GREED VS NEED:
Short version: The deck is stacked against the average American. Unless we change the rules of the game the “great divide” of income and wealth that now exists in the U.S. will only get wider. Wages will remain stagnant, the money will drift to the top. The 60% of Americans who have no wealth at all, living pay check to pay check, will increase. The polls say Americans are angry. Do you have a right to be angry if you don’t do anything about it? Remember, the people you elect are supposed to work for you, not the other way around.
Expanded version: As I’ve said, I write Angels and Assholes because I believe some things simply are wrong and, thus, need to be changed. Something I believe that needs to be changed that affects all but the 1% is the income and wage disparity in the U.S. I assume you know that the average American’s wages at the best have been stagnant, thus, without much, if anything, to invest, net worth, relatively, has declined. The most egregious example is the ratio of CEO pay to average worker pay. After WWII and until about 1980, it was about 20-1, where it is today in countries where the majority of citizens say they’re happy i.e., Norway and Sweden. Today in the U.S. it’s 350-1, and that spread is growing exponentially. AND, those billions of dollars are likely stashed away in foreign accounts that avoid taxes and are not invested in the U.S. economy. Seem absurd to you?
The way it’s supposed to work is: growth in productivity leads to higher wages, which leads to an increased level of economic activity as workers have more money to spend. The spending creates more jobs and thus more tax revenue, which allows the government to improve our (failing) infrastructure and invest in things like education, which boosts productivity, leading to higher wages, propelling the economy to even greater prosperity. As Sen. Wellstone from Minnesota liked to say: “We all do better when we all do better.” Economists call this “The Virtuous Cycle.”
This cycle was altered in the 1980’s. You could say a “Cycle of Greed” replaced it. Prior, CEO’s and highly compensated executives’ top dollars were taxed as high as 92%. This discouraged companies from hoarding money, since it was taxed at such a high rate and they couldn’t hide it overseas, it incentivized them to reinvest in their businesses and pay higher wages. Since the 1980’s, what’s known as “supply-side economics” has become the game, which lowered taxes and, in effect, transferred money to the top. The “theory,” which has caused our “great divide” in income and wealth, has been cutely called “trickle-down” economics. Only the money that goes to the top doesn’t trickle down, it stays at the top, and even hides out in foreign bank accounts. You, of course, pay more in taxes further decreasing your stagnant wages.
Marshall Helmberger, a student at Oak Grove Jr, High when I taught there, is an award-winning editor of The TimberJay Newspapers up here in my neck of the woods and wrote a great article spawning this diatribe of mine. He used the analogy of “poverty poker,” where all of the players have to ante (taxes) but the one’s with money can bet i.e., the 1%. No chips no money to bet (invest). So, the one with the money gets more and more money, hoping I can only imagine, that like in games of money, they end up with all of it. AND they’re not productive members of the economy – they’re Wall Street financial speculators (speculating with your money, by the by) engaged in market manipulation, arbitrage, and outright fraud in some cases.
So, bottom line: we need to return to a “Virtuous Cycle” and break the “Cycle of Greed.” I hate to make this political, because I despise politics, BUT even Reagan’s (the 1980’s) budget director called supply-side economics a “Trojan Horse’ designed to justify massive tax cuts to Reagan’s wealthy friends (who got him elected, naturally). Rather than just be angry, inform yourself. Do something with that knowledge (remember: they work for you). I am not trying to endorse any candidate, but I hope you agree the rules of the game need to be changed. I’m sorry if you’re a die-hard Republican, but it would appear that the way they are postured to try to gain the presidency, the rules won’t change.
Do you believe we’ve had enough of poverty poker? Do we need a new game where the cards aren’t