is rigged against them.

Every important decision on national policy, since at least the North American Free Trade Agreement  (NAFTA) in 1994, has put the interests of the Front Row ahead of the Back Row.

The one institution in society that welcomes the back row is the churches, he wrote.  He himself is an atheist, but he said that churches welcome you, no matter what your credentials or lack of them.  I’m not sure that is true of all churches, but his point is correct.

Another place the Back Row is welcome, he said, is McDonald’s restaurants.  McDonald’s original business model was a place where you can get in and get out quickly, but McDonald’s and other fast-food restaurants have become places where you can get a nourishing meal at a low price, charge your cell phone and hang out with friends.  Most of them have an old man’s table that retirees have staked out for their own.

If you’re a Front Row person and want to break out of your bubble, stop having coffee at Starbuck’s (or the equivalent) and stop start spending time in McDonald’s (or the equivalent), Arnade advised,

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Charles Dickens, Little Dorrit and social class

November 21, 2017

I read Little Dorrit as part of a novel-reading group hosted by my friends Linda and David White.   Reading the novel as part of group helped me appreciate how great Charles Dickens was—as a descriptive writer, as a storyteller and as a student of human nature.

The moral center of the novel is Amy Dorrit, a young woman born in the Marshalsea, a famous debtors’ prison in London, where her father has been imprisoned as a result of business failure.

She is called ‘Little’ Dorrit, rather than by her name, because she is small of stature and looks more like an adolescent girl than a full-grown woman.

She embodies the specifically Christian virtues.  She is loving, self-sacrificing, humble, forgiving, patient, devoted, uncomplaining and thankful for every blessing.  This makes her as out-of-place in class-conscious Victorian London as she would have been in the Rome of Quo Vadis or in success-seeking 21st century USA.

One of the themes of Little Dorrit is what we now would call “classism.”   The novel is full of characters whose life revolves around having other people acknowledge their social rank.   This includes, first and foremost, Little Dorrit’s own family

From a young age, she is a virtual parent to her father and her older brother and sister, for which they show little or no gratitude..  She learns how to read and write, learns marketable skills from other inmates and gets a job outside the prison to an elderly rich businesswoman, Mrs. Clennam.

Her father, William Dorrit, over the years creates an identity as “the Father of the Marshalsea,” to whom visitors and other debtors have to pay tribute and acknowledge his superior status.

Despite William’s dependence on Little Dorrit, he condemns her for befriending fellow inmates, such as the mentally retarded Maggie, because this undermines his pretensions to superior social rank.

Amy’s beautiful gold-digging older sister, Fanny, and shiftless older brother, Edward, take the same attitude.

Mrs. Clennam is the other character in the novel whose life is shaped by religion.  In contrast to Little Dorrit’s, her religion consists in obeying strict rules concerning personal conduct and business obligations, and in showing no mercy to those who do not.

Her religion makes her unhappy, and causes her to make others unhappy.

Little Dorrit is sometimes sad, but she is capable of being happy and she does nothing to make herself unhappy.

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The black and Hispanic top 1 percent

October 6, 2017

The disparity in wealth between black and Hispanic Americans on the one hand and non-Hispanic whites is striking.    The disparities in wealth within each racial group also are striking.

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The top 1 percent in Russia

October 6, 2017

I’ve posted many charts about the growing concentration of income and wealth in the United States in the hands of a tiny elite.   Here is a chart illustrating inequality in Russia.

You should take note about what this chart shows and doesn’t show.  The ruling elite in the old Soviet Union didn’t have large incomes, and they didn’t live like American millionaires and billionaires, but they did have special privileges, much like military officers compared to the rank and file or like American corporate executives with huge expense accounts.    They had special stories, special medical care, special schools for their children, etc.

Also, the chart indicates that relative equality isn’t everything.   I don’t think many Americans would have wanted to trade places with the average person in the old Soviet Union.

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