Wednesday, October 26, 2011

The Myth of Horatio Alger

By Fuzzyone

One of the salutary effects of the Occupy Wall Street movement has been an increased attention to the stupefying increase in income inequality that has occurred in the United States in recent years. (Even Eric Cantor almost talked about it.) A sort of flip side of this massive income inequality is the myth of social mobility.

A couple of things I saw over the weekend made me think about this. One was a letter to the editor in the San Francisco Chronicle (scroll down to "A Sense of Entitlement") which expresses what I imagine a lot of conservatives think, that the OWS protestors are a bunch of spoiled brats who just don't want to put in the hard work to get into the 1%. The other was a piece in the New York Times Sunday Review section on rising income inequality, which posited an interesting theory that decreasing racial and gender discrimination may have made increased inequality more acceptable. The piece ends by pointing out that "Inequality has traditionally been acceptable to Americans if accompanied by mobility. But most recent studies of economic mobility indicate that it is getting even harder for people to jump from one economic class to another in the United States."

It seems clear that Republicans are not sure how to respond to the protests. One, which we have already started to see, is that lower income Americans are not paying their fair share.  Not only is this false, the share of tax revenue that comes from payroll taxes, which every working person pays, has gone up just as the share paid by corporations has gone down.

The reality, as pointed out in yesterday's New York Times is that government policy, particularly tax policy and deregulation, has helped to drive money from wages into corporate profits, from whence it ends up in the hands of a few.  This concentration of wealth in turn has fed the speculative bubbles that have ravaged our economy in recent decades.  Those with too much money feed it into those bubbles and then, more often than not, emerge unscathed, their fall cushioned by public funds and the money that they have looted from the other 99%. 

The Occupy protests are a response to that phenomenon, and one that is not going to go away.  Republicans will continue to demonize them but that will not change the reality of ever rising inequality and the disappearance of the social mobility that enabled elites to convince people that they might be able to make it.  With that hope gone, with the game clearly rigged, and with the economy continuing to burn as the Republicans fiddle, anger can only grow.


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