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.
