Jonathan Tasini has a highly recommended post up over at The Daily Kos titled “Three Grand Myths." In his discussion of one of these Grand Myths – the nation’s debt and deficit problems – Tasini tosses out this observation:
In a press release incomprehensibly titled, “Conrad’s 50-50 Proposal is a Good Sign,” [a] “progressive” leader praises Sen. Kent Conrad – one of the leading purveyors of the phony deficit crisis – for a proposal that would cut critical government services by hundreds of billions of dollars: “The Conrad proposal is the first strong Democratic proposal that has come out of these negotiations.”
The statement is full of self-delusion – that is, that a “50-50 proposal” could cut $2 trillion from the budget but, the statement demands, the proposal has to be one in which, “No deal that takes more out of the programs for middle income and poor Americans than it takes from tax breaks, loopholes and havens for the rich and the big corporations, and no deal that undermines the economic recovery.”
The statement promotes and endorses the immoral framing of “shared sacrifice” – that people who already have paid dearly for the financial mess of the past years with millions of jobs lost and devastated retirement funds, should give even more to repair damage they had no hand in creating. (emphasis added)
I think this is a great point, and one that I’d take even further. Forget about only the suffering caused by “the financial mess of the past [few] years” – that doesn’t go nearly far enough.
I want us to recognize that the Reagan Revolution of 1980 was the start of America’s economic brickhouse being turned into a 30-year Ultimate Rave featuring a great DJ, an open bar and an all-you-can eat buffet . . . except that only the already affluent were invited to the party. And I want us recognize that the time has come to finally put our economic house back in order, and that this means acknowledging that the strength of our nation’s economy ultimately rests on and derives from the economic security of its citizens – all of its citizens.
But I damned sure don’t want to hear anything about how “everybody has to share the sacrifice” that comes from rebuilding our house. Let those who ate and drank and partied so well during the past 30 years of supply-side gibberish, Voodoo Economics, and crony capitalism pay all of the costs for their good times. The rest of us didn’t get to go to the party, we shouldn’t be asked now to clean up the mess.
The Three Grand Myths Jonathan Tasini identifies are not, of course, the only economic fables sold to America by the Right. One of the Right’s favorites, whenever anybody starts getting too obnoxious about the over-large slice of economic pie the well-off tend to appropriate for themselves, is to suggest that “we shouldn’t be worrying about the size of the slices, we should be working to make the whole pie bigger.” Except you know what? The whole pie has been getting bigger, and the well-off have been taking bigger and bigger pieces for themselves anyway.
This isn’t a secret. Anybody who wants can find this out by doing a quick search over at the Bureau of Labor Statistics site. This is a government agency, funded by our tax dollars, that keeps track of this information and makes it available to anybody who wants it. Here is a neat chart tracking labor productivity and hourly compensation in the U.S. from 1950 through last year:
(h/t Angry Bear)
From 1950 until 1980, workers’ wages pretty much exactly tracked the nation’s increasing economic productivity. (More precisely, labor productivity grew by 92%, real hourly compensation increased by 87%). So during these thirty years we saw what we have been told we should expect to see when United States productivity grows: workers’ compensation grows with it. The nation gets rich, we all get rich.
But beginning in the 1980s and continuing until today that hasn’t been the case. Productivity has continued to rise, but workers’ compensation noticeably has failed to keep up. A few years ago Jonathan Schwarz over at A Tiny Revolution put up a quick post about this “productivity gap” and pointed out that had wages continued to keep pace with productivity, “and if this increase were taken in time rather than money, everyone could make as much in wages as they do now while only working four days a week. Or we could all work five days a week but get ten more weeks of vacation every year.”
But, as it is, workers in the United States can look forward to fewer mandated paid vacation days than any other OECD country in the world. That's us, way down at the end on the right:
(h/t The Society Pages)
That’s depressing but, really, Americans probably wouldn’t have it any other way. You see, most of us can’t afford to take a day off because wage stagnation has made it impossible for us to make ends meet unless we literally work ourselves to death. Indeed, we learned just two weeks ago that
[while] median wages for two-parent families have increased 23 percent since 1975, the evidence suggests that this is not the result of higher wages. Rather, these families are just working more. In 2009, for instance, the typical two-parent family worked 26 percent longer than the typical family in 1975. (emphasis added)
So if productivity has been growing since 1980, and wages have been flat-lining – so much so that people now need to work 26% longer than they did 35 years ago just to stay above water – where did all the money go?
Where else? It went to the party people.
Many no doubt already have seen this one. It was put together by Kevin Drum from data provided by the Congressional Budget Office and it shows the degree to which the nation’s income has flowed to different economic classes since 1979:
For those of you to whom reading graphs and charts does not come easily, Drum explains:
If you look at the raw CBO figures, they show that a full tenth of the national income has shifted since 1979 to the top 1% of the country. The bottom quintiles have each given up a bit more than two percentage points each, and that adds up to 10% of all earnings. That 10% has flowed almost entirely to the very tippy top of the income ladder.
Is the middle class worse off because of this? Of course they are. Income matters even if plasma TVs are cheaper than they used to be or if CPI mismeasures middle class consumption or if average households now contain 2.6 members instead of 2.7. If this massive income shift hadn’t happened, middle class earnings would be higher, [the middle class would] be able to buy more stuff, and they wouldn’t be in debt so much. And the top 1% wouldn’t have quite so much idle cash lying around to do stupid things with.
This income shift is real. We can debate its effects all day long, but it’s real. The super rich have a much bigger piece of the pie than they used to, and that means a smaller piece of the pie for all the rest of us. (emphasis added)
* * *
One of the reasons Jonathan Tasini’s disparaging of the “shared sacrifice” idea struck a chord in me is because I really dislike talking to people who advocate for “smaller government” as a goal in and of itself. I don’t know a single Liberal who argues for “larger government” as a goal; by and large, we tend to argue for policy outcomes and then try to figure out how to achieve our goals. Often, but not always, that involves government intervention but that doesn’t mean we seek out government intervention as a good in and of itself.
But the people I’ve met who advocate for small government simply for the sake of small government are always people who think (i) they don’t need the government, and (ii) they don’t see why they should pay for someone else’s programs. I’ve yet to meet someone who argues in favor of “smaller government” as a goal in and of itself who doesn’t also immediately thereafter say something along the lines of: “I made it on my own, why can’t these people?”
Of course, none of us has ever “made it on our own” in this country, even if not all of us had rich families to support us when we were growing up. One big reason this country has accumulated the wealth it has is because, for generations, the people who came before us invested in America’s infrastructure, in its judiciary, in its laws and in its government; it’s a big advantage to be born in the United States as opposed to, say, Bangladesh if you want a chance at a half-way decent life. Another reason we (used to) do well is because – especially following WWII and implementation of the GI Bill – we invested public funds in the improvement of our private citizens.
(I myself went to a very good public university and received a great education, partly because the tax dollars paid by everybody else who lives in my state helped defray the cost of that education. I received a better education than my parents ever could have afforded to give me on their own, at a private school, and I have never lost sight of that fact; it is one of the big reasons I never complain when I have to pay my state income tax now that I am an adult. It's my turn.)
But most people prefer to ignore the fact they ever got a hand up, or else are so dumb that they can’t even recognize when they have been helped – like Craig T. Nelson, who infamously once said to Glenn Beck whilst complaining about government assistance programs:
As a rule, the “small government people” are the people who already are (or at least who think they already are) at a comfortable place in the pecking order, and the last thing they want to see is someone else get a little assistance moving up that order. Equality of opportunity means the possibility of greater competition, and that means those already blessed by the system might suddenly find themselves sliding down a few notches and they can’t have that. When these people tell you that society would be better off as a “meritocracy” and that the government shouldn’t “interfere with the market” what they are really saying is that the status quo favors them, and therefore they don’t want to see the status quo disturbed. Much better all around, they will tell you, not to have the government try and equalize opportunity for everyone; this would – somehow- be unfair to those already privileged.
But when, as now, too much noise has been made about how the status quo cannot be maintained and some sacrifices have to be made, now when suddenly it is trendy to talk about “bearing pain” and “paying the price” . . . well, now, you see, suddenly it turns out that they were wrong, we are all equal and the burdens of cleaning up our economic house have to be borne by us all – no matter how much the government’s prior policies may have showered largess on them (at the expense of us) for decades.
I call shenanigans.
* * *
One of the reasons our economic house is in shambles is because a small number of plutocrats decided to start looting the public treasury, hollowing out America’s wealth, and blowing it all on million-dollar Sweet Sixty-Years Old parties for CEOs, $15,000 shower curtains, and private 18-hole golf courses in their own back yards. All without putting anything back.
Income tax rates are at an all-time low – especially for the richest among us. Capital gains tax rates are at an all-time low – and only the richest among us derive significant income from capital gains. And social services have been slashed to the bone, meaning that everyone else – those of us who have to rely on these services and who didn’t get invited to the 30-Year Ultimate Rave – have had to pay more out of pocket than since those services first became available. All that money went to the plutocrats, and now the economy is in the toilet and the bill is being presented to us.
Well, as someone who came along just a little too late to make it to the party, I call shenanigans. The Rich think we should “all” share in the sacrifice? They should have thought about that when they decided they’d be happier keeping us off of the guest list.
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