The problem in a nutshell is this: Inequality in this country has hit a level that has been seen only once in the nation's history, and unemployment has reached a level that has been seen only once since the Great Depression. And, at the same time, corporate profits are at a record high.
In other words, in the never-ending tug-of-war between "labor" and "capital," there has rarely—if ever—been a time when "capital" was so clearly winning.
In the late 1970s the richest 1 percent of Americans received 9 percent of total income and held 18 percent of the nation’s wealth; by 2007, they had more than 23 percent of total income and 35 percent of America’s wealth. CEOs of the 1970s were paid 40 times the average worker’s wage; now CEOs receive 300 times the typical workers’ wage.
This concentration of income and wealth has generated the political heft to deregulate Wall Street and halve top tax rates. It has bankrolled the so-called Tea Party movement, and captured the House of Representatives and many state governments. Through a sequence of presidential appointments it has also overtaken the Supreme Court.
Bottom line: The average individual now has $1,315 less in disposable income than he or she did three years ago at the onset of the Great Recession – even though the recession ended, technically speaking, in mid-2009... The diminished standard of living, moreover, is squeezing the middle class, whose restlessness and discontent are evident in grass-roots movements such as the tea party and "Occupy Wall Street" and who may take out their frustrations on incumbent politicians in next year's election.
What has led to the most dramatic drop in the US standard of living since at least 1960? One factor is stagnant incomes: Real median income is down 9.8 percent since the start of the recession through this June, according to Sentier Research in Annapolis, Md., citing census bureau data. Another is falling net worth – think about the value of your home and, if you have one, your retirement portfolio. A third is rising consumer prices, with inflation eroding people's buying power by 3.25 percent since mid-2008.
"In a dynamic economy, one would expect Americans' disposable income to be growing, but it has flattened out at a low level," says economist Bob Brusca of Fact & Opinion Economics in New York.
A joke making the rounds on the Internet goes like this:
"There's a plate of 12 cookies sittng on a table. The rich take 11 cookies leaving only 1 cookie left on the plate. They then turn to the Tea Party and say ‘Those unions are trying to take your cookie.'"
This works about equally well with Republicans vs. Democrats.
It's why Republicans versus Democrats is largely a false divide. The monied interests would rather have us arguing Republican vs. Democrat (50/50 split) than Rich vs. Everyone Else (1/99 split).
So, when you connect the dots, properly understood, what happened this week is the first battle in a civil war; a civil war in which, for now, only one side is choosing violence. It is a battle in which members of Congress, with the collusion of the American president, sent violent, organised suppression against the people they are supposed to represent. Occupy has touched the third rail: personal congressional profits streams. Even though they are, as yet, unaware of what the implications of their movement are, those threatened by the stirrings of their dreams of reform are not.
Sadly, Americans this week have come one step closer to being true brothers and sisters of the protesters in Tahrir Square. Like them, our own national leaders, who likely see their own personal wealth under threat from transparency and reform, are now making war upon us.
Critics of the growing Occupy Wall Street movement complain that the protesters don’t have a policy agenda and, therefore, don’t stand for anything. They're wrong. The key isn’t what protesters are for but rather what they’re against -- the gaping inequality that has poisoned our economy, our politics and our nation.
In America today, 400 people have more wealth than the bottom 150 million combined. That’s not because 150 million Americans are pathetically lazy or even unlucky. In fact, Americans have been working harder than ever -- productivity has risen in the last several decades. Big business profits and CEO bonuses have also gone up. Worker salaries, however, have declined.
In his new book, Were You Born on the Wrong Continent?, Thomas Geoghegan makes a strong case that European social democracies -- particularly Germany -- have some lessons and models that might make life a lot more livable. Germans have six weeks of federally mandated vacation, free university tuition, and nursing care. But you've heard the arguments for years about how those wussy Europeans can't compete in a global economy. You've heard that so many times, you might believe it. But like so many things, the media repeats endlessly, it's just not true.
According to Geoghegan, "Since 2003, it's not China but Germany, that colossus of European socialism, that has either led the world in export sales or at least been tied for first. Even as we in the United States fall more deeply into the clutches of our foreign creditors -- China foremost among them -- Germany has somehow managed to create a high-wage, unionized economy without shipping all its jobs abroad or creating a massive trade deficit, or any trade deficit at all. And even as the Germans outsell the United States, they manage to take six weeks of vacation every year. They're beating us with one hand tied behind their back."
[Commenting on this news item: "Bank of America Corp will pay $11 million to ousted executives Joe Price and Sallie Krawcheck"]
You pay fired executives more in severance than the average American worker will earn in a lifetime. For most people on the outside looking in, this seems like it's from outer space, another world entirely. These numbers just do not exist to regular human beings, they cannot be fathomed. The ordinary American is not a class warrior or a woe-is-me whiner coveting the rewards of others - the ordinary American simply believes that extraordinary rewards should go to those who do extraordinary things, not to paper-pushing failures at parasite banks.
So let me give you a hint that will save you countless hours and millions of dollars spent on consultants and the public relations morons you keep on staff: This is why they hate you. This very type of thing, while just a single example, epitomizes the piggish mentality that has set you apart from everyone else. This is why they're marching against you and calling for boycotts and writing their politicians. And this is why your whole model and way of life is on its way to being dead. Forever.
We're all aware of the two tiered political system in which protesters can be run over by police scooters but marauders in suits are put on the President's jobs council to chuckle nervously at Occupy Wall Street. But behind the political inequality lies a new order of credit allocation. Tim Geithner created a two-tiered monetary system, a kind of money they have which you can't get. He wasn't alone in doing this. Financial institutions spent hundreds of millions of dollars influencing federal officials to coalesce a bailout while politicians treated them as a special class of super Americans. But he more than anyone else in the crisis period was the central figure in the creation of our current aristocratic monetary order.
a long time ago workers in this country realized that industrialization wasn’t making their lives better, but worse. The captains of industry were making a ton of money and living a merry life far away from the dirty, dangerous factories they owned, and far away from the even dirtier and more dangerous mines that fed raw materials to those factories.
The workers quickly decided that this arrangement didn’t work for them. If they were going to work as cogs in machines designed to build wealth for the Rockefellers, Vanderbilts and Carnegies, they wanted a cut. They wanted a share of the wealth that they were helping create. And that didn’t mean just more money; it meant a better quality of life. It meant reasonable hours and better working conditions.
Eventually, somebody came up with the slogan, “8 hours of work, 8 hours of leisure, 8 hours of sleep” to divide the 24-hour day into what was considered a fair allocation of a human’s time. It wasn’t a slogan that was immediately accepted. People had to fight to put this standard in place. People demonstrated, and fought with police, and were killed. They were called communists (in fairness, some of them were), and traitors, and many of them got a lot worse than pepper spray at the hands of police and private security.
But by the time we got through the Great Depression and WWII, we’d all learned some valuable lessons about working together and sharing the prosperity, and the 8-hour workday became the norm.
We, the Ben & Jerry’s Board of Directors, compelled by our personal convictions and our Company’s mission and values, wish to express our deepest admiration to all of you who have initiated the non-violent Occupy Wall Street Movement and to those around the country who have joined in solidarity. The issues raised are of fundamental importance to all of us. These include:
The inequity that exists between classes in our country is simply immoral.
We are in an unemployment crisis. Almost 14 million people are unemployed. Nearly 20% of African American men are unemployed. Over 25% of our nation’s youth are unemployed.
Many workers who have jobs have to work 2 or 3 of them just to scrape by.
Higher education is almost impossible to obtain without going deeply in debt.
Corporations are permitted to spend unlimited resources to influence elections while stockpiling a trillion dollars rather than hiring people.
We know the media will either ignore you or frame the issue as to who may be getting pepper sprayed rather than addressing the despair and hardships borne by so many, or accurately conveying what this movement is about. All this goes on while corporate profits continue to soar and millionaires whine about paying a bit more in taxes. And we have not even mentioned the environment.
Right here in the good old US of A, the ratio of CEO pay to average worker pay is running 475 to 1 while in Japan, a very profitable nation with a very good standard of living, the ratio is 11 to 1. The average Japanese CEO would kill himself in shame if his company failed so badly that it needed to be bailed out by the government in order to stop the world economy from crashing. American CEO’s take bonuses of 15 million dollars for doing that.
In case you need somebody to characterize that for you… that’s a bad thing. This level of greed is not a sign of American business success and superiority. It is an example of institutionalized insanity because these companies can and do lose billions of dollars in a single year and the CEO’s still make the monster money.
Anyone who wants to understand the enduring nature of Occupy Wall Street and similar protests across the country need only look at the first official data on 2010 paychecks, which the U.S. government posted on the Internet on Wednesday.
The figures from payroll taxes reported to the Social Security Administration on jobs and pay are, in a word, awful.
These are important and powerful figures. Maybe the reason the government does not announce their release — and so far I am the only journalist who writes about them each year — is the data show how the United States smolders while Washington fiddles.
USA Today says that at some point this year, student loan debt will exceed $1 trillion, surpassing even credit card debt. Felix Salmon says the number is closer to $550 billion. Either way total student loan debt is rising as other debts have tailed off. Delinquency has increased, too, since the height of the financial crisis.
It’s a huge mess.
Some people have noticed that “student loan debt” comes up a lot among the Wall Street Occupiers and the members of the 99 percent movement. Often, older people, who either attended school when tuition was reasonable, or who didn’t attend college at all in an era when a high school diploma was enough of a qualification for a stable, middle-class career, tend to think this is all the entitled whining of spoiled kids. They don’t understand that these kids accepted a home mortgage worth of debt before they ever even had a regular income, based on phony promises, and that the debt is inescapable, regardless of life circumstances or ability to pay.
What can you do? You can join the protests that are occurring in every major city of the United States (locations available here). You can call or write to your friends and help them understand what is happening. You can cancel your account at a "big bank" and move it to a community bank or credit union. You can gather people at your home or a local meeting place (library, bar, school house, shopping center, etc.) to talk about the problems America is facing. You can write to your president, representative and senator. If you have a blog, blog about it. If you have a Facebook account, talk about it there. Vote for candidates who support reform of the American political system. And so on.
In other words, do anything you can to spread the word and help people to understand the problems that the America People are facing today.
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