Sunday, June 28, 2015

Why Are We Number One?

Because, according to the Guardian of London newspaper, the US had 88.8 guns per 100 people in 2007 — compared with 54.8 in the second-closest country, Yemen.

Thursday, June 18, 2015

Saturday, June 6, 2015

Citizens United Against Citizens United

When the Supreme Court is this wrong, it’s time to overrule them

By Doris Kearns Goodwin and Jeff Clements
June 2, 2015

Police form a line after arresting demonstrators on the steps of the 
U.S. Supreme Court, on the anniversary of the Citizens United decision, 
in Washington, January 20, 2012. REUTERS/Jonathan Ernst

Surveys show that a large majority of American citizens across the political spectrum oppose the U.S. Supreme Court’s Citizens United decision that opened the door to unlimited political spending by global corporations and powerful unions. Yet when asked about the prospect of passing a constitutional amendment to reverse the decision, too many people argue that it would be “too hard,” even “impossible.”

This argument lacks historical perspective. Every step on the path to fulfill the promise of the American Revolution was “too hard,” but Americans did it anyway. Hard, yes; yet constitutional amendments have come in waves during times of challenge — and Supreme Court obstinacy — much like our own.

The Bill of Rights and the post-Civil War amendments may be the most well-known examples, but this pattern has recurred. A generation after the Civil War renewed the promise of American equality and democracy, for example, the Supreme Court began elevating money to a privileged place in the Constitution. It struck down basic public-interest laws, including the minimum wage, worker safety, the federal income tax and even child labor laws.
The U.S. Supreme Court building in Washington, May 20, 2009. REUTERS/Molly Riley

The American public took matters into their own hands during the Progressive era at the turn of the 20th century. With the 16th amendment in 1913, Americans reclaimed the power to levy a progressive income tax, without which many of President Franklin D. Roosevelt’s New Deal social programs would not have been possible.

The 17th amendment that same year provided for popular election of U.S. senators. This replaced the old system of election by state legislatures, in which, according to the New York Times, a millionaire, either by outright bribery or contributions to a party’s campaign coffers, could buy a Senate seat “just as he would buy an opera box, or a yacht or any other luxury in which he could afford to indulge himself.” Finally, with the ratification of the 19th amendment in 1920, women gained the right to vote after a struggle that had lasted for more than half a century.

Four decades later, two additional constitutional amendments removed further barriers to political equality. The 24th amendment in 1964 protected the right of all Americans to vote in federal elections, regardless of the ability to pay a poll tax. President Lyndon B. Johnson hailed “the triumph of liberty over restriction, declaring “there can be no one too poor to vote.” The 26th amendment in 1971 reduced the voting age from 21 to 18, which ensured that young adults eligible to serve in the armed forces were able to vote.

Each of these fights required hard work, tough challenges and resilience. This is as it should be. Constitutional amendments are warranted only by what James Madison called “extraordinary occasions.” That is why enacting and ratifying an amendment to the U.S. Constitution is no easy matter.

The situation we face today with regard to campaign finance is one of those “extraordinary occasions.” Overwhelming political spending by a relative handful of organizations and extremely wealthy people is marginalizing the voices and participation of most Americans. In the 2012 presidential election, a few dozen super-PAC donors exceeded all the contributions of $200 or less from the nearly four million donors to the Romney and Obama campaigns combined.

The 2014 midterm elections brought even greater concentration of big spenders. Indeed, virtually all political spending now comes from far less than 1 percent of Americans, and increasingly from global corporations using “dark money” entities to obscure the source.

The result of such unbalanced concentrated power in the U.S. system of government is exactly as Madison and other founding fathers feared: failure of effective republican self-government due to powerful factions and corruption.

The Supreme Court that issued the Citizens United decision will not correct itself. Over the past five years, the sharply divided court has only expanded the ruling. In a series of decisions, it has invalidated traditional powers of the states, striking down longstanding anticorruption laws in Montana and nullifying new approaches to strengthen voter-funded elections in Arizona and Maine. In the 2014 McCutcheon decision, the court struck down a limit as high as $123,000 on total contributions to candidates for Congress. In Hobby Lobby and other recent decisions, courts are empowering corporations to seek even more exemptions from laws based on ever-broadening theories of corporate rights, including speech, religion and equal protection as “persons.”

To hope that the current court will fix things is folly. That is why the 28th amendment is necessary to overturn Citizens United, just as Americans have used the amendment process to overturn the Supreme Court six times before.

The 28th amendment would restore the power of Americans to enact reasonable election spending laws that protect the political equality of all. Specifically, the Democracy For All Amendment, which more than 165 senators and representatives have introduced, restores the authority of Congress and the states to enact election spending laws and to distinguish between human beings and corporations in doing so.

Five years after Citizens United, it is time to accept the historical gravity of our situation. It is time for Americans of all political viewpoints to come together to win the 28th amendment — and to renew U.S. democracy again.

Doris Kearns Goodwin is a presidential historian & Pulitzer prize-winning author, most recently of “The Bully Pulpit." Atty. Jeff Clements is author of “Corporations Are Not People: Reclaiming Democracy” & co-founder of Free Speech For People. 

Friday, June 5, 2015

Monday, June 1, 2015

American Feudalism

Welcome to feudalism, America: How the 1% is systematically destroying the middle class
By Sean McElwee
May 31, 2015


David Koch, Donald Trump (Credit: AP/Mark Lennihan/Reuters/Brendan McDermid/Photo montage by Salon)

The idea of a property-owning democracy has long roots in American political thought. In their book, “The Citizen’s Share,” Joseph R. Blasi, Richard B. Freeman and Douglas Kruse argue that the Founding Fathers wanted everyone (well, everyone who was white and male) to own a small slice of property. Both Madison and Washington praised the relatively equal distribution of property in the United States (compared with Europe). Thomas Jefferson wrote, “It is not too soon to provide by every possible means that as few as possible be without a little portion of land. The small landholders are the most precious part of a state.” Indeed, the concept is still popular today, even on the right. James Poulos writes, “Without an ownership society, where citizens are prudent stewards of broadly distributed private property, freedom tends to become what it was in revolutionary France — an abstract ideal that can easily arouse destructive political feelings that know no bounds.” But new data suggests America may no longer be such a society, and that has worrying implications for democracy.
The idea of a property-owning democracy is no longer the reality in the United States. Edward Wolff finds that the wealthiest 10 percent own 90.9 percent of all stocks and mutual funds, 94.3 percent of financial securities but only 26.5 percent of the debt. For the middle class, their home makes up 62.5 percent of their limited wealth. (The bottom 40 percent have negative wealth.) The Gini coefficient for net worth has increased from 0.803 in 1962 to 0.871 in 2013. (By way of comparison: A Gini coefficient of 1 means that 1 person owns all of the wealth.) As the chart below shows, financial instruments and wealth are far more unequally distributed than income.

The United States is no longer more equal than European nations, but actually deeply more unequal. The chart below shows that the United States has the most unequal distribution of the wealth of any Organisation for Economic Co-operation and Development (OECD) member country examined. Across the OECD, the bottom 60 percent own about 13.3 percent of the wealth. (The bottom 40 percent own only 3.3 percent.) In Canada, the bottom 60 percent own 12.5 percent of the wealth, and the bottom 40 percent own 2.2 percent. In France, the respective numbers are 11.6 percent and 1.8 percent. And in Britain, they are 16 percent and 4.7 percent.

In the United States, however, the bottom 60 percent own a mere 2.5 percent of the wealth and the bottom 40% own negative 0.4 percent of the wealth.

As wealth and stock ownership has become more concentrated, good jobs that lead to a middle class lifestyle are increasingly eroded. Unfortunately, not enough people seem to be noticing.

Indeed, the Wall Street Journal recently reported that “apps do your chores” — but the unfortunate reality is that workers, not “apps,” are doing those chores. The workers are called “contractors,” instead of employees, meaning that they don’t get the protections full-time employees do. And examples of exploitation are piling up.

A startup called CrowdFlower Inc. — which, according to WSJ “breaks down digital jobs, such as data entry, into tiny tasks performed by millions of workers” — was recently sued for paying some of those workers between $2 and $3 an hour. Industry leader Uber, meanwhile, has been criticized for exaggerating the wages of its contractors.  This practice is becoming widespread. A recent study finds that 53 million Americans are doing some sort of freelancing work. Of those, 40 percent are full-time independent contractors, meaning they have no other source of income.

The rich are driven by two main desires: First, to make sure they have more money; and, second, that someone else does the work. There is literally no job the rich are not lazy enough to outsource. Because they cannot figure out the location of their post office, they need “Shyp.” With “Luxe,” they can get a person to park their car for them. And with “Saucey,” they can save themselves a trip to the liquor store. In a recent article for  The New Yorker, Patricia Marx describes some of the more absurd tasks that were included on TaskRabbit, including “Lego sorting,” locating “a reptile handler who is in legal possession of a rattlesnake” and finding a fake wedding ring that looks just like a real one.

It is not of insignificant concern that the rich may cease to be capable of performing the basic tasks necessary in the modern economy. The result is something like the dystopia described in the recent science-fiction film ”In Time,” except that the rich elongate their lives by making the poor do their mundane tasks.

Robert Kuttner writes of TaskRabbit:
To get an assignment, an aspiring Rabbit offers to do the chore for less money than he or she thinks other prospective Rabbits are bidding. That’s what makes it a metaphor for the new economy, a dystopia where regular careers are vanishing, every worker is a freelancer, every labor transaction is a one-night stand, and we collude with one another to cut our wages.
Together these trends should be worrying: The vast majority of Americans own no assets, but are instead laden with debt. The social safety net is being shredded by plutocrats and their political henchmen. Conservatives say workers should instead get benefits from their (preferably privately owned) employers. But those companies are supporting workers less and less: Defined benefit pensions are a thing of the past, and even basic retirement plans are in decline. And that’s just for those who are lucky enough to have jobs with benefits. Many workers are misclassified, or are never employees to begin with, meaning they must manage for retirement and health insurance without all the benefits the government funnels through the employee-employer relationship.

As Matt Bruenig notes, in the United States,
“employers often handle sickness (health insurance, subsidized by federal government), old-age insurance (401k and defined-benefit pensions, subsidized by federal government), survivor’s insurance (life insurance, subsidized by federal government), family benefits (paid leave and health insurance for children), unemployment (severance, though more typically rely heavily on public unemployment insurance), on top of providing socially adequate levels of cash income.”
That is, government has funneled important social benefits through corporations. This not only makes a corporate job more cushy than otherwise, it also makes freelance work more precarious.

Christopher Mims notes that, “Uber isn’t the Uber for rides — it’s the Uber for low-wage jobs.” A large portion of Americans now have two choices: Become servants to the rich for minimal wages, or starve to death. The idea that low-wage work is merely a short-term part of the rung towards a better life is also largely illusory: Upward mobility has been destroyed.

America has fallen into neo-feudalism: A wealthy capital-owning class exists behind a servile class with no assets, and only a life of drudgery ahead of them. The master-servant relationship will only further degrade social trust and civic values. Americans can’t see themselves as equals in the political sphere when large portions are consigned to wait upon the whims of new aristocracy. Conservative politics relies on the middle class making a devil’s bargain, believing they have more in common with the rich than the poor. It won’t be long before that facade crumbles.

Sean McElwee is a writer and a research associate at Demos. His writing may be viewed at Follow him on Twitter at @seanmcelwee.

Summer Reading For The 99 Percent


Review: Four new books, including Joseph Stiglitz's The Great Divide, look at economic inequality

Joseph E. Stiglitz, WW Norton, 384 pages, $34.95
A Better Place on Earth: Among the Haves and Have Nots in Super Unequal British Columbia
Andrew MacLeod, Harbour, 256 pages, $22.95
The Globalization of Inequality
Fran├žois Bourguignon, Princeton University Press, 224 pages, $34.95
Inequality: What Is to Be Done?
Anthony B. Atkinson, Harvard University Press, 400 pages, $37.78

Once upon a time, not altogether too long ago, we talked about something called “class.” There was a lower and working class. There was an upper class. It was understood that these were different groups, with different amounts of power and different, often conflicting interests. Eventually, in the industrializing West, the chasm between these classes grew so great that something had to be done. In 19th-century Europe, workers formed unions and the modern welfare state was born. In the U.S., in the wake of the Great Depression, the New Deal massively expanded public-sector employment. After the Second World War, for the first time in history, the gap between the rich and poor shrank. These were essentially conservative developments. The minimum wage, the eight-hour workday, progressive taxation – all this arose, in part, to ward off the threat of revolution as the Soviet Union loomed and anarchists set off bombs. For the upper class, it was adapt or die, possibly literally.

We don’t talk much about class anymore. Beginning under Richard Nixon, Republicans in the U.S. launched the culture wars, decoupling class from income. Working-class values, oddly, became right-wing values. “Elite” came to denote aesthetics rather than wealth.

In the Reagan-Thatcher years, the assault on the welfare state, the war on organized labour and the dawn of neoliberal globalization began to undo the fleeting progress of the postwar era. This model was exported to most of the West. Now, the only class we mention is the middle class, because, as polls indicate, nearly everyone, no matter how rich or poor, considers herself a part of it. Instead, we use another term: “income inequality.”

There have been a lot of books about inequality lately. This can be traced to three interconnected phenomena: first, the Great Recession; second, the Occupy movement, after which mentions of “income inequality” spiked in the news media; and third, last year’s English-language publication of Thomas Piketty’s Capital in the Twenty-First Century, a dense tome that became an unlikely bestseller. Everyone now understands that the gap between rich and poor is widening, that low and median incomes have stagnated or declined, and that the vast majority of wealth is concentrated at the very top.

In the United States, as Piketty famously documented, economic disparity has returned to levels not seen in a century; in places such as China and India, it has skyrocketed even as standards of living have improved, with the fruits of growth going to a select few. But there is a curious tenor to this discussion. In a recent New Yorker essay, the historian Jill Lepore identified it: “In the first Gilded Age, everyone from reporters to politicians apparently felt comfortable painting plutocrats as villains; in the second, this is, somehow, forbidden.” Our tale has no bad guys.

Is this starting to change? The language of Occupy – the 99 per cent versus the 1 per cent – avoided the supposedly Marxist overtones of “class” even as it divided the rich from the rest of us. Former chief economist of the World Bank and Nobel Prize-winner Joseph Stiglitz unwittingly gave birth to this slogan in a 2011 Vanity Fair essay called “Of the 1%, by the 1%, for the 1%,” which is included in his new collection, The Great Divide: Unequal Societies and What We Can Do About Them.

Early in the book, he describes a party hosted by “a bright and concerned member of the 1 per cent.” The host had brought together an assortment of plutocrats worried about inequality – but not too worried. “I overheard one billionaire – who had gotten his start in life by inheriting a fortune – discuss with another the problem of lazy Americans who were trying to free ride on the rest,” Stiglitz writes. “Soon thereafter, they seamlessly transitioned into a discussion of tax shelters, apparently unaware of the irony.”

For Stiglitz, this encapsulates the problem. Here, the chief villains are the plutocrats whose astronomical wealth have isolated them from the realities of daily life, as well as a political class that has not just allowed this concentration of wealth, but actively encouraged it. But none of this would have been possible without a broader ideological shift, which, in the US at least, resulted in truly poisonous measures: tax cuts for the rich so extreme that they actually became regressive; a deregulated banking sector that turned profits from predatory lending practices into galling CEO performance pay; and, of course, a financial crisis from which the country has yet to fully recover.

“As has been repeatedly observed,” Stiglitz points out, “all of the economic gains since the Great Recession have gone to the top 1 per cent.”

The U.S. is the most economically disparate developed country in the world, and discussions about inequality naturally tend to focus on it. So what about Canada? In the lively and well-reported A Better Place on Earth: Among the Haves and Have Nots in Super Unequal British Columbia, Andrew MacLeod takes us to the province that is, by most measures, the most unequal in the country.
“Since 1982, after-tax income for the top 1 per cent of British Columbians has grown by 60 per cent,” he writes. “For pretty much everyone else, the bottom 90 per cent, that number has remained essentially flat.” This is the dark side of Western Canada’s runaway growth, and the strength of MacLeod’s book comes from its attention to life at the bottom of the pyramid: the almost unfathomable difficulty of surviving on social assistance; the disproportionate impact of government cuts on women, people with disabilities and aboriginal peoples.

In The Globalization of Inequality, Fran├žois Bourguignon, another former chief economist of the World Bank, turns his focus even wider, to the paradox of an interconnected world: even as rising incomes chip away at inequality between countries, inequality within countries continues to rise. For Bourguignon, globalization’s ambivalent legacy is the key to understanding the challenge we face: “It is the background for almost all that has happened. It has changed the international climate for all national economies and profoundly modified their structures.”

For an orthodox economist, this is a dramatic admission: Free trade, technological innovation and market deregulation have not been the panaceas we were promised. “In a majority of countries,” he writes, “the conjunction of these effects has resulted in a significant rise in wage and income inequality.”

The best of the new crop of books, however, is Anthony B. Atkinson’s Inequality: What Is to Be Done? Not unrelatedly, it is also the most solutions-oriented. Atkinson, a distinguished British academic and pioneer of inequality studies, is 70 years old, and at times he sounds fed up. “A number of the proposals involve the classic measures of progressive taxation and social protection,” he writes of his ideas, “and I can already hear critics dismissing them as either boringly familiar or wildly utopian.”

It’s true that Atkinson’s prescriptions are at once timeworn and, in today’s ideological climate, almost radical. They amount to social democracy: a generous welfare state, support for the most vulnerable and limits on the concentration of wealth and political power.

Atkinson rattles off 15 worthwhile proposals, but a few stand out. One is that the state become an employer of last resort, guaranteeing minimum-wage work to anyone who needs it. Another is a universal inheritance: the state doling out a set amount of cash to all upon reaching adulthood. Atkinson’s most compelling idea, however, is something called basic income. The concept of universal basic income – the government providing a monthly payment to every citizen, regardless of employment status – has recently caught fire in policy circles. Atkinson tweaks the idea, calling it a “participation income” and insisting that it require some kind of productive activity, such as employment, volunteer work or education. Other thinkers, however, believe it should be implemented with no strings attached – a paycheque just for existing in the world.

The obvious knock against basic income is that it would act as a disincentive to work. But, during a basic-income experiment that took place in a small Manitoba town called Dauphin in the 1970s, labour-market participation decreased only slightly, while key social indicators, such as high school enrolment and hospitalization rates, improved substantially. That seems a worthwhile trade-off.
Basic income is a noble goal and would eliminate extreme poverty as we know it. But class is a two-way street. Reducing income disparity must not only involve eliminating poverty; it will also require showing the rich what it’s like down here, in the real world. To that end, there is an inverse to basic income that, though discussed less often, is no less worthy: not only guaranteeing the poor a paycheque, but also limiting how much top earners can make. “We’ve had minimum-wage laws in much of the developed world for ages,” MacLeod writes, “so why not set a maximum?”

In Laws, Plato declared that no man should be more than four times wealthier than the poorest member of society. (One can only imagine what he would think of Canada’s current average CEO-to-worker pay ratio, which stands at 206:1.) “In a state which is desirous of being saved from the greatest of all plagues – not faction, but rather distraction; – here should exist among the citizens neither extreme poverty nor, again, excess of wealth, for both are productive of both these evils,” he said. However one feels about Plato’s suggested order of magnitude, it is worth asking how much is too much – what each of us really needs in order to live a good life.

Extreme wealth is just as pernicious as extreme poverty; it distorts the political process, undermines social stability and dampens aggregate demand, since the rich spend a smaller fraction of their income than the poor. It doesn’t make the wealthy any happier, and it doesn’t make society any more productive or just. As Stiglitz points out, today’s superrich largely earn their money through what economists call rent-seeking; it is no coincidence that the two richest men in the world, Bill Gates and Carlos Slim, got that way by creating de facto monopolies, or that the developed countries with the highest levels of inequality, such as the U.S. and the U.K., are also those whose economies have become dependent on the kind of speculative financial activity that led to the 2008 crisis. The existence of obscene wealth in an unequal world is an affront to any reasonable sense of fairness, and implementing a 100-per-cent tax rate on earnings above a given threshold – one to be determined by democratic consensus – is the simplest and best way to rectify this. If no one deserves to be poor, then perhaps no one deserves to be rich, either.