The Other Crisis

It's not just the Climate Crisis that threatens the near future. It's the economic, political and social consequences of the growing divide between the supremely rich and the rest. The rich have been getting richer and everyone else poorer since the Reagan 80s. Though Clinton policies and a booming economy temporarily boosted the middle class, thanks to GB Bush policies and now the lingering effects of the Great Recession--mostly felt by the non supremely rich--the divide is getting way out of hand.

But Bob Herbert's recent column says it better than I can:

Recessions are for the little people, not for the corporate chiefs and the titans of Wall Street who are at the heart of the American aristocracy. They have waged economic warfare against everybody else and are winning big time...

The ranks of the poor may be swelling and families forced out of their foreclosed homes may be enduring a nightmarish holiday season, but American companies have just experienced their most profitable quarter ever. As The Times reported this week, U.S. firms earned profits at an annual rate of $1.659 trillion in the third quarter — the highest total since the government began keeping track more than six decades ago.

The corporate fat cats are becoming alarmingly rotund. Their profits have surged over the past seven quarters at a pace that is among the fastest ever seen, and they can barely contain their glee."

Herbert outlines how self-destructive this is economically, but moves on to the social consequences:

"Beyond that, extreme economic inequality is a recipe for social instability. Families on the wrong side of the divide find themselves under increasing pressure to just hold things together: to find the money to pay rent or the mortgage, to fend off bill collectors, to cope with illness and emergencies, and deal with the daily doses of extreme anxiety.

Societal conflicts metastasize as resentments fester and scapegoats are sought. Demagogues inevitably emerge to feast on the poisonous stew of such an environment."

Herbert suggests that those who don't think this resentment can build should remember the 1930s. But that may be the wrong model. In the 30s, as earlier in the 20th century, it was politically potent to go after Big Business, Wall Street and the Trusts for their imperious wrecking of the economy and society. But after generations of equating such criticism with Communism, and deification of "private enterprise" as the solution for everything, it's politically tougher to aim at the supremely rich corporations so cleanly.

Instead that resentment gets translated the way corporate power prefers: the anxious white middle class scapegoats those below them (actually or traditionally) in the social order: other races and immigrants. So racism is on the rise, translated into anti-Obama fervor and such cultural expressions as the recent Dancing with the Stars debacle, in which voting Tea Partiers chose a talent-challenged Bristol Palin over the clearly more accomplished uppitedly black woman.

The black man in the White House also inflames anti-government rhetoric, thus depriving the middle class of its only institutional protection against predatory corporate power. Republicans gained power by refusing to be a governing partner, a virtually unprecedented act of unpatriotic selfishness. The combination does violence to social cohesion, the kind that is necessary in times of emergency.

Meanwhile, the governing ruling class goes on as apparently clueless as ever. Herbert cites a dandy of an example--

A stark example of the potential for real conflict is being played out in New York City, where the multibillionaire mayor, Michael Bloomberg, has selected a glittering example of the American aristocracy to be the city’s schools chancellor. Cathleen Black, chairwoman of Hearst Magazines, has a reputation as a crackerjack corporate executive but absolutely no background in education.

Ms. Black travels in the rarefied environs of the very rich. Her own children went to private boarding schools. She owns a penthouse on Park Avenue and a $4 million home in Southampton. She was able to loan a $47,600 Bulgari bracelet to a museum for an exhibit showing off the baubles of the city’s most successful women.

Ms. Black will be peering across an almost unbridgeable gap between her and the largely poor and working-class parents and students she will be expected to serve. Worse, Mr. Bloomberg, heralding Ms. Black as a “superstar manager,” has made it clear that because of budget shortfalls she will be focused on managing cutbacks to the school system. So here we have the billionaire and the millionaire telling the poor and the struggling — the little people — that they will just have to make do with less."

Making the point I just tried to make, Herbert adds his remedy:

Extreme inequality is already contributing mightily to political and other forms of polarization in the U.S. And it is a major force undermining the idea that as citizens we should try to face the nation’s problems, economic and otherwise, in a reasonably united fashion. When so many people are tumbling toward the bottom, the tendency is to fight among each other for increasingly scarce resources.

What’s really needed is for working Americans to form alliances and try, in a spirit of good will, to work out equitable solutions to the myriad problems facing so many ordinary individuals and families. Strong leaders are needed to develop such alliances and fight back against the forces that nearly destroyed the economy and have left working Americans in the lurch."