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Money Is Power

You probably also noticed that the economy isn’t doing so well, and it isn’t producing jobs. Instead of caring about the wage collapsing effects that are draining public funds, the people who were wrong about everything in the first place and missed the crisis coming, have busied themselves with slashing the social safety net for ordinary people.

In the middle of this complete economic failure, promises to the middle class aren’t worth much and the kinds of jobs that always sustained a middle class seem to be vanishing.

This is the political climate in which we have to work to close the gender pay gap. There are uncanny similarities to when the New Deal coalition fell apart in the 1970s, as eerily highlighted by Jefferson Cowie; the early racial integration of the labor force had the bad fortune to coincide with a contraction that decreased opportunities for (almost) everyone.

And at this point, I tend to assume that since there are whole other countries that have done things differently for years and had it work out fine, that decreasing opportunities for (almost) everyone is sort of the point. It isn’t as though the way overwhelming concentrations of power follow overwhelming concentrations of money is some kind of secret to people with power.

It isn’t only that, as Dean Baker states so clearly, “Our income is a cost to the rich,” it’s that our income is a cost to the power of the rich. Because it would be better for the economy as a whole if there was less inequality, better for the all-important deficit, even.

It’s just that our economic arguments aren’t about economics. Or the suddenly remembered deficit. They’re about the ruthless preservation of power in the hands that already hold it. Everything else is a distraction.

What if Congress listened to mothers, maybe even single mothers, the way they listened to CEOs?

What if Congress cared about the futures of the working class?

What if Congress really believed that it was wrong for anyone to go hungry or be without medical care?

What if Congress thought that people who were women, or queer, or brown, or foreign, or young, or poor, were real and important people?

There are economic consequences to each of those scenarios that are a cost to the power of the rich, just as the economic consequences of the status quo are a boost to the power of the rich. That we even have political conversations where the supposed merits of concentrating private profits can outweigh the lives and health of human beings really says a lot, particularly because inequality is actually expensive.

Now that the din of Glenn Beck’s revolting appropriation of the civil rights movement has faded a bit, it’s worthwhile pointing out that Martin Luther King thought a lot about the intersection of money and power. Being him, he didn’t only think it was something worth talking about, but actually worth doing something about.

… We’ve come a long way in our understanding of human motivation and of the blind operation of our economic system. Now we realize that dislocations in the market operations of our economy and the prevalence of discrimination thrust people into idleness and bind them in constant or frequent unemployment against their will. Today the poor are less often dismissed, I hope, from our consciences by being branded as inferior or incompetent. We also know that no matter how dynamically the economy develops and expands, it does not eliminate all poverty.

The problem indicates that our emphasis must be twofold. We must create full employment or we must create incomes.

… Now our country can do this. John Kenneth Galbraith said that a guaranteed annual income could be done for about twenty billion dollars a year. And I say to you today, that if our nation can spend thirty-five billion dollars a year to fight an unjust, evil war in Vietnam, and twenty billion dollars to put a man on the moon, it can spend billions of dollars to put God’s children on their own two feet right here on earth. …”

Though as they say, the past isn’t dead, or even past. The waste of humanity’s resources on wars and obscene wealth, to the point of giving some people $79,000/month salaries, continues. The struggle to see that everyone gets a chance at a good life, whoever they are, continues. The struggle to expand our definition of ‘us’, until so many of us stand together for every kind of justice that we can’t be denied, continues.

And on that note, I’d like to sign off on what’s been a very enjoyable guest blogging gig. Thanks for having me, thanks for chatting in comments, and thanks for all the work you do to bring us closer to a time when equality means something more real than the absence of flagrant public insult. Until that day, I couldn’t ask for better company in dissatisfaction.


22 thoughts on Money Is Power

  1. Thank you, natasha. I’ve been spending way too much time on blogsites of….people who consider themselves progressives, but who support the slashing of the few remaining safety nets as…tough, economic decisions that “have” to be made. Why yes, these folks are a great deal wealthier than I am, and have no idea what it’s like to make do on a single mother’s income.

    That’s part of the problem, too. I’m tired of hearing from “progressives” and the right alike that paying people a decent wage and decent benefits is unaffordable. Retirement is unaffordable (or so say the folks with cushy, plush desk jobs whose labor doesn’t break down or contaminate their bodies). Health care is unaffordable. I wish more “progressives” had a positive attitude towards labor and the working class, but I’m not holding my breath. As is repeated just about every month at my union hall: “the working man and woman doesn’t have a representative party in this country (US).”

  2. La Lubu, do unions ever organize amongst themselves? Like, does your union ever team up with the I.B.E.W. (assuming you’re not an electrician) for political purposes? It seems like it would be a great opportunity, but I don’t know much about inter-union politics.

  3. Unions will team up, especially if they are working within the same general field, company, or area. Dad was UAW and would often have dealings and show support for sister unions in other manufacturing and technical fields.

    And kudos Natasha. I spent to much time last week arguing that regardless of whatever your supposedly Darwinian instincts are telling you giving x person more doesn’t translate to you having less in our world. This was just the pick up I needed to keep fighting the good fight.

  4. This is a great post – not because the ideas are so complicated, but because it so emphatically and unabashedly cuts through all of the arguments people use to make the issues seem complicated. Thanks for your clarity and for putting this out there. I’ll be passing it along.

  5. It’s probably an intellectually shallow statement to make, as it doesn’t encompass the entirety and complexities of social class statuses, but I think the country would be much better off if all people in the US were represented by a member of their group in congress, most importantly by having a little more than half of people in the house and senate be women and female persons.

    I think that sort of arrangement would be able to empathize and sympathize with the people of the US and around the world better than what we currently have.

  6. r.t., your argument is hinged on the assumption that all women are progressive or that all men are conservative. The problem isn’t the representation of biological plumbing in the House or Senate, but rather the subtle and latent gender roles guiding North American society to the detriment of democracy (among other things).

  7. It’s just that our economic arguments aren’t about economics. Or the suddenly remembered deficit. They’re about the ruthless preservation of power in the hands that already hold it. Everything else is a distraction.

    YES, YES, YES, YES, YES. And also YEESSSSS….

  8. I think that we need to determine, as a society, what services that all people should be entitled to and then fund them.

    The number one priorities should be education and healthcare. A healthy, educated society is better than the alternative and far more productive. I don’t think that healthcare and education should be withheld for the wealthy. I think that if we cut out alot of other spending, we could easily fund the two of these. It would be much easier to encourage co-ops, business ownership, etc if healthcare was not connected to your specific place of employment. It’s hard for me to encourage co-ops and such for women in the U.S when I know that these women won’t have any healthcare. Well, there’s COBRA, but who can afford that?

    On the flip side, people are concerned about higher taxes for a reason. The wealthy people who can afford a tax increase don’t need to worry about it. They have high priced accountants, off shore accounts, and the capital gains tax. When we increase the safety net, we usually increase the taxes on the middle class, and they can’t afford it. Income is taxed at a much higher rate than wealth.

    Our economy relies on spending, and alot of people can’t afford to do that. Jobs get cut and the government has less tax revenue to fund social safety nets. But it’s hard to create jobs when people don’t have the disposable income to support businesses.

  9. This isn’t a problem limited to the U.S. The new coalition government in the UK is leading an orchestrated campaign to promote the belief that the majority of people claiming disability-related benefits are “scroungers” who are simply too lazy to work and have dragged the company into financial misery, and that immigrants have caused the unemployment crisis. Disability and immigration charities have been swamped by calls from people who are being harassed or in danger of losing their homes, disability and race-related hate crimes are increasing, and there have been suicides related to fear and an overwhelming sense of worthlessness.

    This is all in spite of the fact that the fraud rate for disability benefits is roughly 0.3% (and there are actually £90m of unclaimed benefits), that the rate of pension credit fraud (for the elderly) is higher disability benefit-related fraud,
    and that tax fraud of all kinds completely eclipses all welfare benefit-related fraud. But, by scapegoating the most vulnerable people in society (the disabled and immigrants) and falsely promoting the beliefs that a) the disabled and immigrants are evil thieves, b) that elderly people are the poorest group in the country and c) that the rich, overwhelmingly white men who buy peerages while not paying taxes are non-existent, they’re ensuring that the angry masses suffering because of the recession have their attention diverted away from what caused the recession. They’re steered away from the issues of massive military spending, and from the fact that civil service errors cost the country far more than welfare benefits do. It also ensures that the government continue to have support from people who have no restricted access to voting, who believe that the govt. are apparently punishing ‘lazy thieves’ on behalf of the masses.

    The rich white men are keeping (and gaining) the power and money, while the underclass grows larger and poorer and is almost entirely without representation.

  10. La Lubu, do unions ever organize amongst themselves? Like, does your union ever team up with the I.B.E.W. (assuming you’re not an electrician) for political purposes?

    I’m a journeyman wireman in the IBEW. Yes, my Local cooperates with other unions, on a local, regional, statewide, and national level. All unions affiliated with the AFL-CIO have regional councils, and my Local is one of the heavy-hitters in our council (I am one of several members representing my Local in that body. Well, sometimes. Childcare is an issue. Don’t get me started….)

    But here’s the thing: we don’t always have candidates to back. Mostly, it’s damage control. Maann, I could go on the rant to end all rants on that topic, but….I don’t need to. Anyone who reads this blog knows the drill.

  11. Pingback: Money | Fukshot
  12. Valerie-
    I agree, I failed to explain that I see most of our legislature comprised as one group (older wealthier white heterosexual christian males) and that if all groups were represented, including women and female persons from various groups, the country would be better off.

  13. Picking up on the statement that “inequality is actually expensive,” I saw a couple of articles in the Guardian recently which made this point. According to Aditya Chakrabortty, “a big gap between the haves and the have-mores doesn’t necessarily denote capitalist success at all; indeed, it can just as well indicate imminent economic failure. That’s the argument convincingly made by Raghuram Rajan in his new account of this crisis, Fault Lines.” Similar arguments were made by Ha-Joon Chang: “After three decades of deregulation and tax cuts for the rich, growth has slowed down, rather than accelerated, in almost all countries. The world economy, which was growing at about 3% in per capita terms in the “bad old days” of widespread regulation and punitive taxation for the rich in the 1960s and 70s, has grown at about half that rate in the last three decades. In Britain, average annual per capita income growth rate was 2.4% in the 60s and the 70s, when the country was allegedly suffering from the “British disease”; but it fell to 1.7% during 1990 to 2009, after it is supposed to have been cured of the disease thanks to Margaret Thatcher’s heroic struggle in the 1980s.”

  14. Capitalism as practiced in the west requires a surplus of labour. If there is a shortage wages rise. That cost the employer passes on in price rises and inflation soars to unstable levels. They can do that because for most products and services there is a small number of suppliers whereas there are a large number of workers. Trade Unions changed the balance by allowing workers to co-operate in negotiating pay and conditions just as professional bodies did for lawyers, accountants and doctors. It is hardly surprising to see that as unionised industry declined and was replaced by un-unionised commercial business that in real terms wages fell and profits rose.

    What has changed is that in the last few recessions the job losses have been among the lower rungs of the middle class as well as the lower class. This was inevitable given the shift to middle class occupations over the last forty years. What were safe middle class jobs paying a decent salary have been de-skilled, pay little more than the minimum wage and can be cut back when times are hard. And these people have no Trade Union to help them because they never thought they’d need one.

    The other trick that governments have done to the ordinary person is to minimise the different tax rates on income. When I started work the lowest paid didn’t pay any income tax and the it was only above the average wage that the tax rate rose above the basic rate Now income tax starts at half the minimum wage and the same rate applies until you get well over the average wage. Of course the higher your income the better the opportunities are for avoiding tax.

    As a result even poor people see a rise in income taxes as threatening them even though the effect is likely to be much less than indirect taxes.

  15. There are uncanny similarities to when the New Deal coalition fell apart in the 1970s, as eerily highlighted by Jefferson Cowie; the early racial integration of the labor force had the bad fortune to coincide with a contraction that decreased opportunities for (almost) everyone.

    This attempt to blame racism for the breakup of the new-deal coalition is perverse. Its perverse because the coalition was built on Jim Crow. FDR, like all dems before him and after him up to and including JFK (with the exception of Truman) ran with a segregationist in the ticket. He maintained his power by agreeing to overlook segregation and lynching even though he didn’t need a single southern dem or repub vote to pass the new deal. JFK and LBJ followed suit in ’57 by gutting ike’s civil rights bill (aimed at securing voting rights with federal intervention). This active collusion with the Jim Crow regime meant progreesive presidential candiates started out with an unfair advantage over the right-wing party.

    What blew aprt the coalition was the demise of jim crow, which finally opened the south to the right-wing anti-labor party, freeing it from the likes of robert byrd, a quintessential Dixiecrat (new dealer/economic interventionist plus social conservative).

    Yet, apparently in denial about the reality of jim crow, progressives like Joan Walsh constantly tell us that its the rise, not fall, of racism that ended their reign of power. The linked piece sums up the propaganda: “With their cultural and material standing on the wane, blue-collar workers drifted to the Republican Party, which came to represent a kind of identity politics for white working-class men.”

    This is wrong, wrong, wrong and borderline racist at this point. Even Paul Krugman has conceded the point. The data (from Larry Bartels and others) demonstrates “White voters in the bottom third of the income distribution have actually become more reliably Democratic in presidential elections over the past half-century.”

    In terms of party-identification of low income whites, there is only one area of the country where they’ve become less Democratic (and even then they’re doing it a slower rate than more affluent whites) and that’s the…you guessed it…south….you know the area which was once virtually 100% democratic due to their racially coercive monopoly.

  16. It’s just that our economic arguments aren’t about economics. Or the suddenly remembered deficit. They’re about the ruthless preservation of power in the hands that already hold it. Everything else is a distraction.

    This isn’t completely true. The money for social services has to come from somewhere and no one can figure out how to tax the very wealthy. We tax the not-so wealthy and provide no services for them in return. Here you can only get assistance if you’re unmarried with kids, have a major disability, or make less than about $5,000/yr. Even then it’s difficult.

  17. no one can figure out how to tax no one wants to tax the very wealthy. Working and middle class people are mobilized against tax increases that will impact the wealthy because “taxes are bad!” basically. Active misrepresentation.

  18. La Lubu: But here’s the thing: we don’t always have candidates to back. Mostly, it’s damage control. Maann, I could go on the rant to end all rants on that topic, but….I don’t need to. Anyone who reads this blog knows the drill.

    It’s one of the things that boggles my mind. How did we get from the pre-Regan tax rates to here? How did we get from execs making 50x more than the minimum wage employees to more than 800x? Okay, so those are rhetorical…I know how we got here…but how do we go back? How do we convince middle and working class USians that this is absolutely not the way to greater prosperity? You’d think the recent economic collapse would have more of an impact but instead we’re engaged in a class war where everyone seems to be fighting to protect the rich.

  19. You’d think the recent economic collapse would have more of an impact but instead we’re engaged in a class war where everyone seems to be fighting to protect the rich.

    Exactly. The problem is, people rely on this system for basic necessities. During an economic downturn, people are at risk for losing shelter, access to food, healthcare, etc. It makes challenging the system that much more difficult when there is so much to lose, if you lose.

  20. It’s perfectly straightforward to tax the very wealthy, it’s just that there are enough bought-and-paid-for (or completely stupid) members of Congress that *Congress* is not willing to do it. This includes the entire Republican delegation to Congress, and at last count 30-50 Democrats in the House and at least 10 (no clear upper limit) in the Senate.

    The way such bought-and-paid-for, or completely stupid, scum get re-elected is the subject of a great deal of discussion.

    “It makes challenging the system that much more difficult when there is so much to lose, if you lose.”….
    until you are doing so poorly that you have nothing left to lose. We’ll be there for the majority of the US within a decade at current rates.

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