Showing posts with label inequality. Show all posts
Showing posts with label inequality. Show all posts

Tuesday, July 2, 2013

Don't Blame the School

Rebecca Strauss of the Council on Foreign Relations Renewing America initiative tells us how lavishly the federal and local governments fund education for the rich, and how little for the poor.
On the plus side, the Obama administration has pushed for more cost and quality accountability for education providers. ...

At the postsecondary level, for the first time vocational college programs could soon be held directly accountable for a “gainful employment rule,” where they will lose federal accreditation if the programs’ costs outweigh labor market benefits for their graduates. In other words, programs would shut down if their graduates don’t land good jobs.
Couple this with (1) manufacturers’ efforts to get community colleges to “teach to the job,” so that each graduating class will supply more skilled workers than there are jobs available—so the manufacturer can pick the best, pay bottom wages, and leave many without work; (2) enrollment rises when jobs are scarce. Now we’re going to shut down the school because it didn’t give the graduates a leg up. So they can go directly into the unskilled workforce, with no postsecondary education. Not a good plan.

And of course, no school for the rich will be shut down. Those grads get jobs because Daddy has pull. "Accountability" is just another word for taking from the poor.

Sunday, November 18, 2012

Robber Barony Is Back

http://topincomes.g-mond.parisschoolofeconomics.eu/#Graphic:
select:
United States
1917-2009
Average Incomes
bottom 90% average income - including capital gains

Shows the submerged 90% of us earn the same (per family) in real terms as we did in the late 1960s. Yet the typical family now has more wage earners, working more hours.

Same site, select
Top Income Shares
top .01% - including capital gains

Shows the hunting animals eating the entire carcass except during 1942-1981, when we had effective antitrust law, labor law, and progressive taxation.

In only these forty years was the average family income of the top .01% "only" 165 times the average family income.  Before 1942 and after 1981, the rich took a much larger share.  In 2010 it was 462 times the average and increasing.  (If only the top .01% earned anything, their share would be 10,000 times the average.   That the one family in 10,000 now takes nearly 5% of all the income, is appalling.)

The rich get their income not for what they do, but for what they own.  They claim to be "job creators."  In truth, the only job creator is a customer, who buys something.  We have to get money back in the hands of those who spend it--the nonrich.  When the only people with money to spend have all the stuff they can use, the economy collapses.  These booms and busts happened regularly up through the Great Depression.  It was political action that transformed the working class into the middle class, avoiding the booms and busts.  Deregulation, detaxing the rich, eroding worker rights, free trade, since 1981 are bringing back the bad old days of many serfs, one lord.  Only political action can reverse the trend.  We have to restore antitrust laws, restore workers' rights, establish fair trade not free trade, tax the rich.

Norway has a much fairer balance of power between employees and employers, partly due to nationwide collective bargaining.  U.S. labor laws have been eroded since they were enacted in 1935, by anti-labor court decisions and anti-labor legislation.  Now, management can ignore labor agreements and labor law without serious consequences.

Wednesday, October 26, 2011

Only Money Has Free Speech

As it is now, advertisers make the decisions about the media, not the people, because the media exist for the purpose of making money. . . .

The fact that people with money can hire lobbyists to represent them in Washington limits equity in the political system. Poor people don’t have the money for this—if they spent everything they had, they couldn’t get enough money together to equal the lobbying power of the rich. After an election, people don’t have access to government, because lack of money prevents them from having equal access to the people in power. That’s an inequity that’s built into the system. That’s where money is more powerful than people.

People do have a right to vote. But whom do they have a right to vote for? They have a right to vote for whoever is chosen. That’s our dilemma right now. It starts with how much it costs to run for office—it now costs $3 million to run for governor in Tennessee. That rules out a lot of people. So the choice is between two people who are willing to spend $3 million, which is not a democratic choice. You can say that the people have a right to vote, but they only have the right to choose between two millionaires or people whom other people with money are willing to back.

Myles Horton, The Long Haul, © 1990, pp. 169-170

Wednesday, October 19, 2011

We Are All Immigrants

If you missed it last night, or you've turned your television off like we have, you can watch Frontline: Lost in Detention online (54 minutes). Not for the faint of heart, it shows the abusiveness and insanity of US immigration enforcement.

Because of the likelihood of abuse, a few things should never be privatized. Prisons, health care, and education are at the top of that list. Capitalism is fine. But when it morphs into unbridled greed, as it clearly has done, it can only lead to human suffering, gross injustice, and economic collapse.

Alabama's new anti-immigrant law is already hurting its farmers, because much to the surprise of Governor Bentley, most U.S. citizens really don't want to do farm work. "Jobless resident Americans lack the physical stamina and the mental toughness to see the job through," says Alabama farmer Jerry Spencer. There's a certain measure of desperation, determination, and fortitude required to do that kind of work. Most of us aren't that desperate, determined, or tough. But if the economy and our elected officials continue on their current path, it's likely that our children will be.

All human beings are migrants. We are born into this life, we stay for a while, and then we move on. None of us are permanent residents. In the meantime, we go where we believe we have the best chance to provide for our families. Those who are desperate, determined, and strong enough to do the work that U.S. citizens do not want to do, who see grueling farm work as their best chance to provide for their families, pose no threat to anyone. We need them. And our well-being is tied to theirs.

--TomRW & MaryRW

Saturday, January 8, 2011

Fear, Loathing, and Babies

Why on earth does anyone waist their time targeting the most powerless and disadvantaged among us--unauthorized immigrants and their children--while the most powerful and unscrupulous--greed-driven corporate hegemons--continue to run our civil rights, our government, and our economy into the ground not only with impunity but with hardly a blip on the collective radar? Isn't it just possible that many who focus on the supposed threat posed by the powerless and disadvantaged are being manipulated into misidentifying who should be held accountable for our current economic and political morass?

Might it be that those who are running away with the wealth and power of this country, those who control the language and focus of the mainstream media--who know that calling people "illegals" will stir up resentment and mistrust--bank on being able to take advantage of deep-seated prejudices to distract us from the very real damage that they themselves routinely and cavalierly cause? Allow me to remind you that until very recently the word illegal was used only as an adjective, not a noun, and it was never used to modify people, only actions. Calling people "illegals" dehumanizes them, allowing us to feel that our attitudes toward them are justified.

The arguments used against the current wave of immigrants are the same as the arguments used against all the previous waves of immigrants: "they don't learn the language," "they don't pay taxes," "they don't assimilate." It's true that adult immigrants to this country find English a very difficult language to learn (think about wrapping your mind around "though," "through," "tough," and "cough"), especially because they are preoccupied with procuring employment and providing for their families. But their children never fail to learn English and never fail to assimilate and are very often tremendous assets not only to the immigrant community they grew up with but also to our country, the country that is their own, their home country in every respect.

The claims that unauthorized immigrants don't pay taxes and that they take advantage of our oh-so-abundant (not!) social services is absurd. It's next to impossible to get a paycheck in this country without taxes being taken out. And those who get paid "under the table" often find that they are not paid as much as they were promised or are not paid at all, and because of their status they have no legal recourse. The effect is that we have a subclass of cheap laborers with no rights, no legal recourse when they're exploited, and no political voice or representation. And these are the people we find so threatening? This is what causes outrage when the middle class is disappearing at an alarming rate while our civil liberties are blithely eaten for lunch by greedy fear-mongering corporate hegemons?

And what about the so-called anchor babies? Just what threat do these babies pose exactly? Unauthorized immigrants who bear a child in this country are still subject to deportation. They gain no legal advantage by having a child except the advantage of U.S. citizenship for the child, while they run the risk of having their family torn apart should one or both parents be deported. In what way, exactly, does this pose a threat to anyone, except that it means a continued shift in the ratio of nonwhite to white babies being born in this country? If these babies truly pose a threat, then it's a threat only to those invested in maintaining a homogeneous white majority.

And what would we have these children do, the ones who grow up here and are far more at home here than they could possibly be in their parents' country of origin? We should deport them to a country of which they are not citizens that would be very nearly as foreign to them as it would be to us?

When, oh when, are we going to learn that cultural diversity is a great blessing and strength, that every wave of immigrants has enriched this country in countless ways? We need these newcomers who are being reviled and terrorized because they have the temerity to want to come here to work when work isn't available in their home country. We need them, because the poor--not the rich--form the basis of our economy. The poor spend every last cent of their income because they have no choice to do otherwise. Some may be fortunate enough to have a modest amount to send home to family, but most of what they earn is spent right here. The same cannot be said of the fabulously wealthy, who make far more money than they can possibly spend and do more to weaken our economy than strengthen it.

We need these immigrants not only for economic reasons but also because many aspects of their cultures are antidotes to the most problematic aspects of our own culture, such as extreme individualism, task-orientation, and rampant materialism. We need them because the mixing of cultures and ideas results in stronger values and communities.

When I first started working with my church's Latino congregation, I would arrive a half-hour early every Sunday to practice and prepare for the service. But I soon learned that although the tasks I had in mind weren't unimportant, it was more important to greet the people who arrived early. In other words, people are more important than tasks, which also meant that I was more important than tasks. It was my presence--and theirs--that really counted, not my performance or preparation. It didn't matter if I made mistakes. What mattered--and still matters--is that I love and cherish the people of my faith community. This may be a simple lesson, but it's a profound one, and only one small example of how I've been blessed by coming to know and love my Latino sisters and brothers.

The children of immigrants are quick to see the virtues and attractions of both their parents' culture and the majority culture that surrounds them, and they're very often brilliant at interweaving the best aspects of both to come up with a fabric that is stronger and more beautiful than either of the original threads. Yet these very children--the "anchor babies"--are the ones we find so abhorrent that we would consider altering the Constitution to prevent them from becoming citizens? Not only do these children not pose a threat, but they are the bright promise of tomorrow. What does denying them citizenship accomplish? And what does it say about us as a country? If such a law had been put into effect in the eighteenth century, the founders of this country would not have been citizens. I submit that altering the Constitution in such a way would signify that we have lost our way, that we have refused to learn the lessons of past generations, and that we are a nation guided not by wisdom and compassion but by fear and ignorance.

--Mary (my first blog post in well over a year!)

Sunday, December 26, 2010

The Price of Inequality

This article, adapted from The Price of Everything: Solving the Mystery of Why We Pay What We Do, by Eduardo Porter, explains that wider communications, bigger companies, and deregulation are creating a pay structure where fewer and fewer people are taking more and more of the money, leaving the vast majority with no hope of sharing the benefits. This is a natural process. Wealth concentrates until the only people who can buy anything don’t need to, and the economy collapses. Both that article and this one point out that, in Frank Rich's words, "America can’t move forward until we once again believe . . . that everyone can enter Frontierland if they try hard enough, and that no one will be denied a dream because a private party has rented out Tomorrowland." Bob Herbert points out that in the recession of 2008 to the present, many unemployed people have lost that hope. As Paul Krugman says in The Conscience of a Liberal 2007 (p. 18), “Middle-class societies don’t emerge automatically as an economy matures, they have to be created through political action.” The political actions we need are progressive taxation, regulation to prevent abuse of economic power, public education, and a social safety net. And we should focus not on Gross Domestic Product, which harmfully accrues disproportionately to the wealthy, but on the average income of the poorest half or poorest 35% of the people, as recommended by Muhammad Yunus, "banker to the poor" and Grameen Bank founder.

Too, corporate executive pay often is more plunder than compensation.

Monday, October 5, 2009

Soak the Rich


From 1980 to 2005, more than four-fifths of the increase in the nation's income went to the highest-income 1%. Share of total income going to the highest-income 0.1% rose from less than 4% in 1981 to more than 12% in 2007. Why? Top tax rates plunged. In 1981 the top marginal tax rate was 69%. In 1982 it dropped to 50%, permitting the income share of the top 0.1% to more than double in just the first five years of lower taxes on the rich. From 2003 to 2007 the top rate was down to 35%--and the highest-income 0.1% were absorbing 12% of the nation's wealth.
This is clearly too low to prevent the ever-increasing concentration of wealth. The natural progression continues until the only people who can spend money don't need to, and the economy collapses.
Piketty and Saez (pp. 79-81) show that under the high-tax regime of the 1940s through 1970s, share of income to those at the highest income remained quite constant for decades. (About 33% to 35% going to the highest-income 10%; about 10% to the highest-income 1%; about 3-4% to the highest-income 0.1%.) It's only since 1981 that the lid has blown off the ability of the rich to amass ever greater amounts of the nation's wealth.
Confiscatory taxation is one of the most important functions of government. Progressive taxation is uniquely effective at combating the natural tendency of the rich to get richer and everybody else to descend into serfdom.
Let

individual income tax rate = 1 - (income/poverty level)^-.2

for 0 tax at poverty level, 25% tax rate at about 4x poverty, 50% tax rate at about 30x poverty level, 75% tax at about 1000x poverty level.

For a graph, see
http://www.wolframalpha.com/input/?i=log+linear+plot++1+-+x^-.2++from+1+to+1000
where the vertical axis is the tax rate and the horizontal axis is the ratio of your income to the poverty level. The marginal tax rate would be 0.2 just above the poverty level and 0.8 at 1000 times the poverty level:
http://www.wolframalpha.com/input/?i=log+linear+plot++1+-+derivative%28x^.8%29++from+1+to+1000  

"Income" includes all income, including capital gains (which should be indexed to inflation), and including inheritance. "Income" should exclude income taxes owed to state and local governments on the current year's income. (It's important to exclude state income tax, to prevent the total tax from exceeding 100% for absurdly high income.)

The rich would still be rich. But the rate of widening of the gap would slow. And we would slow the rise in federal debt.

It's also crucial to institute progressive corporate tax. Corporations become ever larger, wealthier, more able to dictate market prices, supplier prices, wages and working conditions, and able to buy political influence to rewrite laws in their favor. They can increasingly soak us, their customers, squeeze their suppliers, keep their workers down--driving us all into serfdom except the business barons.

Let

Corporate tax = profit * [.44 + .1*ln(profit ÷ household poverty rate)/ln(1000)]

So that each doubling of corporate profit causes a rise of about 1% in tax rate (both total and marginal. Each 1000-fold increase in profit raises tax rate by 10%. A trillionfold increase in profit would increase tax rate by 40%.)

On the graph,
http://www.wolframalpha.com/input/?i=log+linear+plot++.44+%2B.1+log+x++%2F+log+1000+from+1+to+100000000 




the vertical axis is corporate tax rate and the horizontal axis is the ratio of corporate income to household poverty level.
  

A progressive tax on business profit would counter the corporate desire for mergers and acquisitions, creating ever more monopolistic conditions.

Of course, we also have to restore all the Progressive Era reforms begun in the Teddy Roosevelt administration and dismantled in and since the Reagan administration. Restore antitrust regulations, financial market regulations, food safety regulations. Repeal the anti-union changes to the Labor Act since 1935. Pass the Employee Free Choice Act.

We must stop subsidizing U.S. agribusiness overproduction of corn, soybeans, cotton, and wheat--which are then dumped below cost on Mexican and Central and South American markets, destroying agricultural economies and forcing millions of people to come to the U.S. seeking unauthorized work. These people are abused with impunity by their employers, because they are afraid of being deported. The availability of millions of zero-status workers drives down wages and working conditions for native U.S. workers.

Political policies have overwhelming effects on economic conditions for ordinary people.

Natural processes, left unchecked, yield a world of a few owners and the rest of us serfs.

Only aggressive, vigilant government action can keep these forces at bay.

Only aggressive, vigilant citizen involvement in the political process can ensure the government does what we vote for, rather than what the moneyed interests pay for.