By MARK KARLIN, EDITOR OF BUZZFLASH AT TRUTHOUT
Mr. President, The Lion of Wealth Doesn’t Want to Share Food With the Sheep of Need. It Wants to Eat Them.
The struggle against dramatically increased income inequality and declining upward mobility finally found a strong voice in the mouth of President Obama. In a speech before the White House friendly Center for American Progress, the president called these issues “the defining challenge of our time.”
He buttressed his commitment to increasing financial sustainability for the majority of Americans with persuasive facts:
And the result is an economy that’s become profoundly unequal, and families that are more insecure. I’ll just give you a few statistics. Since 1979, when I graduated from high school, our productivity is up by more than 90 percent, but the income of the typical family has increased by less than eight percent. Since 1979, our economy has more than doubled in size, but most of that growth has flowed to a fortunate few.
The top 10 percent no longer takes in one-third of our income — it now takes half. Whereas in the past, the average CEO made about 20 to 30 times the income of the average worker, today’s CEO now makes 273 times more. And meanwhile, a family in the top 1 percent has a net worth 288 times higher than the typical family, which is a record for this country.
So the basic bargain at the heart of our economy has frayed. In fact, this trend towards growing inequality is not unique to America’s market economy. Across the developed world, inequality has increased. Some of you may have seen just last week, the Pope himself spoke about this at eloquent length. “How can it be,” he wrote, “that it is not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points?”
In the remarks that the White House PR staff touted heavily in advance, Obama hit many of the surging economic disparity issues head on:
The problem is that alongside increased inequality, we’ve seen diminished levels of upward mobility in recent years. A child born in the top 20 percent has about a 2-in-3 chance of staying at or near the top. A child born into the bottom 20 percent has a less than 1-in-20 shot at making it to the top. He’s 10 times likelier to stay where he is. In fact, statistics show not only that our levels of income inequality rank near countries like Jamaica and Argentina, but that it is harder today for a child born here in America to improve her station in life than it is for children in most of our wealthy allies — countries like Canada or Germany or France. They have greater mobility than we do, not less.
The idea that so many children are born into poverty in the wealthiest nation on Earth is heartbreaking enough. But the idea that a child may never be able to escape that poverty because she lacks a decent education or health care, or a community that views her future as their own, that should offend all of us and it should compel us to action. We are a better country than this.
So let me repeat: The combined trends of increased inequality and decreasing mobility pose a fundamental threat to the American Dream, our way of life, and what we stand for around the globe. And it is not simply a moral claim that I’m making here. There are practical consequences to rising inequality and reduced mobility.
He stood up for the social safety network, for an increased minimum wage, for collective bargaining and an active role of government in ensuring the economic security of its citizens.
These are all good and laudable goals.
But what was missing from the president’s remarks was a call for economic structural change and for attacking systemic economic disadvantages to the majority of Americans. Obama, for example, implied that you could have a renewed economically strong middle class without having any impact on the 1% or on the corporations who are sitting on their profits and not reinvesting in the economy.
In some ways, he was like a preacher of prosperity theology. By making the economic pie bigger through economic expansion, he implies, everyone will be better off.
The reality, of course, is that with trade pacts like the pending Trans-Pacific Partnership (TPP) that diminish the value of labor at home and abroad, the only economic pie that Obama is talking about is a pie in the sky for workers.
There was no mention in the solutions section of his speech of raising taxes on the rich, of ending corporate subsidies, of limiting our dependence on fossil fuels, and of reining in the financial gambling of Wall Street, among other forbidden topics in the DC plutocratic bubble zone.
One recent newspaper article speaks volumes about how the president identified the growing third world economic gap in the United States, but only nibbled at the solution. It relates to a December 3 story in the Washington Post, entitled “Low bank wages costing the public millions, report says”:
Almost a third of the country’s half-million bank tellers rely on some form of public assistance to get by, according to a report due out Wednesday.
Researchers say taxpayers are doling out nearly $900 million a year to supplement the wages of bank tellers, which amounts to a public subsidy for multibillion-dollar banks. The workers collect $105 million in food stamps, $250 million through the earned income tax credit and $534 million by way of Medicaid and the Children’s Health Insurance Program, according to the University of California at Berkeley’s Labor Center.
These corporate subsidies abound, as Truthout and BuzzFlash have documented, including the taxpayer picking up the tab — in many cases — for benefits and basic subsistence for workers at companies like Walmart and fast food chains. That the banks that almost caused an economic meltdown in the US rely on government funding to subsidize teller salaries represents, ironically, a greed beyond comprehension.
But what it also symbolizes is that economic systemic change is the only way to achieve Obama’s goals. For far too long the 90% or 99% have been propping up the corporations and the wealthy elite through “hidden” subsidies, tax loopholes, unaccountable offshore accounts, corporate-written trade agreements, and government funded research that then is basically given away to the private sector (think television bandwith, the Internet, our road system, space technology, etc.), not to mention the value of our public education system in providing intellectual knowledge to the corporate world. And the list goes on.
The bottom line is that as long as President Obama accepts the myth of “heroic” unfettered capitalism, he won’t solve the problem of surging income inequality and increasingly stagnant social mobility.
The president came to the political forefront at the 2004 Democratic Convention with a soaring speech about a “purple” America. As president, he has seen only a red and blue America.
There will be no purple economic equality as long as Wall Street, corporations and the 1% are calling the shots in DC and subsidizing their wealth at our expense.
There’s no purple solution to economic injustice.
