Of, By, And For The One-Percent

Addressing the causes and implications of the massive redistribution of wealth, toward the top 1%, that has occurred in this country over the last three or four decades, Nobel Laureate economist Joseph Stiglitz -- whose years at Amherst College overlapped mine -- has written a thoughtful piece (what else would you expect from an Amherst man?) -- in Vanity Fair. For anyone interested in seriously addressing the issue, it is worth reading in full. Sadly, it's somewhat lengthy and factual and requires the sort of attention of which teabaggRs appear wholly incapable. Which is too bad, because I'd say its many points ought to form the basis for real discussion from both political parties. Here's a sampling:

It’s no use pretending that what has obviously happened has not in fact happened. The upper 1 percent of Americans are now taking in nearly a quarter of the nation’s income every year. In terms of wealth rather than income, the top 1 percent control 40 percent. ... While the top 1 percent have seen their incomes rise 18 percent over the past decade, those in the middle have actually seen their incomes fall....

.... Economists long ago tried to justify the vast inequalities that seemed so troubling in the mid-19th century—inequalities that are but a pale shadow of what we are seeing in America today. The justification they came up with was called “marginal-productivity theory.” In a nutshell, this theory associated higher incomes with higher productivity and a greater contribution to society. It is a theory that has always been cherished by the rich. Evidence for its validity, however, remains thin...

... Some people look at income inequality and shrug their shoulders. So what if this person gains and that person loses? What matters, they argue, is not how the pie is divided but the size of the pie. That argument is fundamentally wrong. An economy in which most citizens are doing worse year after year—an economy like America’s—is not likely to do well over the long haul. There are several reasons for this.

First, growing inequality is the flip side of something else: shrinking opportunity....

... perhaps most important, a modern economy requires “collective action”—it needs government to invest in infrastructure, education, and technology. The United States and the world have benefited greatly from government-sponsored research that led to the Internet, to advances in public health, and so on. But America has long suffered from an under-investment in infrastructure (look at the condition of our highways and bridges, our railroads and airports), in basic research, and in education at all levels. Further cutbacks in these areas lie ahead....

.... America’s inequality distorts our society in every conceivable way... ... Inequality massively distorts our foreign policy. The top 1 percent rarely serve in the military—the reality is that the “all-volunteer” army does not pay enough to attract their sons and daughters, and patriotism goes only so far. Plus, the wealthiest class feels no pinch from higher taxes when the nation goes to war: borrowed money will pay for all that. Foreign policy, by definition, is about the balancing of national interests and national resources. With the top 1 percent in charge, and paying no price, the notion of balance and restraint goes out the window. There is no limit to the adventures we can undertake; corporations and contractors stand only to gain....

...Alexis de Tocqueville once described what he saw as a chief part of the peculiar genius of American society—something he called “self-interest properly understood.” The last two words were the key. Everyone possesses self-interest in a narrow sense: I want what’s good for me right now! Self-interest “properly understood” is different. It means appreciating that paying attention to everyone else’s self-interest—in other words, the common welfare—is in fact a precondition for one’s own ultimate well-being. ... Those canny Americans understood a basic fact: looking out for the other guy isn’t just good for the soul—it’s good for business.

Sure, sure, it sounds like some lefty screed. Worse, it's just what I've been saying: the greed of some is killing us all. But read it and tell me where's he's got his facts wrong. Think it over and consider the falsehood of calling the return to reasonable tax rates "income redistribution" as if it's a bad thing. How about "re-redistribution," back to where society has a chance of working, of surviving?