Archive for June 15th, 2011

Surreal America

The argument that the US is heading for collapse is probably overstated, but sometimes when I look at the nature of political debate in the US it seems plausible.  Rather than taking a cool, pragmatic view of the problems and potential solutions, politicians are increasingly locked in an ideological fog, looking for sound bites and “easy” solutions.   Rather than recognizing the complex array of problems that brought us to this point they prefer to point to some villain who has foisted harmful policies on the US which, if eradicated, would eliminate our problems.

For instance, it’s become mantra for some on the right to see unions as some all powerful bad guy.  The proposition is so absurd as to be laughable.    As this story shows, US workers are lower paid than ever.   One reason is that unions have become impotent and are smaller than ever.   There is no possible way to deny the fact that relative income has shifted away from workers (who have gone from ‘middle class’ to ‘working poor’) towards the wealthy, and that unions have become rare and ineffective.   This is a problem.   With the working class increasingly receiving less income, not only is the divide growing in the US, but economic growth becomes more difficult.   Companies are earning record profits as worker income declines.

If people were rational and objective, they’d see this and come to the obvious conclusion:  corporations and businesses with resources are structuring the game in their favor (and the favor of their share holders) while workers, no longer protected by effective unions, pay the cost.   Instead, driven by irrational ideological faith, many argue that unions are evil and holding back growth and that the government is unfair to big business.    Morever, it’s clear that the wealthiest have had an explosion of income growth in recent years, while the poor and middle class have not.   An objective, rational analysis would say that given high debt and deficits, those who have benefited so much at the expense of others should pay more taxes.  Instead, efforts are underway to cut taxes on the wealthiest and cut services to those poor who have become worse off in the last 30 years.

As I noted yesterday, the argument that these policies trickle down wealth to the poor has been discredited.   Europe, which has stronger labor unions and more wealth equality has also created more jobs in the last 12 years than has the US.   We’ve seen a net shift of wealth towards the already wealthy.   Moreover, there is little class mobility in the US.   It’s not as if the successful are rewarded for hard work and innovation; rather, those with wealth are being rewarded for having wealth.

What’s surreal about this is the way that especially the right in the US ignores the data and continues to argue for tax cuts while demonizing labor unions.   There is no evidence supporting such claims, such views are driven solely by ideological propaganda.    But the left is not without blame either.   Their focus has been increasingly on politically powerful interest groups, meaning the working poor are often left out.   Moreover, they’ve ignored the problem of higher debt and ineffective social welfare programs, giving ammo to the right to show the problems of big government.

In short, the left has been AWOL in terms of truly identifying and offering solutions to the problem of this loss of wealth, status and opportunity of the working poor, defending instead existing government programs.    After all, what political clout do the working poor possess?   They won’t win elections for the Democrats, and defending them only gives fodder to the GOP to scare the wealthier into thinking Democrats want to “transfer wealth” to the poor.

Transferring wealth won’t work.    The problem is not unequal outcomes, but warped opportunities and power structures.   Corporate profits shouldn’t skyrocket while worker income plummets.  There needs to be more fairness in the structure of pay and power in the market place.   This doesn’t call for massive government transfers of wealth, but rather government support of labor unions, transparency in the market, and regulation of big business.   The goal is not to combat the free market, but to make it work effectively.

That’s the most surreal point of all.   The free market has not been working well in the US because it’s been manipulated by insiders with information and power to control how it functions.   The state is supposed to prevent that and protect the market, but increasingly both parties listen to lobbyists representing the current “winners.”   Left unchecked, this will lead to a bifurcated class structure in the US and a potential backlash.    Left unchecked, the US will lose out to others in the global market.   Republicans and Democrats should together recognize the problem; instead, ideology trumps pragmatism, and problems go unsolved.

It feels like I’m watching a great power decline, even though there are ample opportunities to change and regain vibrancy and growth.    Yelling at each other and lost in ideological fog, those opportunities are ignored.   Instead of problem solving, opponents are demonized in a weird effort to pin problems on a particular group.   The way some Republicans talk about “liberals” — as if all the problems the country faces are caused by ‘liberals’ — is dangerous.   Rather than seeing problems that need solutions, others are demonized and uncritically blamed for all that is wrong.

As someone who is critical of both the left and the right, and who believes that pragmatic solutions require compromises from each side, I hope the surreal political debate gives way to more rational, practical, problem solving.  If not, then perhaps the best days of America are behind us…or at the very least, will take awhile to return.