29 March 2008 On the Road from Samaria When they manipulated the stock market, I remained silent; I was making money and felt superior to the crowd. When they silenced their critics, I remained silent; I was self-righteous and felt they got what they deserved. When they came for the blue... More
The sense of outrage that permeated nearly every announcement of obscene compensation for Wall Street’s profligate managers and traders a year ago seems to have faded with the public’s anticipation that the worst of the economic crisis is over.
Right now, in the world today there is only one choice for an economic system. That’s corporatist capitalism. By it’s very nature it is set up to funnel public funds into private hands in order that the rich elite becomes ever richer. What it does to the rest of us is leave us out of the equation except as gaping mouths to be fed an ever increasing mass of stuff.
Unfortunately as the rich get richer the poor and middle class tend to get poorer. The numbers of people falling below the poverty line is steadily increasing thanks to the Friedmanite Chicago school of economics that has held sway in the world for 30 years (for an excellent analysis of this paradigm shift see The Shock Doctrine by Naomi Klein). The IMF and World Bank, as well as the good ole US of A, have made certain that countries with any kind of social programs, populist regulatory systems or infrastructure improvement projects, are forced to gut these programs and infrastructure, sometimes at gunpoint. Why do they do this? To make sure that the robber barons of multinational corporations are allowed to ride into town unhindered by even the semblance of a sheriff to keep things civil.
From the democratically elected president of Iran in the 50s to the democratically elected presidents of Chile, Argentina, Brazil, Indonesia (I could go on) in the 60s and 70s, the corporatists have made sure that no democracy would stand as long as it worked for its own people and not for big business. Only through dictatorship and oppression could the draconian economic measures of the IMF and World Bank have been stuffed down the throats of the third world in order to line the pockets of rich elites.
Unfortunately this is the system we now have throughout the world. Where social programs, decent infrastructure, good education and public goods (such as low cost utilities, access to clean water, and free airwaves) are a thing of the past. The system is so ubiquitous that it’s almost impossible to opt out of it.
How do you fight the powers that be when they practically control our very thought patterns? You can’t go to the store to buy a piece of clothing or a vegetable without running smack into the corporate machine.
One must ask, what would hurt the multinationals the most? What can the average human being do to refuse to be a part of the corporatist agenda? How do we opt out of the slave wage/slave consumer paradigm that we are allotted by those who would rob us blind and make us obedient little batteries to power the machine? How do we refuse to believe that “War is Peace.” and not buy into the Big Brother mentality?
The one area that the big corporations are weak is in the area of profits. If profits don’t keep climbing they lose. They can create another war, they can create another disaster in order to suck the economic life out of the shell-shocked citizens. But what if we refuse to be duped? What if we opt out of their consumer/consumption paradigm? What if we no longer buy their stuff? What if we grow our own food or buy our food from local people who grow it? What if we don’t buy lots of cheap, poorly made clothing from Walmart and instead buy it from second hand shops or garage sales? Without consumers all that stuff sits on the shelves. Without consumers, profits would suffer. Even if only 10% of the people stopped buying all the corporate made garbage that is thrown our way it would hit the corporations where it hurts.
And what if we refused to be slave labor, working for an hourly wage, most of us without decent benefits, no hope of any decent retirement (401Ks don’t count; as we have seen they can be wiped out in a heartbeat) and certainly not receiving the massive bonuses of the CEOs and the shareholders. CEOs don’t make things that can be sold to bring in the profits. And certainly shareholders don’t either.
So if we opt out of the slave market of corporate labor, what do we do instead? Create a local economy, supported by other local economists. At first it wouldn’t be easy because people aren’t used to buying local. They’re used to going to the big box stores to get lots of cheap stuff. But what if you decide you don’t need lots of cheap stuff, but instead go for a small amount or moderate amount of locally produced, well made stuff that will last 5 to 10 years longer than anything produced in China? Decide what you would like to do with your life if you didn’t have to go to that boring 9 to 5 slave’s job every day, Monday through Friday. Then figure out how to make a living at it. Sure it would probably be a lot more work. But it would be work that has true worth to you, to your community, to your family and eventually to the world.
As for the corporate controlled government with their hands in our pockets, if you keep your income below a certain level you don’t have to pay taxes. And your money won’t be going to support the rich elite, illegal and unjust wars, torture, destruction of democratic governments, and arms dealers. “But,” you say, wringing your hands, “how can I possibly survive without making all that money? How can I have all the goodies and the brand new (gas guzzling) car and the 3000 square foot house with a pool and all the amenities?” For this, please read Radical Simplicity: Small footprints on a Finite Earth by Jim Merkel. It is possible, and in fact, it is necessary if we are not to end up in a Soylent Green world.
Building communities of people opting out of the corporatist rat race would provide support for those choosing this lifestyle. A good example of the type of community possible can be seen in many Amish communities in the U.S (not all, mind you. Some have fallen prey to the need for a paycheck.). These communities have their own banks that are supported by customers in the community through good financial responsibility. They buy and sell goods among themselves, without need of inputs from the corporate world. It is a much simpler, slower and less harmful way of life. I’m not saying you have to do without electricity or drive a horse-drawn carriage. But producing your own power through wind, water or solar or a combination of all three would certainly reduce your ecological footprint as well as remove the need for corporate controlled energy (re: Enron and the theft of billions of taxpayer dollars through market manipulation).
I’m not saying that completely cutting off all commerce that involves corporations would be easy. You might opt to make your own clothing but where does the cloth come from? If you have a local cloth mill where does the fiber come from? If you have your own cotton fields, hemp fields (the more sustainable choice), or sheep herds, where do the machines come from (used machinery? I’m sure in this country with the outsourcing to China and other low cost producers there must be used machines that could be obtained)? It is a daunting task to reinvent an entire civilization. How on earth do you replace the corporate made computers? Perhaps by supporting locally produced ones, if that’s even possible?
So we start with baby steps. We start buying our clothing second hand. We sell that 3000 sqft house and buy a piece of land where we can grow our own food, raise our own livestock, quit the 9 to 5 slavery, do what you’ve always dreamed of doing for a living. As long as you don’t want to be one of the wealthy elite leaching off the rest of society and others’ hard work. I find that most people simply want to be comfortable and happy, safe and relaxed. They don’t need to make millions for that. And if the thought of growing your own food is simply too much, support other local growers. A local economy currency or straight up barter could be instituted. Communities across the world have done this already. Wouldn’t be terribly difficult to duplicate in most areas. These steps have the benefits of cutting the corporate umbilical and letting the national government know that we aren’t going to pay for their wars and destruction any more. And it grows community. “It takes a whole village to raise a child.” would no longer be hollow words in the fragmented, hyper-individualistic, me first world we live in now.
The only way to break the backs of the corporations that are most responsible for the destruction of our environment, the looting of our national wealth, the poisoning of our children and the violent expropriation of the commons is to hit them in the pocket book. Opt out of their all consuming program to take all the wealth they can steal from the poor and middle class to enrich the controlling elites. Don’t let them control us in true Orwellian fashion. Free yourself from the Matrix they have created for us. Refuse to be a battery.
(ChattaBox)— Professor Emmanuel Saez of the University of California, Berkeley, recently updated a study of wealth distribution in the United States, finding Income inequality at levels not seen since the Gilded Age of the late 19th century, during a time when disreputable robber barons gobbled up all of the wealth in the country on the backs of the working poor and child labor.
The disparity in wealth distribution began in the 1990s, but increased dramatically during the Bush administration, with tax cuts for the rich. The study analyzes data through the year 2007. A few statistics stand out.
In 2007, the top .01 percent of American earners took home 6 percent of total U.S. wages, a figure that has nearly doubled since 2000. Additionally, the top decile of American earners, raked in 49.7 percent of total wages, a level that’s “higher than any other year since 1917 and even surpasses 1928, the peak of stock market bubble in the ‘roaring” 1920s.’”
“The top 1 percent of incomes captured half of the overall economic growth over the period 1993-2007,” wrote Saez. The policies of the Bush administration from 2002-2007 accelerated the slow growth of average incomes, while enabling the very rich to pull in a greater share of the country’s wealth.
According to the study, “…the bottom 99 percent of incomes grew at a solid pace of 2.7 percent per year from 1993-2000, these incomes grew only 1.3 percent per year from 2002-2007. As a result, in the economic expansion of 2002-2007, the top 1 percent captured two thirds of income growth.”
Saez notes that, the “…top incomes earners today are not “rentiers” deriving their incomes from past wealth but rather are “working rich,” such as the wealthy Wall Street traders and their multi-million dollar bonuses.
Saez expects the wealth concentration at the very top to fall slightly for the years 2008-2009, but to rebound back to previous levels, unless policy changes are implemented.
“Based on the US historical record, falls in income concentration due to recessions are temporary unless drastic policy changes, such as financial regulation or significantly more progressive taxation, are implemented and prevent income concentration from bouncing back, wrote Saez.
Income inequality in the United States is at an all-time high, surpassing even levels seen during the Great Depression, according to a recently updated paper by University of California, Berkeley Professor Emmanuel Saez. The paper, which covers data through 2007, points to a staggering, unprecedented disparity in American incomes. On his blog, Nobel prize-winning economist and New York Times columnist Paul Krugman called the numbers "truly amazing."
Though income inequality has been growing for some time, the paper paints a stark, disturbing portrait of wealth distribution in America. Saez calculates that in 2007 the top .01 percent of American earners took home 6 percent of total U.S. wages, a figure that has nearly doubled since 2000.
As of 2007, the top decile of American earners, Saez writes, pulled in 49.7 percent of total wages, a level that's "higher than any other year since 1917 and even surpasses 1928, the peak of stock market bubble in the 'roaring" 1920s.'"
Beginning in the economic expansion of the early 1990s, Saez argues, the economy began to favor the top tiers American earners, but much of the country missed was left behind. "The top 1 percent incomes captured half of the overall economic growth over the period 1993-2007," Saes writes.
Despite a rising stock market, largely growing employment and a historic housing boom things were not nearly so rosy for the rest of U.S. workers. This trend, according to Saez, only accelerated during the George W. Bush's tenure as President:
"...while the bottom 99 percent of incomes grew at a solid pace of 2.7 percent per year from 1993-2000, these incomes grew only 1.3 percent per year from 2002-2007. As a result, in the economic expansion of 2002-2007, the top 1 percent captured two thirds of income growth."
In the last four decades, many millions of manufacturing jobs in this country have been shipped overseas. This transfer was supposed to be part of the "win-win" process of free trade. But 27 straight years of growing trade deficits with the rest of the world makes one wonder: who's winning?
Conventional economists and their Republican and Democratic converts try to cushion this job-export machine by saying that the large majority of jobs in this country are white collar, not blue collar. The implication is that white-collar jobs are not as easy to export.
Well, welcome to the computerization age. U.S. companies are rushing headlong to export computer programming work to countries like India and Malaysia and now China, where English-language proficiency and cheap labor cut costs by more than two-thirds. Payroll processing, airline passenger billings, insurance computer applications, new software designs are only some of the labor that is done in foreign countries for U.S. companies.
Last week's Computerworld magazine calls "Offshore's Rise" relentless. By next year the article reports "Forty percent (of U.S. companies) will have completed some kind of pilot program or will be using nearshore or offshore services. IBM and Accenture Ltd. were named as firms pushing what the research firm, IDC, says is the dominant trend in the information technology services industry. IDC adds that 42 percent of the application management contracts now contain some offshore component.
It is difficult to find any estimates regarding the total number of American jobs displaced in this sector. But Gartner Inc. uses the jargon "human resources outsourcing services" and puts a $46 billion price tag on them for this year.
Moreover, U.S. firms are opening subsidiaries in countries like India to compete with Indian firms for outsourcing business. Accenture CEO Joe W. Forehand is reported by Computerworld as comparing the trend to the previous exodus from the United States of many manufacturing operations.
"The way we look at it, the industrialization of IT (information technology) is a reality and we have to embrace that," he said.
IT has been in a bit of a slump, not to mention the rest of the computer industry. So, when outsourcing is combined with massive layoffs in this country and the continuing inflow of lower-wage computer technology workers under H-1B and L-1 work visas, it is not surprising to see the gloom besetting American technology workers.
Unlike H-1B visas, which are supposed to receive prevailing wages (but often do not), the L-1 does not oblige employers to pay workers prevailing wages, and there is no cap on the number of these visas that can be awarded foreign workers.
With more than 500,000 workers in this country on "temporary" H-1B visas, supposedly meeting a domestic dearth of skills, the L-1 visa workers are supposed to be just transfers between subsidiaries and parent companies. In fact, reports the New York Times, "They are now routinely used by companies based in India and elsewhere to bring their workers into the United States and then contract them out to American companies - in many instances to be replacement for American workers." The number of workers replaced is unknown, according to the Times.
All this upsets the Organization of the Rights of American Workers, a nonprofit group based in Meriden, Conn. Its president, John Bauman, believes that a recovery in this industry will not bring back the American jobs due to both outsourcing and these special visa programs so strongly desired by Silicon Valley companies.
When these concerns are raised to international economists, one of their replies is, "Don't you know what an extraordinary job machine is the U.S. economy?"
Well, it has lost 2.6 million jobs since February 2001. More important is that at least one-third of our economy's full-time - nearly 50 million - workers do not earn a living wage! The federal minimum wage, adjusted for inflation since 1968 would be around $8 an hour. Instead, it has remained at $5.15 an hour, exerting a downward pull on lower-income wages generally.
Someday the pollyanna belief that the U.S. economy always replaces the jobs it loses overseas with new jobs here, as we keep racing ahead of other countries with modern technology and new or redundant services, may run into a contrary riptide that no set of spurious statistics can obscure.
Ralph Nader is a consumer advocate and former Green Party presidential candidate. Readers may write to him at: Public Citizen, 1600 20th Street NW, Washington D.C. 20009, citizen.org.
Every week, Marcia Carroll collects examples of privatization (that is, corporatization of the peoples' assets). Looking at her website, Privatizationwatch.org, will either make you laugh helplessly or make your blood boil.
The "off the wall" giveaways at bargain-basement prices of what you and other Americans own eclipses imagination. The latest escapes from responsible government are called "public-private partnerships" and are designed to enable the likes of Morgan Stanley and Goldman Sachs to take over highways, meter-collecting, and public buildings in deals that are loaded with complex tax advantages for the investors.
Here are two of her latest entries. Arizona lawmakers and Governor Jan Brewer are moving to fill a $3.4 billion budget shortfall by selling state-owned buildings. These include not only prisons, but also the House and Senate buildings. That's the state legislature, fellow Americans! Metaphor becomes reality!
The proposed sale has bipartisan support and will require a leaseback by the buying corporation to the lawmakers with the right to repurchase the premises within twenty years.
The Arizona Republicreports that the deal, which includes 32 state properties, would bring in $735 million in upfront money and entail state lease payments totaling $60-70 million a year.
"We need the money," State Minority Whip Linda Lopez, Tuscon Democrat said, adding, "You've got to find it somewhere." Well, why not rent out the backs of the state legislators to their favorite corporate funders? At least the public would get full disclosure of ownership.
"I look at it as taking out a mortgage," practical Arizona House Majority Leader John McCormish, a Republican, told the Wall Street Journal.
The second item comes from the Denver Post, which reports that the foreign consortium, Auto-estradas de Portugal (Brisa), operating the toll road Northwest Parkway under a 99-year lease, objected to improvements on a nearby public road. Under the complex leasing contract, the company could cite the improvements as an "adverse action" reducing toll revenue and the number of vehicles using the parkway. This action would presumably entitle this foreign company to compensation from Colorado taxpayers.
Last year, Pennsylvania Governor Ed Rendell tried to push through the legislature a complex, 75-year lease of the storied Pennsylvania Turnpike in exchange for $12.8 billion up front. All kinds of tax breaks and trap-door evasions filled the 686 page lease. The Governor was prepared, for example, to agree to pay the consortium of foreign investors if new safety measures or emergency vehicles entered the toll road and affected the flow of traffic. Fortunately, the legislature rebelled and blocked the deal.
The Indiana Toll Road was turned over to private companies in 2006. The 75-year lease was for $3.8 billion, which is a little more than the cost to repair the Woodrow Wilson bridge over the Potomac River between Virginia and Washington, DC.
Tolls on the Indiana Toll Road have already doubled and are expected to double again within ten years, according to the Dallas Morning News.
Last year, Mayor Richard Daley of Chicago privatized the city's parking meters. Chicago's inspector general concluded that the meters were worth nearly twice as much to the city as the $1.15 billion that the city received under an agreement rushed through the City Council with no civic input. A fourfold increase in meter rates this year has driven many motorists to residential neighborhoods in search of free parking spaces.
Indiana, a leader in outsourcing governmental functions to private corporations, gave the servicing of the state's welfare program to IBM. According to the Indianapolis Star, error rates since corporatization have risen 17.5 percent last November and 21.4 percent in December.
The myth that corporatization is "better, faster, and cheaper" is falling apart. This year, the IRS announced that it will end the use of private tax collectors after consumer groups argued that taxpayers were subjected to immediate payment demands by private collectors while IRS employees would offer citizens an array of options to help pay their tax debt.
So, you're not surprised. But are you indignant? Are you ready to make sure the politicians hear from you in no uncertain terms, hear from you to stop this recklessness and restore public control of the public infrastructure under accountable government?
If the state politicos try to pull a fast one, demand public hearings with thorough reviews of the proposed contracts or leasebacks. Better yet, in states like Arizona or Colorado, require any such proposals go through the open, state-wide referendum voting process.
Corporatizations such as the above just pass on to our children the burdens that our generation should have assumed itself to run government within its means funded by fair taxation.
Ralph Nader was born in Winsted, Connecticut on 27 February 1934. He is a consumer advocate, lawyer, and author. This article was first published by Nader.org on 3 August 2009.URL: mrzine.monthlyreview.org/nader100809.html
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.
Robber-baron audacity
By Dan K. Thomasson
Tuesday, August 4, 2009
The sense of outrage that permeated nearly every announcement of obscene compensation for Wall Street’s profligate managers and traders a year ago seems to have faded with the public’s anticipation that the worst of the economic crisis is over.
More »How do you fight the system?
Right now, in the world today there is only one choice for an economic system. That’s corporatist capitalism. By it’s very nature it is set up to funnel public funds into private hands in order that the rich elite becomes ever richer. What it does to the rest of us is leave us out of the equation except as gaping mouths to be fed an ever increasing mass of stuff.
Unfortunately as the rich get richer the poor and middle class tend to get poorer. The numbers of people falling below the poverty line is steadily increasing thanks to the Friedmanite Chicago school of economics that has held sway in the world for 30 years (for an excellent analysis of this paradigm shift see The Shock Doctrine by Naomi Klein). The IMF and World Bank, as well as the good ole US of A, have made certain that countries with any kind of social programs, populist regulatory systems or infrastructure improvement projects, are forced to gut these programs and infrastructure, sometimes at gunpoint. Why do they do this? To make sure that the robber barons of multinational corporations are allowed to ride into town unhindered by even the semblance of a sheriff to keep things civil.
From the democratically elected president of Iran in the 50s to the democratically elected presidents of Chile, Argentina, Brazil, Indonesia (I could go on) in the 60s and 70s, the corporatists have made sure that no democracy would stand as long as it worked for its own people and not for big business. Only through dictatorship and oppression could the draconian economic measures of the IMF and World Bank have been stuffed down the throats of the third world in order to line the pockets of rich elites.
Unfortunately this is the system we now have throughout the world. Where social programs, decent infrastructure, good education and public goods (such as low cost utilities, access to clean water, and free airwaves) are a thing of the past. The system is so ubiquitous that it’s almost impossible to opt out of it.
How do you fight the powers that be when they practically control our very thought patterns? You can’t go to the store to buy a piece of clothing or a vegetable without running smack into the corporate machine.
One must ask, what would hurt the multinationals the most? What can the average human being do to refuse to be a part of the corporatist agenda? How do we opt out of the slave wage/slave consumer paradigm that we are allotted by those who would rob us blind and make us obedient little batteries to power the machine? How do we refuse to believe that “War is Peace.” and not buy into the Big Brother mentality?
The one area that the big corporations are weak is in the area of profits. If profits don’t keep climbing they lose. They can create another war, they can create another disaster in order to suck the economic life out of the shell-shocked citizens. But what if we refuse to be duped? What if we opt out of their consumer/consumption paradigm? What if we no longer buy their stuff? What if we grow our own food or buy our food from local people who grow it? What if we don’t buy lots of cheap, poorly made clothing from Walmart and instead buy it from second hand shops or garage sales? Without consumers all that stuff sits on the shelves. Without consumers, profits would suffer. Even if only 10% of the people stopped buying all the corporate made garbage that is thrown our way it would hit the corporations where it hurts.
And what if we refused to be slave labor, working for an hourly wage, most of us without decent benefits, no hope of any decent retirement (401Ks don’t count; as we have seen they can be wiped out in a heartbeat) and certainly not receiving the massive bonuses of the CEOs and the shareholders. CEOs don’t make things that can be sold to bring in the profits. And certainly shareholders don’t either.
So if we opt out of the slave market of corporate labor, what do we do instead? Create a local economy, supported by other local economists. At first it wouldn’t be easy because people aren’t used to buying local. They’re used to going to the big box stores to get lots of cheap stuff. But what if you decide you don’t need lots of cheap stuff, but instead go for a small amount or moderate amount of locally produced, well made stuff that will last 5 to 10 years longer than anything produced in China? Decide what you would like to do with your life if you didn’t have to go to that boring 9 to 5 slave’s job every day, Monday through Friday. Then figure out how to make a living at it. Sure it would probably be a lot more work. But it would be work that has true worth to you, to your community, to your family and eventually to the world.
As for the corporate controlled government with their hands in our pockets, if you keep your income below a certain level you don’t have to pay taxes. And your money won’t be going to support the rich elite, illegal and unjust wars, torture, destruction of democratic governments, and arms dealers. “But,” you say, wringing your hands, “how can I possibly survive without making all that money? How can I have all the goodies and the brand new (gas guzzling) car and the 3000 square foot house with a pool and all the amenities?” For this, please read Radical Simplicity: Small footprints on a Finite Earth by Jim Merkel. It is possible, and in fact, it is necessary if we are not to end up in a Soylent Green world.
Building communities of people opting out of the corporatist rat race would provide support for those choosing this lifestyle. A good example of the type of community possible can be seen in many Amish communities in the U.S (not all, mind you. Some have fallen prey to the need for a paycheck.). These communities have their own banks that are supported by customers in the community through good financial responsibility. They buy and sell goods among themselves, without need of inputs from the corporate world. It is a much simpler, slower and less harmful way of life. I’m not saying you have to do without electricity or drive a horse-drawn carriage. But producing your own power through wind, water or solar or a combination of all three would certainly reduce your ecological footprint as well as remove the need for corporate controlled energy (re: Enron and the theft of billions of taxpayer dollars through market manipulation).
I’m not saying that completely cutting off all commerce that involves corporations would be easy. You might opt to make your own clothing but where does the cloth come from? If you have a local cloth mill where does the fiber come from? If you have your own cotton fields, hemp fields (the more sustainable choice), or sheep herds, where do the machines come from (used machinery? I’m sure in this country with the outsourcing to China and other low cost producers there must be used machines that could be obtained)? It is a daunting task to reinvent an entire civilization. How on earth do you replace the corporate made computers? Perhaps by supporting locally produced ones, if that’s even possible?
So we start with baby steps. We start buying our clothing second hand. We sell that 3000 sqft house and buy a piece of land where we can grow our own food, raise our own livestock, quit the 9 to 5 slavery, do what you’ve always dreamed of doing for a living. As long as you don’t want to be one of the wealthy elite leaching off the rest of society and others’ hard work. I find that most people simply want to be comfortable and happy, safe and relaxed. They don’t need to make millions for that. And if the thought of growing your own food is simply too much, support other local growers. A local economy currency or straight up barter could be instituted. Communities across the world have done this already. Wouldn’t be terribly difficult to duplicate in most areas. These steps have the benefits of cutting the corporate umbilical and letting the national government know that we aren’t going to pay for their wars and destruction any more. And it grows community. “It takes a whole village to raise a child.” would no longer be hollow words in the fragmented, hyper-individualistic, me first world we live in now.
The only way to break the backs of the corporations that are most responsible for the destruction of our environment, the looting of our national wealth, the poisoning of our children and the violent expropriation of the commons is to hit them in the pocket book. Opt out of their all consuming program to take all the wealth they can steal from the poor and middle class to enrich the controlling elites. Don’t let them control us in true Orwellian fashion. Free yourself from the Matrix they have created for us. Refuse to be a battery.
For a version of this blog entry with links to many sites verifying my facts go to www.hermitslamp.blogspot.com
Rising Income Inequality: Incredibly Good Deal for Super Rich
(ChattaBox)— Professor Emmanuel Saez of the University of California, Berkeley, recently updated a study of wealth distribution in the United States, finding Income inequality at levels not seen since the Gilded Age of the late 19th century, during a time when disreputable robber barons gobbled up all of the wealth in the country on the backs of the working poor and child labor.
The disparity in wealth distribution began in the 1990s, but increased dramatically during the Bush administration, with tax cuts for the rich. The study analyzes data through the year 2007. A few statistics stand out.
In 2007, the top .01 percent of American earners took home 6 percent of total U.S. wages, a figure that has nearly doubled since 2000. Additionally, the top decile of American earners, raked in 49.7 percent of total wages, a level that’s “higher than any other year since 1917 and even surpasses 1928, the peak of stock market bubble in the ‘roaring” 1920s.’”
“The top 1 percent of incomes captured half of the overall economic growth over the period 1993-2007,” wrote Saez. The policies of the Bush administration from 2002-2007 accelerated the slow growth of average incomes, while enabling the very rich to pull in a greater share of the country’s wealth.
According to the study, “…the bottom 99 percent of incomes grew at a solid pace of 2.7 percent per year from 1993-2000, these incomes grew only 1.3 percent per year from 2002-2007. As a result, in the economic expansion of 2002-2007, the top 1 percent captured two thirds of income growth.”
Saez notes that, the “…top incomes earners today are not “rentiers” deriving their incomes from past wealth but rather are “working rich,” such as the wealthy Wall Street
traders and their multi-million dollar bonuses.
Saez expects the wealth concentration at the very top to fall slightly for the years 2008-2009, but to rebound back to previous levels, unless policy changes are implemented.
“Based on the US historical record, falls in income concentration due to recessions are temporary unless drastic policy changes, such as financial regulation or significantly more progressive taxation, are implemented and prevent income concentration from bouncing back, wrote Saez.
Here is source and link to the full report:
Income Inequality Is At An All-Time High: STUDY
Income inequality in the United States is at an all-time high, surpassing even levels seen during the Great Depression, according to a recently updated paper by University of California, Berkeley Professor Emmanuel Saez. The paper, which covers data through 2007, points to a staggering, unprecedented disparity in American incomes. On his blog, Nobel prize-winning economist and New York Times columnist Paul Krugman called the numbers "truly amazing."
Though income inequality has been growing for some time, the paper paints a stark, disturbing portrait of wealth distribution in America. Saez calculates that in 2007 the top .01 percent of American earners took home 6 percent of total U.S. wages, a figure that has nearly doubled since 2000.
As of 2007, the top decile of American earners, Saez writes, pulled in 49.7 percent of total wages, a level that's "higher than any other year since 1917 and even surpasses 1928, the peak of stock market bubble in the 'roaring" 1920s.'"
Beginning in the economic expansion of the early 1990s, Saez argues, the economy began to favor the top tiers American earners, but much of the country missed was left behind. "The top 1 percent incomes captured half of the overall economic growth over the period 1993-2007," Saes writes.
Despite a rising stock market, largely growing employment and a historic housing boom things were not nearly so rosy for the rest of U.S. workers. This trend, according to Saez, only accelerated during the George W. Bush's tenure as President:
READ the entire paper:
http://www.huffingtonpost.com/2009/08/14/income-inequality-is-at-a_n_259516.html
U.S. workers are really the losers in free trade
In the last four decades, many millions of manufacturing jobs in this country have been shipped overseas. This transfer was supposed to be part of the "win-win" process of free trade. But 27 straight years of growing trade deficits with the rest of the world makes one wonder: who's winning?
Ralph Nader is a consumer advocate and former Green Party presidential candidate. Readers may write to him at: Public Citizen, 1600 20th Street NW, Washington D.C. 20009, citizen.org.Conventional economists and their Republican and Democratic converts try to cushion this job-export machine by saying that the large majority of jobs in this country are white collar, not blue collar. The implication is that white-collar jobs are not as easy to export.
Well, welcome to the computerization age. U.S. companies are rushing headlong to export computer programming work to countries like India and Malaysia and now China, where English-language proficiency and cheap labor cut costs by more than two-thirds. Payroll processing, airline passenger billings, insurance computer applications, new software designs are only some of the labor that is done in foreign countries for U.S. companies.
Last week's Computerworld magazine calls "Offshore's Rise" relentless. By next year the article reports "Forty percent (of U.S. companies) will have completed some kind of pilot program or will be using nearshore or offshore services. IBM and Accenture Ltd. were named as firms pushing what the research firm, IDC, says is the dominant trend in the information technology services industry. IDC adds that 42 percent of the application management contracts now contain some offshore component.
It is difficult to find any estimates regarding the total number of American jobs displaced in this sector. But Gartner Inc. uses the jargon "human resources outsourcing services" and puts a $46 billion price tag on them for this year.
Moreover, U.S. firms are opening subsidiaries in countries like India to compete with Indian firms for outsourcing business. Accenture CEO Joe W. Forehand is reported by Computerworld as comparing the trend to the previous exodus from the United States of many manufacturing operations.
"The way we look at it, the industrialization of IT (information technology) is a reality and we have to embrace that," he said.
IT has been in a bit of a slump, not to mention the rest of the computer industry. So, when outsourcing is combined with massive layoffs in this country and the continuing inflow of lower-wage computer technology workers under H-1B and L-1 work visas, it is not surprising to see the gloom besetting American technology workers.
Unlike H-1B visas, which are supposed to receive prevailing wages (but often do not), the L-1 does not oblige employers to pay workers prevailing wages, and there is no cap on the number of these visas that can be awarded foreign workers.
With more than 500,000 workers in this country on "temporary" H-1B visas, supposedly meeting a domestic dearth of skills, the L-1 visa workers are supposed to be just transfers between subsidiaries and parent companies. In fact, reports the New York Times, "They are now routinely used by companies based in India and elsewhere to bring their workers into the United States and then contract them out to American companies - in many instances to be replacement for American workers." The number of workers replaced is unknown, according to the Times.
All this upsets the Organization of the Rights of American Workers, a nonprofit group based in Meriden, Conn. Its president, John Bauman, believes that a recovery in this industry will not bring back the American jobs due to both outsourcing and these special visa programs so strongly desired by Silicon Valley companies.
When these concerns are raised to international economists, one of their replies is, "Don't you know what an extraordinary job machine is the U.S. economy?"
Well, it has lost 2.6 million jobs since February 2001. More important is that at least one-third of our economy's full-time - nearly 50 million - workers do not earn a living wage! The federal minimum wage, adjusted for inflation since 1968 would be around $8 an hour. Instead, it has remained at $5.15 an hour, exerting a downward pull on lower-income wages generally.
Someday the pollyanna belief that the U.S. economy always replaces the jobs it loses overseas with new jobs here, as we keep racing ahead of other countries with modern technology and new or redundant services, may run into a contrary riptide that no set of spurious statistics can obscure.
Purloining the People's Property
by Ralph Nader
Every week, Marcia Carroll collects examples of privatization (that is, corporatization of the peoples' assets). Looking at her website, Privatizationwatch.org, will either make you laugh helplessly or make your blood boil.
The "off the wall" giveaways at bargain-basement prices of what you and other Americans own eclipses imagination. The latest escapes from responsible government are called "public-private partnerships" and are designed to enable the likes of Morgan Stanley and Goldman Sachs to take over highways, meter-collecting, and public buildings in deals that are loaded with complex tax advantages for the investors.
Here are two of her latest entries. Arizona lawmakers and Governor Jan Brewer are moving to fill a $3.4 billion budget shortfall by selling state-owned buildings. These include not only prisons, but also the House and Senate buildings. That's the state legislature, fellow Americans! Metaphor becomes reality!
The proposed sale has bipartisan support and will require a leaseback by the buying corporation to the lawmakers with the right to repurchase the premises within twenty years.
The Arizona Republic reports that the deal, which includes 32 state properties, would bring in $735 million in upfront money and entail state lease payments totaling $60-70 million a year.
"We need the money," State Minority Whip Linda Lopez, Tuscon Democrat said, adding, "You've got to find it somewhere." Well, why not rent out the backs of the state legislators to their favorite corporate funders? At least the public would get full disclosure of ownership.
"I look at it as taking out a mortgage," practical Arizona House Majority Leader John McCormish, a Republican, told the Wall Street Journal.
The second item comes from the Denver Post, which reports that the foreign consortium, Auto-estradas de Portugal (Brisa), operating the toll road Northwest Parkway under a 99-year lease, objected to improvements on a nearby public road. Under the complex leasing contract, the company could cite the improvements as an "adverse action" reducing toll revenue and the number of vehicles using the parkway. This action would presumably entitle this foreign company to compensation from Colorado taxpayers.
Last year, Pennsylvania Governor Ed Rendell tried to push through the legislature a complex, 75-year lease of the storied Pennsylvania Turnpike in exchange for $12.8 billion up front. All kinds of tax breaks and trap-door evasions filled the 686 page lease. The Governor was prepared, for example, to agree to pay the consortium of foreign investors if new safety measures or emergency vehicles entered the toll road and affected the flow of traffic. Fortunately, the legislature rebelled and blocked the deal.
The Indiana Toll Road was turned over to private companies in 2006. The 75-year lease was for $3.8 billion, which is a little more than the cost to repair the Woodrow Wilson bridge over the Potomac River between Virginia and Washington, DC.
Tolls on the Indiana Toll Road have already doubled and are expected to double again within ten years, according to the Dallas Morning News.
Last year, Mayor Richard Daley of Chicago privatized the city's parking meters. Chicago's inspector general concluded that the meters were worth nearly twice as much to the city as the $1.15 billion that the city received under an agreement rushed through the City Council with no civic input. A fourfold increase in meter rates this year has driven many motorists to residential neighborhoods in search of free parking spaces.
Indiana, a leader in outsourcing governmental functions to private corporations, gave the servicing of the state's welfare program to IBM. According to the Indianapolis Star, error rates since corporatization have risen 17.5 percent last November and 21.4 percent in December.
The myth that corporatization is "better, faster, and cheaper" is falling apart. This year, the IRS announced that it will end the use of private tax collectors after consumer groups argued that taxpayers were subjected to immediate payment demands by private collectors while IRS employees would offer citizens an array of options to help pay their tax debt.
Then there are the corporatized water systems where the companies deliver poorer service at higher cost.
Since the 19th century, privatizing public functions has opened the doors to kickbacks, price fixing, and collusive bidding.
New depths of corruption were reached in Pennsylvania recently when two state judges pleaded guilty to taking bribes in return for sending youths to privately-owned jails.
After reading report after report about the vast, relentless waste, fraud, and abuse arising out of corporate contractors to the Pentagon in Iraq, why should readers be surprised at this domestic scene whereby taxpayers pay through the nose for corporations to govern them?
So, you're not surprised. But are you indignant? Are you ready to make sure the politicians hear from you in no uncertain terms, hear from you to stop this recklessness and restore public control of the public infrastructure under accountable government?
If the state politicos try to pull a fast one, demand public hearings with thorough reviews of the proposed contracts or leasebacks. Better yet, in states like Arizona or Colorado, require any such proposals go through the open, state-wide referendum voting process.
Corporatizations such as the above just pass on to our children the burdens that our generation should have assumed itself to run government within its means funded by fair taxation.
Ralph Nader was born in Winsted, Connecticut on 27 February 1934. He is a consumer advocate, lawyer, and author. This article was first published by Nader.org on 3 August 2009.
URL: mrzine.monthlyreview.org/nader100809.html
The nation quickly descending into chaos
Latest Followers
StockTalks
-
May 12, 2009
More »Posts by Ticker
Latest Comments
Most Commented
Instablogged Stocks
Latest Instablog Posts
-
1
-
2
-
3
-
4
-
5
See all Latest Instablog Posts »Top Instabloggers
-
1
-
2
-
3
-
4
-
5
See all Top Instabloggers » Top StockTalkers »