Wednesday, October 5, 2011

Why I Would Occupy Wall Street

Why I'd occupy Wall Street

You can be right but you still have to be humble to win.

Jacob S Hacker and Paul Pierson have written what I would call the definitive work on not just the financial collapse but on the political reality that has shaped our economy for the last 30 or so years. The crux of their argument is that no economy can ever be purely capitalist and government has a hand in all transactions. This means that the government does create conditions for who wins and how. Winner Take All Politics puts to rest the argument that leaving the markets be is even a possibility.

Since 1979, average gains in median household income (the amount of money that the highest population of American households make in a year) gained marginally (about 1.5% per year). So in 2006 (the last year where data is available) the average household was making nearly double what it did in 1979 in real terms. But look at the amount of hours added to make that money and it is no surprise. Since 1979 more women have entered the workforce, effectively accounting for the majority of that gain. Compound that with skyrocketing healthcare costs (not to mention a myriad of other costs) and the average American household has not gained much.

By contrast the top 1 percent of households (that is 1 in every 100) gained an astounding 256% percent in their incomes. Stratify that even more; the top .1 percent (1 in 1000) made an average after tax income change (in adjusted dollars) of $20.3 million.

This isn't class warfare. Before 1979 average income growth was almost equal amongst all income earning groups; that is, there were rich and poor, but they were all growing at the same rate. Then in 1979 something changed and the top 8-ish percent of income earners pulled ahead. In the top 1 and .1 percent of earners they gained even more and even faster. Most political scientists and economists have not even stratified the top earners, but suffice it to say that someone earning $250,000 a year versus the average of $1.2 million is a big difference. Even moreso when you look at the top .1% who are earning $24.3 million per year. Scientists and the government have effectively hidden from us the excessive wealth that the top 15,000 or so families in the United States have taken in.

I believe in democracy governing capitalism. “The true friend of property, the true conservative, is he who insists property shall be the servant and not the master of the commonwealth” said Theodore Roosevelt, one of the toughest independents who also understood that westward expansion could not have been possible without the postal service or the army clearing the indians or a myriad of other government services that paved the way for American entrepreneurship. Everything about how we function rests on a well-functioning government that regulates the excesses of all classes. “Wherever there is great property there is great inequality...Civil government, so far as it is instituted for the security of property, is in reality, instituted for the defence of the rich against the poor, or of those who have some property against those who have none at all” said Adam Smith, the founder of economics.

Democracy and capitalism can go together, and for a functioning society they must. But my rights as a citizen must always take precedence over the economic value of another, for the same reason we no longer use asbestos to insulate our homes, or radon in our water, I say that we must no longer allow the slow poisoning of our civil and economic rights for the benefit of industry.

I will occupy Wall Street. At least in spirit. Because I know what I am fighting for now. I am asking for logical non-partisan political reform. I want logical non-partisan political reform. I want it now. I want the runaway 1 percent controlling 60% of my pie to give just a little to the 52 million Americans now below the poverty line. I want the financial industry to adjust its rules so that it can't externalize its risks on the American people. I don't care if the top .1 percent remain in that margin. I don't buy the pundits' argument that there will be something trickling down. My slice of the pie is smaller, and so is everyone else's, except for the richest. I want more pie, and I want my legal and political system to stop giving it to people who have already had plenty either through action or neglect.

I am wary of defenders of the status quo, after all Montesquieu argued, “to men of overgrown estates, everything which does not contribute to advance their power and honor is considered by them as an injury.” So give me logical non-partisan legal reform. Something where the numbers give us a course of action unrestricted by political mantra. I'm not seeking to overthrow some sort of established order. I am asking democratic governance to do what it is meant to do, carry out the people's will. There is no revolution. Only democracy, and I want it now. I want non-partisan political reform.