Daily Archives: April 3, 2011

Quote of the Day: “Of the 1%, by the 1%, for the 1%”


“The greatest trick the devil ever pulled was convincing the world he doesn’t exist”

Economist Joseph Stiglitz sounds the warning in this month’s Vanity Fair. The least productive in society have taken just about everything there is to take. No, not welfare mothers.

A sample:

It’s no use pretending that what has obviously happened has not in fact happened. The upper 1 percent of Americans are now taking in nearly a quarter of the nation’s income every year. In terms of wealth rather than income, the top 1 percent control 40 percent. Their lot in life has improved considerably. Twenty-five years ago, the corresponding figures were 12 percent and 33 percent. One response might be to celebrate the ingenuity and drive that brought good fortune to these people, and to contend that a rising tide lifts all boats. That response would be misguided. While the top 1 percent have seen their incomes rise 18 percent over the past decade, those in the middle have actually seen their incomes fall. For men with only high-school degrees, the decline has been precipitous—12 percent in the last quarter-century alone. All the growth in recent decades—and more—has gone to those at the top. In terms of income equality, America lags behind any country in the old, ossified Europe that President George W. Bush used to deride. Among our closest counterparts are Russia with its oligarchs and Iran. While many of the old centers of inequality in Latin America, such as Brazil, have been striving in recent years, rather successfully, to improve the plight of the poor and reduce gaps in income, America has allowed inequality to grow.

Economists long ago tried to justify the vast inequalities that seemed so troubling in the mid-19th century—inequalities that are but a pale shadow of what we are seeing in America today. The justification they came up with was called “marginal-productivity theory.” In a nutshell, this theory associated higher incomes with higher productivity and a greater contribution to society. It is a theory that has always been cherished by the rich. Evidence for its validity, however, remains thin. The corporate executives who helped bring on the recession of the past three years—whose contribution to our society, and to their own companies, has been massively negative—went on to receive large bonuses. In some cases, companies were so embarrassed about calling such rewards “performance bonuses” that they felt compelled to change the name to “retention bonuses” (even if the only thing being retained was bad performance). Those who have contributed great positive innovations to our society, from the pioneers of genetic understanding to the pioneers of the Information Age, have received a pittance compared with those responsible for the financial innovations that brought our global economy to the brink of ruin.

Not to mention the middle and working classes, upon whose labors the entire fraud depends. How else could speculators drive up the price of gasoline and food without the victims whose money is played in the casino markets they have created? The house always wins.

Our House

The mace of the Speaker of the House of Commons

Stephen Harper, one week into the campaign, has said he needs a majority government to end publicly-funded party subsidies based upon votes received in the previous election. This would open the gates to the Conservative-friendly corporate financing that has ravaged the American political system and flooded Congress with eager shills whose only agenda in government is to make it unworkable. The shrugging off of public interests to corporate ones has also promoted the anti-government demagoguery in much of what passes for political discourse in the U.S. — five minutes with Fox News or talk radio is enough to get the full effect. Such a conglomeration of interests is a monster that devours money and excretes confusion and fear: and it’s not the tip-top tier of society that ends up covered in shit or is reduced to eating it.

This is one of many reasons Harper should not have the majority that his entire time in government seems to have been designed to win. Public financing has insulated the Canadian political process from the purchase of politicians who regard their constituents as patsies to be tricked out of voting in their own interest every election cycle. Many Canadians no doubt regard the nihilist antics of the American right with horror. It’d be a mistake for them to think it can’t happen here.

Like the Republicans Harper emulates, he’s not a conservative. Edmund Burke was a conservative. Benjamin Disraeli was a conservative. John Diefenbaker, sponsor of the Canadian Bill of Rights, was an excellent example of Canadian Tory conservatism. Those who claim the title these days are actually corporatists who have, in a single generation, degraded the notion of “citizen” to “consumer.” Citizens have hard-won rights. Consumers, on the other hand, are always in danger of being stripped clean by insatiable commercial predation. Adam Smith knew it. We have no excuse not to know it too. We’ve been living with the fact of it long enough.

How much more do the most privileged among us need? They’ve already denuded the working class of the little it possessed and are now moving in on the middle class, whose labor has earned it zero percent of the wealth it has generated for the last thirty years. So exactly how much more do they want? There is evidently never enough, no matter how much there is for them to take. It’d be satisfying to say that this kind of greed can only consume itself, which it certainly does. The problem is that it only consumes itself after it has devoured everything else.

That’d be us. But the single advantage we still possess is the knowledge that, whatever Stephen Harper may think government is for, the House of Commons belongs to us. It is not Stephen Harper’s House. It is our House. We are only required to maintain it by deciding who gets to inhabit it and who does not.