Thursday, 21 May 2015

Second Gilded Age

Change come slowly like the ocean
But it keeps on coming nonetheless
Take my hand, oh dear companion,
We may not find happiness,
But peace and then some real contentment
And a measure of social justice;
Change come slowly like the ocean
But they can’t stop the tide
And they’re never ever going to stop us.

            I wrote that song in 1994 just as the US was heading into Clinton overdrive - an unprecedented era of optimism and job growth. Alas, we’ve had two recessions since in our boom and bust economy. Change, how are you!

            I need hardly mention that the last Great Recession destroyed the financial security of millions, culled the middle class, and seemingly cemented income inequality.

            One would imagine there would be a broad-based movement to redress these wrongs and restore a cherished American ideal - that “all men are created equal.”

            It’s not that the subject is under wraps – far from it, politicians of all ideological shades condemn income inequality. Republicans trot out their usual tired panacea of cutting taxes, regulations and the deficit; much of this has been tried in Europe with alarming consequences.

            Indeed, had President Obama not pushed through an anemic stimulus back in 2008 we’d still be mired in our own low-growth recession. It’s hard to understand why the US has not been borrowing money at the current low rates and investing it in the country’s crumbling infrastructure. Rates will rise, bridges and buildings collapse, and it will all cost a whole lot more to repair them in the future.

            And what of the Democrats? Many talk a good game but the closer it gets to election time, the faster they bolt towards a fiscally conservative center.

            The battle against income inequality will not be easy when it’s finally joined but the sooner we get a start on it – the better.

            Raising the current federal minimum wage of $7.25 an hour ($8.75 in NY) is a no-brainer.  No recipient will hit the jackpot even if the rate is increased to $15 as demanded by some. Should you think this increase too drastic then consider that the aggregate of Wall Street bonuses last year was nearly double the total earnings of all Americans working full time for federal minimum wage. Talk about a gilded age!

            Even an annual increase of a dollar an hour to the minimum wage would help drag many workers above subsistence level, eventually reduce the cost of programs like food stamps, increase the tax base, and inject some much-needed spending into the economy.

Costs would rise, but most economists now agree that a reasonable increase in inflation would actually be advantageous for the economy. More than anything, though, it would restore the notion of the American Dream, an aspiration badly missing in so many sectors of current society.

The recent Great Recession has allowed corporations to ride herd over the vast majority of their workers. Think about it! How long since you received a raise? Or rather, how long since you even thought of requesting one?

            Adjusting for inflation, a majority of workers were better off in the 1960’s. The constant drive to cut workers and wages has decimated the middle class.

            This is no anti-Capitalist rant! Despite an almost constant upsurge in corporate profits over the last six years, stockholders – on the whole – are not reaping commensurate higher dividends. Multi-nationals prefer to park their profits overseas rather than repatriating them and paying the requisite taxes - and dividends.

            Is this all a new phenomenon? Hardly, the robber barons of the First Gilded Age cut a mean deal for the masses. However, Americans in the Progressive Era did elect politicians such as Teddy Roosevelt to challenge these titans and enact legislation that led to regulation and change. 

            Teddy Roosevelt was no radical. He was an aristocrat who saw that the system would buckle if it didn’t promise every American a “square deal.” We’re approaching the same watershed moment.

Politicians will talk about income inequality until the cows come home. Our job is to demand a detailed plan from each of them on how they intend dealing with this cancer of income inequality that’s eating our society in this Second Gilded Age.

No comments:

Post a Comment

We welcome short comments on Belfast Media Group blog postings but you should be aware that, since we've put our names to our articles, we encourage you to do so also. Preference in publication will be given to those who provide an authenticated full name — as is already the case in our newspapers. Comments should be short and relate to the subject matter and, of course, shouldn't be libelous. And remember, if you find that there isn't enough space on our blogs for your views, you can always start your own. There are over two million blogs out there, another one can only benefit the blogosphere.