Why Do People Put Up With Our Economic System?

Income inequality in the United States is well documented.  Looking at the top 1% of the population … whether it’s high-flying corporate CEOs or tech billionaires or financial gurus or even the top worker bees … the disparity between their incomes and the average worker in their firms is staggering.  That people live in poverty, not having enough food on the table or living in substandard housing, while the super rich bank their millions and billions is unconscionable.  

You cannot but help ask yourself that if the system is so unequal, if it is so broken, why do people put up with the system.  Why is there no major protest, either on the streets or at the ballot box?  For clarification, the Tea Party or Trump middle-class supporters, are not protesting the economic system, they are protesting the role of government.  And the progressives who are protesting the system have not attained the critical mass to bring about change; they are still a splinter group.

The answer is that while the income inequality is huge, a large proportion of the population is doing ok; the system works for them at least to some extent.  In 2018, the top 15% of households made $150,000 or more; the top 42% made $75,000 or more.  That means that 40% of the population have a decent standard of living unless they’re living in New York City or San Francisco.

The people who are really impacted by income inequality are those for whom the system just doesn’t work - the 50% of households who make less than $50,000.  And it doesn’t work for them not just because they don’t have enough money to afford what most consider essentials, let alone live as they would like. 

But the added indignity is that the system constantly clobbers them psychologically.  Indeed, it clobbers almost everyone who isn’t in that top 1%.  Why?  Because most people in our society are all about ego.  They identify themselves in comparison to what society and the media tells them the good life is, what people who have “it” do, how people who are successful live.

And most people, certainly not those with household incomes under $50,000, but not even those with incomes of $150,000, are not able to live the life that is posited before them as their goal by our media.  They cannot have the housing, the education, the food, the travel, the clothing … none of the accoutrements of those that are held up as models of success. 

Our society cultivates us to always want more.  That’s what keeps the wheels of consumerism spinning and the economy growing.

That results in most people feeling frustrated, disappointed with their lives.  Whether you’re homeless, working poor, middle class, or lower upper class, people want more and are dissatisfied with their current state.  Indeed, the more they have the more they want.

Why isn’t that a cause for revolt?   Ironically, regardless how frustrated people are, even those who have been beaten down by the system, most still believe in the system; they see themselves as somehow being at fault, or perhaps the government, but not the system, and indeed they want to use the system to get ahead.  That is why rather than disdaining people with money, those are their idols.  That’s who they want to be.

And so instead of people either having a choice to fight to change the system or accept their lot in life and be happy, people in our society mostly have no choice.  They are trapped by the golden handcuffs they wish they had, and so they suffer.  How sad.

Economic Justice for All - Why and How

We live at a time where there is no greater challenge for America (yes, even greater than the terrorist threat) than forging a nation of greater economic justice and income equality.  The existence of a large portion of the population struggling to keep their financial heads above water - who 40 years ago were solidly middle class and prospering - and another large segment who are poor and without opportunity -  as they have always been - creates a drag on our economy, a drag on the social fabric that holds us together as a nation, and a drag on the democratic strength of America.

The Declaration of Independence famously says that all men are created equal and that they are all endowed with the inalienable rights to life, liberty, and the pursuit of happiness.  Less well known is the fact that it further states that it is government’s purpose to secure those rights.

Thus whether from a sense of America’s founding values, a general sense of social justice, or a practical desire to strengthen America economically, we must find ways to reverse the trend of the past 40 years, recreate a robust middle class, and for the first time provide real opportunity for the poor to rise up from poverty.

Some will say that these are lofty goals and beyond our current means, that we are a country in financial stress with a huge debt.  To answer that I would say that we are a very rich country and there is in fact no shortage of available funds to meet these goals without further increasing the debt.  It is a question of priorities.  It is a question of how much revenue is raised and how that revenue is spent.  It will no doubt mean having to increase our revenue as well as shift current government spending patterns.  So be it.

Given the importance of the proposed actions to the health of our nation, such changes are not just warranted they are necessary.  If we want America to be strong as a nation and for its people to be strong in body and soul, then we must act.

What are the practical ways in which such a policy commitment to the American people would be carried out?  The people deserve to know.

1.  Through renegotiating international trade deals and changing the tax code, we will both shift many lost jobs back to the United States as well as encourage the creation of new manufacturing middle-class jobs here.  Our current free trade agreements and tax code have worked to increase the wealth of corporations while destroying much of our middle class by shipping their jobs overseas and either leaving them unemployed or underemployed in low-paying service industry jobs.

2.  We will embark on a massive infrastructure replacement program which is desperately needed to ensure a strong America.  Virtually anywhere you look, our infrastructure is both outdated and in dangerously bad repair.  By replacing this failing infrastructure with technologically advanced systems we will strengthen America, we will create new business for a multitude of American companies, and we will create jobs for millions of American workers.

3.  Through increased investment in education in areas of our cities and country which have historically suffered from a lower rate of investment and quality than those areas of greater affluence,  we will create the first generation of American children who truly will be able to experience equal education opportunity.  No child deserves to be left behind.

4.  No American, regardless of color, should be discriminated against.  It is anti-American, based on both the Declaration of Independence and our Constitution.  The laws already on the books against discrimination and ensuring equal opportunity must be more vigorously enforced.  Employers and institutions should be required to have plans in place that strongly discourage discrimination.  (This is already required by some states; it should be Federal law and thus uniform.)

In limited areas however, such as education, where Blacks and other poor people have not had access to equal education opportunity, we need to continue affirmative action to help bring the country into balance.  But once the education initiatives outlined above have been put in place and a generation of children have benefited from them, there would be no further justification for affirmative action.  Each person should be judged on their merit.

5.  To pay for these programs, in addition to shifting current budget patterns, additional revenue will need to be raised, as noted above.  A large portion of that increased revenue should come from higher income and other taxes (such as luxury) on the very rich.  

Let me be clear … it is no sin to be rich and the ability to become rich is a strong motivator in our society to perform well and succeed, which in turn benefits society in many ways.  However, there comes a point where a person has acquired so much wealth where not only does one have more money than one knows what to do with but where, from a social contract standpoint, it becomes obscene.  Such income should be taxed at a high rate.  Citizens who have profited to such an extent from the opportunities afforded by our economic/political system have a social obligation, as citizens, to pay back to the system to ensure that it stays strong and that more people come to have such opportunities.

Besides being what I think the country needs at this point in time, if Hillary Clinton and the Democratic Party adopted such a slogan and program as a key element of the 2016 campaign (yes, many of my points are already included in the 2016 Platform, but a platform is cumbersome), it would go a long way … assuming it was presented enthusiastically, vigorously … to blunting Trump’s claim to be the savior of the forgotten.  It would maximize her chances of not just winning, but winning big and Democrats’ regaining the Senate and perhaps even the House.